StreetArtist.com: Business Plan

By Joe Burns

Statement of Purpose This business plan was created to introduce H------- Bank to a business idea by Joe and Tammy Burns, StreetArtist.com.

The following pages will provide a business description, financial and management plan.

StreetArtist.com will be a new business so all of the funds requested herein will go towards start-up costs including hardware, software, product, and advertising. A break down of the requested loan amount can be found within this business plan.

We are asking for $1XX,XXX to start StreetArtist.com.

StreetArtist.com Owners

Joe Burns, Ph.D.
Joe Burns is currently a professor of Communications and the Internet at Southeastern Louisiana University. In addition to his teaching load, Dr. Burns consults for New York based Earthweb. He had previously started a profitable Internet business, HTMLGoodies.com. In 1998, HTMLGoodies.com was sold to Earthweb who now pays Dr. Burns a monthly consultant fee to maintain the Web site. Dr. Burns is well versed in Internet business having created Web sites and helping to build Internet businesses since 1992.

Tammy Burns, RRT
Tammy Burns is currently a salesperson. She holds a bachelor's degree in journalism and professional writing. In addition, she holds a degree as a registered respiratory therapist.

Description of Business

StreetArtist.com is an Internet-based art gallery selling paintings from European street artists.

StreetArtist.com will be open 24 hours a day, seven days a week, 365 days a year. That's the main benefit of an online business. The Web site will go live September 1, 2000.

The Product
StreetArtist.com will sell art sold directly to us by street artists in and around Europe. Our first trip after conceiving the idea convinced us that product would be plentiful as many street artists were willing to sell their collections for very modest prices.

The amount of art was vast and the prices per painting ranged from $XX up to $XXX. However, we found, after talking to many artists, that if we purchased their art in bulk, they would be willing to drop their prices.

This will allow us to purchase more art for less money giving the customer a greater selection and giving StreetArtist.com an edge in the art market.

We expect each piece of art to sell for between $XXX and $XXX dollars and, from that, for StreetArtist.com to gross over $XXXXXX from each trip abroad.

We expect to make at least two trips each year to buy art.

Street Art
Street art is defined as paintings and other pieces of art purchased from artists selling original art on the streets of Europe. We have spoken to many artists and art buyers and the allure of the art being from Europe is very appealing to them.

The Competition
There are certainly other art galleries on the Web as well as in traditional brick and mortar stores. Where StreetArtist.com is different is the product. Each piece of art will come from Europe and will be an original. We will not sell numbered copies or hand-painted screen-printings. An extensive search of the Web and numerous art-based magazines proved to us that we would be the first to specialize in European street art. Another selling point is price. The majority of galleries on the Web start their prices around $500 targeting consumers of fine art and name-buying. Our paintings will be originals, every bit as high in quality, but $1500 will be well above our top price.

The Customer
StreetArtist.com will advertise both on the Web and in art-based traditional and trade magazines. Our customers are interior decorators, the framing industry, bulk art buyers, and of course, the end consumer who wants a beautiful, and original, piece of art from Europe. Our art is priced so that it is not out of the reach of anyone who loves art.

UPS will act as our customs broker. Since our art will be shipped from Europe unframed, there will be no duty charge to import it into the country. There will be port fees.

The Offices
The art and the StreetArtist.com business office will be housed in XXXXXXXX. There will be no gallery at that location. All art will be sold online.

The Software
The software to run StreetArtist.com is custom written for our gallery business. The entire site will be database driven offering customers the ability to look at paintings by choosing numerous topics. The site will, in effect, choose the art for the customer depending on what the customer requests. One of the problems in online business is selling a product that is not available or is out of stock. The StreetArtist.com software is written to only allow a painting to be purchased once. Once the purchase is made, another customer cannot see the painting. That way there are no double selling errors. We don't have doubles of anything so this is very important.

StreetArtist.com will accept payment via credit card over the Web. The StreetArtist.com server will be secure at 128-bit encryption. StreetArtist.com will open a merchant account with H------- Bank. When a purchase is made, the card number will be kept in a secure portion of the server and retrieved by us over a secure line. We will then enter the purchases by hand at the end of each day. We feel this is the best method in that it does not involve a third party and will allow us to verify each purchase ourselves. We can also quickly deal with any returns.

Shipping from StreetArtist.com to the customer will be done through the U.S. Postal Service. Registered mailing will be included in the price.

The Hardware
StreetArtist.com will run from its own server housed at XXXXXXXX.com located in XXXXXXXX. The server will run from a T1 Internet line capable of handling great volumes of visitors and requests. The server will run software designed especially for StreetArtist.com by professional computer programmers at XXXXXXXXXX.com. The hardware will have a full time technician and support staff. The hardware will be dedicated to StreetArtist.com alone eliminating any slowing because of having to serve multiple domains.

Financial Data

StreetArtist.com will be a business run in addition to Joe and Tammy Burns' current employment. We do not expect to leave our present positions.

The following is a summary of our monthly income and expenses for the year 2000 and beyond. All numbers are gross income.

Monthly Income

Joe Burns. Ph.D.
      SLU Salary $XXXX
      Earthweb Salary $XXXX

Tammy Burns, RRT
      Innovex Salary $XXXX (not counting bonuses/car allowance)

Total Gross Income: $XXXX /month

Monthly Expenditures

Mortgage $XXX
Auto Loan $XXX
Utilities $XXX
Insurance $XXX
Phone $XXX
Groceries $XXX

Total Expenditures: $XXXX

We have a VISA credit card that is paid to a zero balance each month

The Loan Breakdown

$25,500 Hardware: Server, housing, programming, digital imagery equipment, Verisign, maintenance. This will cover two years at a 10% discounted price
$XX,000 Product: We expect to purchase between 600 and 800 paintings for this amount of money.
$XX,000 Advertising: This will cover six months of advertising in four magazines. The online advertising will be through Ebay.com and search engines, neither of which charges a fee.
$X,500 Trip to Europe: This trip is booked for June 15, through July 4, 2000. The trip will have us in Rome, Florence, Venice, Paris, and London on days we are most likely to find street art available
$X,000 Import Shipping: UPS quoted $350 for a large box to be shipped from each of the cities mentioned above to our doorstep. We see ourselves sending back five shipments, one from each city. That equals $1750, with $250 allotted for port fees.
$X,000 Merchant Account Fees Buyout: We intend to pay the buyout amount up front to minimize our monthly costs during the first months of the business.
$X,000 Shipping and Office Supplies: This money will cover packing to ship to StreetArtist.com customers as well as holders for the artwork and miscellaneous office supplies.
$1XX,000       Total Loan Amount

None of this money will be paid out as salary. We will use it fully on start up costs.


$XX,000 Savings Account Balance
$XX,000 Down payment on our house (valued at $XXX,000)
$XX,000 Mutual Funds: Fidelity, Kemper, Trow Price, Invesco, Kaufman Fund
$XX,000 Fine art etchings and paintings by Rembrandt, Chagall, Dali, Peter Max, Hazel Soan, and Jeanne Down
$XX,000 Earthweb Stock
$XX,000 SEP Joe Burns
$XX,000 1996 Nissan Maxima
$XX,000 Leather furniture, pool table, and antique armoire.
$XX,000 Computer equipment and armoire
$XX,000 Jewelry
$XX,000 Hand-knotted silk rug from Cappadocia, Turkey
$XX,000 Appliances (refrigerator, washer/dryer)
$XX,000 Quintiles Stock

Why You Should Give Us a Loan

It is our opinion that H------ Bank's main question is, Why should we give you a loan? We felt it would be a good idea to write out what we feel is the answer.

From the beginning of our marriage, Tammy and I have both wanted to be in business for ourselves. We have worked to keep our credit clean and to be the people a bank would find trustworthy. We have had many personal loans, each of which was paid off early.

The money we received from the sale of the HTMLGoodies.com site, we feel, set us up to be able to start our business. We were able to pay off all school loans, credit card debts, and personal loans. We have worked hard to make our living expenses as low as possible while keeping our incomes high.

We have no doubts that StreetArtist.com will be a successful business. From your point of view though, you need to know that we will be able to pay down our note if we never sell a piece of art. Let me assure you, we can.

Our combined income easily allows the money to keep up monthly payments on a business loan. We understand the risk we are taking starting this business. We also understand the risk you are taking on us.

In it our intention that StreetArtist.com become self sufficient in a year. We expect to make our first profit within two years. We hope to have your loan to us paid off within five.

We ask you to take the risk and give us the start up money we require to get this business up and running correctly. We believe StreetArtist.com will be a mutually beneficial endeavor for everyone involved.

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