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Business Plan:
3D Additive Manufacturing
Technologies, Co. – 3-DAMTM
Joe Ott
7-18-2012
1. BUSINESS CONCEPT
1.1. INTRODUCTION / EXECUTIVE SUMMARY
This business plan will outline the scope and make-up of the 3-DAMTM company, the market, competition, and
financial outlook of the proposed company. The business name of the company to be formed will be “3D Additive
Manufacturing Technologies, Co.” otherwise known as 3-DAMTM. This name comes from a combination of the two
common names for the technology the company is based upon, “3D Printing” and “Additive Manufacturing”.
The initial location of the first office should be located in Houston, TX. According to (Kotkin, Dec 2011) Forbes
Magazine4, this is currently the largest center of manufacturing in the US.
3-DAMTM will utilize the technologies of additive manufacturing and offer a “KinkosTM” style of service and
manufacturing to customers.
From ASTM Designation: F2792 – 10 - Standard Terminology for Additive Manufacturing Technologies 2,
additive manufacturing (AM), n—process of joining materials to make objects from 3D model data,
usually layer upon layer, as opposed to subtractive manufacturing methodologies, such as casting, forging,
and machining. Synonyms: additive fabrication, additive processes, additive techniques, additive layer
manufacturing, layer manufacturing, and freeform fabrication. It can encompass metals, polymers, and
electronics and apply to a range of structural and functional materials as well as components for an array
of defense and energy applications.
Why pursue additive manufacturing? There are many benefits in using additive manufacturing to make hardware
over conventional manufacturing5:
Design flexibility
No tooling constraints
Allows complex models
No hard tooling required
No material lead time
Automated process
Reduced development expenses
Faster concept design to functional component
Reduced manufacturing costs
Near wrought material properties
Reduced product life cycle cost
Reduced manufacturing time: hours/days/weeks vs. months
Minimal secondary machining - near-net shape part
Additive manufacturing is an emerging industry.
3-DAMTM projects that it will be able to generate approximately $340,000 in sales in the first year of operation, in
its first store. This is projected to grow by 12.5% per year per store to $2,343,000 by YR3 as the company opens its
5th store. As 3-DAMTM will be in its initial growth phase it is not expected to make profit over the first 3 years as
the focus will be on explosive growth to the key manufacturing centers in the US.
The keys to success for 3-DAMTM will be focusing on the following core attributes:
Flexibility – providing solutions for variety of customer and their unique requirements.
Adaptability – have technology and capability for variety of needs.
Sustained Growth – have capacity where and when a customer needs it.
Technical “Know-how” – have understanding of how to use additive manufacturing technology to provide
best results.
Speed – providing solutions faster and more efficient than anyone else.
Funding – have cash and capital to sustain growth and profit.
The technology has such potential that President Obama announced a Pilot Institute for Manufacturing Innovation
in March 20126. As described in the announcement, "The pilot institute will host centralized, openly accessible
capabilities, the infrastructure needed to support advances in manufacturing (housed in one or more facilities)
through development, demonstration and evaluation of product and process technologies relating to the
technology area (additive manufacturing)."
This business plan was developed using SmartPlan Generator version 1.510
1.2. BUSINESS IDEA
A large market exists for this style of business. Additive manufacturing can compete/complement against all
traditional manufacturing methods (castings, forgings, machining, etc.) and many industries, such as automotive,
tooling, aerospace, medical/dental, hobbyist, could utilize additive manufacturing.
It is envisioned that customers would contact a local 3-DAMTM business center to initiate a job. A job may consist
of a request to assist in engineering an additive manufacturing solution as well as create some parts/hardware to
the customer’s necessary specifications. Additional post processing may also be required and would be
coordinated with outsource processing suppliers.
As part of a Diversification Growth Strategy 3-DAMTM would practice Forward Integration by getting in front of the
customer; the customer is the primary focal point. The customer would pay a fee for evaluation and non-
reoccurring engineering to evaluate as well as prep a part(s) for build. Additionally, a developmental build may
require 1-3 test builds to ensure necessary results. The customer would additionally be charged for materials,
machine time, and technician time to make hardware. Finally, a customer would be required to pay for any post
processing necessary that customer elects for business center to perform (this may be outsourced to strategic
partners and would be a facilitation fee in addition to supplier fees).
The growth of 3-DAMTM will be of primary importance to the business’s success. To assist in growth the first two
years will be spent establishing a solid foundation.
2 years of operation:
Increase market share – establish 4 stores in largest US manufacturing locations (Houston, TX; Milwaukee,
WI; Seattle, WA; San Antonio, TX)4
Increase market penetration over time – continue to grow each store’s revenue at least 12.5% yearly (this
is the industry’s expected growth rate from 2011 to 2020).
Expand the number of clients - commercial, residential, government, and industrial markets
Establish new pricing incentives and promotions
Build long lasting quality partnerships
Establish relationships with local advertisement agencies (weekly/monthly flyers, radio, television, news
papers, classifieds, college campuses/websites, Face-book, personal webpage)
Join Committee F42 on Additive Manufacturing Technologies 1
6 years of operation:
Increase market share – establish a store in 10 major US cities. Have plan developed to have 50 stores in
major US cities by 10 years of operations.
Increase market penetration over time – continue to grow revenue at least 12.5% yearly, per store.
The key to success for 3-DAMTM will be focusing on the following core attributes:
Flexibility – providing solutions for variety of customer and their unique requirements. This will be
achieved by understanding each market’s unique needs (part sizes, quality level, common materials, etc.)
Adaptability – have technology and capability for variety of needs. This will be achieved by procuring
additive manufacturing machines that initially will be able to serve the needs of the majority of markets.
Sustained Growth – have capacity where and when a customer needs it. By targeting major
manufacturing cities and business and residential centers, 3-DAMTM will be at the fingertips of industry. By
taking internet and phone orders can provide service worldwide.
Technical “Know-how” – have understanding of how to use additive manufacturing technology to provide
best results. Will train and educate sales engineers and operators in various additive manufacturing
technologies. Will provide continuing education as technologies change and mature.
Speed – providing solutions faster and more efficient than anyone else. This will be achieved by
streamlining the store’s infrastructure using lean concepts and software integration. A lean value chain
will ensure post processing turn time is minimized.
Funding – have cash and capital to sustain growth and profit. Aggressively campaign for funding via
government and private investment.
2. THE COMPANY
2.1. LEGAL STRUCTURE AND OWNERSHIP
3-DAMTM will be listed with the Internal Revenue Service as a sole proprietorship and will be privately owned. The
principle owner (and equity shareholder) will be Joe Ott. Minor equity shareholders will be silent partners based
upon funding investment agreements but will not be greater than 49% equity holding.
Joe Ott will chair the board. As principle owner/CEO/CTO, Joe will have complete oversight and responsibility for
the company. As owner/CEO/CTO Joe will get paid upon the company making a profit in both cash and ownership
equity, to be set aside in an account for use if equity sold to investors. Payment will be determined after all other
monthly debts accounted.
Additional Board members would be advisors from various investment/venture capital groups.
2.3. ACCOUNTANT
Accounting and Human Resources will be outsourced to a 3rd party company and overseen by the CFO. The
company will be responsible for all day to day accounting and human resources activities, including accounts
receivable and payable, health and dental care, 401k management, and taxes, etc.
2.4. TECHNOLOGY TEAM will consist of a materials expert, a technology and processes researcher, and a Training
and Quality expert.
2.5. BRANCH MANAGEMENT – oversee local offices and sales functions.
Board of Directors
CEO / CTO
Accounting / HR
3. PRODUCTS / SERVICES
3.1. PRODUCT AND SERVICE SUMMARY
The target customers are everyone from local hobbyist and enthusiast to large Fortune 500 companies needing
unique part developed and produced. There are many companies looking into using additive manufacturing to
improve their capabilities. GE, Pratt & Whitney, Boeing, and Lockheed-Martin are some larger companies all
looking to improve manufacturing by “printing” parts.
The current market doesn’t have local “to-go-to” places where customers can easily contact/interact with
someone who will help them take advantage of additive manufacturing for their requirements. All competition is
located in a few select locations and they provide services internationally to customers, usually targeting large
business. There is no one place to get all your materials and additive manufacturing methods and post-processing
under one roof.
3-DAMTM would provide a place for customers to have one-stop-shopping for their manufacturing. Customer(s) can
contact the business center by phone, web, or face-to-face. Sales engineers would be available to help customers
work through product development and iteration until the final product is ready. Pricing would be evaluated
based upon the necessary amount of engineering and development to make hardware, material considerations,
and post processing requirements.
Some of the unique benefits of a "Kinkos" style of additive manufacturing would be 5:
Reduced Weight Structures - components no longer constrained by tooling definition/capability
Integrated Part Consolidation - advanced single-piece designs
Improved Performance - advanced features can be combined into designs
Embedded Features – integral to part
Tailored Materials - functionally gradient alloys, metal-composite components
Speed - Additive manufactured parts often have weeks to months lead time reduction, in comparison to
parts mfg. by castings or forgings.
Tooling - Additive manufactured parts often do not require tooling to be completed.
Expertise - customers would have access to people with expertise in taking concept ideas from initiation
to final delivery.
1. Mydea Technologies – digital model shop and an additive manufacturing and rapid prototyping provider.
http://www.mydeatechnologies.com/ (See Appendix 1).
Owners: Michael Siemer
Annual Sales: $520K
Competitor’s distribution channel: Internet
Competitor’s marketing strategy: Internet Sales
Products and Services: Product Development & 3-D CAD Modeling, Rapid Prototyping/Additive Fabrication,
Subtractive Rapid Prototyping, Rapid Tooling & Manufacturing
Competitors price strategy: mid to high cost.
Fees:
Design & Engineering
3-D CAD Modeling, 2-D to 3-D CAD Conversion, Reverse Engineering - $50/hr
Senior Product Design and Design for Assembly & Manufacturability - $100/hr
Rapid Prototyping & Production – By Quote
Rapid prototyping costs are driven by the size, materials and other factors.
2. Shapeways – 3D Printing company for designers and Do-It-Yourselfers. Helps people make and sell their items.
http://www.shapeways.com/ (See Appendix 2)
Owners: Peter Weijmarshausen
Annual Sales: $1.90M
Competitor’s distribution channel: Internet
Competitor’s marketing strategy: Internet Sales, Arts and Crafts forums, Web sales of clients’ products, Do-It-
Yourself market.
Competitors price strategy: Low to mid cost.
Products and Services: Tutorials, Shapeways Lab, Software, Metals and plastic fabrication, Online Sales.
The following companies are a selection that specialize in additive technology and would be competition for their
prospective sub-fields:
Morris Technologies - http://www.morristech.com/ – Selective Laser Sintering (SLS) metals
C&A Tool - http://www.catool.com/ – SLS metals and machine shop
Paramount Industries – http://www.paramountind.com/ - Stereolithography (SLA) and SLS of plastics
Materialise - http://manufacturing.materialise.com/ - a Belgian firm that uses additive manufacturing to make a
range of products, including medical devices.
The following are the anticipated costs considerations to produce the products and services 3-DAMTM would offer.
• Evaluation and Non-Reoccurring Engineering - Service cost is the salary of the sales engineer, the technician
labor per hour, and any machine time and materials cost to develop the builds and post processing
requirements.
• Make parts on-site - Cost of overhead, machine cost per hour, labor per hour for technicians, materials costs.
Additional cost is cost of any special handling concerns
• Post Processing - Service cost is the salary of the sales engineer plus, for internal processing: the technician
labor per hour, and any machine time; for external suppliers - cost of operation by suppliers
• Distribution will be accomplished using services such as FedEx and UPS to move hardware. In-process
hardware will be shipped overnight express between post processing centers. Shipment to the customer will
be express or overnight at the customer’s desire and billed accordingly.
• Costs will be minimized with implementation of lean manufacturing concepts to minimize holding costs,
turn time, etc. and value chain management for external suppliers.
3.5. TECHNOLOGY
The following technology is necessary for 3-DAMTM in order to create an output. These will be key technologies
that will enable 3-DAMTM to be competitive and maximize turn-time while keeping quality. These technologies are
generally very expensive capital investments. Additionally, these machines take up floor space and must have
special environmental controls / PPE. It will require significant investments to procure initial machines and supplies
and floor space.
Powder Bed Technologies - Powder Bed is the distribution of thin layer of powder (metal or thermoplastic) and
uses an energy source to sinter/melt the powder into solid form. Powder Bed Technologies offer high resolution,
medium volume, small to medium sized part capabilities. Two common methods are:
Selective Laser Melting – laser beam power source in an inert atmosphere (nitrogen or argon)
Electron Beam Melting – electron beam power source in a heated, vacuum environment
Deposition Technologies – Metal is introduced via powder nozzle or wire feed into an energy source directly at the
build location, which melts to metal into solid form. Deposition Technologies offer lower resolution, lower volume,
larger sized part capabilities. 3 common methods are:
Laser Powder Deposition – laser/power nozzle combination
Laser Wire Deposition – use of a continuous feed wire and laser energy source
Electron Beam Wire Deposition – use of continuous feed wire and EB energy source
Additive Technologies are generally considered "Green Technology". But due to the fine particle size of powders
used in manufacture special PPE and air filters will be required. Inert gases, such as argon, will be used in the
manufacture of 3D parts. This may require a permit.
Other regulatory considerations will be protection of Intellectual Property of customers. As this technology can
easily be used to copy designs, infringement must be evaluated and considered 7. Also, product liability should be
accounted for and proper insurance ($1Million minimum) carried in the case of a bad part causing damage to
persons or property7 or litigation.
New products/services will need to be included in the 3-DAMTM portfolio in the future. As the additive
manufacturing technology continues to grow and change the company will need to grow and change with it. This
will require yearly review and evaluation of existing and new technologies. An evolving plan will be managed by
the Technology Team to review current technology capabilities, requirements, and customer needs and feedback.
Recommendations will be made to 3-DAMTM management for necessary re-tooling and development on a
quarterly basis. New machines may be leased or bought outright.
Among the current considerations for individual store growth the following will be of primary importance to round
out the business concept and should be incorporated with-in the first 2-3 years.
Tool and Finishing Shop – a tooling and finishing shop is envisioned to be a necessary post processing
requirement for the current portfolio of additive manufacturing technologies and market needs. While
the current plan is to outsource the addition of a machine and finishing shop would provide the necessary
steps “under one roof” that 3-DAMTM needs for the “Kinkos” business concept.
Stress Relief, Heat Treat, HIP – these are also additional post processing steps necessary to provide metals
customers what they need for their specific requirements.
Grow metrology center – the metrology (measurement) center will be the focal point in each store where
production validation and quality will be evaluated for each part produced. Ensuring accurate
measurements and testing will be critical to customer satisfaction.
As the company develops it is expected that Intellectual Property will be developed. This will most likely be in
form of integrating software that manages models from customer delivery through final product, and materials,
machine and process capability and expertise. As necessary, patents and trade secrets will be filed and licensed as
opportunities are found.
4. THE MARKET
4.1. MARKET ANALYSIS
From A FRAMEWORK FOR REVITALIZING AMERICAN MANUFACTURING11, “In 2008 manufacturing produced $1.4
trillion in national income, making it one of the largest sectors in the American economy. The National Association
of Manufacturers has estimated that, ‘every $1.00 in manufactured goods generates an additional $1.37 worth of
additional economic activity - more than any other economic sector.’ This also helps create jobs – one study found
that each job in manufacturing supported three jobs in the rest of the economy. American manufacturing has been
among the most successful in the world. Figure 2 (below) demonstrates that U.S. manufacturing output began to
increase most rapidly after 1994, propelled by rapidly increasing productivity. This improvement is unmatched by
any other G7 country.
Picture from A FRAMEWORK FOR REVITALIZING AMERICAN MANUFACTURING11
A sub-category of manufacturing, additive manufacturing had a total of market size of $1.7 billion worldwide in
2011, according to a new industry report from Wohlers Associates Inc. Wohlers Associates said the additive
manufacturing industry has grown in double digits for 15 of its 24 years. The industry declined by 9 percent in
2009, because of the recession, but then rebounded in 2010 to grow 24.1 percent, to $1.3 billion. New advances in
metals and design tools are fueling new businesses to do additive manufacturing, the report said. Thirteen
companies in Europe now make additive manufacturing systems, and Wohlers said Europe is a hotbed of metal-
based AM equipment. Direct manufacturing—using additive manufacturing to make finished products, not just
prototypes—has grown from virtually zero in 2003 to 24 percent of the industry’s total revenues in 2011.”
Emerging Industry
Additive manufacturing can be considered an emerging industry in the US. From A NATIONAL STRATEGIC PLAN
FOR ADVANCED MANUFACTURING12, the National Science Foundation states that “Advanced manufacturing is
emerging as an especially potent driver of future economic growth. A distinguishing feature of advanced
manufacturing is its continual improvement in processes and rapid introduction of new products. It is this
paradigm-shifting aspect of advanced manufacturing that has the most potential to spin off entirely new industries
and lead to production methods that are most likely to “stick” in the United States because they are hard to
imitate.
The technology has such potential that President Obama announced a Pilot Institute for Manufacturing Innovation
in March 20126. As described in the announcement, "The pilot institute will host centralized, openly accessible
capabilities, the infrastructure needed to support advances in manufacturing (housed in one or more facilities)
through development, demonstration and evaluation of product and process technologies relating to the
technology area (additive manufacturing)."
4.2. TARGET MARKET SEGMENT
Competitors are targeting select markets in plastics or metal or both, with low to medium scale production. No
operation is looking to bring all the pieces together. 3-DAMTM will target this market. Potential Customers can be
divided into 3 categories:
Small Businesses -
2+ years old (generally wouldn't be start-ups in their first year)
Income - Have manufacturing costs >$1000 per part.
Need - need fast parts made, short runs
Education - do not need to be educated in how to make the parts but need to understand hardware end
requirements.
Work - manufacturing, research, engineering, automotive, etc.
Geographical location - in key starting cities, some internet sales.
Large Business -
2+ years old
Income - Have manufacturing costs >$1000 per part.
Need - need fast parts made, short runs, development iterations
Education - do not need to be educated in how to make the parts but need to understand hardware end
requirements.
Work - manufacturing, research, engineering, automotive, etc.
Geographical location - in key starting cities, some internet sales.
Hobbyists -
Age - 16 years or older
Income - able to afford part costs between $100 and $2000.
Need - generally have a concept they want to make or need a replacement part for one that broke
Gender - male and female
Education - majority expected to have some college and / or trade school
Work - professionals and trades
Geographical location – key US manufacturing centers / cities, some internet sales.
Potential Customer Year 1 Year 2 Year 3 CAGR
Figure 3. – Expected Number of Customers in Each Market Segment - Expect average growth of 12.5% per year
per store.
The current US manufacturing market is still recovering from the 2009 recession and outsourcing due to
Globalization. TJ McCue from his May 2012 article in Forbes9 states with “financial hardships for many American-
based manufacturers, additive manufacturing technologies offer a way for companies to get started on a
shoestring”. Additive is the solution for America’s manufacturing gap with the rest of the world.
Also, the current additive manufacturing market doesn’t have a local “to-go-to” place for customers interested in
taking advantage of the technology. All competition is located in a few select locations and they provide services
internationally to customers. There is no one place to get all your materials and additive manufacturing methods
and post processing under one roof. Additionally, there is a need for fast development and production of
small/short runs.
4.5. TRENDS
This is a growing market. Technology growth and development of processes and materials will play a big role in
market. Standards and regulation will provide direction for the industry and technology. “The March 2009 RAM
workshop, resulted in 26 research recommendations. Among them13:
1) Produce a new foundation for CAD systems to overcome modeling limitations associated with building AM
parts,
2) Create closed-loop and adaptive control systems with feed-forward and feedback capabilities for AM
machines,
3) Develop and identify sustainable (green) materials that are recyclable, reusable, and biodegradable,
4) Develop training programs with certifications for industry practitioners,
5) Develop and adopt internationally recognized standards, such as those initiated by ASTM International, and
6) Establish a national test bed center with AM machines and expert users to leverage equipment and human
resources in future research.”
According to TJ McCue in his Mar 2012 Forbes Magazine8 article he states, “Additive Manufacturing, aka 3D
Printing, will reach $3.1 billion worldwide by 2016 and $5.2 billion by 2020.” If 3-DAMTM can capture even 1% of
this market that would be $31 million dollars in revenue. 5% growth in revenue the next year would result in
$32,550,000 of revenue, per store.
5. THE INDUSTRY
5.1. INDUSTRY ANALYSIS
5.2. DISTRIBUTION
Business would staff trained engineers and technicians to assist customers in selecting the correct technology to
manufacture their hardware. Staff would have the necessary skills to providing modifications to designs to use
additive manufacturing machines to make best part possible, set-up and operate machines, and recommend /
coordinate necessary post processing. Agreements would be set up with suppliers to support post processing
requirements initially.
Distribution will be accomplished using services such as FedEx and UPS to move hardware. In-process
hardware will be shipped overnight express between post processing centers. Shipment to the customer will be
express or overnight at the customer’s desire and billed accordingly.
Supplies would be managed with Pull-Systems for the various metals and plastic raw materials. Service
contracts with manufacturers would keep machines running at peak efficiency.
6. SALES
6.1. SALES STRATEGY
It is envisioned that customers would contact a local 3-DAMTM business center to initiate a job. A job would be
evaluated on the spot for low complexity models/hardware and with-in 4 days for complex jobs. Quotations
would be valid for 30 days.
Customer information and projects would be kept in a database. Sales engineers would be able to reference past
jobs to speed up processing of repeat customers. Jobs would look to complete with-in hours for low complexity
low volume jobs to a month for higher complexity jobs.
Pricing would factor in the costs of overhead, materials, and per hour cost for machines and personnel. The
customer would pay a variable fee (set on number of required hours and difficulty) for evaluation and non-
reoccurring engineering to evaluate as well as prep a part(s) for build. The customer would additionally be charged
for materials, machine time, and technician time to make hardware. Finally, a customer would be required to pay
for any post processing necessary that customer elects for business center to perform (this may be outsourced to
strategic partners and would be a facilitation fee in addition to supplier fees). A profit mark-up of 30% will be
added to each job.
Sales will be generated through advertisement and campaigns. The campaign will utilize TV, trade journals, and the
internet (web pages, FaceBook, etc.). Highlights of ads will target design freedom, no or low tooling, and speed.
Additionally, small to large manufacturing companies will be approached.
“3-DAMTM is manufacturing freedom” – 3-DAMTM slogan
A marketing group will be selected to assist in the marketing campaign on a yearly contract. A $100k budget will
be set for marketing.
Sales are based upon forecast for 3 major products/services that 3-DAMTM will provide: Sales Engineering,
Fabricated Metals, and Fabricated Plastics.
Sales were forecasted by projected the amount of sales revenue generated by the average increase in customers
each month times the expected revenue each customer would generate. YR 2 accounts for 4 stores in key cities.
YR 3 accounts for 5 stores in key cities. Expect average growth of 12.5% per year for each store. These numbers
are based upon a best scenario.
Cost of sales is the overhead for the sales engineers and technicians plus an estimated monthly operating cost for
the metal machines of $4000 and plastic machines of $3000.
Sales
Forecast M1 M2 M3 M4 M5 M6 M7 M8 M9 M10 M11 M12 YR1 YR2 YR3
Sales
Engineering $0 $0 $0 $0 $2,000 $5,000 $10,000 $10,000 $15,000 $18,000 $18,000 $20,000 $98,000 $503,000 $664,000
Powder
Metal $0 $0 $0 $0 $0 $0 $4,000 $12,000 $18,000 $30,000 $40,000 $40,000 $144,000 $740,000 $975,000
Powder
Plastic $0 $0 $0 $0 $1,000 $5,000 $8,000 $15,000 $25,000 $10,000 $20,000 $20,000 $104,000 $533,000 $704,000
Total: $346,000 $1,776,000 $2,343,000
Table 1: Sales Forecast
Sales
Forecast M M M M
Costs 1 2 3 4 M5 M6 M7 M8 M9 M10 M11 M12 YR1 YR2 YR3
Sales
Engineeri $30,00 $30,00 $30,00 $30,00 $30,00 $30,00 $30,00 $30,00 $240,00 $525,00 $620,62
ng $0 $0 $0 $0 0 0 0 0 0 0 0 0 0 0 5
Powder
Metal $0 $0 $0 $0 $0 $0 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $24,000 $70,000 $82,750
Powder
Plastic $0 $0 $0 $0 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $24,000 $52,500 $62,062
$288,00 $647,50 $765,43
Total: 0 0 7
Table 2: Sales Forecast Costs
Total, direct costs, sales 288 000 647 500 765 437
Table 3: Sales Forecast and Costs by YR
Figure 4. - Sales monthly
As part of a Diversification Growth Strategy 3-DAMTM would practice Forward Integration. As the customer is the
focal point for the business model, 3-DAMTM offices will be targeted close to the customers. Customers will be
contacted through advertisement and campaigns. The campaign will utilize TV, trade journals, and the internet
(web pages, FaceBook, etc.). Highlights of ads will target design freedom, no or low tooling, and speed.
Additionally, small to large manufacturing companies will be approached.
“3-DAMTM is manufacturing freedom” – 3-DAMTM slogan
A marketing group will be selected to assist in the marketing campaign on a yearly contract. A $100k budget will
be set for marketing. The marketing campaign will start in June 2013 and continue through December 2013.
7.2. PARTNERSHIP
The business would initially depend upon partnerships and/or cooperation with machine shops, until the machines
and technicians can be funded and added to the services 3-DAMTM can provide.
Alliances and partnerships can also be formed with engineering and industrial firms looking to outsource their
manufacturing work or traditional machining houses can’t make the parts their customers’ desire.
CEO / CTO
Joe Ott will perform as CEO/CTO. Joe will have complete oversight and responsibility for the company as well as
technical authority. At 37, Joe is nearing completion of his MBA and MSME degrees. Joe has experience in additive
manufacturing, specializing in the aerospace industry and requirements. Joe has extensive project management
qualifications and is a registered Engineer-In-Training (EIT) candidate in the state of MA. Joe currently works at
Pratt&Whitney as an Integrated Product Team Lead for the Engineering Integrated Solutions Group / Engineering
Innovation Center.
CFO
The CFO will be hired after the company is funded. The CFO should have the following qualifications:
Under the direction of the Chief Executive Officer (CEO), the Chief Financial Officer (CFO) has direct oversight of
the following reporting line: Accounting, Accounts, Communications, Purchasing, Printing & Duplicating,
Information Management, Management Information Systems.
The CFO has overall management responsibilities for Fiscal and Business Services and has legal responsibilities as
the internal auditor for the company. This position is accountable for the development and implementation of
fiscal systems, budgeting processes, financial reporting, and fiscal policies and procedures.
Ten years of progressively responsible leadership positions with at least five years’ experience in manufacturing
and/or start-up csompany accounting at a managerial level. Familiarity with healthcare reimbursement systems.
Successful track record in the management of people, budgets, systems, and processes. College graduate with
major in Accounting/Finance. MBA and/or CPA required.
Material Engineer: Provides material selection and related manufacturing process recommendations to improve
quality, performance, cost reduction, product reliability, and/or standardization through analysis of designs and
problem solving techniques.
Preferred Qualifications
• M.S. in Materials Science / Metallurgical Engineering or equivalent degree from an accredited university
• Basic knowledge of polymer component design in transportation applications
• Non-destructive testing experience or certification. Basic knowledge of ferrous metallurgy, heat treating, and
failure analysis
Technology Researcher: Reviews and evaluates additive manufacturing technologies for application to business.
Participates in the creation, implementation, and administration of vehicle group policies, procedures, and work
instructions. Utilizes the engineering Maturity Model concept to drive personal and regional process and
knowledge development. Understands design, development, and failure analysis through assigned engineering
projects. Applies fundamental engineering practices and decision making for problem solving.
Preferred Qualifications
• M.S. in Mechanical or Project Engineering or equivalent degree from an accredited university
• Manufacturing or additive manufacturing experience or certification
• Project management experience / PMI certification
Training / Quality: Maintains understanding of the varied and balanced needs of cost competitiveness, product
reliability / robustness, innovation, constraints relating to the global availability of material and manufacturing
processes. Local expert in assigned product / process. Educates and manages company Health and Safety:
Complies with requirements of the Quality and Environmental Management Systems.
Preferred Qualifications
• M.S. in Quality and Training or equivalent degree from an accredited university
• Basic knowledge of lean / 6 sigma
• Non-destructive testing experience or certification
• EH&S experience or certification
PRIMARY RESPONSIBILITIES:
·Through telemarketing, prospecting, account calls, demonstrations and marketing activities, generate demand
and pipeline for assigned products.
·Achieve assigned gross profit target each month by selling solutions to discreet & process manufacturing
companies.
·Investigate and understand the internal business processes of potential clients; and strategize, present and
demonstrate a tailored technology solution.
·Build relationships with key executives (CEO, CFO, and Technology Team) and fellow Branch Managers.
·Hold a technical understanding of customer’s business objectives in order to map a strategy consisting of
machines, materials, training, and implementation as a solution to those business objectives.
·Develop gross profit, revenue & accurate forecast in coordination with CEO.
8.2. EMPLOYEES
Sales engineers – customer interface, engineers marry up technology to customer needs. There will be 2-
3 per store.
CAD and Build technicians – modify designs to make technology friendly, operate and run machines.
There will be 1 per machine and two CAD operators per store.
Post processing technicians - provide any necessary post processing and coordination. There will be one
per store.
Shipping/Receiving – ship and receive hardware, supplies, etc. There will be one per store.
Sales Eng. and Techs 360 000 360 000 1 440 000
3-DAMTM will have 1 initial store in a major manufacturing center of USA. The plan will be to grow to 2 stores by
end of second year. The next goal will be to grow the business to have stores in each of 5 major manufacturing
centers in USA in 5 years. The long term plan will be to grow to have one store in 50 major cities in 10 years.
We plan to hire 3 sales engineers and 3 technicians and 1 Branch Manager in the first year for the first store.
By year two, we plan to hire 9 sales engineers, 9 technicians, and 3 branch managers to staff 3 additional stores.
We plan to implement an annual training curriculum for each person for updating their technical knowledge.
9. ACTIVITY PLAN
This section describes some activities that will be needed to implement the whole or parts of the business plan.
Order and Install Machines – machines and installation at $1,000,000 a-piece. 1 plastics, 2 metals, 1 metrology
and inspection, 1 oven and autoclave = $5,000,000
Store – 15,000 sq. ft. * $3.523 per foot per year = $52,800. Plus $1,000,000 for upgrades and office requirements.
Equals $1,052,800.00
Hire Accounting / HR - $100,000
Supplies - $100,000
Advertising Campaign - $100,000
Order and Install Machines 03/01/2013 06/01/2013 5 000 000 CTO Technology Team
Start-up funding
The following describes all the “Start-up through Second Stage” funding (existing and needed) for the project:
Bank Loans – $3,000,000 – Secured against the procured equipment. Equipment, Real-estate, and Long-
term loans.
Angel Investors – $2,000,000
Other Investors – $2,000,000 – Informal Risk Capital, Venture Capital
Grants – $2,000,000 – SBIR - Phase I and Phase II, Fed, State, Local.
Government Loans - $1,000,000 – SBA (504, SBA), etc.
Total: $10,000,000
Third stage (growth) funding would be necessary for expansion beyond the first store and would be necessary at
last quarter 2013.
The following describes the long term assets. Depreciation period was calculated at minimum 3 years.
Smartplan10 calculate a depreciation of 1/5 per/year as standard.
Yr1 Yr2 Yr3
Equipment – $5,000,000 $20,000,000 $25,000,000
Real-estate – $1,052,800 $ 4,211,200 $ 5,264,000
Total: $6,052,800 $24,211,200 $30,264,000
The following describes long-term liabilities; debts that would be paid back over a period of more than a year.
Interest Amortization/Yr
Bank Loans – $3,000,000 6% 12/1
Angel Investors – $2,000,000 4% 12/1
Other Investors – $2,000,000 4% 12/1
Government Loans – $1,000,000 3% 12/1
*interest rates and amortization/yr. have been assumed.
Profit and loss expenses – other anticipated costs (short term liabilities) for the operation of your business.
BTO profit % 17 % 64 % 67 %
Expenses
Financial costs -0 -0 -0
Profits before tax -4 076 453 -17 756 300 -19 760 737
Current assets
Total current assets 1 643 208 -7 489 893 -19 911 593
Fixed assets
Fixtures and fittings & fixed assets 6 052 800 29 264 000 54 528 000
Acc depreciation fixtures & fittings/fixed assets 1 210 560 7 263 360 19 368 960
Total fixtures and fittings/fixed assets 4 842 240 22 000 640 35 159 040
Liabilities
Share capital & risk capital 10 000 000 10 000 000 10 000 000
Long-term liabilities 0 0 0
Total liabilities & equity capital 10 561 901 6 914 247 15 008 184
Profit for the year -4 076 453 7 596 500 239 263
Table 9: BALANCE SHEET
Debt Ratio = 6.43 -0.92 -0.75 *indicates business while taking on more debt is
working out of debt
Net Profit Margin = -11.78 4.28 0.10 *indicates high initial risk but business becoming more
stabile.
ROI = -0.63 0.52 0.02*indicates high initial risk but business becoming more
stabile.
Generally these ratios are stating that the business will be very risky at the onset due to the high amount of debt
the company will have. This debt will continue to grow as the company expands but the expansion and income
will stabilize the company as it grows out of debt in its first decade.
These ratios can be compared (Appendix 3) against just the initial store. We see the same risk but slower recovery,
though more stability.
10.4 CASH FLOW ANALYSIS
Year 1 Year 2 Year 3
Other earnings 0 0 0
Total earnings from activities 346 000 1 776 000 2 343 000
VAT and tax refunds 612 082 2 859 146 2 479 729
Total liquid assets obtained 958 082 4 635 146 4 822 729
Total expenditure from activities 2 937 992 13 136 300 9 275 437
VAT and tax payments 323 160 721 842 1 253 200
Total liquid assets spent 4 313 952 18 069 342 15 792 637
Net cash flow -3 355 870 -13 434 196 -10 969 908
Liquid assets, outgoing 6 644 130 -6 790 066 -17 759 975
Table 10. CASH FLOW
11. NETWORK & SERVICE PROVIDERS
11.1 BANK
3-DAMTM will initially work with USAA Bank, located in TX. This is an all purpose international bank that has no
branches, that instead works entirely online.
11.2 ACCOUNTANT
Accounting and Human Resources will be outsourced to a 3rd party company and overseen by the CFO. The
company will be responsible for all day to day accounting and human resources activities, including accounts
receivable and payable, health and dental care, 401k management, and taxes, etc.
A web hosting firm will be solicited once a location has been determined for the initial Houston, TX store.
3-DAMTM will contact the Houston, TX local small business administration business development services upon
business starting.
A marketing group will be selected to assist in the marketing campaign on a yearly contract. The initial marketing
group should be experience in a regional to national campaign, working with manufacturing, and start-up
businesses.
A $100k budget will be set for marketing. The marketing campaign will start in June 2013 and continue through
December 2013.
11.7 IT PROVIDER
An IT firm will be solicited once a location has been determined for the initial Houston, TX store.
3-DAMTM will initially work with USAA Bank, located in TX. This is an all purpose international insurance company
that has no branches, that instead works entirely online.
SALES FORECAST
Sales Year 1 Year 2 Year 3
Total, direct costs, sales 288 000 324 000 364 500
Sales monthly
Sales yearly
EMPLOYEES
Personal Year 1 Year 2 Year 3
Sales Eng. and Techs 360 000 360 000 360 000
Start-up funding
BTO profit % 17 % 17 % 17 %
Expenses
Financial costs -0 -0 -0
Current assets
Fixed assets
Fixtures and fittings & fixed assets 6 052 800 5 052 800 4 052 800
Acc depreciation fixtures & fittings/fixed assets 1 210 560 2 421 120 3 631 680
Total fixtures and fittings/fixed assets 4 842 240 2 631 680 421 120
Liabilities
Share capital & risk capital 10 000 000 10 000 000 10 000 000
Long-term liabilities 0 0 0
Total liabilities & equity capital 10 561 901 6 521 447 1 992 737
Profit for the year -4 076 453 -4 569 210 -4 561 053
10.4 CASH FLOW ANALYSIS
Year 1 Year 2 Year 3
Other earnings 0 0 0
Total earnings from activities 346 000 389 250 437 907
VAT and tax refunds 612 082 1 961 333 891 638
Total liquid assets obtained 958 082 2 350 583 1 329 545
Total expenditure from activities 2 937 992 8 826 800 2 514 500
VAT and tax payments 323 160 369 411 381 349
Total liquid assets spent 4 313 952 9 196 211 2 895 849