How to Start a Crime Scene Cleanup Business
As A Whistle will provide residential and commercial cleaning services of trauma scenes, crime scenes and residential biohazardous cleanups. The principal officers of As A Whistle believe there is a lack of service providers and thus a lack of competition in this field and have observed poor training of employees in those companies that do exist.This can lead to lower customer satisfaction and a low word-of-mouth referral rate.
As A Whistle believes that it can improve upon and exploit these weaknesses to gain prompt recognition and local market share. The objectives for As A Whistle over the next three years are: •To achieve sales revenues of approximately $200,000 in year one, $500,000 in year two and $875,000 by year three. •To achieve contracts, beginning with Metro Phoenix and then with state and local police departments, fire departments and hotels. To expand operations to include all the Greater Phoenix Valley area including Payson, Show Low and Globe. The company will seek to provide its cleaning services in the timeliest manner and with an ongoing comprehensive quality-control program to provide 100% customer satisfaction. The company’s principal officers see each contract as an agreement not between a business and its customers, but between partners that wish to create a close and mutually beneficial long-term relationship.
This will help to provide greater long-term profits through referrals.As A Whistle will institute the following key procedures to reach its goals: •Design a comprehensive training program to create quality employees utilizing Amdecon’s 5-day CTS Decon course. •Institute a program of profit sharing among all employees to give them a vested interest in achievement. As A Whistle is a start-up limited liability company consisting of two principal officers.
As A Whistle will be a partnership between Ms. Nancy Smith and Ms. Daisy Shaw. The principals will be investing their own capital into the company and will also be seeking a loan of $80,000 to cover start-up costs and future growth.
Finally, the company has procured a $10,000 line of credit (not shown on financial statements) that will be used if necessary to cover unforeseen expenses or opportunities. As A Whistle will be located in a purchased location at 1081 S Meridian Road in Apache Junction, AZ. The facilities will include a reception area, offices for the principals, storage/garage area for inventory, and employee lounge. As A Whistle offers a wide variety of services primarily focused on interior and exterior residential and commercial cleaning of crime and trauma scenes.
The firm also provides services such as automobile/train/bus/airplane cleaning (suicide/homicide), fingerprint dust removal, animal carcass removal, tear gas removal, and others. The purpose is to provide clients with a broad range of related services that will minimize their need to employ a variety of contractors. As A Whistle will engage in a low-cost leadership strategy while maintaining a high level of quality. Initially the company will focus on residential and commercial customers in the Apache Junction, Mesa and Chandler areas. However, by the end of three-years, the company expects to be serving the entire Greater Phoenix Metro area.The company has rigorously examined its financial projections and concluded that they are both conservative in regards to revenues and generous in estimating expenditures.
This was done deliberately to provide budget flexibility for unforeseeable events. The company’s principals believe that cash flow projections are realistic. Highlights 1. 1 Objectives The objectives for As A Whistle over the next three years are to achieve sales revenues as demonstrated above, achieve multiple contracts with government and commercial groups and to expand statewide. 1. 2 MissionThe mission of As A Whistle is to provide top-quality interior and exterior residential and commercial cleaning services of trauma scenes, crime scenes and residential biohazardous cleanups.
The company will seek to provide these services in the timeliest manner and maintain an ongoing comprehensive quality control training program to provide 100% customer satisfaction. The company’s principal officers see each contract as an agreement not between a business and its customers, but between partners that wish to create a close and mutually beneficial long-term relationship.This will help to provide greater long-term profits through referrals. 1.
3 Keys to Success The principal officers of As A Whistle have had many years of experience in the cleaning business, Ms. Prince with a drycleaning business background specializing in spot and stain removal, and Ms. Legrin with a prior successful house-cleaning business. They believe that there is a lack of service providers in this industry, and those there are suffer from a major deficiency that As A Whistle can improve upon and exploit. The problem comes from a lack of quality training.Many crime scene cleaning companies don’t train their employees sufficiently, which leads to sloppy and incomplete cleaning, decontamination and deodorizing of crime and trauma scenes and that leads to a decrease in customer satisfaction and retention.
Additionally, many companies rely on temporary or transient employees. This leads to high turnover rates and decreased service quality. As A Whistle will institute a comprehensive training program to create quality employees, utilizing Amdecon’s 5-day CTS Decon course and will also start a program of profit sharing among all employees to give them a vested interest in achievement. . 0 Company Summary As A Whistle is a start-up limited liability company consisting of two principle officers.
The company is formed to take advantage of the perceived weakness and inadequacies of other regional service providers in terms of quality and customer satisfaction. As A Whistle will be operated by Ms. Nancy Smith and Ms. Daisy Shaw.
The principles in the company will be investing their own capital into the company and will also be seeking a loan to cover start-up costs and future growth. As A Whistle will be located in a purchased location at 1081 S Meridian Road in Apache Junction, AZ.The facilities will include a reception area, offices for the principals, storage/garage area for inventory, and employee lounge. The company plans to use aggressive directed advertising to generate short-term residential contracts. Its long-term profitability will rely on focusing on using its existing contacts, legwork, determination and a comprehensive marketing program to achieve state and local commercial contracts with police departments, fire departments and hotels. 2.
1 Company Ownership As A Whistle is a privately owned limited liability partnership with each of the principal officers holding an equal share in the company. . 2 Start-up Summary The following table shows the start-up costs for As A Whistle. Start-up Expenses Training $7,580 Medical Requirements$516 Personal Protection Supplies$350 Chemicals$855 Additional Cleaning Supplies$257 Restoration Supplies$1,660 Medical Waste Disposal$1,500 Office Equipment – Furniture/Lighting$2,170 Office Equipment – Technology Supplies$1,828 Office Equipment – Desk Accessories$185 Office Supplies$160 Breakroom Equipment/Supplies$476 Legal$1,200 Advertising$2,000 Insurance$1,100 Location Purchase Down Payment$28,000 Transportation Equipment Purchase Down Payment$10,000Expensed Equipment$11,545 Other$0 Total Start-up Expenses$71,382 Start-up Assets Needed Cash Balance on Starting Date$25,000 Start-up Inventory$1,172 Other Current Assets$0 Total Current Assets$26,172 Long-term Assets$15,600 Total Assets$41,772 Total Requirements$113,154 Funding Investment Nancy Smith$17,000 Daisy Shaw$16,154 Total Investment$33,154 Current Liabilities Accounts Payable$0 Current Borrowing$80,000 Other Current Liabilities$0 Current Liabilities$80,000 Long-term Liabilities$0 Total Liabilities$80,000 Loss at Start-up($71,382) Total Capital($38,228) Total Capital and Liabilities$41,772 Start-up . 3 Company Locations and Facilities As A Whistle will be located in a purchased location at 1081 S Meridian Road in Apache Junction, AZ. The facilities will include a reception area, offices for the principals, storage/garage area for inventory, and employee lounge.
3. 0 Services As A Whistle offers residential and commercial cleaning services of trauma scenes, crime scenes and residential biohazardous cleanups. 3. 1 Service Description As A Whistle services include: •Full prep work.
•Complete cleanup. •Fine detailing. •Odor removal. •Animal carcass Removal. •Fingerprint dust removal.
•Tear gas removal. Pressure washing of exterior sites. •Damaged carpet, floor, and wall or car interior removal. •Damage restoration of affected areas. Each project is customized to the wants and needs of the client.
Prices are determined by the scope of the project, what materials are needed, wear and tear on equipment and required profit margin. 3. 2 Competitive Comparison The crime scene cleanup industry is not very competitive. The barriers to entry and exit in this market are very low, but it takes a strong makeup to pursue this type of work, making this an industry with a very small number of rival firms with high turnover rates.Moreover, customer loyalty is not an advantage because of the small likelihood of one consumer needing these services multiple times.
Crime scene cleanup companies must compete on quality and timeliness of service, customer relations, and price. Additionally they must seek to gain relationships with police and fire departments as well as hotels and any other industry that may find use of the services a multiple necessity. As A Whistle believes that it can improve on the quality and timeliness of services in this industry by instituting procedures that will avoid many of the mistakes that other firms make. This ncludes poor training and high employee turnover, which leads to lower service quality. The company will be equally competitive in price and will seek close relationships with police, fire and hotels in the area.
Through these steps, As A Whistle will be able to build up a reputation of better quality service at competitive prices than its competitors. 4. 0 Market Analysis Summary As A Whistle will focus on two markets within the industry, the residential segment (including apartment buildings) and the commercial segment (including hotels). Over the past decade a number of new trends have been observed in this industry.
This includes the tremendous growth of the economy and the high technology boom. Market Analysis (Pie) 4. 1 Market Segmentation As A Whistle will focus on two markets within the industry, the residential segment (including apartment buildings) and the commercial segment which includes hotels, police and fire departments. The company can handle any place that needs its services.
It is the goal of the company to eventually have approximately two-thirds of all business coming from the commercial segment, since this generates the greatest cash flow and the greatest number of project situations.Furthermore, it is the goal of the company to achieve contracts with many varied commercial locations. Initially the company will focus on the two segments in just the Metro Phoenix area. However, by the end of the three year projections, the company expects to be serving the entire Greater Phoenix Valley area. 4.
2 Target Market Segment Strategy Each of the two market segments has differing needs and trends. The following sections go into detail about how the company will face them. 4. 2. 1 Market TrendsOver the past decade a number of new trends have been observed in this industry. The tremendous growth of the economy has exponentially expanded the population of the area, causing increased crime statistics.
The high technology boom has created new equipment and chemical compounds which the industry has also benefited from. As A Whistle plans to increasingly focus on the commercial segment as the company grows in order to promote greater revenue and income. 4. 3 Competition and Buying Patterns The crime scene cleanup industry is not very competitive.The barriers to entry and exit in this market are very low, but it takes a strong makeup to pursue this type of work, making this an industry with a very small number of rival firms with high turnover rates. Moreover, customer loyalty is not an advantage because of the small likelihood of one consumer needing these services multiple times.
Crime scene cleanup companies must compete on quality and timeliness of service, customer relations, and price. Additionally they must seek to gain relationships with police and fire departments as well as hotels and any other industry that may find use of the services a multiple necessity. . 3. 1 Main Competitors The main competitors for As A Whistle include BioPro, ServPro and Steri-Clean.
None of these competitors pose a significant threat to As A Whistle. BioPro has limited advertising and a website with no information, ServPro markets its fire and water restoration as opposed to the crime scene cleanup and Steri-Clean, though licensed to operate in Arizona, is physically located in California. As A Whistle will compete with these rivals through the use of greater marketing and better service. 5.
0 Strategy and Implementation SummaryAs stated before, the company will focus on greater service through better training, advertising, and greater alignment of personnel by providing profit sharing. The company is seeking to use the most up-to-date communications and technology between management and operations personnel to insure that jobs are completed with quality and on a timely basis. Furthermore, the company will seek to create a reliable pool of individuals to draw upon and eventually hire them all full time with salary and other compensation. The company also plans to carry out an aggressive marketing plan starting in year one.This includes actively seeking contracts with the commercial groups who would have the greatest need for the services provided by As A Whistle, include police and fire departments as well as hotels.
5. 1 Marketing Strategy The following sections detail the marketing strategy for As A Whistle. 5. 1.
1 Pricing Strategy The company will price each project based on time, chemicals required, restoration needed and a flat 5-10% profit margin, depending on the segment. In the first year or two, depending on sales, the company will focus more on getting the contracts than on maintaining its pricing structure.Therefore, profit margin may be a little low for the first year or two. 5. 1. 2 Promotion Strategy The company will be engaging in a two-fold aggressive marketing program as follows: •To obtain commercial contracts, the strategy will include issue-sensitive mailers, phone and personal solicitation, and other platforms to generate service awareness.
•To obtain residential customers the company will use more modest marketing tools such as promotion of word-of-mouth marketing and ads such as in the Yellow Pages. 5. 2 Sales StrategySales forecast is based on ability of the two principal officers of the company to generate new sales based on their contacts, legwork and determination. Furthermore, the company’s growing marketing program will generate the growth the company needs to survive.
5. 2. 1 Sales Forecast See Sales Strategy. Sales Forecast Sales200920102011 Commercial Buildings$149,000$415,130$755,404 Residential Buildings$57,500$85,375$123,644 Total Sales$206,500$500,505$879,048 Direct Cost of Sales200920102011 Commercial Buildings$29,480$68,783$110,189 Residential Buildings$7,250$12,920$17,566Subtotal Direct Cost of Sales$36,730$81,703$127,755 Sales Forecast 1 Direct Cost of Sales 1 6. 0 Management Summary Management consists of two individuals who have extensive experience in the cleaning industry. These are Ms.
Nancy Smith and Ms. Daisy Shaw. Each individual brings a unique outlook and skill set that will help drive sales and profits. The president and head of operations of As A Whistle will be Nancy Smith, the head of inventory, expeditor and Q;A will be Nancy Smith and the people in charge of sales and contracting will be both Ms. Prince and Ms. Negrin.
6. 1 Organizational StructureThe company will follow a hierarchical structure with Ms. Nancy Smith at the top as president and Ms. Daisy Shaw as department head. The sales and contracting department will consist of only those individuals until such time as growth of the company will require more people. This is anticipated to occur in year two to four.
6. 2 Management Team Ms. Nancy Smith has been in the drycleaning industry with a focus on spot and stain removal for 15 years. She initially started off with Sunset French Cleaners as a presser and spotter and worked with various companies for the next ten years.
She then worked for US Foodservice as an accounting lead and financial analyst. Desiring to own her own company, Ms. Prince is attending Chandler Gilbert Community College seeking a A. A.
S. in General Business. Ms. Daisy Shaw started out as a stay-at-home mother working with housecleaning companies on weekends.
She then began her own house cleaning business in Oregon and ran it successfully for twelve years before selling it and moving to Arizona. She has seventeen years experience in sales. 6. 3 Personnel Plan The following table is the personnel plan for As A Whistle.
Personnel PlanProduction Personnel200920102011 Dispatcher$0$20,000$20,000 Vehicle Cleaner$0$25,000$25,000 Residential Cleaner$25,000$25,000$25,000 Residential Cleaner$0$0$25,000 Residential Cleaner$0$0$25,000 Commercial Cleaner$25,000$25,000$25,000 Commercial Cleaner$0$25,000$25,000 Commercial Cleaner$0$25,000$25,000 Commercial Cleaner$0$0$25,000 Commercial Cleaner$0$0$25,000 Other$0$0$0 Subtotal$50,000$145,000$245,000 Sales and Marketing Personnel Ms. Daisy Shaw$20,000$30,000$40,000 Ms. Nancy Smith$20,000$30,000$40,000 Subtotal$40,000$60,000$80,000 General and Administrative Personnel Ms.Nancy Smith Operations$0$20,000$20,000 Ms. Daisy Shaw, Expeditor and Q;A$0$20,000$20,000 Expeditor$0$0$20,000 Q;A$0$0$20,000 Subtotal$0$40,000$80,000 Other Personnel Name or Title$0$0$0 Other$0$0$0 Subtotal$0$0$0 Total People4814 Total Payroll$90,000$245,000$405,000 7.
0 Financial Plan The following sections will outline the Financial Plan of As A Whistle. 7. 1 Important Assumptions The following table shows the General Assumptions for As A Whistle. General Assumptions 200920102011 Plan Month123 Current Interest Rate10.
00%10. 00%10. 00% Long-term Interest Rate10. 00%10. 00%10. 00% Tax Rate30.
00%30. 0%30. 00% Sales on Credit %50. 00%50. 00%50.
00% Other000 General Assumptions 1 7. 2 Key Financial Indicators The chart below shows the Benchmarks for As A Whistle. 7. 3 Break-even Analysis The Break-even Analysis gives the reader an idea of how many projects As A Whistle must obtain and complete each month to cover costs.
Because As A Whistle is providing a customized service with many projects having unique requirements, the estimates of revenue and cost are somewhat arbitrary. Fixed costs are based on running costs estimated by the officers of the company and include payroll for all employees.Variable costs are based on a 20% estimate of the average sales per unit. The average revenue estimate is based on the consensus of the principal officers who have had many years of experience in the industry and on the realistic assumption of the types of contracts the company will get in the beginning and the requirements needed to complete such projects. Break-even Analysis: Monthly Units Break-even5 Monthly Revenue Break-even$18,777 Assumptions: Average Per-Unit Revenue$4,000. 00 Average Per-Unit Variable Cost$1,200.
00 Estimated Monthly Fixed Cost$13,144 Break-even Analysis . 4 Projected Profit and Loss The following table shows the projected Profit and Loss for As A Whistle. Pro Forma Profit and Loss 200920102011 Sales$206,500$500,505$879,048 Direct Cost of Sales$36,730$81,703$127,755 Production Payroll$50,000$145,000$245,000 Other Production Expenses$0$0$0 ———————————— Total Cost of Sales$86,730$226,703$372,755 Gross Margin$119,770$273,802$506,293 Gross Margin %58. 00%54. 71%57.
60% Operating Expenses: Sales and Marketing Expenses: Sales and Marketing Payroll$40,000$60,000$80,000 Advertising/Promotion$3,600$5,000$10,000Travel$1,000$3,500$4,000 Miscellaneous$2,400$3,000$3,000 ———————————— Total Sales and Marketing Expenses$44,600$71,500$97,000 Sales and Marketing %21. 60%14. 29%11. 04% General and Administrative Expenses: General and Administrative Payroll$0$40,000$80,000 Sales and Marketing and Other Expenses$0$0$0 Leased Equipment$11,545$11,545$11,545 Utilities$1,800$1,800$1,800 Insurance$3,600$3,600$3,600 Mortgage$24,000$24,000$24,000 Payroll Taxes$19,500$36,750$60,750 Other General and Administrative Expenses$0$0$0 ————————————Total General and Administrative Expenses$60,445$117,695$181,695 General and Administrative %29. 28%23. 52%20.
67% Other Expenses: Other Payroll$0$0$0 Bookkeeper and accountant$2,400$2,500$2,750 ———————————— Total Other Expenses$2,400$2,500$2,750 Other %1. 17%0. 50%0. 32% ———————————— Total Operating Expenses$107,445$191,695$281,445 Profit Before Interest and Taxes$12,325$82,107$224,848 Interest Expense$700$700$700 Taxes Incurred$3,327$22,169$60,709 Net Profit$8,298$59,238$163,439 Net Profit/Sales4. 02%11.