atlantic shores realtors better homes gardens

CONFIDENTIAL

BETTER HOMES & GARDENS @ ATLANTIC SHORES REALTORSTHE NEW LOOK FOR REAL ESTATE ON LONG ISLAND

BUSINESS PLANPrepared April 2013

CONTACT INFORMATIONJerry Gucciardo 156 E. Main [email protected] Huntington, New York 11743, USA

631.754.0866

ATLANTIC SHORES REALTORS BETTER HOMES & GARDENS i

CONFIDENTIAL - DO NOT DISSEMINATE. This business plan contains confidential, trade-secret information and is shared only with the understanding that you will not share its contents or ideas with third parties without the express written consent of the plan author.

Table of ContentsExecutive Summary .........................................................................1Who We Are..................................................................................................................................................................1What We Sell .................................................................................................................................................................2Who We Sell To ............................................................................................................................................................2Financial Summary .......................................................................................................................................................2

Company .........................................................................................4Company Overview.....................................................................................................................................................4Management Team.......................................................................................................................................................5Senior VP Profile ...........................................................................................................................................................6

Real Estate Services .......................................................................11BH&G @ Atlantic Shores Advantages ......................................................................................................................11Competitors ................................................................................................................................................................13

Target Market ................................................................................15Market Overview........................................................................................................................................................15Market Needs .............................................................................................................................................................15

Strategy and Implementation .........................................................16Marketing Plan ............................................................................................................................................................16Milestones....................................................................................................................................................................18

Financial Plan.................................................................................20Sales Forecast .............................................................................................................................................................20Personnel Plan.............................................................................................................................................................22Budget..........................................................................................................................................................................22Profit and Loss Statement...........................................................................................................................................24

Office Growth Strategy ..................................................................26Huntington ...................................................................................................................................................................26Sayville.........................................................................................................................................................................26Setauket .......................................................................................................................................................................27

ATLANTIC SHORES REALTORS BETTER HOMES & GARDENS ii


Appendix.......................................................................................28Sales Forecast .............................................................................................................................................................28Personnel Plan.............................................................................................................................................................31Budget..........................................................................................................................................................................32Profit and Loss Statement...........................................................................................................................................34

ATLANTIC SHORES REALTORS BETTER HOMES & GARDENS 1


Executive Summary

Who We AreBetter Home & Gardens @ Atlantic Shores is a fusion company composed of a respected new home builder and remodeler and new Long Island real estate company dedicated to incorporating the appeal of homeownership, remodeling, decorating and life style. With the help of the BH&G brand we intend to bring a new look to Long Island Real Estate.

These are our core beliefs and they will be incorporated into our Policy & Procedures Manuel

We are committed to communication and transparency: We foster an environment that empowers each individual to proactively communicate and share our talents, industry knowledge and resources. We hope to be the first to offer Transaction software for not only the professionals involved with our sales but our buyers and sellers as well. This culture fosters superior communication among our team members and investment partners who depend on us to consistently provide timely, accurate information and strategic judgment.

We will encourage personal balance along with community balance: We focus on having a balanced life - personally and professionally. We emphasize physical well-being by promoting a healthy, active lifestyle and contributing to our families and communities with green initiatives.

Our team members will drive our success: We will strive to attract and motivate leaders of character and invest in team members who demonstrate initiative and a customer service spirit. We believe that the exceptional diversity of skills our team members possess and an emphasis on collaboration give us a powerful foundation.

Relationships Matter : Our organization is comprised of talented people who foster meaningful alliances with their partners, industry colleagues and fellow team members. We continually work to develop deep, mutually rewarding relationships with all members of our real estate community.

We accept personal responsibility : In an ever-changing business environment, as we pursue new ideas, are accountable for our actions, and are never satisfied with the status quo. We take the initiative and personal responsibility for our actions and our company’s success and reputation, always seeking to exceed the expectations of our partners, colleagues and ourselves.



We Emphasize Discipline: Having navigated challenges across multiple cycles or the ups and downs of the real estate industry, we understand the importance of proactive risk management. Capital preservation is foremost in our minds to survive the inevitable downturns. "We cannot change the direction of the wind , we can adjust our sails"

Integrity and Respect is at the heart of our firm: We demand and reward integrity in the belief that it is the only way to do business and the only way to foster relationships that stand the test of time. We treat partners, team members and those in our real estate community as we would want to be treated.

We are results driven: A financially strong organization is essential to our long-term success, and we believe everyone contributes to the bottom line. We operate within clearly defined and aligned goals in order to deliver superior economic performance. We recognize and reward each team member’s results as well as agents from our competition who perform for us.

What We SellWe intend to market a "Better way to do Real Estate", by combining our agency and the Better Home & Gardens Brand and Lifestyle. We will provide a new approach to Real Estate by providing a modern, up tech, socially driven way to do Real Estate. By designing a marketing campaign to fuse home improvement with home ownership with life style we will be able to emphasize the benefits of BH&G @ Atlantic Shores approach.

Who We Sell ToOur target customers and clients will be those Long Islanders that live a BH&G lifestyle, love remodeling a home, scaling up to a new home or downsizing , gardening. A demographic between the ages of twenty five and seventy and yearns for a company that can simplify the housing market place and knowing that having the right realtor can make all the difference. According to our research this middle to upper middle class demographic has been neglected in the communities we hope to enter.

Financial SummaryFinancial Highlights

Atlantic Shores has prepared this Business Plan using conservative numbers for our unit sales projections. We halved the numbers our competitors whom we have targeted are currently doing. We feel comfortable with our projections partly because we own our office space which gives us a great deal of flexibility during our initial growth period. Our family team has set aside a year's worth of expenses as a worst case scenario solution. This in combination with having the availability of a commercial and



residential builder as our owner allows us to build a BH&G designed office and to offer unique marketing solutions not available to our competitors.

Net Profit (or Loss) by Year



CompanyCompany OverviewAfter over twenty five years of owning and building a Real Estate and Residential Construction business on Long Island we have determined thru market research and area expertise believe that the time is right in the residential real estate market for a new dynamic Real Estate Brand in Huntington and its surrounding areas.

The company being formed to build that product is a collaborative effort between Atlantic Shores Builders, a leading residential and commercial building corporation on Long Island and the east coast together with Atlantic Shores Realtors a ongoing Real Estate business originally formed to market Atlantic Shores Builder's residential developments and Anthony Vitale a real estate professional with over twenty five years of residential real estate brokerage ownership, a former Broker/ Owner of Coach Realtors on Long Island as well as Senior Vice President of Daniel Gale Sotheby's International Real Estate. Atlantic Shores main office will serve as corporate and first office. Located on "Realtors Row" in Huntington, Long Island. This former Prudential Real Estate office with over forty three hundred square feet of prime office space will be with the help of BH&G & Atlantic Shores Builders be transformed into the proud flagship office for BH&G @ Atlantic Shores.

Mission Statement:

We are committed to serve the real estate needs of our clients through the highest level of professionalism, creativity and service. We execute our transactions through a true team approach to avoid conflicts of interest and projecting a unified theme.

These commitments, together with due diligence in execution and unparalleled experience, are what will distinguish BH&G @ Atlantic Shores Realtors from our competitors.

Company Goals:

Atlantic Shores Realtors in Partnership with Better Homes & Gardens hopes to deliver to the Long Island marketplace a fresh approach to Real Estate for our agents and clients alike targeting a young technically savvy agent who is trained to speak the same language of a younger highly energized buyer. By providing new solutions to old Real Estate road blocks we hope to streamline the business process while making it as enjoyable as possible.



We intend to maximize the BH&G brand by offering unique programs to achieve desired Market Share in the targeted communities we choose to enter throughout Long Island.

Business Philosophy:

Atlantic Shores Realtors intends to be a “Force for Positive” in our communities and business. Which can best be expressed by the motto to “Follow the Golden Rule” treating our real estate community with the highest level of professionalism by always providing the “benefit of doubt” when challenging others motives. We intend to lead by example to prove that Atlantic Shores is the place to be for a Better Homes and Garden.

Management TeamThe Gucciardo Family and friend

Jerry Gucciardo , Broker / Owner Atlantic Shores Realtors Inc. , Owner Atlantic Shores Builders & Developers, Masters Degree in Accounting, Over 25 years experience as a residential and commercial developer on Long Island and the east coast of the United a states

Christopher F. Gucciardo , Associate Broker , Manager in Training Atlantic Shores Realtors, Director of Operations and Marketing Atlantic Shores Builders & Developers, Inc. Chris has the tech talent to be relevant in today's business environment.

Jamie Gucciardo Cordts , Associate Broker , Manager in Training Atlantic Shores Realtors, Experience realtor in the Huntington area , Jamie possess the brains and charm to be a leader not only in this company but in the realtor community as well.

Angela Gucciardo , Office Director , Relocation Director, Bookeeper

Anthony Vitale , Associate Broker & Senior Vice President, who as broker / owner of Coach Realtors, was the catalyst for the expansion from eight offices to over twenty at the time of his departure. By developing a sales technique that was instrumental in bringing competitors into the Coach brand, Coach was able to roll in existing offices with little loss of revenue. Anthony also co-chaired the Luxury Group division and Senior division. During his time at Coach ,Anthony was also instrumental in unifying the Brand look and feel, through ad, office and sign design. He is a proficient recruiter who knows what is important to realtors and their business. As owner of his own software company Anthony has developed products for MLS boards in the North East and is currently in the process of developing an app for realtors for the iPad.



Senior VP Profile Senior Vice President

Dynamic professional poised to transition into a leadership role to effectively shape and articulate organizational policies, protocols, and strategic vision. Eager to establish a presence in the Long Island Real Estate community. Expertise in administration, operations management, and execution. Possess a deep understanding of the vulnerabilities of business and the need for operational uniformity. Dynamic leader delivers outstanding results by actively engaging employees and gaining buy in.

Areas of Expertise

• Strategic Planning

• Performance Management

• Recruitment Leadership/Mentoring

• Relationship Development Budget

• Administration

• Employee Oversight

• Training/Development

• Policy/Procedure Development

• Performance Review

• Equipment Purchasing

• Standard Operating Procedures

Talk2Tony Real Estate Advisor , Setauket, NY - 2010-Present

President, Broker/Owner Professional Real Estate Advisor, NY Licensed- Provided Real Estate advice and transactional guidance for corporate, legal and residential clients throughout New York.

Delivered Results:

Serve as court appointed or legal representative for Real Estate matters concerning divorce and separations.

Relocation Services provided to Stony Brook University, SUNY NY



www.talk2tony.biz

Daniel Gale Sotheby’s Int’l Realty, Setauket, NY – 2008 to 2010

Senior VP, Acquisitions and Expansion/Broker: Meet rigorous organizational objectives in development of five offices for this top real estate company serving clients across the Long Island, New York area. Oversee all aspects of the operation including recruitment and staffing, location build out, equipment purchase, and advertising campaign development.

Delivered Results:

Built bench strength in the recruitment and selection of more than 100 sales associates.

Designed and executed an advertising strategy that effectively built the business brand across local communities.

Cultivated strategic business and fundraising relationships across local communities, which generated significant interest in the company; obtained scholarships and advertising sponsorships as corporate liaison.

Coordinated overall fund raising efforts. Oversaw renovation projects and administered development budgets.

Worked hand in hand with Universities’ Presidents office at SUNY Stony Brook University to develop a plan and Co-ordinate Relocation Services for candidates seeking employment from around the United States. Supplying services including home purchase, mortgage service, title service, moving services etc.

Coach Realtors, Christie’s Great Estates, Setauket, NY – 1997 to 2008

Vice President/Owner: Set challenging business objectives and executed through a high performance team of three managers and 138 agents across five offices.

Delivered Results:

Led the strategic merger with Coach Realtors under a separate corporation. Managed top producing offices along with top listing and sales agents for seven years.

Conceptualized, developed, and implemented a relocation assistance plan.

Designed the Buyers Book, which standardized practices in support of incoming candidates.



Led the business to top performance five years in a row.

Co-chaired The Institute for Luxury Home Marketing and co-designed comprehensive training sessions. Established companywide standards and cultivated relationships with luxury home venders.

Played a key role in the design and development of the organization’s web site. Created an agent billing and direct order system, the Floor Plan Online for Long Island Exclusive.


Setauket Harbor Realty, Setauket, NY – 1990 to 1997

Owner/Broker: Grew small three agent office to Top Producing Real Estate Office in The Three Village Community

Delivered Results:

Built business to become top independent real estate company in the Three Village Community. Worked hand in hand with Northville Industries to solve homeowner problems as a result of oil contamination including the purchase and sale of many properties for Northville. Served as property manager until properties were ready for resale in the market.

Earned recognition as top producer companywide.

Earlier Roles

BH&G Better Homes And Gardens, Real Estate Division, Andor , Stony Brook, NY

Sales Agent

Delivered Results:

Licensed Sales Agent: Developed client relationships in promotion of real estate properties. Earned recognition as top producer companywide1985,86,87

Memberships & Affiliations

SUNY SB Vice President Athletic Directors Advisory Council (ADAC), Corporate Advancement Liaison



The Setauket Yacht Club, Board of Directors, Nominating Committee, Membership Chairman

The Setauket Neighborhood, Past President Setauket Neighborhood House, Board of Directors, Current Trustee

One Design Sailing Program, Setauket Yacht Club, Port Jefferson Village and the Three Village Community, Director Project JY-15, Organizer/Promoter

Personal Boast Statement

As a candidate for the position you will find in me over twenty five years experience as a business owner. A business owner who has scaled from a two person office at the bottom of my market place to top of my market with over two hundred sales people. On that journey I have mastered many valuable skills essential to grow and sustain a profitable and successful business. Skills as varied as designing and overseeing construction, decorating of office space to motivating and obtaining “buy-in” with a sales force of over one hundred and eighty commission based agents.

I have personally instructed and developed a culture of productivity among all personnel.

I have created budget plans for both positive and negative market conditions that sustain my business through good as well as bad times, ensuring survival and in fact growth of my company.

Instituted and developed specialized divisions (Luxury and Senior divisions), developed strategic relationships with affiliate businesses ie: Well Fargo, Christie’s Great Estate, FloorPlan Online

Developed alternative commission plans to effectively enhance my recruitment and retention of salespeople.

As a former software developer (Apple Macintosh products) I was and am in a unique place to bring the latest technologies to my personnel and train them to use technology effectively.

I developed a recruitment regiment that successfully filled five top producing offices.

I negotiated the purchase or assumption of competitors in my field.

I have personally trained my employees in use of the latest technology and sales techniques and the development and management of their business plans.

Provided for education about industry knowledge and procedures, Human Resource and workplace behavior.



As owner I oversaw and trained a management team, developed many successful marketing campaigns, created a budget plan.

I directed researched and purchasing of technical, business and training systems, delivered them to my personnel and insured that they were properly trained in their effective use.




Real Estate Services BH&G @ Atlantic Shores AdvantagesIt is Better Homes & Gardens @ Atlantic Shores intention to offer two lines of products both targeted at desirable clientele.

Home Sellers & Buyers

To the home sellers and buyers in our targeted areas we offer unique services to distinguish BH&G from our competition along with all the benefits of BH&G we intend to offer what we like to call Real Estate 3.0 services like

Twitter: feeds directly from our agents to their buyers using twitters new card feature, customized for each new listing.

Transaction software: to create a transparent view into every transaction thru customized software every participate will have access to a virtual transaction with their own passwords. Attorneys ,Title People , Mortgage people as well as our agents will be able to track each step of a transaction and input any missing data.

The BH&G @ Atlantic Shores Community Card: Community Card (Credit Card facsimile) to all agents buyers & sellers and participates . This card along with participating merchants will bring service and discounts from merchants to users , our web site will keep up to date with all participating merchants.



The Atlantic Shores Curb Appeal Initiative: a program offered to homeowners who list their property with BH&G @ Atlantic Shores a service whereby at the recommendation of an agent work needed on a home to improve its salability or increase its value can be performed by Atlantic Shores

Builders who will defer payment until closing. (all RESPER laws will apply)

Agents & Associate Brokers Who Affiliate with BH&G @ Atlantic Shores

Achievable Sales Contest: to reward as many agents as possible.

Excellent Technology: Computer, telephone, training

The iPad Mini Reward: We hope to offer every new agent that affiliates with BH&G in 2013 an iPad mini loaded with Real Estate tools to help them perform their job more efficiently.

The Nail Shop: The nail shop is a concept our SVP experimented with in his former office which proved very successful. On Fridays the broker hired a nail technician to come in and provide manicures to agents. This turned into a very popular perk that also

worked as a great tool encouraging agents to share about upcoming business with their fellow agents therefore increasing our "in house" sales units. This perk is still under discussion among the management team.

All agents and Associate Brokers who affiliate with BH&G @ Atlantic Shores will automatically have access along with their family members to The BH&G @ Atlantic Shores Community Card, Transaction Software for agents in addition to all the benefits provided by the BH&G tools.



Recruitment Bonus: BH&G @ Atlantic Shores intends to offer a bonus incentive plan for any agent who provides our Human Resources department with leads to agents or brokers wishing to associate with BH&G. We at Atlantic Shores are committed to providing our family of agents with the most up to date technology and equipment along with training to use these tools to maximum effectiveness.

CompetitorsOur Competition

In Huntington our competition has raced to the top to brand themselves as "Luxury Realtors" although not a bad idea in moderation, the supply has outstripped demand and created a gap in the agencies that can best serve the demographic that we believe is perfectly aligned with the BH&G brand. We believe that this leaves us (BH&G @ Atlantic Shores) a unique opportunity at the right time, when agents and brokers are still digging themselves out of hibernation to introduce a fresh dynamic brand into the market place. Our competition breaks down as follows.

Bloomingdales

Daniel Gale Sotheby's : Large, independent, just about owns the High End

Signature Properties : Small, two office, independent, has made some inroads vs DG

Douglas Elliman * : Formerly Prudential, their impact has not hit the market yet.

Sears / KMart

Laffey * Formerly C21 Laffey trying to rebrand upscale

Realty Connection* : Agency made up of realtors following Remax concept mostly unhappy (see remax)

Remax: We all know about them and the agents they attract

Coldwell Banker*: Good Company , tired brand , agents are mostly bored. They command a good market share in Huntington @ #3 behind DG & Signature

Macy's



Coach Realtors*: Tries to walk the line between Luxury and middle income, sometimes successful, charges a 6% franchise fee without providing any uniform services, company is always confused and under weak leadership. Services are patched together to look like a brand , mostly dysfunctional

Our campaign for market share and agents will focus on three companies

1. Coach Realtors

2. Coldwell Banker

3. Douglas Elliman (formerly Prudential)

All of which are susceptible in specific ways to BH&G

Our Opportunity

We see a great opportunity to market to sellers, buyers and agents who have been ignored by the Bloomingdales agencies as well as the Sears group whose agents are mostly bored with brands that have lost their direction, Coach Realtors is particularly vulnerable because of the inclusion of our SVP a former owner of Coach who has deep connections and insight to their operation.

* Indicates agencies whose agents are experiencing change or stress in office and are susceptible to recruitment.



Target MarketMarket OverviewOur Customers

Our customers and clients will be the homeowners and buyers who are looking for a fresh method of dealing with real estate, a customer who identifies with homeowners portrayed on HGTV, people who care about and are proud of their homes that they themselves decorate and upgrade every weekend they have available. They see the house transfer process as overly complicated and a tad bit suspicious. We at BH&G @ Atlantic Shores hope to target that demographic.

Our Agents:

They are agents that need a strong brand to identify with, a company that supports them in their business and a partnership with their company to enhance their quality of life.

Market NeedsBuyers & Sellers

Our demographic target market is those middle to high income sellers and buyers looking for a familiar positive household brand like BH&G. We feel that by including innovating transaction tracking software, technology enhanced communication, our curb appeal initiative, a reputable mortgage services, BH&G quality trained agents along with our community relationships, will allow us to create that fresh approach to Real Estate that this demographic would love.

Agents

Highly effective training, quality brand recognition, access to superior marketing material, a partner in business.



Strategy and ImplementationMarketing PlanOverview

Better Homes & Garden @ Atlantic Shores Market Plan will roll out in three stages.

Stage1 Office and Brand Introduction:

This stage will focus on introducing BH&G to Long Island, We will rely on BH&G marketing material. We hope to roll this out in September 2013 to coordinate with the openings of our two branch offices.

Stage 2 Agent Recruitment advertising campaign:

Stage 2 focuses on recruiting agents as well as promoting our brand, subtle in nature it's goal is to excite the passion of the realty community about the brand. We will be rewarding agents of other companies that are co-brokers on our transaction with small tokens of our appreciation as well as a yearly meet and greet social events.

Stage 3 Community Marketing:

This stage will be used to establish a link to the communities we serve by participating in visible local campaigns and fundraisers. The strong business and neighborhood connections of our Broker and

SVP will provide recognition that otherwise might take a generation to develop.



Positioning

At BH&G @ Atlantic Shores we pride ourselves on our relationship with our agents, customers and staff. We offer a fresh approach to Long Island Real Estate.



MilestonesMilestone Due Date Who's Responsible Details

Finish BH&G April 27, 2013 Jamie , Anthony, Jerry

Complete BP for BHG April 29, 2013 Anthony, Jamie & Chris Waiting on Financials

Complete Build out Huntington Office

July 15, 2013 Jerry Gucciardo Atlantic Shores

Furnish and Hire for Huntington Office

July 15, 2013 Angela Gucciardo Coordinate all utilities , hiring , decoration with office directors

Grand Opening Huntington Office

August 01, 2013 Jamie Cordts Rebuild by Atlantic Builders

Build out Sayville August 15, 2013 Jerry Gucciardo Atlantic Shores directed by Chris

Build Out Setauket Office August 15, 2013 Jerry Gucciardo Atlantic Shores Directed by APV

Hire , Decorate, prepare Sayville office

August 15, 2013 Angela Gucciardo Hire , decorate , utilities in conjunction with office director

Hire , Decorate and prepare Setauket office

August 15, 2013 Angela Gucciardo Coordinate opening with Office director

Grand Opening Setauket Branch

September 01, 2013 Anthony P. Vitale Build out Rental in Setauket

Grand Opening Sayville Branch Office

September 01, 2013 Christopher Gucciardo Build out by Atlantic Shores

BH&G Grand Opening promotion Kickoff

September 01, 2013 Anthony P. Vitale Begin campaign to introduce LI to BH&G

Recruitment Campaign October 01, 2013 Anthony P. Vitale Begin campaign to encourage recruitment from the Real Estate Community

Recruit 10 Full time agents to Huntington

December 31, 2013 Anthony P. Vitale

Recruit 7 Full Time Agents to Setauket Office


Recruit 7 Full Time Agents to Sayville Office




Financial PlanSales ForecastSales Forecast

FY2014 FY2015 FY2016

Unit Sales

Existing Home Sales Huntington Office 61 88 95

Existing Home Sales Setauket Office 40 55 75

Existing Home Sales Sayville Branch Office 33 45 65

Price Per Unit

Existing Home Sales Huntington Office $10,840 $10,840 $10,840

Existing Home Sales Setauket Office $9,000 $9,000 $9,000

Existing Home Sales Sayville Branch Office $8,040 $8,040 $8,040

Sales

Existing Home Sales Huntington Office $661,240 $953,920 $1,029,800



Total Sales $1,286,560 $1,810,720 $2,227,400

Direct Cost Per Unit




Direct Cost




Total Direct Cost $771,936 $1,086,432 $1,336,440



Gross Margin $514,624 $724,288 $890,960

Gross Margin % 40% 40% 40%

Sales by Month

About the Sales Forecast

The financials are taken from data provided by BH&G's website , the average price of a home in the Huntington area $542,000.00 assuming a 2% office commission with a 40% retention dollar.

The average sales price of a home in Setauket in the first quarter of 2013 $450,000.00

The average sales price of a home in Sayville in the first quarter of 2013 $402,000.00



Personnel PlanPersonnel Table

FY2014 FY2015 FY2016

Senior Vice President $63,500 $63,500 $63,500

Office Administrator -Huntington $20,160 $26,880 $26,880

Office Administrator-Sayville $17,920 $26,880 $26,880

Office Administrator-Setauket $17,920 $26,880 $26,880

Total $119,500 $144,140 $144,140

About the Personnel Plan

As our systems grow we will add a full time Director of Relo Services, full time bookeeper and a full time Recruiter, these responsibilities will be handled by the Family team.

BudgetBudget Table

FY2014 FY2015 FY2016

Operating Expenses

Salary $119,500 $144,140 $144,140

Employee Related Expenses $23,900 $28,828 $28,828

Rent on Setauket $16,000 $24,000 $24,000

Advertising, Marketing & Promotion $11,500 $6,000 $4,000

Utilities-Huntington-Sayville-Setauket $15,300 $20,400 $20,400

Office Supplies- Huntington-Setauket-Sayville $9,000 $12,000 $12,000

E&O Insurance, Health & Content $1,740 $1,740 $1,740

MLS and Broker Fees $1,600 $2,400 $2,400

Rent Paid on Huntington $0 $38,400 $38,400

Rent Paid on Sayville $8,800 $26,400 $26,400

Total Operating Expenses $207,340 $304,308 $302,308



Expenses by Month

About the Budget

Marketing expenses will be higher in the first year to announce the opening of the firm and will drop after that. Most expenses will show small increases each year as the business will remain in the same location over the first three years. Payroll is by far the largest expense the company incurs (besides cost of goods sold). Staff will need to be managed and hours regulated so that hours worked correlate to sales. Emphasis will be placed on minimizing expenses that do not help generate bottom line.

Startup Costs

The start-up costs of BH&G Atlantic Shores will consist primarily of inventory, equipment and fixtures. Atlantic Shores will invest cash, benefits and labor to the start up. Investors will contribute substantially.

There is an amount budgeted for leasehold improvements which is intended to make major modifications to two of the proposed sites and minor to Setauket to prepare it for opening. These improvements include replacing missing ceiling tiles and cleaning, polishing, or redoing the floor tile in Setauket. Renovation to company owned building in Huntington & Sayville. It is anticipated that the new renovations to the company owned buildings will greatly enhance attractiveness and market value



Profit and Loss StatementProfit and Loss Statement

FY2014 FY2015 FY2016

Revenue $1,286,560 $1,810,720 $2,227,400

Direct Cost $771,936 $1,086,432 $1,336,440

Gross Margin $514,624 $724,288 $890,960


Operating Expenses

Salary $119,500 $144,140 $144,140


Rent on Setauket $16,000 $24,000 $24,000









Operating Income $307,284 $419,980 $588,652

Income Taxes $61,457 $83,996 $117,730

Total Expenses $1,040,733 $1,474,736 $1,756,478

Net Profit $245,827 $335,984 $470,922

Net Profit / Sales 19% 19% 21%



Financial Highlights by Year


About the Profit and Loss Statement

The company generates a profit as sales revenue gets above the break-even line. A push on sales will be very important in generating bottom line profits. A strong recruiting campaign should negate any further concern



Office Growth StrategyHuntingtonOur corporate office and Flagship is located on Main Street in the middle of Realtors Row, Huntington. Formerly the office of Prudential Real Estate this office commands over 4300 square feet of prime office space, long known as a Realtors spot. This location has plenty of off the street parking. Upon affiliating with BH&G we hope to take advantage of their design crew to sculpture a BH&G flagship. This opportunity is available due to a close partnership with Atlantic Shores Builders and Developers.

Our effort in the Huntington area to focus on leveraging our Brokers reputation as a major residential and commercial builder combined with the BH&G brand will be an effective tool as a recruiting strategy. Our Manager in training, Jamie Cordts, has been an active agent formerly with Coldwell Banker in the area and has established many connections and friendships. Jerry, our broker, has developed long term relationships as a home builder in the area. Jerry has already been reaching out to some of those agents that have expressed a desire to affiliate. We intend to concentrate on our target agencies, Coldwell Banker, Coach Realtors and the former Prudential , Douglas Elliman. Our SVP, Anthony, having been a former owner and is well respected and fondly thought of among Coach Agents who credit him with the golden period of Coach Realtors.

The unique combination of a reviving Market, Hibernating Competition, Perfect fit Affiliations and timing come together to create a fantastic opportunity to begin.

SayvilleSayville, located on Long Island's South Shore offers a another important opportunity for growth, once again we own a building on Montauk Highway, again a former Prudential Real Estate location known in the community as a real estate office for many years. Another opportunity to sculpture a building to BH&G look and feel. This community has become the new up and coming family community on the south shore, our competition in the area is weak. Our approach will be to rebuild the office, introduce the BH&G brand and slowly build roots in the community. The average price range is lower with resale's average price in the $400k range. Nicely fitting into the BH&G demographic.




SetauketThis is the former market of our SVP , his connections with the community and Stony Brook University are deep. Having operated a successful real estate brokerage for over twenty five years, he is very familiar with all of the Real Estate community. Familiar with hundreds of agents, we feel very confident that his reemergence in that market place will be a highly successful venture. The office space chosen for Setauket is in fact the very office Mr. Vitale used as his headquarters. During his tenure in Setauket Mr. Vitale established strong ties with university department heads by offering a relocation service to all incoming candidates which proved very successful and has not been utilized since he left the area. Mr. Vitale is very excited to reestablish the business he spent many years building.

Along with his real estate career, Mr. Vitale has served on many boards including Stony Brooks Athletic Directors Board. The Setauket Neighborhood House as well as The Setauket Yacht Club.




AppendixSales ForecastSales Forecast Table (With Monthly Detail)

FY2014 May '13 Jun '13 Jul '13 Aug '13 Sep '13 Oct '13 Nov '13 Dec '13 Jan '14 Feb '14 Mar '14 Apr '14

Unit Sales

Existing Home Sales Huntington Office

0 1 4 6 6 6 6 3 3 7 9 10

Existing Home Sales Setauket Office

0 0 0 2 3 5 5 3 3 6 6 7

Existing Home Sales Sayville Branch Office

0 0 0 1 1 2 3 3 4 5 7 7

Price Per Unit


$10,840 $10,840 $10,840 $10,840 $10,840 $10,840 $10,840 $10,840 $10,840 $10,840 $10,840 $10,840


$9,000 $9,000 $9,000 $9,000 $9,000 $9,000 $9,000 $9,000 $9,000 $9,000 $9,000 $9,000


$8,040 $8,040 $8,040 $8,040 $8,040 $8,040 $8,040 $8,040 $8,040 $8,040 $8,040 $8,040

Sales


$0 $10,840 $43,360 $65,040 $65,040 $65,040 $65,040 $32,520 $32,520 $75,880 $97,560 $108,400




$0 $0 $0 $18,000 $27,000 $45,000 $45,000 $27,000 $27,000 $54,000 $54,000 $63,000


$0 $0 $0 $8,040 $8,040 $16,080 $24,120 $24,120 $32,160 $40,200 $56,280 $56,280

Total Sales $0 $10,840 $43,360 $91,080 $100,080 $126,120 $134,160 $83,640 $91,680 $170,080 $207,840 $227,680



$6,504 $6,504 $6,504 $6,504 $6,504 $6,504 $6,504 $6,504 $6,504 $6,504 $6,504 $6,504


$5,400 $5,400 $5,400 $5,400 $5,400 $5,400 $5,400 $5,400 $5,400 $5,400 $5,400 $5,400


$4,824 $4,824 $4,824 $4,824 $4,824 $4,824 $4,824 $4,824 $4,824 $4,824 $4,824 $4,824

Direct Cost


$0 $6,504 $26,016 $39,024 $39,024 $39,024 $39,024 $19,512 $19,512 $45,528 $58,536 $65,040


$0 $0 $0 $10,800 $16,200 $27,000 $27,000 $16,200 $16,200 $32,400 $32,400 $37,800


$0 $0 $0 $4,824 $4,824 $9,648 $14,472 $14,472 $19,296 $24,120 $33,768 $33,768

Total Direct Cost $0 $6,504 $26,016 $54,648 $60,048 $75,672 $80,496 $50,184 $55,008 $102,048 $124,704 $136,608

Gross Margin $0 $4,336 $17,344 $36,432 $40,032 $50,448 $53,664 $33,456 $36,672 $68,032 $83,136 $91,072

Gross Margin % 0% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40%



FY2014 FY2015 FY2016

Unit Sales

Existing Home Sales Huntington Office 61 88 95

Existing Home Sales Setauket Office 40 55 75

Existing Home Sales Sayville Branch Office 33 45 65

Price Per Unit




Sales

Existing Home Sales Huntington Office $661,240 $953,920 $1,029,800



Total Sales $1,286,560 $1,810,720 $2,227,400





Direct Cost




Total Direct Cost $771,936 $1,086,432 $1,336,440

Gross Margin $514,624 $724,288 $890,960




Personnel PlanPersonnel Table (With Monthly Detail)


Senior Vice President $5,291 $5,291 $5,291 $5,291 $5,292 $5,292 $5,292 $5,292 $5,292 $5,292 $5,292 $5,292

Office Administrator -Huntington

$0 $0 $0 $2,240 $2,240 $2,240 $2,240 $2,240 $2,240 $2,240 $2,240 $2,240

Office Administrator-Sayville

$0 $0 $0 $0 $2,240 $2,240 $2,240 $2,240 $2,240 $2,240 $2,240 $2,240

Office Administrator-Setauket

$0 $0 $0 $0 $2,240 $2,240 $2,240 $2,240 $2,240 $2,240 $2,240 $2,240

Total $5,291 $5,291 $5,291 $7,531 $12,012 $12,012 $12,012 $12,012 $12,012 $12,012 $12,012 $12,012

FY2014 FY2015 FY2016

Senior Vice President $63,500 $63,500 $63,500

Office Administrator -Huntington $20,160 $26,880 $26,880

Office Administrator-Sayville $17,920 $26,880 $26,880

Office Administrator-Setauket $17,920 $26,880 $26,880

Total $119,500 $144,140 $144,140



BudgetBudget Table (With Monthly Detail)


Operating Expenses

Salary $5,291 $5,291 $5,291 $7,531 $12,012 $12,012 $12,012 $12,012 $12,012 $12,012 $12,012 $12,012

Employee Related Expenses

$1,058 $1,058 $1,058 $1,506 $2,402 $2,402 $2,402 $2,402 $2,403 $2,403 $2,403 $2,403

Rent on Setauket $0 $0 $0 $0 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000

Advertising, Marketing & Promotion

$0 $1,000 $1,000 $1,000 $1,000 $500 $5,000 $500 $0 $500 $1,000 $0

Utilities-Huntington-Sayville-Setauket

$0 $0 $0 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700

Office Supplies- Huntington-Setauket-Sayville

$0 $0 $0 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000

E&O Insurance, Health & Content

$145 $145 $145 $145 $145 $145 $145 $145 $145 $145 $145 $145

MLS and Broker Fees $0 $0 $0 $0 $200 $200 $200 $200 $200 $200 $200 $200

Rent Paid on Huntington $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Rent Paid on Sayville $0 $0 $0 $0 $0 $0 $0 $0 $2,200 $2,200 $2,200 $2,200

Total Operating Expenses

$6,494 $7,494 $7,494 $12,882 $20,459 $19,959 $24,459 $19,959 $21,660 $22,160 $22,660 $21,660



FY2014 FY2015 FY2016

Operating Expenses

Salary $119,500 $144,140 $144,140


Rent on Setauket $16,000 $24,000 $24,000











Profit and Loss StatementProfit and Loss Statement (With Monthly Detail)


Revenue $0 $10,840 $43,360 $91,080 $100,080 $126,120 $134,160 $83,640 $91,680 $170,080 $207,840 $227,680

Direct Cost $0 $6,504 $26,016 $54,648 $60,048 $75,672 $80,496 $50,184 $55,008 $102,048 $124,704 $136,608

Gross Margin $0 $4,336 $17,344 $36,432 $40,032 $50,448 $53,664 $33,456 $36,672 $68,032 $83,136 $91,072

Gross Margin % 0% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40% 40%

Operating Expenses

Salary $5,291 $5,291 $5,291 $7,531 $12,012 $12,012 $12,012 $12,012 $12,012 $12,012 $12,012 $12,012

Employee Related Expenses

$1,058 $1,058 $1,058 $1,506 $2,402 $2,402 $2,402 $2,402 $2,403 $2,403 $2,403 $2,403

Rent on Setauket $0 $0 $0 $0 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000

Advertising, Marketing & Promotion

$0 $1,000 $1,000 $1,000 $1,000 $500 $5,000 $500 $0 $500 $1,000 $0

Utilities-Huntington-Sayville-Setauket

$0 $0 $0 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700

Office Supplies- Huntington-Setauket-Sayville

$0 $0 $0 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000

E&O Insurance, Health & Content

$145 $145 $145 $145 $145 $145 $145 $145 $145 $145 $145 $145

MLS and Broker Fees $0 $0 $0 $0 $200 $200 $200 $200 $200 $200 $200 $200

Rent Paid on Huntington $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0



Rent Paid on Sayville $0 $0 $0 $0 $0 $0 $0 $0 $2,200 $2,200 $2,200 $2,200

Total Operating Expenses

$6,494 $7,494 $7,494 $12,882 $20,459 $19,959 $24,459 $19,959 $21,660 $22,160 $22,660 $21,660

Operating Income ($6,494) ($3,158) $9,850 $23,550 $19,573 $30,489 $29,205 $13,497 $15,012 $45,872 $60,476 $69,412

Income Taxes $0 $0 $40 $4,710 $3,915 $6,097 $5,841 $2,699 $3,002 $9,175 $12,095 $13,883

Total Expenses $6,494 $13,998 $33,550 $72,240 $84,422 $101,728 $110,796 $72,842 $79,670 $133,383 $159,459 $172,151

Net Profit ($6,494) ($3,158) $9,810 $18,840 $15,658 $24,392 $23,364 $10,798 $12,010 $36,697 $48,381 $55,529

Net Profit / Sales 0% (29%) 23% 21% 16% 19% 17% 13% 13% 22% 23% 24%



FY2014 FY2015 FY2016

Revenue $1,286,560 $1,810,720 $2,227,400

Direct Cost $771,936 $1,086,432 $1,336,440

Gross Margin $514,624 $724,288 $890,960


Operating Expenses

Salary $119,500 $144,140 $144,140


Rent on Setauket $16,000 $24,000 $24,000









Operating Income $307,284 $419,980 $588,652

Income Taxes $61,457 $83,996 $117,730

Total Expenses $1,040,733 $1,474,736 $1,756,478

Net Profit $245,827 $335,984 $470,922

Net Profit / Sales 19% 19% 21%

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