About Pit Stop

Pit Stop is intended to be a major travel centre on the NH66 Mumbai Goa highway located
at Mopa on the border of Maharastra and Goa. It will consist of a convenience store,
gas/diesel pumps, parking area, restaurant, rooms and other amenities for the truckers,
travellers, interstate busses and their passengers. Pit Stop is a corporation owned and
operated by Kelvin S. Fernandes and another investor Mathew D*. Who will share the
investment profits/losses on a 50-50 basis.

The company's management philosophy is based on responsibility and mutual respect. Pit
Stop has an environment and structure that encourages productivity and respect for
customers and fellow employees.

Pit Stop is organized into 3 main functional areas: convenience store, gas/diesel pump
parking bays, the restaurant and recreational centre, each will have its own on-site
management. They will head the operation, and will concentrate on product sourcing, sales,
marketing, finance, and overall administration. Each area will have a manager responsible
for daily operations who will report to either owner.

Rail and roads dominate the transport industry in India both carry about 87% of the total
freight traffic in the country, with road having majority share. Estimates say commercial
freight transportation market had aggregate revenues of $64 billion.

On the Mumbai Goa NH 66 there are on an average 1,730 buses, trucks, small commercial
vehicles and passenger that pass by this route on a daily basis. Meaning there is a good flow
of steady customers.

Mission

The mission of Pit Stop is to start a public travel center which will service the fuelling,
recreational and shopping needs of the general traveling public.
Vision
To establish Pit Stop has a nationwide brand of travel centers that caters to travellers needs
across the borders of all the states of India and the world

Company Summary
Pit Stop is a start-up company whose management perceives a growing demand for vehicle
services. The company's management staff include Mathew, who has extensive experience
in the Logistics and Oil services industry. It is Pit Stops long-term goal to create multiple
service centers throughout the country and service the commercial traffic and create a
brand awareness that transcends state borders.

Location:
Pit Stop will be located on NH 66 connecting Goa to Maharastra and Mumbai. Access to the travel
center will be through this major crucial highway connecting these two states. This highway also
connects traffic going to Karnataka through Goa. The advantages of this site are listed below and
should be evaluated accordingly when investments for site developments (or improvements) are
being considered.

Visibility of this site is considered good.

Competition at and around this location is low.

Quantity of competition is classified as limited.

Accessibility to location is good.

Traffic count potential at this location is considered good.

House count at this location is very low.

Demographics at this location are excellent.

Growth of area around this site is fair.

The main problems or pain points Pit Stop will address is that travellers, can have an easy hassle free
pit stop on their journeys to far and wide corners of the country. They will have clean sanitation
facilities that are not available across the highway and healthy reasonable food offerings, also
facilities like parking a vehicle without any worries, staying a night at the motel before continuing
ones journey, shopping for the essentials for a road trip and playing a few games all under 1 roof
are second to none

Company Ownership
Interstate Travel Center is solely owned by Kelvin and Mathew. It is not anticipated that the
company will seek additional shareholders for the foreseeable future.

Start-up Summary
Funding Requirements and Uses
The initial seed capital will amount to Rs.70 lakhs. This will be used to purchase land,
develop it and construct travel center on a 93,560 sq.ft piece of land complete with
gas/diesel pumps, parking spots, scales, a restaurant and rooms. The owners have a
combined 43,560 sq.ft of land in Pernem Goa located 27 mts from the NH 66 highway.
Another 50,000 sq.ft of land will be purchased at Rs 130 a square foot. That will cost Rs 65
lakhs. The total land to be used would be 93,560 sq.ft. The initial capital injection by both
owners will be Rs 90 Lakh. The remaining will be funds in the form of a Rs 60 Lakh loan. The
loan will carry a 9% interest p.a on the principal amount and will be re paid in a period of 12
years or less if the firm generates the projected profits. Excess capital will be kept in the
form of reserve. Figure 1 provides a breakdown of how the funding will be used and Figure 2
provides the Expenditure Outline for Phase I.
Figure 1. Use of Initial Funds

Working Capital 2,00,000

Inventories (Shopping facility & Rest) 10,00,000

Land 65,00,000

Building including all outlets (15,000 sq.ft) 30,00,000

Gasoline Facility 2,00,000

Miscellaneous 1,00,000

Total 1,10,00,000

Figure 2. Start-Up Costs

Parking bay equipment 1,00,000

Prepaid Expenses 1,00,000

Travel Center Equipment 2,50,000

Restaurant Equipment 3,00,000

Contingency Costs 1,00,000

Cash Required 1,00,000

Games room equipment 3,50,000

TOTAL 13,00,000
Products and Services
Pit Stop will be a travel center offering an array of goods and services. The travel center will
have a convenience store as well as gas/diesel fuel pumps. Amenities for other travelers,
such as public restrooms, showers, telephones, game room, trucker lounge/TV room, scales,
and a parking lot for bus, car, trucks, will also be included.

Store

Suggested Goods and Services, Convenience Store:

Two registers and checkout areas.

16-20 quantity walk-in cooler.

Coffee/Tea juice etc offering based on customer mix.

Heavy snack items.

Travel grocery items.

Extra-heavy oil and other offerings based on the customer mix.

Public restrooms which will be both large and clean.

Separate amenities for truckers, such as entrances and restrooms.

Food

Suggested Goods and Services, Fast Food:

The following fast food offerings suggested for this location:

National brand fast food chain (Outsourced)

Full service restaurant with seating capacity of 170 customers

Suggested Fast Food Amenities:

Indoor seating for 30-50 patrons.

Drive-thru window (with car stack capabilities).

Order station (with car stack capabilities).

Interior menu board and order line.

Facility

Signage

High-rise highway sign (essential).

Brand pole/Street family sign.

Store name sign.

Gas/Diesel price sign.(Provided by Oil company)

Fast food sign.

Building sign.

Other: Highway billboards (North, South, East, and West of site, 20-25 miles).

Parking facility:

Car /small commercial vehicle parking: 30 spots.

Truck parking: 60 spots.

Bus 30 spots.

Parkin for the first 20 mins free for all vehicles. After which the following will be
charged every 20 minutes.
- Trucks 30 - Buses 25 - Cars 15

Gas

Suggested Goods and Services, Gasoline Installation:

Multiple Pump Dispensers at gas islands.

TV monitors and credit/debit card acceptance.

Gasoline Configuration (layout style):

Head-in/Drive-in (vehicles face main building when fuelling and pass through premises
before exit).

Diesel

Suggested Goods and Services

Fuelling lanes for large trucks/quantity: four

Single fuel lanes for smaller vehicles/quantity: one (Phase II).

High speed pumps at dual fuelling lanes.

Air, water, and window cleaning equipment at fuelling islands.

Branded petrol and diesel.

Charge/pay systems associated with the trucking industry.

Future Products and Services

A full service trailer/truck repair shop, Motel of 30 rooms, and warehousing are planned for
this project. Other lease spaces for services, such as shoeshines, haircuts, a medical center,
and other kiosk centers, will be available in the critical 2nd phase of development that will
begin in the 3rd year of operations if profitable.

Market Analysis Summary

Truckers Dominate Freight Market

Based on value of service, trucks and busses (excluding warehousing and logistics)
accounted for 63% of traffic or more on Indian roads. This is because items transported by
truck tend to be lightweight manufactured goods that move short distances, rather than the
heavy, long-haul, bulk commodities that travel by rail barge.

Motor carriers specialize in higher-value freight that moves 2000 miles or less, and for which
delivery is required within three days. Examples of this type of freight are food and
consumer staples delivered locally, and manufactured goods shipped between commercial
establishments or delivered to consumers or retail outlets.

Truckers have the largest share of the freight market. Unlike railroads, pipelines, or water
carriers, they don't face geographic limits caused by physical constraints, and can offer
door-to-door service. They also pay relatively little to use the nation's highway system.
Railroads by contrast, must with difficulty find their rights-of-way.

The 2 types of carriers are:

-Private Carriers
-For-Hire Carriers

Business Participants

Strategy and Implementation

Pit Stop strategy is to develop a major travel center in Goa. The center will consist of a major
convenience store, gas/diesel islands, restaurant, washroom and amenities for the trucking
business. Key components of the company's initial strategy are summarized as follows:

Advertising. Promote the new business through extensive advertising.

Location. Provide a clean, safe and appealing location for travellers.

Provide a convenient center with a full array of products and services for those that are
traveling as and for the citizens of Goa and surrounding communities.

One-stop shop. Be the one-stop shop for travellers to and from Mumbai and Goa.

Maintain a profitable business with a good return on investment.

Interstate Travel Center will be developed in 2 phases. Phase development will enable the
owner/operator to introduce viable, profitable goods and services without over-building.
The timeline for the implementation of the various phases is contingent upon customer
response and profitability and action is initiated at the discretion of the owners. It is
assumed that the implementation of Phase II will occur sometime after the first
three years of operation.
Phase I: Initial Development

Diesel fueling lanes: four; dual-sided fueling.

Travel Store: Approximately 4,000 square feet.

Showers and restrooms

Truck Loungers.

Recreational Room.

Restaurant.

Parking bays

Phase II: Increased Goods and Services, Third Year of Operation

Diesel fueling lanes: add two for a total of six lanes.

Truck parking: add 30-50 spaces.

Diesel fueling lanes: increase to eight dual-sided fueling.

Travel Store: Enlarge to 2,500 square feet.

Service Station: Add space for services such as repairs tires, batteries, oil, etc.

Add fast food unit.

Add additional restaurant seating for a total of 100 patrons.

Motel: Add 70 rooms.

Truck/Car Wash.
Branding
Gasoline/Diesel branding
The suggested branding is for market impact. A positive draw of highway customers is more
likely on a branded unit than on a non-branded unit. Branding will draw those customers
that might have otherwise traded in a larger open area. Branding will help to draw local and
long-haul vehicles that need fuel between their designated stops.

It is highly recommended that the location be promoted for local and long-haul businesses,
and for companies to fill their vehicles at the new travel center. Suggested promotions
include special pricing discounts and coupons. The marketing costs will be incurred on 70-30
basis with the oil company paying the majority up to 3.5 lakhs.

Branding recommendations:
It is suggested that the new site be branded with one of the following options for national or
regional recognition.

HP

BP

Reliance

Private Brand

Branding advantages:
The primary advantage to branding is the financial assistance offered by the oil companies.
Most major companies have rebates and allowances that will assist in the investment by the
retailer. Regionally, we are seeing oil companies upgrade their company-owned leased
facilities. The brand suggested is in a strong growth pattern in many communities similar to
this one. Additional advantages are listed below:

Best to be branded on a highway and/or commuter type location.

In a transit location, it is best to be branded to draw sales.

Branded locations have a larger sale per visit than unbranded locations.
 Constructing the facility as a branded location will enable the owner to take advantage
of the rebate programs, improving their return on investment (ROI).

The 70-30 program will reduce the total investment over the next 3 to 5 years. This fact
alone improves the risk factor and should carry a great deal of weight when being
considered by local financing and/or banking services.

The owners have to choose a brand preference for their new business. Their selection will
be based on several factors, such as incentives, advertising allowances, company flexibility,
and their acceptance of all major credit cards.

Marketing Strategy
A small traveler's guide will be published to advertise the travel center and all it has to offer.
Advertising will be disseminated through the use of local newspapers, radio and television
commercials. Other promotional items, such as billboards and local chamber of commerce
propaganda will also be employed. Customer service will be the number one priority of this
business. This will in turn, generate repeat business.

Sales Strategy
The sales figures are based on projections of vehicles using the major highway adjacent to
the Interstate Travel Center. The yearly growth figures are based on conservative
projections of increasing customer base as marketing and customer retention builds an
established customer base. It is assumed that this venture will grow a stable customer base
more quickly than the other ventures due to its more unique product experience. This again
reflects the belief that this venture will have the most difficulty in building service
awareness and retention.

Sales Forecast
The following table and chart show our sales forecast
SALES FORECAST YEAR 1 YEAR 2 YEAR 3

Unit sales/Profit

Gasoline (ltr) 10,00,000/1 15,00,000/1 20,00,000/1

Travel Store (no of visitors/ 6,00,000/3 8,00,000/5 10,00,000/7

avg profit per individual)

Restaurant (no of visitors/ 8,00,000/10 9,00,000/10 10,00,000/15

/avg profit per individual)

Parking service (no of vehicles 3,00,000 4,00,000 6,00,000

/profit Truck/Bike/Car) 15/10/7 15/10/7 17/12/10

Total Sales Revenue

Gasoline (per ltr) 10,00,000 15,00,000 20,00,000

Travel Store (Avg profit per individual) 18,00,000 40,00,000 70,00,000

Restaurant (Avg profit per individual) 80,00,000 90,00,000 1,50,00,000

Parking service T/B/C 30,00,000 40,00,000 72,00,000

Management Summary
Kelvin and Mathew will be the sole owners of Interstate Travel Center for the foreseeable
future. It is planned that a management staff, consisting of a full-time manager and a part-
time assistant manager, will be hired to handle the day-to-day operations of both the
gas/diesel service and the restaurant sections of the travel center. As the company
continues to grow, so will management. Salaries for owners will change after year 4.

PERSONNEL PLAN YEAR 1 YEAR 2 YEAR 3

Kelvin & Mathew 10/p.m 2,40,000 2,40,000 2,42,000

Convenience store/Gas station Manager/cashier 11/p.m 1,32,000 1,32,000 1,34,000

Restaurant Manager 13/p.m 1,56,000 1,56,000 1,58,000

Cook1 10/p.m 1,20,000 1,20,000 1,22,000

Cook 2 1,20,000 1,20,000 1,22,000

Waiter 7/p.m 84,000 84,000 86,000

Waiter 84,000 84,000 86,000

Waiter 84,000 84,000 86,000

Cashier 6/pm 72,000 72,000 74,000

Maintenance 4/p.m 48,000 48,000 50,000

Helper 4/p.m 48,000 48,000 50,000

TOTAL PAYROLL 11,88,000 11,88,000 12,10,000

Financial Plan
The following topics outline the financials for Interstate Travel Center.

Important Assumptions

The chart indicating the projected cash account does not take into account the investment
needed to initiate Phases II. The General Assumptions table states some of the more
important business assumptions for the company.

GENERAL ASSUMPTIONS YEAR 1 YEAR 2 YEAR 3

Current Interest Rate 9.00% 9.00% 9.00%

Tax Rate 00.00% 00.00% 00.00%

(No tax for first 3 years as scheme for
start-ups)

Projected Cash Flow

The tables reveal the projected cash flow for Interstate Travel Center for fiscal years 2018,
2019, and 2020.
Break-even Analysis

Monthly Revenue Break-even 68,00,000 7,07,334

(50% initial funds + start-up costs +
Salarys + operating expense + utilities)

Initial costs + Startup Expenses 1,23,00,000 ---------- ----------

Payroll 11,88,000 11,88,000 12,10,000

Marketing & Sales 1,50,000 1,50,000 1,50,000

Depreciation 50,000 50,000 50,000

Utilities 3,00,000 3,00,000 5,00,000

Raw Materials 3,00,000 3,00,000 4,00,000

Insurance 1,00,000 1,00,000 1,00,000

Total Operating Expenses 2,00,000 2,00,000 3,00,000

Interest expense 5,40,000 5,40,000 5,40,000

Total profit 1,38,00,000 1,85,00,000 3,12,00,000

Total cost 1,48,28,000 38,56,000 32,50,000

Net Profit -10,28,000 1,46,44,000 2,79,50,000

 FUEL
ENTRY
FAST FOOD REST STATION

RESTAURANT

PARKING BAYS

SHOPPING CENTER
&
RECRATIONAL
CENTER

EXIT