Table of Content

    Do you want to start a Manufacturing business plan?

    Have you been thinking about starting a manufacturing business? It’s a great plan if you are. Some of the most profitable businesses happen to be in the manufacturing line. So, you don’t need to worry about market involvement. However, to create a successful business, you will need a manufacture business plan.

    Though it is very profitable to start a manufacturing business, you need some money to get it off the ground. If you have enough money, then you’re set. However, if you need capital, you need to apply for a bank loan for business.

    Once you’re all set with the financial part of the business, you need to start developing a business plan. You can learn how to write a manufacturing business plan by taking help from this document.

    Executive Summary

    2.1 The Business

    Henry Works will be a startup manufacturing business plan started and owned by Henry Langerman. The business will provide manufacturing services to people in and around Oregon. It will offer services like the development of manufacturing chains in different companies. It will also handle manufacturing for small-scale companies while consulting with medium-level businesses.

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    2.2 Management of Manufacturing Company

    Provided that you have an idea, you will need a manufacturing business plan proposal to make that idea a reality.

    For guidance, you can go through manufacturing business plan examples or even a woodworking business plan. You can also take help from an investment group in this business as they can guide you better in the financial aspect of the business.

    In this manufacturing business plan pdf, we are providing all the necessary details necessary to make a business successful from the start.

    2.3 Customers of Manufacturing Company

    The customers of Henry Works will primarily be other businesses who will buy raw manufactured material from Henry Works and develop it the way they want at their end. Our main customer groups, in this case, will be:

    • Distributors/Wholesalers
    • Retailers
    • Production/Merchandising Companies
    • Smaller Manufacturing Units

    2.4 Business Target

    Our primary goal is to become a trustworthy manufacturing business that can cater to the needs of its customers at all times.

    The monetary targets we want to achieve within the first five years of starting are as follows:

    Manufacturing Business Plans-3 Years Profit Forecast

    Franchise Business Plan
    Helps the franchisee get business case approval from the franchisor

    Company Summary

    3.1 Company Owner

    Henry Works will be owned by Henry Langerman, who completed his MBA four years ago. After graduation, he was attached to a large consulting and manufacturing company for three years, where he learned all the fundamental principles of business in the real world. He then left his job for helping his dream of manufacturing business to start.

    3.2 Why the Manufacturing company is being started

    During his BA, Henry had noticed that it is costly to come by bulk material in Oregon. And after some research, he understood that it was because of a lack of manufacturing businesses around Oregon. Therefore, he decided to start working on a business continuity plan template for manufacturing.

    3.3 How the Manufacturing company will be started

    Step1: Plan Everything

    Before starting a business, you need to develop a good business plan. Whether it is a business plan for a metal casting shop or a manufacturer business plan, it will guide you in starting up your business.

    If you are wondering how to write a business plan pdf manufacturer for your business, you can take help from this business plan. For general guidance, you can also refer to a business plan written for sewing or a small manufacturing business plan. Through these business plans, you will plan out all the major stages of starting your business. And this will help you be prepared for anything that may come up.

    Step2: Define the Brand

    Recognition is key to a successful business. You need to ensure that your customers pay attention to your products and services. Therefore, you will have to establish a brand for your business that will attract your customers to your business.

    Step3: Establish Your Corporate Office

    Henry decided to buy a warehouse in the outskirts of Oregon to start his manufacturing business. He will now determine the inventory needed to start the company and the workforce required.

    Step4: Establish a Web Presence

    Social media and general online presence have become necessary to the existence of a business nowadays. Therefore, Henry will not only have a website developed for his business, but he will also hire a social media manager to keep up a business profile for Henry Works on all Social Media platforms.

    Step5: Promote and Market

    The final step in starting a business is to promote it through a stellar marketing plan.

    Manufacturing Business Plans-Startup Cost

    Start-up Expenses  
    Legal $301,100
    Consultants $0
    Insurance $23,000
    Rent $45,000
    Research and Development $10,000
    Expensed Equipment $26,000
    Signs $3,400
    TOTAL START-UP EXPENSES $408,500
    Start-up Assets $366,000
    Cash Required $209,000
    Start-up Inventory $39,000
    Other Current Assets $240,000
    Long-term Assets $203,000
    TOTAL ASSETS $1,057,000
    Total Requirements $1,465,500
    START-UP FUNDING
    Start-up Expenses to Fund $408,500
    Start-up Assets to Fund $1,057,000
    TOTAL FUNDING REQUIRED $1,465,500
    Assets
    Non-cash Assets from Start-up $1,462,000
    Cash Requirements from Start-up $167,000
    Additional Cash Raised $50,000
    Cash Balance on Starting Date $35,000
    TOTAL ASSETS $1,714,000
    Liabilities and Capital
    Liabilities $18,000
    Current Borrowing $0
    Long-term Liabilities $0
    Accounts Payable (Outstanding Bills) $58,000
    Other Current Liabilities (interest-free) $0
    TOTAL LIABILITIES $76,000
    Capital
    Planned Investment $1,465,500
    Investor 1 $0
    Investor 2 $0
    Other $0
    Additional Investment Requirement $0
    TOTAL PLANNED INVESTMENT $1,465,500
    Loss at Start-up (Start-up Expenses) $172,500
    TOTAL CAPITAL $1,638,000
    TOTAL CAPITAL AND LIABILITIES $1,714,000
    Total Funding $1,465,500

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    Services

    To start a manufacturing business, you need to figure out the services you will provide to your customers. That way, you can plan the steps of developing your startup manufacturing ideas in a better way.

    A strong business manufacturing plan will help you map out your business to make it more efficient. There are many types of manufacturing business, and each has its services. Therefore, you can take help from this manufacturing business plan template to develop your plan. Alternatively, you can also take help from other business plans like solid semiconductor business plan etc. for further guidance.

    For business ideas manufacturing of Henry Works, the primary services are listed below:

    • Production of Raw Materials

    We will offer manufacturing services to produce refined raw materials that can be used for developing other products. These raw materials will vary depending on our contracts with customers.

    • Specialized End-Product Development

    Henry Works will also offer the production of end-products with complete packaging facilities. However, if the product development involves complex or specific-domain processes, the work will be outsourced for retaining the best quality.

    • Consulting

    We will offer consulting services to manage production and supply chains for medium and large-scale companies so that they can obtain maximum efficiency at each stage.

    • Development of Manufacturing Chains

    We will offer services to develop and deploy a production chain that they can easily keep track of and stay independent for our small-scale business customers.

    Marketing Analysis of Manufacturing Company

    When you have decided to open a business, you will need to write a business proposal for manufacturing with a solid marketing analysis. Just like any other business, starting manufacturing business requires you to have an in-depth knowledge of your customers and market positions.

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    For writing a business continuity plan template manufacturing, you will need to pay attention to not only present market analysis but also information of past and future. If you want, you can take help from logging company business plan or diamond business plan or any other thorough business plan for further guidance.

    Your business plan will help you identify your customer base, services, and how to attract the two. Therefore, focus on manufacturing definition business when developing your marketing plan.

    Here, we have detailed the marketing plan and its details for Henry Works:

     

    5.1 Market Trends

    According to IBISWorld, there are more than 636000 manufacturing businesses, and they are increasing at a steady rate of 3.6% per year. According to NAM, the manufacturing industry also holds a market share of 11.39%. It means that the demand for manufacturing businesses is not going down any time soon. And you will have a good standing in the market for your business which will not decline in the coming years.

    5.2 Marketing Segmentation

    The potential customers of Henry Works are divided into the following groups:

    Manufacturing Business Plans-Marketing Segmentation

    Business Plan for Investors

    5.2.1 Distributors/Wholesalers

    Our primary customers will be distributors or wholesalers to provide raw materials or finished products. These companies usually buy and sell in bulk, so they are expected to avail of our services frequently.

    5.2.2 Retailers

    Our second biggest customers will be retailers. We intend to sell to retailers directly for getting our products to the general public. We will also agree on contracts with retailers to produce products of their choice. Therefore, we expect to receive a fair amount of attention from these stores and companies.

    5.2.3 Production/Merchandising Companies

    Production and merchandising companies need raw materials to produce their specified merchandise. Therefore, we expect these customers to require our services quite often.

    5.2.4 Small Manufacturing Units

    Lastly, we will also offer our supplying and consultation services to smaller manufacturing units around Oregon to aid their production.

    Market Analysis
    Potential Customers Growth Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
    Distributors 31% 34,500 41,400 49,680 59,616 71,539 10.00%
    Retailers 23% 22,500 27,000 32,400 38,880 46,656 10.00%
    Merch Companies 24% 21,700 26,040 31,248 37,498 44,997 10.00%
    SMUs 22% 19,000 22,800 27,360 32,832 39,398 11.00%
    Total 100% 97,700 117,240 140,688 168,826 202,591 10%

     

    5.3 Business Target

    • To become the most reliable manufacturing business in Oregon.
    • To expand our business and open branches in other states of the US.
    • To approach a net profit of $90k/month by the end of the first three years
    • To achieve customer satisfaction above 90%.

    5.4 Product Pricing

    Our prices will be much lower than the imported materials brought into Oregon from other states. However, the quality will be the same or better but not lower. It will be one of the main standout points of Henry Works.

    Marketing Strategy

    To stand out amongst your competitors, you need to offer several advantages to your customers that the competition cannot. For this, you will need to refer to a business plan for manufacturing company. For general reference, you can also take help from business plan manufacturing and operations plan or business plan coal mining company.

    Even If you want to open a small manufacturing business at home, you will still need a strong marketing strategy to make your business a success.

    6.1 Competitive Analysis

    • We provide the option of contracts to our customers to produce customized materials.
    • We have fantastic customer service. We will cater to all the customer’s needs and issues and ask for feedback for further improvement.
    • We will use green practices and machines for the production of goods.
    • Our customers can book appointments with us through our website or reach out to us on our social media.

    6.2 Sales Strategy

    • We will advertise our company through Google Ads, billboards, word of mouth, and social media.
    • We will offer wholesale prices to our customers with the best quality.
    • We will also offer discounts to our first-time customers.
    • Our customers can also reach out for a contract entailing the production of customized end-products.

    6.3 Sales Monthly

    Manufacturing Business Plans-Sales Monthly

    6.4 Sales Yearly

    Manufacturing Business Plans-Sales Yearly

    6.5 Sales Forecast

    Manufacturing Business Plans-Unit Sales

    Personnel plan

    There are a lot of manufacturing ideas in the USA. But only a few are successful. That is because the value of a business is determined not only by the quality of its products but also by its workforce. Henry knew the importance of good employees. So, he incorporated strict criteria for selecting all company employees within the manufacturing business plan sample pdf.

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    7.1 Company Staff

    • 1 Co-Manager to help in overall operations
    • 8 Certified Machinery Operators
    • 5 CIMS Certified Commercial Cleaners
    • 2 Technicians to maintain the machinery
    • 1 Web Developer to manage the online site
    • 1 Sales Executives to organize and promote sales
    • 1 Accountant
    • 1 Receptionist

    7.2 Average Salary of Employees

     Personnel Plan      
    Year 1 Year 2 Year 3
    Co-Manager $60,000 $66,000 $72,600
    Machinery Operators $342,000 $376,200 $413,820
    Commercial Cleaners $182,000 $200,200 $220,220
    Technicians $54,000 $59,400 $65,340
    Web Developer Expert $23,000 $25,300 $27,830
    Sales Execs $32,000 $35,200 $38,720
    Accountant $26,000 $28,600 $31,460
    Receptionist $30,000 $33,000 $36,300
    Total Salaries $719,000 $790,900 $869,990

     

    Financial Plan

    When writing a business plan for manufacturing, you also need to focus on the monetary details. There are a lot of low cost manufacturing ideas in the world, but not all of them are beneficial to your business. Therefore, to ensure your company’s efficient and smooth working, you need to develop a detailed financial plan. A financial plan will guide you in managing the available resources in your company, thereby preventing your business from becoming a manufacturing business for sale after significant losses.

    Here we’re providing the detailed financial plan made for Pro Cleaning Services so that you can get an idea of the business finances.

    8.1 Important Assumptions

     General Assumptions      
    Year 1 Year 2 Year 3
    Plan Month 1 2 3
    Current Interest Rate 8.12% 8.20% 8.26%
    Long-term Interest Rate 8.40% 8.44% 8.47%
    Tax Rate 24.03% 24.21% 24.60%
    Other 0 0 0

     

    8.2 Break-even Analysis

    Manufacturing Business Plans-Break-even Analysis

     Break-Even Analysis  
    Monthly Units Break-even 5340
    Monthly Revenue Break-even $132,500
    Assumptions:
    Average Per-Unit Revenue $231.00
    Average Per-Unit Variable Cost $0.62
    Estimated Monthly Fixed Cost $163,800

     

    8.3 Projected Profit and Loss

     Pro Forma Profit And Loss    
    Year 1 Year 2 Year 3
    Sales $2,562,500 $3,150,850 $3,874,285
    Direct Cost of Sales $1,325,000 $1,544,950 $1,719,529
    Other $0 $0 $0
    TOTAL COST OF SALES $1,325,000 $1,544,950 $1,719,529
    Gross Margin $1,237,500 $1,605,900 $2,154,756
    Gross Margin % 48.29% 50.97% 55.62%
    Expenses
    Payroll $719,000 $790,900 $869,990
    Sales and Marketing and Other Expenses $145,000 $148,000 $156,000
    Depreciation $2,300 $2,350 $2,500
    Leased Equipment $0 $0 $0
    Utilities $2,900 $3,000 $3,100
    Insurance $2,100 $2,100 $2,100
    Rent $2,900 $3,000 $3,200
    Payroll Taxes $24,000 $25,000 $27,000
    Other $0 $0 $0
    Total Operating Expenses $898,200 $974,350 $1,063,890
    Profit Before Interest and Taxes $339,300 $631,550 $1,090,866
    EBITDA $339,300 $631,550 $1,090,866
    Interest Expense $0 $0 $0
    Taxes Incurred $67,860 $126,310 $218,173
    Net Profit $271,440 $505,240 $872,693
    Net Profit/Sales 10.59% 16.04% 22.53%
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    8.3.1 Profit Monthly

    Manufacturing Business Plans-Profit Monthly

    8.3.2 Profit Yearly

    Manufacturing Business Plans-Profit Yearly

    8.3.3 Gross Margin Monthly

    Manufacturing Business Plans-Gross Margin Monthly

    8.3.4 Gross Margin Yearly

    Manufacturing Business Plans-Gross Margin Yearly

    8.4 Projected Cash Flow

    Manufacturing Business Plans-Projected Cash Flow

     Pro Forma Cash Flow      
    Cash Received Year 1 Year 2 Year 3
    Cash from Operations
    Cash Sales $51,000 $55,080 $59,486
    Cash from Receivables $22,000 $23,760 $25,661
    SUBTOTAL CASH FROM OPERATIONS $73,000 $79,570 $85,936
    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 $74,000 $79,000 $85,000
    Expenditures Year 1 Year 2 Year 3
    Expenditures from Operations
    Cash Spending $42,000 $42,000 $45,000
    Bill Payments $27,000 $28,000 $31,000
    SUBTOTAL SPENT ON OPERATIONS $69,000 $70,000 $76,000
    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 $69,000 $74,520 $80,482
    Net Cash Flow $21,000 $23,000 $25,000
    Cash Balance $27,000 $30,000 $33,000

     

    8.5 Projected Balance Sheet

     Pro Forma Balance Sheet    
    Assets Year 1 Year 2 Year 3
    Current Assets
    Cash $275,000 $308,000 $338,800
    Accounts Receivable $24,000 $26,880 $30,213
    Inventory $4,300 $4,816 $4,900
    Other Current Assets $1,000 $1,000 $1,000
    TOTAL CURRENT ASSETS $282,000 $315,840 $355,004
    Long-term Assets
    Long-term Assets $10,000 $10,000 $10,000
    Accumulated Depreciation $19,400 $21,728 $24,444
    TOTAL LONG-TERM ASSETS $24,400 $27,328 $30,744
    TOTAL ASSETS $294,000 $329,280 $370,440
    Liabilities and Capital Year 4 Year 5 Year 6
    Current Liabilities
    Accounts Payable $18,700 $20,944 $23,541
    Current Borrowing $0 $0 $0
    Other Current Liabilities $0 $0 $0
    SUBTOTAL CURRENT LIABILITIES $19,000 $21,280 $23,919
    Long-term Liabilities $0 $0 $0
    TOTAL LIABILITIES $15,000 $16,800 $18,883
    Paid-in Capital $30,000 $30,000 $31,000
    Retained Earnings $53,000 $57,770 $63,547
    Earnings $193,400 $210,806 $231,887
    TOTAL CAPITAL $285,000 $310,650 $341,715
    TOTAL LIABILITIES AND CAPITAL $300,000 $329,280 $370,440
    Net Worth $293,400 $319,806 $351,787

     

    8.6 Business Ratios

     Ratio Analysis        
    Year 1 Year 2 Year 3 INDUSTRY PROFILE
    Sales Growth 7.25% 8.03% 8.90% 3.00%
    Percent of Total Assets
    Accounts Receivable 9.21% 10.20% 11.31% 9.80%
    Inventory 5.39% 5.97% 6.62% 9.90%
    Other Current Assets 2.11% 2.34% 2.59% 2.40%
    Total Current Assets 149.80% 151.00% 152.00% 158.00%
    Long-term Assets 11.55% 11.60% 11.64% 12.00%
    TOTAL ASSETS 100.00% 100.00% 100.00% 100.00%
    Current Liabilities 4.90% 4.94% 4.98% 4.34%
    Long-term Liabilities 0.00% 0.00% 0.00% 0.00%
    Total Liabilities 7.59% 7.65% 7.72% 7.38%
    NET WORTH 100.45% 101.25% 102.19% 110.00%
    Percent of Sales
    Sales 100.00% 100.00% 100.00% 100.00%
    Gross Margin 94.60% 97.15% 99.87% 99.00%
    Selling, General & Administrative Expenses 93.56% 96.09% 98.78% 97.80%
    Advertising Expenses 1.52% 1.56% 1.60% 1.40%
    Profit Before Interest and Taxes 41.50% 42.62% 43.81% 33.90%
    Main Ratios
    Current 34 35 36 32
    Quick 33 33.8 34.645 33
    Total Debt to Total Assets 0.18% 0.18% 0.17% 0.40%
    Pre-tax Return on Net Worth 74.08% 74.89% 75.00% 75.00%
    Pre-tax Return on Assets 96.30% 101.12% 106.17% 111.30%
    Additional Ratios Year 1 Year 2 Year 3
    Net Profit Margin 33.56% 34.60% 35.67% N.A.
    Return on Equity 55.80% 57.53% 59.31% N.A.
    Activity Ratios
    Accounts Receivable Turnover 7.7 7.8 7.8 N.A.
    Collection Days 100 100 100 N.A.
    Inventory Turnover 32.4 34.02 35 N.A.
    Accounts Payable Turnover 15.6 16 16.3 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 $244,000 $257,664 $272,093 N.A.
    Interest Coverage 0 0 0 N.A.
    Additional Ratios
    Assets to Sales 0.85 0.87 0.89 N.A.
    Current Debt/Total Assets 1% 0% 0% N.A.
    Acid Test 29 29.12 29.16 N.A.
    Sales/Net Worth 2.1 2.2 2.2 N.A.
    Dividend Payout 0 0 0 N.A.

     

    FAQ

    1. What are manufacturing plans in a business plan?

    Manufacturing plans are just details laid out in a manufacture business plan that tell you how a business will operate.

    1. How can I start my manufacturing business?

    To start manufacturing business plan, you have to figure out all the details of how your business will operate. For this, a business plan is usually drafted. For more information, you can refer to the template above.

    1. What is an example of a manufacturing business?

    There are different kinds of manufacturing businesses. One manufacturing business example is of electronics manufacturing business.

    1. What are the 3 types of manufacturing businesses?

    There are 3 types of manufacturing business:

    1. Make-to-Stock (MTS)
    2. Make-to-Order (MTO)
      3. Make-to-Assemble (MTA)

    Download Manufacturing Business Plan Sample in pdf