Deck Mart’s management team consists of Joseph Young. Joseph Young has over 10 years experience in the construction industry and 20 years experience in management and leadership. I started and managed a construction company that provided residential and commercial construction services. I gained extensive management and leadership experience in business working with companies such as UPS, Hess Oil Company, and WAWA. My strengths include motivating and training personnel, business computer systems, architecture and engineering principles, customer service, and advertising. I am a certified master carpenter and a certified residential code inspector. My education includes an Associates in Science Degree (with honors) majoring in business management. I attained the rank of sergeant in the United States Air Force. Currently, I am enrolled in Rutgers University and am employed as the deck specialist and sales person at the Somerville Lumber Company of Somerville, New Jersey.
Proposed outside management:
Mattleman, Weinroth & Miller Law Firm, Outside Legal Representation
John Ur, EA, Public Accountant
Armas Segundo AIA, Architect
Proposed inside management:
Scott C. Young, Computer Programmer, Technology, Partner
Eric S. Young, MA, Human Resources Executive at General Electric, Partner
Dr. Douglas Bobko, PhD., Training and Development, Partner
Martin Demcak., 20 years in construction industry, Partner
Currently, I have submitted a proposal to TREX Corporation for review and will be setting up appointments to talk about viability and partnering. I also have obtained contact names at Disney® Corporation and at the NFL® Corporation to submit proposals to. I have established connections with a commercial real estate agent and have a few factory locations to ponder over. Also have established relationships with several other suppliers of different materials. A prototype of the website is in the works. Our next step will be to decide on a factory location by the end of May. The intellectual property rights to the name Deck Mart is in service mark (sm) mode and on line to be placed in trademark status within a few months. The time is now. With the right combination of leadership, innovation, money, brainpower and commitment Deck Mart will become the number one deck builder in the United States and abroad. I will launch by June 1, 2006.
Market trends within the industry are the emerging high-end market. This increased growth is due to the dynamics of the housing market and homeowners experiencing increased cash realization that they reinvest in their homes by making high-end improvements. Largest evidence of this is of Walmart aggressively targeting the high-end market.
The first markets Deck Mart will service are new and existing homeowners, new home builders, and businesses found within New Jersey, North Eastern Pennsylvania (Bucks County), and Southern Connecticut. Our residential customers would be owners of single detached homes, townhouses, and condominiums. Builders of new high-end detached homes would offer Deck Mart Smart Deckssm as an accessory option. Business customers would consist of businesses that would purchase a deck with their corporate logo for their employees to use.
Primary market is single family detached house. The household would consist of a one or two parent family with children, have some college education, and have an annual income of between $100,000 and $500,000. According to a study done by the U.S. Forestry Service, over 219 decks are purchased every hour, every day, year-after-year and that is just single-family detached residential homes.
The major competitors of the size and caliber that Deck Mart is expected when mature are mainly Archadeck and Home Depot. Archadeck is a brand name owned by U.S. Structures. Started in 1980 by an architect and a builder, Archadeck is a franchise business model with almost 90 locally owned and operated offices in 27 U.S. states, as well as in Canada, and Japan, and has built more than 65,000 projects worldwide. Home Depot’s deck business is centralized and is part of a multi-billion dollar worldwide network of retail outlets that supplies the construction industry. While both companies claim to be worldwide brand names, Home Depot is much better known than Archadeck. Archadeck is a national and international brand name but in many areas of the United States the average person does not recognize the brand. Both these companies are not really competition for Deck Mart because they would either be purchasing Deck Mart Smart Decks, be a point of purchase, or be granted a license to manufacture Decks using the Deck Mart Smart Deck process.
Our strategy for success has several stages. Initially, Deck Mart will be launched as a deck building company, building decks in the traditional way to generate cash flow. During this period we will target a niche market such as new single detached luxury homeowners with homes valued at between $500,000 and $1,000,000. In addition, Deck Mart will establish itself as a brand of decks with the launching of the Deck Mart Smart Decksm and the Deck Mart Sports Deck. We will build a relationship and partner with other brand names beginning with the NFL Sports Deck. We will grow the company’s revenue and establish a customer base. We will use the New Year to launch the NFL Sports Deck to leverage the Super Bowl and launch the new Deck Mart Smart Decksm process.
There are four risks that are being addressed by the Deck Mart Smart Decksm process: material problems, lack of skilled labor, competition, and deforestation. Material problems and deforestation are being addressed by the new infusion of newly discovered hardwoods, composite materials, and plastics. The Deck Mart Smart Decksm process really takes the skill out of the labor needed to build a deck. Competition threat is diminished because builders can buy decks from Deck Mart. The homeowner can purchase the Deck Mart Smart Deck and get who ever they want to put it together.
Deck Mart’s value chain begins by getting its material directly from the manufacture or mills. There would be an expansive inventory of raw material but the finished parts would be built just-in-time. The added value to the customer would be that the customer does not have to go through shelves of lumber to locate a few good boards or fear delivery of bad lumber that they can never return. Small independent factories would produce Prefabricated Modular Deck Parts (PMDPs) to service individual markets. Building a deck using modular building techniques is the solid foundation that is going to make the whole operation work. The average 10 ft x 20 ft deck would retail for $15,000 depending on material.
The installation and service of Deck Mart Smart Decks would fall under the auspices of a separate company. The PMDPs would be placed on a truck and sent to the jobsite ready for the customer to install or to have Deck Mart Installers assemble the deck parts into a deck. The installation time for an average size deck would be two or three days compared with five to seven days for a stick built deck. Deck Mart is promoted through local cable television, radio, internet, in conjunction with direct advertising.
A telephone number would be established and information would be included on the website. The information on the website would contain everything from how-to videos to live talks with deck technicians. The idea of modular deck building is to reduce most of the skill needed to build a deck. Reducing the skill reduces deck costs, increases value to the customer, increase margins for the company, and gives the average person the ability to build a deck.
The management team focuses on goals set out in their strategic plan. In addition, all management levels would be required to actively participate in leadership training and in the use and implementation of six standard deviations from the mean (six-sigma) techniques.
Deck Mart would have an advance ordering system through the use of the internet and strategically located kiosks where the internet is not accessible. Moreover, the in-house technology would include advanced Computer Aided Design software that would allow for development of new and exciting deck designs, an advanced database system to track everything from consumer trends to inventory flows to remote viewing of problems in the field.
The start-up capital requirements for Deck Mart Corporation are $2.6 million to build infrastructure. This would include moneys for two front warehouses. The first warehouse would open in northern New Jersey and 8 months later open a second store front warehouse in southern New Jersey. The warehouses would be leased and would be capable of supplying 5 to 10 decks per week. Start up capital also includes moneys for trademark and patent fees. These numbers are an estimation of start-up capital and the real numbers may vary from 2 to 5%. Working capital requirements are $290,000 per month for operating expenses, advertising and promotion campaign, personnel, and contingency funds. Fixed requirements are $320,000 for equipment for two warehouses. It would take about 24 to 36 months to achieve a positive cash flow. The break-even point for the business would be 33 months with units priced at between $15,000 and $20,000. In 72 months it is projected that Deck Mart would be generating $9,482,234 in revenue based on two factories.
Exit Strategy: By positioning ourselves in the market, as a central point of purchase and manufacturing of decks, we will gain the interest of Home Depot or Lowe’s, not to mention larger home builders. Either we will run the business to generate positive cash flow or our firm would be acquired by another firm for its parts.