Attached please find an EXCEL Model of a business as described Below:

This is an entrepreneur that is analyzing the possibility to create an investment opportunity

with a $$QuickLub Express$$ store. The idea is to analyze the feasibility of a car oil change

facility with the concept of fast service; $$on the go$.$ In the long$-$run, what this person is

looking for is the creation of a business model that could be replicated in many places and

eventually become a franchise. However, he strongly believes that, in order to be successful

in the long$-$run, the business should be profitable even if it is only $1$ store. In the mind of this

entrepreneur, the return on investment should be over $28\%$ in yearly basis.

The basic store will count with four service platforms, well equipped in order to be able to

serve a car in no more than $15$ minutes. Each of these platforms and its side equipment cost

about $$80$K$.$ Those are very reliable equipment$$s$,$ so the manufacturer guarantees an $90\%$

operativity; considering appropriate maintenance. Each platform will require a trained

operator, the training will require $4$ weeks and would be provided by the equipment supplier.

The store will require about $4$K sqft$,3$k for the service area and $1$K for office and customer

waiting space. The estimated cost for such space is about $$3$k a month plus utilities; the rent

contract would require a deposit of three months. Utilities, telephone and internet would be

about $$850$ a month. The space would require an investment of about $$15$K plus $$10$K in

office equipment and furniture; the process of remodeling and conditioning will take $4$

months.

The market has to be fully developed; however, the identified location is very promising in

this respect so $$full occupation$$ is expected once the market is developed. By regulation of

the tenant however, the store may only open $6$ days a week from $8$:$00$ am to $6$:$00$pm$.$

The entrepreneur, for this kind of analysis utilize a $36$ months$$ time frame, expecting that the

business would be comfortably $$operationally stable$$ within this period; even though, the

business is expected to continue in operation much longer.

$2$

In relation to sales, we can assume initially that the Gross Margin is $30\%$ and the average

service per client $($vehicle$)$ is $$45\mathrm{.}00.$ Please, assume that all sales are in cash, the inventory is

owned by the supplier so every day supplies are to be paid. The model should be flexible

enough to accepts different scenarios in this respect, also.

After understanding the project and analyzing the model provided, please answer the

following questions:

Is this project viable base on the scenario presented in the model? Argument your response.

What can be reasonably proposed to make the project viable?

NOTE: Please read the history parented and try to make sense of the model based on such a

narrative. It is important, so we can go over the problem during the class time.