Do you want to start data entry business?

Executive Summary

Company Summary

Products

Marketing Analysis of Marketing Agency

Strategy

Personnel plan

Financial Plan

Do you want to start data entry business?

If you want to start a data entry business, you have made the right choice as there are many benefits of starting this business. First, you can start it with a very low initial investment from a small office or even your home and you can later increase its magnitude to any size depending on your requirements. Moreover, it gives an incredibly high return on investment as compared to other businesses started from similar amounts of investments.

However, before you start this business, you will have to prepare a comprehensive data entry business plan to serve as the basis of your company’s future decisions. If you are wondering how to write one, here we are providing you a data entry business plan sample of a startup named ‘Liz Data Entry Services’.

Executive Summary

2.1 The Business

Liz Data Entry Services will be a licensed and insured data entry business start up located in downtown Boston. The business will provide a variety of services in the Data Processing and Hosting Services industry.

2.2 Management

The company will be owned by Liz Gyda who has degrees in Computer Science and Business Administration from Harvard University. Liz has been associated with several tech companies across the US including software giants and has all the experience needed for starting a data entry business.

2.3 Customers

Our customers will be the business businesses, government agencies, banks, and non-business organizations located across the globe.

2.4 Business Target

Our target is to balance the initial cost of the startup with earned profits by the end of the first year and to achieve the net profit margin of $10k per month by the end of the first year.

Company Summary

3.1 Company Owner

The company will be owned by Liz Gyda who did her Bachelors in Computer Science from Harvard University before pursuing her Masters in Business Administration. After that, she has been associated with several tech companies across the US including software giants like Microsoft and Oracle for more than seven years.

3.2 Why the Business is being started

Ever since Liz started her business classes, starting her own business became her sole passion. But she didn’t want to start a business without gaining all the experience required to do so, that’s why she opted to serve in other companies after graduation. However, after seven years of service, she is now all ready to start her own venture.

3.3 How the Business will be started

It’s very easy to start a data entry home business as one doesn’t need lots of investment but Liz wanted to go a step ahead. So, Liz Data Entry Services will be a licensed and insured data entry company located in downtown Boston.

For the startup, the company will procure the latest computers, servers, laptops, anti-malware software, intrusion detection and prevention systems, data management software, besides the usual inventory. The company will undertake all the required measures to make sure our data is secured from unnecessary threats. The startup summary is as follows:

Data Entry Business Plan 1

The detailed startup requirements are given below:

Start-up Expenses
Legal $55 300
Consultants $0
Insurance $32 750
Rent $32 500
Research and Development $32 750
Expensed Equipment $32 750
Signs $1 250
TOTAL START-UP EXPENSES $187 300
Start-up Assets $220 875
Cash Required $332 500
Start-up Inventory $32 625
Other Current Assets $232 500
Long-term Assets $235 000
TOTAL ASSETS $121 875
Total Requirements $245 000
START-UP FUNDING
START-UP FUNDING $273 125
Start-up Expenses to Fund $151 875
Start-up Assets to Fund $123 000
TOTAL FUNDING REQUIRED $0
Assets $23 125
Non-cash Assets from Start-up $18 750
Cash Requirements from Start-up $0
Additional Cash Raised $18 750
Cash Balance on Starting Date $21 875
TOTAL ASSETS $373 125
Liabilities and Capital $0
Liabilities $0
Current Borrowing $0
Long-term Liabilities $0
Accounts Payable (Outstanding Bills) $0
Other Current Liabilities (interest-free) $0
TOTAL LIABILITIES $0
Capital $620 125
Planned Investment $620 125
Investor 1 $0
Investor 2 $0
Other $0
Additional Investment Requirement $0
TOTAL PLANNED INVESTMENT $620 125
Loss at Start-up (Start-up Expenses) $313 125
TOTAL CAPITAL $251 875
TOTAL CAPITAL AND LIABILITIES $251 875
Total Funding $255 000

 

Products

Before you dig into details of how to start data entry business, you must decide the services you will provide to your customers as it will help you with several subsequent steps. Liz Data Entry Services will provide a variety of services in the Data Processing and Hosting Services industry aimed to help our clients grow. Our primary services include:

  • Data entry services
  • Database management services
  • Data processing services
  • Data protection services

Marketing Analysis of Data Entry Business

The most important component of a data entry business plan is its accurate marketing analysis as it helps you identify and target your potential customers. An accurate marketing analysis will also reveal if the market of your business has the potential to provide profits or not. If you are starting a data entry company on a small scale, such as from your home, you can just take help from online data entry business plan samples. Otherwise, if you are starting on a big scale, it’s better to seek help from marketing experts regarding marketing analysis.

5.1 Market Trends

The demand for data entry businesses is increasing day by day due to the increase in eCommerce and online marketing activities. According to a report by IBISWorld, the data entry industry is growing at a considerable rate of 5.5% annually. There are more than 63,000 registered data processing and hosting companies working in the United States, responsible for the employment of more than 620,000 persons and generating a revenue of more than $150 billion per year. These stats clearly reveal that the Data Processing and Hosting Services industry has a lot of potential for startups.

5.2 Marketing Segmentation

Owing to the nature of this business, we can easily serve any company located anywhere on the globe. Liz Data Entry Services primarily aim to serve the corporate sector, non-business organizations, and financial institutions located around the world. The division of our target audience is as follows:

Data Entry Business Plan 2

5.2.1 Bank & Financial Institutions: Banks and financial institutions such as mortgage and insurance companies require a lot of data entry and processing work. They usually outsource this work to freelance groups or companies likes us because their staff can’t handle the amount of work they are required to do. Hence, we will be a perfect choice for them for all data entry related services.

5.2.2 Organizations: Our second target group comprises of non-business organizations located worldwide including schools, colleges, and universities, government and public-sector organizations, religious and sports organizations, political parties, etc. NGOs also require lots of data entry work to prepare reports on several issues.

5.2.3 Corporate Sector: This target group will comprise of businesses including but not limited to hotels, restaurants, manufacturers, distributors, branding agencies and software development companies.

The detailed market analysis of our potential customers is given in the following table:

Market Analysis
Potential Customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
Bank & Financial Institutions 48% 22 334 32 344 43 665 52 544 66 432 10,00%
Organizations 32% 12 867 14 433 15 999 17 565 19 131 15,32%
Corporate Sector 20% 11 433 13 344 16 553 18 745 20 545 13,43%
Total 100% 46 634 60 121 76 217 88 854 106 108 9,54%

 

5.3 Business Target

Our primary business targets are as follows:

  • To become one of the leading data entry services
  • To create a solid presence on all major freelancing platforms such as Upwork and Fiverr within the next six months
  • To balance the initial cost of the startup with earned profits by the end of the first year
  • To achieve the net profit margin of $10k/month by the first year, $15k by the second year, and $25k by the third year

5.4 Product Pricing

Product pricing is one of the most important factors in deciding the strategy for any business and it can easily become your competitive advantage if you act wisely. We will provide our services in relatively lower ranges to introduce ourselves and create a strong presence online.

Strategy

If you are going to start a data entry online business, and you want to target clients from around the world, you should make a solid sales strategy. An exceptional strategy is the only way to stand out among your competitors and attract high-paying clients, even if you’re starting a home based data entry business.

6.1 Competitive Analysis

Our biggest competitive edge will be our competitive prices and the quality of our services. We will be offering a wide range of services to our customers located around the globe and we will be available 24/7 to cater to their needs. We will also ensure to keep the valuable data of our clients safe and secure by following all standards.

6.2 Sales Strategy

We will advertise our services in following ways.

  • We will hold seminars and workshops in business as well as non-business organizations to raise awareness about the usefulness of outsourcing data entry work
  • We will advertise our services through digital marketing
  • We will offer a 10% discount on our services for the first three months of our launch
  • We will maintain a solid presence on all major freelancing platforms such as Upwork and Fiverr

6.3 Sales Monthly
Data Entry Business Plan 3

Sales Forecast
Unit Sales Year 1 Year 2 Year 3
Data entry services 1 887 030 2 680 320 2 588 240
Database management services 802 370 815 430 823 540
Data processing services 539 320 770230 1 002 310
Data protection services 265 450 322 390 393 320
TOTAL UNIT SALES 3 494 170 4 588 370 4 807 410
Unit Prices Year 1 Year 2 Year 3
Data entry services $140,00 $150,00 $160,00
Database management services $600,00 $800,00 $1 000,00
Data processing services $700,00 $800,00 $900,00
Data protection services $650,00 $750,00 $850,00
Sales
Data entry services $2 149 800 $2 784 000 $3 383 200
Database management services $120 050 $194 500 $268 500
Data processing services $50 110 $71 600 $93 000
Data protection services $139 350 $194 600 $249 850
TOTAL SALES
Direct Unit Costs Year 1 Year 2 Year 3
Data entry services $0,70 $0,80 $0,90
Database management services $0,40 $0,45 $0,50
Data processing services $0,30 $0,35 $0,40
Data protection services $3,00 $3,50 $4,00
Direct Cost of Sales
Data entry services $989 300 $1 839 000 $2 679 700
Database management services $66 600 $119 900 $173 200
Data processing services $17 900 $35 000 $52 100
Data protection services $19 400 $67 600 $115 800
Subtotal Direct Cost of Sales $1 294 100 $1 699 400 $2 104 700

6.4 Sales Yearly
Data Entry Business Plan 4
6.5 Sales Forecast
Data Entry Business Plan 5

 

Personnel plan

After knowing the basics of how to start data entry office, the most important step is to hire skilled and experienced professionals to assist you in running your business.

7.1 Company Staff

Liz will be hiring the following staff for the startup.

  • 1 Accountant to maintain financial and other records
  • 2 Technicians to operate the servers and other machines
  • 10 Data Entry persons for data entry and processing software
  • 2 Vulnerability Officers for ensuring data protection
  • 2 Managing Assistants to manage the company’s official website
  • 2 Customer Representatives to interact with customers and record their orders

7.2 Average Salary of Employees

 Personnel Plan
Year 1 Year 2 Year 3
Accountant $85 000 $95 000 $105 000
Technicians $50 000 $55 000 $60 000
Data Entry Persons $387 000 $394 000 $401 000
Vulnerability Officers $50 000 $55 000 $60 000
Managing Assistants $85 000 $95 000 $105 000
Customer Representatives $50 000 $55 000 $60 000
Total Salaries $185 000 $205 000 $225 000

Financial Plan

If you are going to make your data entry business a success, make sure to pay special attention to your financial plan. Your financial plan should include all details about how you will be recovering investments from the profit as well as how you will be managing your incomes and expenses. Even if you’re planning to make money by data entry from home, you should consider making a financial plan for it to assess how it can yield a maximum profit to you. If you’re starting on a big scale, it’s better to seek help from experts.

8.1 Important Assumptions

 General Assumptions
Year 1 Year 2 Year 3
Plan Month 1 2 3
Current Interest Rate 10,00% 11,00% 12,00%
Long-term Interest Rate 10,00% 10,00% 10,00%
Tax Rate 26,42% 27,76% 28,12%
Other 0 0 0

8.2 Brake-even Analysis
Data Entry Business Plan 6

 Brake-Even Analysis
Monthly Units Break-even 5530
Monthly Revenue Break-even $159 740
Assumptions:
Average Per-Unit Revenue $260,87
Average Per-Unit Variable Cost $0,89
Estimated Monthly Fixed Cost $196 410

8.3 Projected Profit and Loss

 Pro Forma Profit And Loss
Year 1 Year 2 Year 3
Sales $309 069 $385 934 $462 799
Direct Cost of Sales $15 100 $19 153 $23 206
Other $0 $0 $0
TOTAL COST OF SALES $15 100 $19 153 $23 206
Gross Margin $293 969 $366 781 $439 593
Gross Margin % 94,98% 94,72% 94,46%
Expenses
Payroll $138 036 $162 898 $187 760
Sales and Marketing and Other Expenses $1 850 $2 000 $2 150
Depreciation $2 070 $2 070 $2 070
Leased Equipment $0 $0 $0
Utilities $4 000 $4 250 $4 500
Insurance $1 800 $1 800 $1 800
Rent $6 500 $7 000 $7 500
Payroll Taxes $34 510 $40 726 $46 942
Other $0 $0 $0
Total Operating Expenses $188 766 $220 744 $252 722
Profit Before Interest and Taxes $105 205 $146 040 $186 875
EBITDA $107 275 $148 110 $188 945
Interest Expense $0 $0 $0
Taxes Incurred $26 838 $37 315 $47 792
Net Profit $78 367 $108 725 $139 083
Net Profit/Sales 30,00% 39,32% 48,64%

8.3.1 Profit Monthly
Data Entry Business Plan 7

8.3.2 Profit Yearly
Data Entry Business Plan 8

8.3.3 Gross Margin Monthly
Data Entry Business Plan 9

8.3.4 Gross Margin Yearly
Data Entry Business Plan 10

8.4 Projected Cash Flow
Data Entry Business Plan 11

 Pro Forma Cash Flow
Cash Received Year 1 Year 2 Year 3
Cash from Operations
Cash Sales $40 124 $45 046 $50 068
Cash from Receivables $7 023 $8 610 $9 297
SUBTOTAL CASH FROM OPERATIONS $47 143 $53 651 $59 359
Additional Cash Received
Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0
New Long-term Liabilities $0 $0 $0
Sales of Other Current Assets $0 $0 $0
Sales of Long-term Assets $0 $0 $0
New Investment Received $0 $0 $0
SUBTOTAL CASH RECEIVED $47 143 $53 651 $55 359
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $21 647 $24 204 $26 951
Bill Payments $13 539 $15 385 $170 631
SUBTOTAL SPENT ON OPERATIONS $35 296 $39 549 $43 582
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $0 $0 $0
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
SUBTOTAL CASH SPENT $35 296 $35 489 $43 882
Net Cash Flow $11 551 $13 167 $15 683
Cash Balance $21 823 $22 381 $28 239

8.5 Projected Balance Sheet

 Pro Forma Balance Sheet
Assets Year 1 Year 2 Year 3
Current Assets
Cash $184 666 $218 525 $252 384
Accounts Receivable $12 613 $14 493 $16 373
Inventory $2 980 $3 450 $3 920
Other Current Assets $1 000 $1 000 $1 000
TOTAL CURRENT ASSETS $201 259 $237 468 $273 677
Long-term Assets
Long-term Assets $10 000 $10 000 $10 000
Accumulated Depreciation $12 420 $14 490 $16 560
TOTAL LONG-TERM ASSETS $980 $610 $240
TOTAL ASSETS $198 839 $232 978 $267 117
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $9 482 $10 792 $12 102
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
SUBTOTAL CURRENT LIABILITIES $9 482 $10 792 $12 102
Long-term Liabilities $0 $0 $0
TOTAL LIABILITIES $9 482 $10 792 $12 102
Paid-in Capital $30 000 $30 000 $30 000
Retained Earnings $48 651 $72 636 $96 621
Earnings $100 709 $119 555 $138 401
TOTAL CAPITAL $189 360 $222 190 $255 020
TOTAL LIABILITIES AND CAPITAL $198 839 $232 978 $267 117
Net Worth $182 060 $226 240 $270 420

8.6 Business Ratios

 Ratio Analysis
Year 1 Year 2 Year 3 INDUSTRY PROFILE
Sales Growth 4,35% 30,82% 63,29% 4,00%
Percent of Total Assets
Accounts Receivable 5,61% 4,71% 3,81% 9,70%
Inventory 1,85% 1,82% 1,79% 9,80%
Other Current Assets 1,75% 2,02% 2,29% 27,40%
Total Current Assets 138,53% 150,99% 163,45% 54,60%
Long-term Assets -9,47% -21,01% -32,55% 58,40%
TOTAL ASSETS 100,00% 100,00% 100,00% 100,00%
Current Liabilities 4,68% 3,04% 2,76% 27,30%
Long-term Liabilities 0,00% 0,00% 0,00% 25,80%
Total Liabilities 4,68% 3,04% 2,76% 54,10%
NET WORTH 99,32% 101,04% 102,76% 44,90%
Percent of Sales
Sales 100,00% 100,00% 100,00% 100,00%
Gross Margin 94,18% 93,85% 93,52% 0,00%
Selling, General & Administrative Expenses 74,29% 71,83% 69,37% 65,20%
Advertising Expenses 2,06% 1,11% 0,28% 1,40%
Profit Before Interest and Taxes 26,47% 29,30% 32,13% 2,86%
Main Ratios
Current 25,86 29,39 32,92 1,63
Quick 25,4 28,88 32,36 0,84
Total Debt to Total Assets 2,68% 1,04% 0,76% 67,10%
Pre-tax Return on Net Worth 66,83% 71,26% 75,69% 4,40%
Pre-tax Return on Assets 64,88% 69,75% 74,62% 9,00%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin 19,20% 21,16% 23,12% N.A.
Return on Equity 47,79% 50,53% 53,27% N.A.
Activity Ratios
Accounts Receivable Turnover 4,56 4,56 4,56 N.A.
Collection Days 92 99 106 N.A.
Inventory Turnover 19,7 22,55 25,4 N.A.
Accounts Payable Turnover 14,17 14,67 15,17 N.A.
Payment Days 27 27 27 N.A.
Total Asset Turnover 1,84 1,55 1,26 N.A.
Debt Ratios
Debt to Net Worth 0 -0,02 -0,04 N.A.
Current Liab. to Liab. 1 1 1 N.A.
Liquidity Ratios
Net Working Capital $120 943 $140 664 $160 385 N.A.
Interest Coverage 0 0 0 N.A.
Additional Ratios
Assets to Sales 0,45 0,48 0,51 N.A.
Current Debt/Total Assets 4% 3% 2% N.A.
Acid Test 23,66 27,01 30,36 N.A.
Sales/Net Worth 1,68 1,29 0,9 N.A.
Dividend Payout 0 0 0 N.A.