1.0 Executive Summary
Deutsch EV Group LLC (“the Company”) was founded to provide an exceptional and easy to reach station where individuals can charge their electric vehicles. The business is based in Lambertville, New Jersey. At this time, the Company is seeking $500,000 of debt to develop the facilities discussed in this document. The Company was founded by Matthew Deutsch. Full scale revenue generating operations are expected to commence in the first quarter of next year once the buildout of the location is completed.
Operations
The primary revenue center for the company will come from the ongoing use of its Level 3 chargers that are appropriate for any make and model of electric vehicle. The Company will charge is expected to generate $15 to $40 per charging engagement. The state-of-the-art Level 3 chargers will ensure that an electric vehicle battery can reach maximum capacity within a 20 minute to 40-minute timeframe.
Unique to the Company’s operations is that the business will provide access to a number of amenities, including food and beverage service while customers wait for their vehicles to fully charge. The location will have an onsite café that will serve a number of coffee and tea drinks as well as small food items. This will be a very high margin revenue center for the Company.
This the third section of this electric vehicle charging station business plan will further document operations.
The Financing
As noted above, the Company is currently seeking a $500,000 loan in order to establish it operations. Matthew Deutsch will contribute $100,000 towards venture.
Although this is not expected to occur, Management may secure additional financing should additional electric vehicle charging station locations be developed. The Company could also acquire a revolving credit facility in order to manage its cash flows, although this is unlikely to occur within the first five years of operation.
The Future
Given the substantial number of electric vehicles that operate in the greater Hunterdon County market, the business will be able to quickly find an immense audience of people that will use the location when traveling through this area. The Company will undertake an ongoing marketing campaign that will bring the location to the attention of passersby within Lambertville and surrounding areas.
Market Overview
Revenue Forecasts
2.0 The Financing
2.1 Funds Required
The $500,000 of debt and $100,000 of equity will be allocated as follows:
2.2 Management and Investor Equity
Matthew Deutsch is the 100% owner of Deutsch EV Group LLC.
2.3 Exit Strategies
The number of electric vehicles that are operated within the United States has increased significantly over the past ten years. A such, there would be a significant demand for the acquisition of the business, given the high margin revenues that are generated from access to electric vehicle chargers as well as food and beverage sales. Although this is a new industry, it can be reasonably expected that the business would receive a price of earnings multiple of five times EBITDA, which would include the value of real estate.
3.0 Operations
As noted in the executive summary, Deutsch EV Group will be an expansive facility based in Lambertville that will provide access to a number of Level 3 chargers. The business intends to acquire five of these devices which provide extremely rapid charging of electric vehicle batteries. Each engagement is expected to produce $15 to $40 a revenue. The Company will coordinate with the regional utility company so that proper electrical infrastructure is in place to accommodate the greater amount of electricity required to conduct the Company’s operations.
To complement these operations, the business will have an onsite café that will serve a number of premium coffee and tea drinks. The Company will work with local bakeries in orders for baked goods as well as premade sandwiches that will be offered as well. Management anticipate that the Company will generate contribution margins of 72% on each sale with an average per ticket revenue of $10.
In order to further make the location comfortable while people wait for their vehicles to be charged, the business will provide free access to the internet as well as featuring a number of large-scale TVs on the premises.
4.0 Overview of the Organization
4.1 Registered Name
Deutsch EV Group LLC. The business is registered as a limited liability company in the State of New Jersey.
4.2 Commencement of Operations
Full scale revenue generators for this electric vehicle charging station will commence in the first quarter of next year.
4.3 Mission Statement
To provide a cost-effective solution for EV drivers who need to recharge their vehicles.
4.4 Vision Statement
To become a widely known destination among EV drivers for the exceptional level of service they receive at Deutsch EV Group.
4.5 Organizational Objectives
• Maintain an expansive online presence so that when searches for EV charging stations are conducted, Deutsch EV Group’s website will appear frequently in the search.
• Establish referral relationships with hospitality businesses among entities that have guests that drive electrical vehicles.
• Adhere to all regulations regarding be continued maintenance of EV charging stations.
• Work with local bakeries to source products that can be sold to the Company’s onsite café.
• Implement social media campaigns that referrals made along individual seeking EV charging stations.
• Continue to source additional potential locations and economically viable markets in New Jersey in Pennsylvania.
5.0 Market and Industry Analysis
5.1 External Environmental Analysis
This section of the EV charging station business plan will document the industry, the current economic climate, the demographics of people using the Company’s services, and the ongoing competition at the business will face.
That economic climate within the United States is currently considered to be moderate. Over the past twelve months, there has been an added degree of volatility introduced to the market based on changing trade policies as well as adjustments to the governments annual budget.
It should be noted that any serious issue with the economy will only have a very modest impact on the Company’s ability to generate revenue. The demand among EV drivers for access to Level 3 chargers is significant. The of these types of stations is an absolute necessity among people traveling.
5.2 Industry Analysis
Although this is a new industry, there are already 78,000 companies that operate EV charging stations in a standalone capacity within the United States. These businesses generate $6 billion of revenue well providing employment opportunities for 50,000 people.
The growth of this industry will be substantial in the coming years as more people adopt electric vehicle technology for their daily driving needs. The compounded annual growth rate for the electric vehicle charging station in industry is expected to remain near 30% over the next five years.
5.3 Customer Profile
The demographics of people that will use the Company’s services are extremely broad. Any individual that owns an electric vehicle and is traveling through the Hunterdon County market is a potential customer for Deutsch EV Group. Generally, it is expected that these individuals will have a household income exceeding $100,000.
5.4 Competitive Analysis
After a thorough market analysis, it was found that no other similar business operates within a 20-mile location of the Company’s planned facilities in Lambertville. Should a competitor enter this market, the Company will maintain a significant competitive advantage given the wide range of premium coffee and tea beverages coupled with food service at the location.
6.0 Key Strategic Issues
6.1 Sustainable Operations
Deutsch EV Group will have sustainable operations as a result of the following:
• Extremely high demand in the Hunterdon County market for access to Level 3 EV chargers.
• Substantial contribution margin generated from the ongoing sale of food and beverage products onsite.
• Given the ongoing demand, the Company can easily establish additional locations within New Jersey in Pennsylvania.
• The business will have fixed the operating costs.
• An experienced owner, Matthew Deutsch, that has operated several retail and service focus businesses in the past.
6.2 Basis of Growth
The Company will expand via the following methods:
• Continued development of additional EV charging stations within the Northeastern United States.
• Expansion of the Company’s food and beverage service.
• Continue to establishment with relationships with hospitality businesses that will provide referrals, especially among facilities that do not maintain their own chargers.
7.0 Marketing Plan
7.1 Marketing Objectives
• Leverage multiple forms of online marketing so the business can be quickly found when relevant searches are conducted for Level 3 chargers.
• Established ongoing relationships with hospitality businesses that will provide referrals to their clients that are traveling through Lambertville and Hunterdon County.
• Implement a moderate scale social media campaign, so that referrals can be made among people that have guests in their home that operate electric vehicles.
7.2 Revenue Forecasts
7.3 Revenue Assumptions
Year 1
• The EV charging location will launch in the first quarter of next year.
• Revenue will reach $822,000.
Year 2
• The business will continue to expand the scope of its marketing efforts with referring hospitality businesses.
• Revenue will reach $888,000.
Years 3-5
• In Year 5, total revenue will reach $1.1 million.
• Gross profits will reach $554,000.
7.4 Marketing Strategies
The Company has sourced a highly visible location that will serve as the site for Deutsch EV Group. During the construction process, a substantial amount of exterior signage will be fixed to the building so that passersby understand that this is an electric vehicle charging station. The location will be highly visible from the road.
For the Company’s website, this platform will undergo substantial search engine optimization so that when searches are conducted specifically for electrical vehicle charging stations in Central New Jersey are completed, the website will appear frequently. As many people will be driving when conducting these searches, the business will focus heavily on maintaining a mobile friendly platform.
Direct outreach with regional hospitality businesses is also a major component of the Company’s marketing operations. The Company will specifically focus on bed and breakfast hospitality facilities, motels, and boutique hotels that do not maintain Level 3 chargers at their facilities. These referral relationships will be an invaluable source of business in the coming years.
The Company will also maintain a modest profile among all social media pages. Images of the facility as well as video walk-throughs will be posted to the Company’s social media accounts. This will facilitate ongoing referrals among the local population.
As a green focused business, the Company will also provide financial support for organizations on a regional level that provide services that improve the environment. These will be undertaken in a co-branding marketing capacity.
8.0 Organizational Plan
8.1 Organizational Hierarchy
8.2 Personnel Costs
9.0 Financial Plan
9.1 Underlying Assumptions
• The Company will secure a $500,000 loan to develop its operations.
• Deutsch EV Group will achieve a compounded annual growth rate of 8%.
• Matthew Deutsch will contribute $100,000 towards the venture principally for working capital purposes.
9.2 Financial Highlights
• On EV charging services, the company will achieve contribution margins of 65%.
• For food and beverage sales, the business will achieve contribution margins of 70%.
9.3 Sensitivity Analysis
Even during a highly severe economic recession, the demand for EV charging services will remain incredibly strong as this is an absolute necessity among drivers of these types of vehicles. The Company will recognize substantial high margin revenue streams through its operations. The highly predictable nature of this income will fully support the underlying operations of Deutsch EV Group.
9.4 Source of Funds
9.5 Financial Proformas
A) Profit and Loss Statement
B) Common Size Income Statement
C) Cash Flow Analysis
D) Balance Sheet
9.6 Breakeven Analysis
9.7 Business Ratios
SWOT Analysis
Strengths
• Highly limited competition within a 20-mile radius of the Company’s location in Lambertville.
• An owner, Matthew Deutsch, that will be able to effectively manage the day-to-day operations of this EV charging station.
• The Company will produce substantial contribution margins from its food and beverage operations.
• The numerous amenities that are available onsite will find an immense audience of EV drivers.
Weaknesses
• Moderately high cost as a relates to energy.
• Potential competitors could establish similar locations within the target market.
Opportunities
• Development of ongoing EV charging station locations throughout Central New Jersey and selected markets of Pennsylvania.
• Expansion of the Company’s food and beverage service to include other types of fare.
Threats
• Continued to increase increases in energy costs can cause the contribution margins of the Company to decline.
Risk Analysis
Development Risk – Low
The operating strategy that Deutsch EV Group will employ has already been developed by the Founder. The primary matter that needs to be addressed to securing the funding sought in this document so that the Company can establish it EV charging operations in Hunterdon County.
Financing Risk – Low
The vast majority of the debt capital sought in this document will be used for the build out of the location. Nearly all of his capital will be fully collateralized with real estate, furniture, fixtures, and equipment. These risks are tempered by the highly predictable nature of the Company’s revenue.
Marketing Risk – Low
Given the ongoing demand for comprehensive Level 3 chargers, the ongoing marking required by the business will be relatively modest and straightforward. The use of multiple online marketing strategies will be one of the key components of Deutsch EV Group success.
Management Risk – Low
Matthew Deutsch is a highly experienced entrepreneur that will be able to effectively bring the operations of Deutsch EV Group to profitability as well as positioning the location one of the preeminent EV charging station companies in the region.
Valuation Risk – Low
The valuation risk is offset by:
• Highly predictable streams of revenue from the ongoing use of EV chargers, as well as food and beverage sales.
• The Company can easily establish additional charging center locations through economically viable markets in New Jersey in Pennsylvania.
• Given the demand for these types of businesses, the business could command a significant price to earnings multiple.
Exit Risk – Low
In the event that it is financially viable to do so, Matthew Deutsch may sell the operations of Deutsch EV Group to a third-party. In this event, the Company will coordinate with a qualified business sales professional that will first conduct a formal valuation prior to sourcing a suitable buyer.