Table of Content

    Home inventory business plan for starting your own company

    Do you want to start your business with the least possible investment? This business plan for home inventory business can make that possible for you. In the following text we’ll tell you how to run a home inventory business. All you have to do is to keep record of what people have at home. Simple as that!

    This business is a very simple one. You do not need a lot of cash to get started with it as you would need for real estate business plans. It makes this the best business plan for investors who are short on cash. We’ll follow the example of Cobol Home Inventory Reporting.

    Executive Summary

    2.1 The Business

    Cobol Home Inventory Reporting will be a licensed, ensured, and bonded home inventory services provider situated in Fort Lauderdale and operate in all of Florida. This home inventory business start up will be owned by Dickard Cobol.

    Let’s see how to start a home inventory business.

    2.2 Management of Home Inventory Company

    If you want to know how to create an inventory system for small home business, keep reading. For the business to be successful it must have multiple locations across Florida. This calls for creating a franchise business plan.

    The management of this business will be divided into two parts. One will be responsible for operations and the other will look after the external relations and PR.

    2.3 Customers of Home Inventory Company

    The customers of the Home inventory business will be of three main categories:

    • People who want to keep track of their personal belongings.
    • Insurance companies who need reporting on the home inventory of the insured people.
    • The government can also be a customer if they want to get the inventory details of a crime scene.

    2.4 Business Target

    The target of the business is to ultimately become the only nationwide home inventory service. This is just like that of a a. The objective targets are:

    • Expanding to at least 3 states by the end of year 1.
    • Obtaining at least 10 large clients within 6 months.
    • Increasing the annual revenue to $311,000 by the end of year 3.

    Home Inventory Business Plan - 3 Years Profit Forecast

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    Company Summary

    3.1 Company Owner

    The owner of the Cobol Home Inventory Reporting will be Dickard Cobol. Cobol will also act as the CEO of the company. An experience of 30 years in the insurance adjustment industry has earned Cobol a lot of contacts. Those people can make this inventory business plan sample successful.

    3.2 Why the Home Inventory Business being started

    Cobol is starting a home inventory business mainly because he has a lot of experience. Another reason behind him starting this business is the recent increase in the need for this field. When people get their homes insured, the stuff inside is also insured. To make sure that they claim what they actually had, the need for home inventory reporting has skyrocketed following the recent storms in America.

    3.3 How the Home Inventory Business will be started

    Step1: Planning

    The first step in starting this business is making the business plan inventory example. This is the stage where it will be planned what services we will provide and to what extent. The market segments to be focused in the business will also be determined in this step. Before you go ahead for home inventory business plan download, you need to read it.

    Step2: Define the Brand

    This is not a resort business plan where you can spend a lot of money to make more. You need to establish a brand. This can only be done by portraying an image of fair practices and exalted service. You will need to come up with a great name, logo, and tagline for the brand.

    Step3: Establish Your Office

    The next step will be to establish an office. This is must to get the trust of the clients.

    Step4: Online Presence

    Unlike a real estate agency business plan, this business needs an online presence. You need to make a website for your clients to connect with you.

    Step5: Marketing

    You need to market your services via print, electronic and social media.

    Home Inventory Business Plan - Startup Cost

    Start-up Expenses  
    Legal $247,000
    Consultants $0
    Insurance $31,000
    Rent $19,000
    Research and Development $26,000
    Expensed Equipment $52,000
    Signs $4,200
    TOTAL START-UP EXPENSES $379,200
    Start-up Assets $338,000
    Cash Required $345,000
    Start-up Inventory $50,000
    Other Current Assets $217,000
    Long-term Assets $238,000
    TOTAL ASSETS $1,188,000
    Total Requirements $1,567,200
    START-UP FUNDING
    Start-up Expenses to Fund $379,200
    Start-up Assets to Fund $1,188,000
    TOTAL FUNDING REQUIRED $1,567,200
    Assets
    Non-cash Assets from Start-up $1,576,000
    Cash Requirements from Start-up $360,000
    Additional Cash Raised $53,000
    Cash Balance on Starting Date $32,000
    TOTAL ASSETS $2,021,000
    Liabilities and Capital
    Liabilities $30,000
    Current Borrowing $0
    Long-term Liabilities $0
    Accounts Payable (Outstanding Bills) $41,000
    Other Current Liabilities (interest-free) $0
    TOTAL LIABILITIES $71,000
    Capital
    Planned Investment $1,567,200
    Investor 1 $0
    Investor 2 $0
    Other $0
    Additional Investment Requirement $0
    TOTAL PLANNED INVESTMENT $1,567,200
    Loss at Start-up (Start-up Expenses) $382,800
    TOTAL CAPITAL $1,950,000
    TOTAL CAPITAL AND LIABILITIES $2,021,000
    Total Funding $1,567,200

    Any questions? Get in Touch!

    Services

    Before you can start a home inventory service business, you need to have a solid home inventory business plan. As this is not as simple as making a property management business plan, you need to define the services that you will be giving to the clients. Our services for this company will be divided into three categories:

    • Domestic Home Inventory Service

    This segment will make up for the largest number of clients but with small revenue per client. The services provided to these clients will include:

      • Maintaining a list of home inventory for their personal reference.
      • Preparing home inventory lists for insurance purposes.
      • Reporting the inventory in case of damage to the property.
    • Assets Inventory Service for Insurance

    For this segment of the customers, we will have lesser customers but each of them will give us substantial revenue. The services for these customers will include:

      • Home inventory reporting for the insured homes.
      • Inventory reporting for non-residential insured properties.
      • Presenting inventory reports to the concerned authorities when needed.
    • Retail Inventory Service

    These clients will also be in lower numbers but will be high-paying. We will provide them these services:

      • Inventory record management for offices.
      • Inventory reporting for insurance purposes.
    • DIY Inventory Tracking App

    For people who would want to keep record of their belongings themselves, we’ll be offering a user-friendly mobile app. Through app that will come up with a subscription fee, our customers will be able to keep record of their kitchen inventories and more.

    Marketing Analysis of Home Inventory Company

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    For successfully running a home inventory company, you need to know how to do a home inventory for insurance. But even before that, you need to know the market. Even before you start a home inventory business. A recent report has determined that in the USA more than half of the homeowners do not have a home inventory. Keeping in mind that the market has such a huge gap, a property inventory business plan is all you need to start a profitable business. All you need to do is to have a staff that knows how to make a home inventory.

    The next thing you need to do is to have a look on the current market trends of the industry to see how you can enter. As a new entrant, you will have to present something that your competitors lack. Only then you can have a reasonable chance of being successful at this business.

    5.1 Market Trends

    After it was made necessary by the law to maintain a home inventory with a licensed provider, following the Hurricane Katrina, the home inventory business has grown very much. Previously it was something reserved for the ultra-rich. A middle-class man does not have too much stuff to have something note it down for them.

    However, now Uncle Sam wants your MacBook and washing machine on the list. If they are not, your chances of getting insurance compensation diminish greatly. This automatically means that the home inventory service providers are in luck. Now is the time to capture this market before it saturates like many others.

    Let’s now see the marketing segmentation to better know how to plan this business.

    5.2 Marketing Segmentation

    The potential customers of our home inventory reporting business will be the following:

    Home Inventory Business Plan - Marketing Segmentation

    5.2.1 Homeowners

    This is the segment of the market that will account for the largest number of customers. We will give them the services of keeping a record of their home possessions. In case their property is lost, we can present the inventory to the insurance company or law enforcing agencies handling the case.

    5.2.2 Insurance Providers

    Insurance companies need the services of home inventory reporting companies to report on the possessions of the insured homeowners. This segment will be the source of the bulk of our cashflow.

    5.2.3 Corporate Clients

    These clients need someone to keep track of all the stuff in their offices. These clients will be a few but their projects are large.

    5.2.4 Law Enforcing Agencies and Courts

    These bodies can sometimes ask home inventory reporting companies to report on the possessions of homeowners. These clients are not regular ones but offer better payout.

    Market Analysis
    Potential Customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
    Homeowners 41% 43,000 45,000 48,000 50,000 53,000 10.00%
    Insurance Providers 37% 40,000 42,000 45,000 47,000 50,000 10.00%
    Corporate Clients 12% 12,000 13,000 14,000 15,000 16,000 10.00%
    Law Enforcing Agencies and Courts 10% 6,500 7,000 8,000 9,000 10,000 11.00%
    Total 100% 101,500 107,000 115,000 121,000 129,000 10%
    Any questions? Get in Touch

    5.3 Business Target

    • To sign contracts with the 10 major insurance providers in Florida.
    • To achieve and maintain an average rating above 4.5 throughout our service years.
    • To make at least $311,000 in profits per annum by the end of year 3.
    • To obtain and retain a CSAT score of 95%.

    5.4 Product Pricing

    The prices for our services will be higher than the competitors. This is because of the experience of the founder and the dedication of our team. However, we’ll offer discounts at the start. This is not a business plan for painting company. We need to charge for what we are doing.

    Marketing Strategy of Home Inventory Company

    Of all the things that make it successful, marketing a home inventory business is the most important factor. Before you open a home inventory business franchise, you need to have a solid marketing strategy.

    For making an effective marketing strategy, it is important to perform an extensive competitive analysis and base your marketing and sales strategy on it.

    6.1 Competitive Analysis

    1. After competitive analysis we have discovered that no home inventory business in Florida has a better experienced team.
    2. Another competitive advantage that Cobol Home Inventory Reporting has is the relations with the insurance industry leaders that Dickard Cobol has developed.
    3. Lastly, and the most importantly, Cobol Home Inventory Reporting will provide services to independent homeowners too, unlike any competitor.

    6.2 Sales Strategy

    • The business will be promoted by online ads and TV commercials and the marketing effort will be augmented by emailing insurance agencies.
    • We will offer a flat 30% discount for the first 100 customers and 10 insurance agencies.
    • We will establish an impeccable honesty and integrity reputation.

    6.3 Sales Monthly

    Home Inventory Business Plan - Sales Monthly

    6.4 Sales Yearly

    Home Inventory Business Plan - Sales Yearly

    6.5 Sales Forecast

    Home Inventory Business Plan - Unit Sales

    Sales Forecast      
    Unit Sales Year 1 Year 2 Year 3
    Domestic Home Inventory Service 48,000 50,880 53,933
    Assets Inventory Service for Insurance 45,000 47,700 50,562
    Retail Inventory Service 27,000 28,620 30,337
    DIY Inventory Tracking App 24,000 25,440 26,966
    TOTAL UNIT SALES 144,000 152,640 161,798
    Unit Prices Year 1 Year 2 Year 3
    Domestic Home Inventory Service $43.00 $49.88 $57.86
    Assets Inventory Service for Insurance $43.00 $49.88 $57.86
    Retail Inventory Service $41.00 $47.56 $55.17
    DIY Inventory Tracking App $33.00 $38.28 $44.40
    Sales
    Domestic Home Inventory Service $2,064,000.00 $2,537,894.40 $3,120,594.95
    Assets Inventory Service for Insurance $1,935,000.00 $2,379,276.00 $2,925,557.77
    Retail Inventory Service $1,107,000.00 $1,361,167.20 $1,673,691.19
    DIY Inventory Tracking App $792,000.00 $973,843.20 $1,197,437.60
    TOTAL SALES $5,898,000.00 $7,252,180.80 $8,917,281.51
    Direct Unit Costs Year 1 Year 2 Year 3
    Domestic Home Inventory Service $41.00 $46.00 $53.00
    Assets Inventory Service for Insurance $41.00 $46.00 $53.00
    Retail Inventory Service $39.00 $44.00 $51.00
    DIY Inventory Tracking App $31.00 $35.00 $41.00
    Direct Cost of Sales
    Domestic Home Inventory Service $1,968,000.00 $2,340,480.00 $2,858,438.40
    Assets Inventory Service for Insurance $1,845,000.00 $2,194,200.00 $2,679,786.00
    Retail Inventory Service $1,053,000.00 $1,259,280.00 $1,547,197.20
    DIY Inventory Tracking App $744,000.00 $890,400.00 $1,105,622.40
    Subtotal Direct Cost of Sales $5,610,000.00 $6,684,360.00 $8,191,044.00

    Personnel plan

    Business Plan for Investors

    For the home inventory business to run smoothly, we need trained professional staff. The staff will have to have two types of skills. If you want to make the most out of home inventory business opportunities, the staff is one of the most important factors determining your success.

    7.1 Company Staff

    • 1 Chief Operational Officer.
    • 1 Liaison and PR Manager.
    • 5 Surveyors to conduct field work.
    • 1 IT Expert for managing the website, apps, and social media presence.
    • 4 Drivers.
    • 1 Peon for office work.
    • 1 Office Boy to take care of office errands.

    7.2 Average Salary of Employees

     Personnel Plan      
    Year 1 Year 2 Year 3
    Chief Operational Officer $14,000 $15,400 $16,940
    Liaison and PR Manager $13,000 $14,300 $15,730
    Surveyors $50,000 $55,000 $60,500
    Accountant $9,000 $9,900 $10,890
    IT Expert $8,000 $8,800 $9,680
    Peon $7,000 $7,700 $8,470
    Office Boy $7,000 $7,700 $8,470
    Drivers $35,000 $38,500 $42,350
    Total Salaries $143,000 $157,300 $173,030

    Financial Plan

    For running successful home inventory business, it is important to calculate the home inventory service cost. For that it is paramount to make a financial plan for the company. For the starting of the business, we will be focusing on the costs that we will incur to start the business. These will include:

    • The cost for getting the office space.
    • Cost for buying 4 pickup trucks for moving the crew.
    • The salaries of the staff.
    • The cost of advertisement and social media presence.
    • The cost of overheads before the company starts making profit.

    8.1 Important Assumptions

     General Assumptions      
    Year 1 Year 2 Year 3
    Plan Month 1 2 3
    Current Interest Rate 8.22% 8.23% 8.28%
    Long-term Interest Rate 8.39% 8.44% 8.47%
    Tax Rate 23.10% 24.10% 25.50%
    Other 0 0 0

    8.2 Break-even Analysis

    Home Inventory Business Plan - Break-even Analysis

     Break-Even Analysis  
    Monthly Units Break-even 5344
    Monthly Revenue Break-even $131,890
    Assumptions:
    Average Per-Unit Revenue $236.00
    Average Per-Unit Variable Cost $0.64
    Estimated Monthly Fixed Cost $163,160

    8.3 Projected Profit and Loss

     Pro Forma Profit And Loss      
    Year 1 Year 2 Year 3
    Sales $5,898,000 $7,252,181 $8,917,282
    Direct Cost of Sales $5,610,000 $6,684,360 $8,191,044
    Other $0 $0 $0
    TOTAL COST OF SALES $5,610,000 $6,684,360 $8,191,044
    Gross Margin $288,000 $567,821 $726,238
    Gross Margin % 4.88% 7.83% 8.14%
    Expenses
    Payroll $143,000 $157,300 $173,030
    Sales and Marketing and Other Expenses $122,000 $123,000 $124,000
    Depreciation $2,220 $2,300 $2,420
    Leased Equipment $0 $0 $0
    Utilities $2,980 $3,000 $3,100
    Insurance $2,000 $2,100 $2,200
    Rent $2,800 $2,900 $3,000
    Payroll Taxes $27,000 $28,000 $29,000
    Other $0 $0 $0
    Total Operating Expenses $302,000 $318,600 $336,750
    Profit Before Interest and Taxes ($14,000) $249,221 $389,488
    EBITDA ($14,000) $249,221 $389,488
    Interest Expense $0 $0 $0
    Taxes Incurred ($2,800) $49,844 $77,898
    Net Profit ($11,200) $199,377 $311,590
    Net Profit/Sales -0.19% 2.75% 3.49%

    Any questions? Get in Touch!

    8.3.1 Profit Monthly

    Home Inventory Business Plan - Profit Monthly

    8.3.2 Profit Yearly

    Home Inventory Business Plan - Profit Yearly

    8.3.3 Gross Margin Monthly

    Home Inventory Business Plan - Gross Margin Monthly

    8.3.4 Gross Margin Yearly

    Home Inventory Business Plan - Gross Margin Yearly

    8.4 Projected Cash Flow

    Home Inventory Business Plan - Projected Cash Flow

     Pro Forma Cash Flow      
    Cash Received Year 1 Year 2 Year 3
    Cash from Operations
    Cash Sales $52,500 $56,700 $61,236
    Cash from Receivables $18,700 $20,196 $21,812
    SUBTOTAL CASH FROM OPERATIONS $71,200 $77,608 $83,817
    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 $72,000 $78,000 $84,000
    Expenditures Year 1 Year 2 Year 3
    Expenditures from Operations
    Cash Spending $33,000 $34,000 $35,000
    Bill Payments $18,500 $19,800 $21,000
    SUBTOTAL SPENT ON OPERATIONS $51,500 $53,800 $56,000
    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 $52,000 $56,160 $60,653
    Net Cash Flow $16,000 $17,000 $18,000
    Cash Balance $23,000 $24,000 $25,000

    8.5 Projected Balance Sheet

     Pro Forma Balance Sheet      
    Assets Year 1 Year 2 Year 3
    Current Assets
    Cash $268,000 $300,160 $330,176
    Accounts Receivable $22,000 $24,640 $27,695
    Inventory $4,000 $4,480 $4,900
    Other Current Assets $1,000 $1,000 $1,000
    TOTAL CURRENT ASSETS $286,780 $321,194 $361,022
    Long-term Assets
    Long-term Assets $10,000 $10,000 $10,000
    Accumulated Depreciation $17,400 $19,488 $21,924
    TOTAL LONG-TERM ASSETS $25,000 $28,000 $31,500
    TOTAL ASSETS $296,000 $331,520 $372,960
    Liabilities and Capital Year 4 Year 5 Year 6
    Current Liabilities
    Accounts Payable $18,720 $20,966 $23,566
    Current Borrowing $0 $0 $0
    Other Current Liabilities $0 $0 $0
    SUBTOTAL CURRENT LIABILITIES $15,500 $17,360 $19,513
    Long-term Liabilities $0 $0 $0
    TOTAL LIABILITIES $15,000 $16,800 $18,883
    Paid-in Capital $29,000 $30,000 $31,000
    Retained Earnings $53,000 $57,770 $63,547
    Earnings $190,000 $207,100 $227,810
    TOTAL CAPITAL $281,200 $306,508 $337,159
    TOTAL LIABILITIES AND CAPITAL $296,200 $331,520 $372,960
    Net Worth $275,000 $299,750 $329,725

    8.6 Business Ratios

     Ratio Analysis        
    Year 1 Year 2 Year 3 INDUSTRY PROFILE
    Sales Growth 7.23% 8.01% 8.88% 3.00%
    Percent of Total Assets
    Accounts Receivable 9.24% 10.24% 11.34% 9.80%
    Inventory 5.44% 6.03% 6.68% 9.90%
    Other Current Assets 2.14% 2.37% 2.63% 2.40%
    Total Current Assets 149.00% 151.00% 152.00% 158.00%
    Long-term Assets 11.32% 11.37% 11.44% 12.00%
    TOTAL ASSETS 100.00% 100.00% 100.00% 100.00%
    Current Liabilities 4.87% 4.91% 4.95% 4.34%
    Long-term Liabilities 0.00% 0.00% 0.00% 0.00%
    Total Liabilities 7.52% 7.58% 7.65% 7.38%
    NET WORTH 100.23% 101.03% 101.96% 110.00%
    Percent of Sales
    Sales 100.00% 100.00% 100.00% 100.00%
    Gross Margin 94.06% 96.60% 99.30% 99.00%
    Selling, General & Administrative Expenses 94.00% 96.54% 99.24% 97.80%
    Advertising Expenses 1.50% 1.54% 1.58% 1.40%
    Profit Before Interest and Taxes 41.00% 42.11% 43.29% 33.90%
    Main Ratios
    Current 33 34 35 32
    Quick 34 34.4 35.26 33
    Total Debt to Total Assets 0.17% 0.17% 0.16% 0.40%
    Pre-tax Return on Net Worth 72.00% 73.20% 74.00% 75.00%
    Pre-tax Return on Assets 94.60% 99.33% 104.30% 111.30%
    Additional Ratios Year 1 Year 2 Year 3
    Net Profit Margin 33.00% 34.02% 35.08% N.A.
    Return on Equity 55.00% 56.71% 58.46% N.A.
    Activity Ratios
    Accounts Receivable Turnover 7.7 7.8 7.8 N.A.
    Collection Days 100 100 100 N.A.
    Inventory Turnover 31.1 32.655 33 N.A.
    Accounts Payable Turnover 15.4 15.7 16.2 N.A.
    Payment Days 27 27 27 N.A.
    Total Asset Turnover 2.5 2.5 2.6 N.A.
    Debt Ratios
    Debt to Net Worth -0.04 -0.03 -0.04 N.A.
    Current Liab. to Liab. 1 1 1 N.A.
    Liquidity Ratios
    Net Working Capital $232,450 $245,467 $259,213 N.A.
    Interest Coverage 0 0 0 N.A.
    Additional Ratios
    Assets to Sales 0.86 0.87 0.87 N.A.
    Current Debt/Total Assets 1% 0% 0% N.A.
    Acid Test 28 28.5 29 N.A.
    Sales/Net Worth 2.1 2.2 2.3 N.A.
    Dividend Payout 0 0 0 N.A.

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