Do you want to start Painting Contractors business?
Painting is a great business for anyone who is creative, can find worthy partners and can fill happiness and peace in other’s life by selecting suitable paint combinations.
Starting a painting business doesn’t only mean that you have to pick up a brush or a bottle of paint to start your work, surprisingly it can be as wide as you may like. You can hire employees if you have a big budget and extend your business to the commercial level, or even you can manufacture your own paint for if you want to have perfection and sole independence.
In each case, you can take help from the painting business plans available on the web, like the one we are providing here for paint manufacturing and painting company ‘Giana Paints’.
2.1 The Business
Giana Paints will be a licensed and registered painting company based on providing top-quality exterior and interior painting services in Seattle. The business will be owned by Giana Pratt. Giana is a graduate in Chemical & Manufacturing Engineering from the University of California.
Considering the time and money she can invest in her business, she has decided to open a company that can manufacture paint as well as provides its customers the facility of painting by highly efficient and professional painters.
Before taking the initiative, you might be thinking that how to run a successful painting company, but if you are following a stepwise approach you don’t need to bother about it. Firstly, make a thorough painting and decorating business plan envisaging all the important details of your business.
In case of Giana, as she was a graduate in pure engineering subject so she had decided to seek the services of professional house painting business plan writers to write a paint business plan for her.
Owing to the large number of equipment and manpower required in this business, she has decided to hire a General Manager even before the actual launch of the business to help her in managing several tasks.
Painting business has its customers in residential communities, commercial areas as well as in industries. Usually, the residents having a small apartment find it easy and enjoyable to paint by their own hands, so we will mainly focus on commercial level projects.
Moreover, we expect that most of the residents in such a big city would like this work to be done by someone expert and skilled. So, they are still in the category of our customers.
2.4 Target of the Company
The company aims at providing the highest quality services to its customers, taking care of the employees at the same time. We believe in making and maintaining long term relationships with our clients. Our target is to extend our business and include a broad range of related services so that our clients don’t need to contact several companies for the maintenance of their property.
The financial targets of the company are given here:
- To balance the startup cost by earned profits by the end of the first year
- To achieve a net profit margin of $100k per month by the end of the first year and to achieve the profit margin of $150k by the end of the second year.
3.1 Company Owner
Giana Paints will be owned by Giana Pratt, a graduate in Chemical and Manufacturing Engineering from the University of California. Giana has a seven-year experience of working in Nippon Painters Company. She is a really ambitious and hardworking woman.
3.2 Why the Business is being started
After serving as a chemical engineer in Nippon Paints company, Giana has gained a valuable experience which she wants to flourish by opening her own business. After getting her shares she had everything required to open up a new business.
3.3 How the Business will be started
The first step will be to make a business plan for painting company, after which Giana will hire a manager to help her through the process of registration and insurance, buying equipment and employing people. A building will be taken on rent and modified to satisfy the requirements of the reception area, storage area for inventory and sitting lounge for employees.
The company has forecasted the following costs for the start-up:
The detailed information about the start-up is given below:
|Research and Development||$32,750|
|TOTAL START-UP EXPENSES||$187,300|
|Other Current Assets||$232,500|
|Start-up Expenses to Fund||$11,875|
|Start-up Assets to Fund||$15,000|
|TOTAL FUNDING REQUIRED||$0|
|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|
|Liabilities and Capital||$0|
|Accounts Payable (Outstanding Bills)||$0|
|Other Current Liabilities (interest-free)||$0|
|Additional Investment Requirement||$0|
|TOTAL PLANNED INVESTMENT||$695,000|
|Loss at Start-up (Start-up Expenses)||$313,125|
|TOTAL CAPITAL AND LIABILITIES||$251,875|
Services for customers
To fulfill the demands of the public, Giana had included the following services she wants to provide her customers in her painting business description.
Giana Paints aims at providing painting services to its customers by their own manufactured paint. The company, however, will extend itself and provide all the given services within just the two years of the launch.
- Residential Painting
- Commercial Painting
- Exterior Painting
- Flooring Services including safety and aisle striping
- Wall Cleaning
- Logo Paintings
- Pipe Coating
- Rust Encapsulation
- Bridge Painting
The price of services will vary depending on the project and deadline.
Marketing Analysis of Painting Contractors business
If you are looking for how to build a successful painting business, you must focus on analyzing your target market and latest trends before finalizing your painting business plan.
Your paint manufacturing business plan must contain accurate market analysis and the trends that how other people are doing it. Marketing analysis for the Giana Paints according to its location and target market is provided here for your help if you want to study market trends for this business to know how to run a successful painting business.
5.1 Market Trends
Due to expansion in real estate, the business of painting mainly for commercial purposes is increasing with a surprising rate. According to IBISWorld, the business has seen an annual growth rate of 4.9 percent over the past five years and has generated total revenue of $40 billion in the year 2018. Despite the fact that more than 306,500 painter’s businesses are running in the United States, there is still place for many.
Marketing trends of this business are highly satisfactory and depict that you can never be at loss starting this business, provided that you plan it properly.
5.2 Marketing Segmentation
Giana Paints has identified the following groups which can serve as its potential customers.
5.2.1 Industrial Sector: The major group of target customers will come from the industrial sector. We expect to get orders of flooring services, wall cleanings, rust encapsulation, pipe coatings etc. from this target group.
5.2.2 Commercial Estate Owners: This group includes the owners of the big building and offices who require services of highly professional, fast servicing and insured crew to help them in maintaining their estate. We expect to get long term projects and various orders from this group of our customers.
5.2.3 Home Owners: This group will comprise of the residents and homeowners who require professional and skilled painters to help them in renovating their houses and to paint inaccessible places. They are expected to use our painting, wall cleaning, and exterior painting services.
The detailed market analysis of our potential customers is given in the following table:
|Potential Customers||Growth||Year 1||Year 2||Year 3||Year 4||Year 5||CAGR|
|Commercial Estate Owners||48%||22,334||32,344||43,665||52,544||66,432||10.00%|
5.3 Business Target
Our main business targets are as follows:
- To achieve the net profit margin of $10k per month by the end of the first year, $15k per month by the end of the second year, and $25k per month by the end of the third year
- To balance the initial cost of the startup with earned profits by the end of the first year
5.4 Product Pricing
To get ourselves introduced to a wide audience we have priced our services and items a little lower than our competitors.
After composing your painting contractor marketing plan the next step is to define the plan by which you will be getting introduced to your target customers. A clear and effective advertising strategy for the business plan will help you in gaining the customers, at the very instant you are starting a painting company.
6.1 Competitive Analysis
Knowing about the competition, it has to face, Giana Paints have come up with several competitive aspects that most of other in the same business lack. Our staff is highly customer care oriented and they will treat your property like a piece of art. We have skilled workers to paint your facility efficiently, followed by recurrent refinishing.
Moreover, our experts will be there as soon as possible after your contract and will finish all the work before the deadline. Lastly, we will be applying paint that is highly durable, stain resistant and can resist chemical effects too.
6.2 Sales Strategy
- We will advertise ourselves in magazines, newspapers, TV stations, and social media
- We will make an online website for people to know about us and our services
- We will offer a 15% discount on our services for the first three months
6.3 Sales Monthly
6.4 Sales Yearly
6.5 Sales Forecast
Our forecasted sales are summarized in the following column charts:
The detailed information about the sales forecast is given in the following table:
|Unit Sales||Year 1||Year 2||Year 3|
|Residential, Commercial, Exterior Painting||1,887,030||2,680,320||2,588,240|
|Flooring & Wall Services||802,370||815,430||823,540|
|Logo & Bridge Paintings||539,320||770230||1,002,310|
|Pipe Coating & Rust Encapsulation||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|
|Residential, Commercial, Exterior Painting||$140.00||$150.00||$160.00|
|Flooring & Wall Services||$600.00||$800.00||$1,000.00|
|Logo & Bridge Paintings||$700.00||$800.00||$900.00|
|Pipe Coating & Rust Encapsulation||$650.00||$750.00||$850.00|
|Residential, Commercial, Exterior Painting||$2,149,800||$2,784,000||$3,383,200|
|Flooring & Wall Services||$120,050||$194,500||$268,500|
|Logo & Bridge Paintings||$50,110||$71,600||$93,000|
|Pipe Coating & Rust Encapsulation||$139,350||$194,600||$249,850|
|Direct Unit Costs||Year 1||Year 2||Year 3|
|Residential, Commercial, Exterior Painting||$0.70||$0.80||$0.90|
|Flooring & Wall Services||$0.40||$0.45||$0.50|
|Logo & Bridge Paintings||$0.30||$0.35||$0.40|
|Pipe Coating & Rust Encapsulation||$3.00||$3.50||$4.00|
|Direct Cost of Sales|
|Residential, Commercial, Exterior Painting||$989,300||$1,839,000||$2,679,700|
|Flooring & Wall Services||$66,600||$119,900||$173,200|
|Logo & Bridge Paintings||$17,900||$35,000||$52,100|
|Pipe Coating & Rust Encapsulation||$19,400||$67,600||$115,800|
|Subtotal Direct Cost of Sales||$1,294,100||$1,699,400||$2,104,700|
Personnel plan gives you an estimation of the required staff and their salaries over the next few years. It is important to hire your required staff before at least one week of the actual launch of the business so that you will be able to define your painting contractor company profile, alongside training and testing their skills.
7.1 Company Staff
Giana will hire a general manager one month before the launch to help her in employing other staff and to manage the process of registrations. The company will initially hire the following people:
- 2 Administrators/Accountants for maintaining financial records
- 4 Sales Executives for discovering new ventures
- 4 Assistants for undertaking various day to day tasks
- 6 House Painters
- 1 IT Expert for managing the company’s website
- 1 Driver for transportation
7.2 Average Salary of Employees
|Year 1||Year 2||Year 3|
The financial plan is a very essential part of your paint shop business plan. It includes the details about from where you will be collecting the capital to spend on your startup, and how long can you run your business with the present finances if you are failed to gain your target customers.
It is advisable to get your financial plan written by an expert, especially if you are starting on a big scale or also if it is Greek to you. As Giana hadn’t much experience in writing a financial plan so she had hired a financial expert to do this task for her. Giana Paints’ financial plan is as follows:
8.1 Important Assumptions
|Year 1||Year 2||Year 3|
|Current Interest Rate||10.00%||11.00%||12.00%|
|Long-term Interest Rate||10.00%||10.00%||10.00%|
8.2 Brake-even Analysis
|Monthly Units Break-even||5530|
|Monthly Revenue Break-even||$159,740|
|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|
|Direct Cost of Sales||$15,100||$19,153||$23,206|
|TOTAL COST OF SALES||$15,100||$19,153||$23,206|
|Gross Margin %||94.98%||94.72%||94.46%|
|Sales and Marketing and Other Expenses||$1,850||$2,000||$2,150|
|Total Operating Expenses||$188,766||$220,744||$252,722|
|Profit Before Interest and Taxes||$105,205||$146,040||$186,875|
8.3.1 Profit Monthly
8.3.2 Profit Yearly
8.3.3 Gross Margin Monthly
8.3.4 Gross Margin Yearly
8.4 Projected Cash Flow
|Pro Forma Cash Flow|
|Cash Received||Year 1||Year 2||Year 3|
|Cash from Operations|
|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|
|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|
|SUBTOTAL CASH SPENT||$35,296||$35,489||$43,882|
|Net Cash Flow||$11,551||$13,167||$15,683|
8.5 Projected Balance Sheet
|Pro Forma Balance Sheet|
|Assets||Year 1||Year 2||Year 3|
|Other Current Assets||$1,000||$1,000||$1,000|
|TOTAL CURRENT ASSETS||$201,259||$237,468||$273,677|
|TOTAL LONG-TERM ASSETS||$980||$610||$240|
|Liabilities and Capital||Year 1||Year 2||Year 3|
|Other Current Liabilities||$0||$0||$0|
|SUBTOTAL CURRENT LIABILITIES||$9,482||$10,792||$12,102|
|TOTAL LIABILITIES AND CAPITAL||$198,839||$232,978||$267,117|
8.6 Business Ratios
|Year 1||Year 2||Year 3||Industry Profile|
|Percent of Total Assets||4.35%||4.71%||5.80%||9.80%|
|Other Current Assets||1.75%||2.02%||2.29%||27.40%|
|Total Current Assets||138.53%||150.99%||163.45%||54.60%|
|Percent of Sales|
|Selling, General & Administrative Expenses||74.29%||71.83%||69.37%||65.20%|
|Profit Before Interest and Taxes||26.47%||29.30%||32.13%||2.86%|
|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.|
|Accounts Receivable Turnover||4.56||4.56||4.56||N.A.|
|Accounts Payable Turnover||14.17||14.67||15.17||N.A.|
|Total Asset Turnover||1.84||1.55||1.26||N.A.|
|Debt to Net Worth||0||-0.02||-0.04||N.A.|
|Current Liab. to Liab.||1||1||1||N.A.|
|Net Working Capital||$120,943||$140,664||$160,385||N.A.|
|Assets to Sales||0.45||0.48||0.51||N.A.|
|Current Debt/Total Assets||4%||3%||2%||N.A.|
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