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Mechanical Engineering Business Plan [Sample Template]

Are you about starting a mechanical engineering firm? If YES, here is a complete sample mechanical engineering business plan template & feasibility report you can use for FREE.

Starting a mechanical engineering business is different from your average business, as expertise in this industry is required especially if you intend to be able to meet some of the expectations of your clients. The mechanical engineering industry is one with several niches such as kinematics, mechanics; robotics; drafting and structural analysis and most firms usually offer to stick to one or two niches rather than attempt to offer all the services.

Starting this business can be a bit difficult as you will also need to employ or partner with a host of mechanical engineering professionals, and also employ other proficient staff to help you run your firm and achieve your intended corporate goals and objectives.

Another thing that would be required is a business plan. While writing a business plan might look complex, it is for this reason that a sample mechanical engineering firm business plan has been prepared below for you;

A Sample Mechanical Engineering Firm Business Plan Template

1. Industry Overview

The engineering industry isn’t doing so well as demand fell due to the fall of oil prices in 2015. This action caused the industry to not only slow down but to cancel on major projects in the case of the crunch. Asides cancellation of projects, most firms in the industry also reduced its capital spending which led to a stall in the industry.

The oil price was not responsible alone for the fall of the industry as economic activities in other countries such as China which had seen a decline also contributed to the global downturn.  China has been a chief player globally as regards economic activity and infrastructure projects for at least the past ten years.

According to analysts, 2016 will still not be a good year for the engineering industry as revenues will continue to fall especially as global economy is virtually still unstable. This action will lead to a stagnation process for the industry that was previously recovering from the previous collapse it experienced in the 2008 and 2009 financial crisis.

According to a study by Commerzbank, the mechanical engineering industry in Germany was on the positive outlook as there was a slight increase of about 3% in demand for the country’s products by other nations in Europe. This means that the mechanical engineering sector in the engineering industry is growing when compared to other sectors in the industry.

China has seen stiff competition in its mechanical engineering industry from other Asian countries as more providers are also entering the market in order to showcase what they are able to offer.

According to the united states Bureau of Labor Statistics, employment of mechanical engineers will grow by 5% between the periods of 2014 to 2024. This percentage is averagely what other occupations in other industries are expected to pull.

It is however not all gloom in the industry as the sector saw a slight increase in the year 2015 and has been projected to grow another 6% in the year 2016. According to analysts, a global growth and economic stability will see an annual growth in the industry to more than 100% what it is currently is.

2. Executive Summary

Motown Mechanical Engineering Firm is a standard mechanical engineering firm that will be based in Detroit – Michigan, USA and will cover all our corporate and individual clients. We are in the mechanical engineering sector to offer production of products as well as consultancy and advisory services to our various clients.

Our vision as a company is to ensure that we get at least three major clients by the end of our second year in business and that we meet the expectations of our customers so as to ensure that they stick with our firm and also refer us to others. To achieve this, we will build excellent relationships with our clients and also build the best business structure.

Our location in Detroit – Michigan is very strategic as it is one of the mechanical engineering hubs in the country, which means that we are near to the kind of strategic clients that will give our business the boosts we need. We are also in a very conspicuous location that makes it very easy for our customers and even employees to access us.

The machineries we use in our mechanical engineering firm are those that are designed to give us optimum satisfaction by lasting for a long time and causing us to spend less on buying new machines and equipment as replacements. This means that our customers have no need to fear that their demands will not be met on time due to poor machineries.

We have the best management team as they are not only the best we could source for in relation to the size and scale of our firm but they are also determined individuals that understand our core values and are willing and committed to ensure that we attain our desired goals and objectives.

We have built the best business structure for our firm as we sourced for and recruited the best hands to help us achieve our vision. Our workers understand that we are in business to make a profit and that the closer we are to achieving our goals, the better it gets for all those involved and so they are willing to remained dedicated to our true goals.

Our facility is one that is conducive for our employees because we understand that a conducive environment breeds productivity and efficiency in the workplace. We also run a standard facility and our work ethics are of the highest standard and as transparent as possible.

Finally, our Chief Executive Officer Mr. Don Perrine is a talented entrepreneur and businessman who have the finesse and expertise required to ensure that our mechanical engineering firm attain its intended goals and objectives. He has a B.Sc. Degree in Mechanical Engineering from the University of Oxford as well as a Masters Degree in Business Administration. He is also a certified project manager and has many projects under his belt

3. Our Products and Services

Motown Mechanical engineering Firm is established with the intention of dealing in all sorts of services to its various clients not only here in Detroit – Michigan but all over the United States of America as well. In our bid to ensure that we build a bottom line that will sustain our business and allow us grow, we intend to offer several services in addition to our core service in order to create multiple sources of income.

We intend to make our profit legally and under the permissible laws of the United States of America. Therefore some of the services we intend to offer to our clients are;

  • Mechanical designs
  • Structural analysis
  • Robotics
  • Other services such as assistance on code compliance, litigation support, safety inspections, and operational procedures
  • Trainings
  • Consultancy and advisory services

4. Our Mission and Vision Statement

  • Our vision is to ensure that we get at least three major clients by the end of our second year in business and also to ensure that we meet the expectations of our customers so as to ensure that they stick with our firm and also refer us to others.
  • To achieve our vision, we will ensure that we build effective long-term relationships with our clients and also offer excellent and efficient services that will be delivered in a timely and cost-effective manner.

Our Business Structure

Having a solid business structure is very important to us and so we have set forth processes and structures that would ensure that we start off on a solid foundation and run with as less hitches as possible. This is why we are willing to go the extra mile to ensure that we get the right hands to work with us in all the available positions in our mechanical engineering firm here in Detroit – Michigan.

We are going all out to ensure that we build a professional team that are not only committed but understand our vision and where we are going to and are willing to ensure that we attain our corporate goals and objectives. Our management staffs for instance are some of the best professionals in the whole industry and have the expertise on how to ensure that we become a reckoning force nationally.

Due to the fact that we intend to offer more services than we ordinarily should, we would be employing more hands to handle the new tasks that would arise from our more services here at Motown Mechanical Engineering Firm Inc. Below is the business structure that we will build at Motown Mechanical Engineering Firm;

  • Chief Executive Officer
  • General Manager
  • Chief Financial Officer
  • Plant Manager
  • Human Resources and Admin Manager
  • Marketing Executives
  • Customer Service Executives
  • Business Development Officer
  • Driver
  • Security Guard
  • Cleaner

5. Job Roles and Responsibilities

Chief Executive Officer

  • Drafts policies and strategies that will set the path for the organization’s future
  • Meets with high level clients on behalf of the organization
  • Reviews policies and modifies ineffective policies whilst ensuring that effective policies are duly implemented

General Manager

  • Coordinate all the departments and ensures that management staff duly understands the policies of the organization
  • Takes certain important decisions on behalf the chief executive officer
  • Meets with high level clients on behalf of the organization

Chief Financial Officer

  • Handles all financial transactions and ensures that all transactions are in accordance to financial rules
  • Monitors the revenue of the organization in order to ensure that the loan collected is fully repaid
  • Prepares tax documents accurately and ensures that they are submitted to the tax authorities as at when due

Plant Manager

  • In charge of all machineries and employees working in the plant
  • Ensures that machineries in plant are functioning fine
  • Carries out light maintenance and repairs when necessary on behalf of management

Human Resources and Admin Manager

  • Conducts recruitment and carries out orientation of new employees on behalf of the organization
  • In charge of employee welfare and incentive packages
  • Carries out regular performance appraisals in order to rev up the productivity of the employees for the benefit of the firm

Marketing Executives

  • Conducts market research in order to determine new markets for the firm
  • Drafts effective marketing objectives to be used to attract clients for the firm
  • Meets physically with clients on behalf of the firm

Customer Service Executives

  • Answers enquiries from clients with the aim of giving back accurate information about the company
  • Ensures that they are updated not only on company policies but also on industry trends
  • Keeps an updated and accurate database of clients on behalf of the firm

Business Development Officer

  • Looks into developing new businesses in order to generate new streams of income for the firm
  • Works with the marketing executives in order to understand the target market
  • Carries out any other duties that might crop up


  • Drives supplies and materials to and from the firm
  • Ensures that materials gotten are accurate and in line with documentation
  • Carries out light maintenance and repairs on the vehicle when necessary

Security Guard

  • Ensures that the premises and properties is always secured at all times
  • Monitors all activities both incoming and outgoing on behalf of the organization
  • Provides beneficial security tips on behalf of the organization


  • Ensures that the premises is kept clean at all times
  • Ensures that cleaning supplies are always in stock
  • Carries out all duties as might be determined by the human resources

6. SWOT Analysis

Due to our desire for excellence, we know how important it is for us to start and run a standard mechanical engineering firm and so we have had to engage one of the finest business consultant here in Michigan who has a deep knowledge of the business we intend going into as well as the environment from where we intend to operate from.

After looking through our business concept, the business consultant used an analysis that would allow him know how we were likely to fare in the mechanical engineering industry.

In carrying out an evaluation as we asked for, the business consultant was able to use our strengths, weaknesses, opportunities and threats to determine what we are likely to be exposed to here in Detroit – Michigan, here in the United States of America. Below is the result of the SWOT analysis that was conducted on behalf of Motown Mechanical Engineering Firm;

  • Strengths

There are several strengths available to us as a new start-up and it starts from the services that we are offering our various customers. We fully intend to employ highly competent and professional employees who not only understand what our firm stands for but also what trends in the industry and how our firm could benefit from it.

We have a team that would b able to meet up with demands of our clients as our motto is to be able to deliver our projects in a timely manner to all our clients. We know how valuable our clients are and so we intend to ensure that we go all out to make them keep coming back to patronize us and also refer others to us as well.

Finally, our management staff and our chief executive officer have the necessary experience and qualifications that would ensure that we are able to achieve our corporate goals and objectives.

  • Weaknesses

The mechanical engineering industry is a complex one and so as a start-up we would not be able to fully compete with already established mechanical engineering firms because we are limited in finances and employees. We intend to work seriously though and change our weaknesses to our strengths as soon as we can.

  • Opportunities

Several opportunities are available to us in this industry and we are set to ensure that we fully tap into the opportunities available. We intend adding the robotics niche because we know that the future lies in robotics, which is another opportunity for us.

  • Threats

Every business faces threats at every point in time and our business is no different. We would likely be facing threats from the economy especially if it experiences a downturn which would mean that there would be fewer clients for the firm.

Also, if there is an arrival of a competitor offering same services in our same location, it will definitely affect our overall revenue. Facing threats aren’t new, but we have strategies in place to handle any threat that are likely to occur.


  • Market Trends

Even though mechanical engineering firms can service a broad client base by offering several services, most mechanical engineering firms choose instead to specialize in a niche, whilst forming strategic partnerships with other mechanical engineering firms offering other services in order to be able to fully deliver to their customers.

Whilst this might seem counterproductive, a niche market offering is actually wise especially for a start-up who might not have all the necessary resources in which to offer a full scale of activities to its customers. Recruiting the right employees for a mechanical engineering firm can be very difficult because of the need to recruit an array of engineering professionals amongst other kinds of workers.

Most clients will only patronize the services of a mechanical engineering firm, if they know that the staffs in the firm have the necessary experience and expertise. This does not however mean that you cannot start your mechanical engineering firm with some core staff whilst partnering with another firm for staffs you might need whenever a job comes up.

Most mechanical engineering firms usually end up expanding their business models in order to offer support services such as safety inspections, litigation support, operational procedures as well as assistance with code compliance. This is often to create multiple sources of income for the firm in order to sustain and grow the company.

8. Our Target Market

Even though mechanical engineering firms offer services to a wide array of clients, restriction of the target market to just a set of clients for our firm cannot be done, which is why we have conducted a market research on the market we intend entering.

The reason for the market research is so that w would have an idea on what the clients expect from us, which would allow us know how best we can offer our services. We therefore are in business to offer our services to the following group of people;

  • Government agencies
  • Corporate organizations
  • Other engineering firms
  • Construction companies
  • Aviation industry
  • Transportation and auto industries
  • Other mechanical engineering firms
  • And other related industries

Our competitive advantage

We are a business established because of our passion for the engineering industry and the desire to bring forth standard practices through our ethical practices. We are also a firm that intends to make profit via our services and also be able to compete favorably against our competitors in the same industry globally and nationally.

To achieve all that we intend, we have laid down competitive strategies that we intend to deploy as a means of standing out in the industry.

Our intention is to be amongst the top three mechanical engineering firms not only here in Detroit – Michigan but also all around the United States of America. We will ensure that we deploy effective promotional strategies to entrench our brand in the mind of our customers.

We have the best technologies and also use the best machineries which mean that clients who place orders always get it done within time with as few hitches as possible. All our machineries and equipment all undergo intense inspection before and after use to be able to forestall any problems that might likely crop up.

We have highly trained and competent staff in our employ as we understand that having experienced and competent staff gives us an edge over our competitors because not only do they understand what our company stands for, they know how best to help us achieve our goals.

We also offer our employees a great welfare package, better than what they are most likely to get if they were working for our competitors. We also ensure that our employees get periodical trainings that will enhance not only their skills but also increase the productivity and efficiency rate for our firm.

Finally, we understand how valuable customers are to any business and so we treat all our clients with the utmost respect that they deserve. All complaints are promptly treated and all feedbacks duly appreciated. We also reward customers who are loyal to us as well as those who refer us to others.


  • Sources of Income

Motown Mechanical Engineering Firm is a reputable firm that is based in Detroit – Michigan and intends to offer certain services to its intended customers from in and around its intended location.

Asides our core service, we will be adding other services as well in order to boost our bottom line and help sustain and grow our company. Therefore the several ways by which we intend to generate income for our mechanical engineering firm include;

  • Mechanical designs
  • Structural analysis
  • Robotics
  • Other services such as assistance on code compliance, litigation support, safety inspections, and operational procedures
  • Trainings
  • Consultancy and advisory services

10. Sales Forecast

Mechanical engineering firms are ones that are very vital to the economy and as such cannot be done without. Our strategic location in Detroit – Michigan is one that has us optimistic of not only generating and reaching our revenue goals but also allow us grow and expand our business in as little time as possible.

Our arrival at the sales forecast for a three year period was borne from the fact that we conducted a critical analysis of the industry and how we intended to achieve our set goals based on certain data and assumptions from the similar start-ups such as ours especially those who were located in the same location with us.

Below therefore are the sales projections that we arrived at for Motown Mechanical Engineering Firm using several assumptions;

  • First Fiscal Year-: $2,000,000
  • Second Fiscal Year-: $4,000,000
  • Third Fiscal Year-: $8,000,000

N.B: It should be noted that the above sales projections were carried out based on the fact that certain assumptions would not change, such as there would not be a downturn in the economy or the arrival of any major competitor. Should any of these assumptions change, it would have an impact on the sales projection, which might increase or decrease depending on the positivity or otherwise of the assumptions stated.

  • Marketing Strategy and Sales Strategy

Marketing is a very essential part of any business because not only does it generate awareness about the brand but it also serves to generate income for the brand. Not carefully drafting and deploying effective marketing strategies has seen to the collapse of businesses.

Since this is basically the major way to generate revenue for our firm, we have conducted a marketing research in order to identify our best to attract our target market.

We know how importance technology has come to be in the marketing process and we fully intend to use this to our advantage in our marketing strategies by creating apps and also using the internet to ensure that we create awareness for our mechanical engineering firms.

We have hired a marketing consultant who is well versed in the industry and who understands the environment we will be operating in to help us draft effective marketing strategies that will allow us be able to compete favorably against our competitors.

We would also be empowering our marketing staff in order to modify or remove ineffective marketing strategies and decide what is best for our firm overall based on our corporate core values and philosophies, whilst also positively communicating our brand to our potential and existing clients.

Therefore, the marketing and sales strategies we intend to adopt for Motown Mechanical Engineering Firm are;

  • Ensure that we formally introduce our mechanical engineering firm to our potential and existing clients as well as industry stakeholders
  • Throw a grand opening party to launch our mechanical engineering firm in a way to boost awareness for our firm
  • Engage in direct marketing
  • Place advert for our mechanical engineering firm in local newspapers, and on radio and television stations
  • Ensure that we use social media platforms such as LinkedIn, Google Plus, Facebook, and Twitter to advertise our business
  • Ensure that we are listed in local (yellow pages) and online directories

11. Publicity and Advertising Strategy

No matter how large scale our business might be, having the right publicity is very vital to the business as it would ensure that not only is our brand positively communicated to all our clients but that we are able to effectively compete against our competitors in the marketplace.

We have for this purpose hired a brand consultant who has knowledge about our kind of business and the environment we intend to start off in to help draft effective publicity and advertising strategies that would help create a positive awareness in the eyes of our clients not only here in Michigan but all over the United States of America.

The platforms that we intend to use in promoting and advertising Motown Mechanical Engineering Firm here in Detroit – Michigan are;

  • Sponsoring projects in the local community in which we are based
  • Use corporate social media platforms like LinkedIn, Google Plus, Facebook and Twitter to generate the right awareness for our mechanical engineering firm
  • Placing of adverts in local newspapers as well as on radio and television stations
  • Install our bill boards in strategic locations all around Detroit – Michigan in order to raise awareness locally about our services
  • Distribute our handbills and fliers in target locations
  • Promote our activities vi our official website as well as on other related blogs and websites

12. Our Pricing Strategy

Setting the right rates for our services will depend on a whole lot of factors such as what our overhead costs and operational costs are, what our competitors are offering and what is fair to our customers while allowing us make a profit as we should.

Setting the right rates for our services will mean we employing the right strategy that will allow us get the detailed rates that we will eventually come to charge our customers. In view of this, we intend to charge rates much lower than what is ordinarily obtainable in the industry for at least three months.

The idea behind this is that we will be able to attract the customers we would need for our business, which would allow them see what we have to offer. We however will not offer ridiculous prices in such a way as to cause a price war between us and our competitors.

Having looked critically at the rates we will be offering during this period, we would however like to point out that even though we would be running on a low profit margin for this period, we would not be incurring any loss whatsoever for our firm.

  • Payment Options

Due to the diverse offerings that we intend to offer at Motown Mechanical Engineering Firm, it will allow us to have attract different customers to our firm who will have diverse preferences for how they which to pay for the services we would be offering.

This has enabled us to come up with different payment options. The payment options that we therefore intend to offer all our various customers are;

  • Payment via check
  • Payment via bank draft
  • Payment via online payment portal

The above payment options which we came up with were carefully chosen by us after considering what will be good for our clients and for us eventually. The platforms will be without any hitches whatsoever.

13. Startup Expenditure (Budget)

Mechanical engineering firms are complex businesses because it not only require professionals but also need strategic partnerships with other firms, which is why in generating capital for the firm, there are a lot of things that need to be put under consideration.

Therefore, after generating our capital, it should be noted that the bulk of the capital will definitely go into procuring equipment, paying employee salary and leasing a facility. Therefore, the key areas where we intend to spend our start-up capital on are;

  • Total fee for registering the business in the United States of America – $750
  • Obtaining of licenses, permits and accounting and customer management software – $5,250
  • Cost of hiring several reputable business consultants and payment for a business plan – $20,000
  • Insurance coverage (general liability, asset insurance, equipment insurance and workers’ compensation) – $5,000
  • Cost of purchasing several equipment and machinery – $500,000
  • Operational cost for the first 6 months (payments of employee salaries and utility payments) – $300,000
  • Cost of leasing a facility for use at six years and carrying out renovations – $300,000
  • Marketing promotion expenses (grand opening party promotion and general marketing) – $20,000
  • Other start-up expenses (furniture, stationeries, computers, printers, and phones) – $9,000
  • Cost of purchasing one transport truck – $55,000
  • Cost of launching a website – $1,000
  • Cost of throwing a launching party – $5,000
  • Miscellaneous – $10,000

From the above analysis, we would need the sum of $1,231,000 if we intend to not only start but successfully run our mechanical engineering firm here in Detroit – Michigan.

Even though the amount is quite average, it should be noted that the bulk of the capital will go into buying heavy machineries and equipment for use; leasing and renovating a facility and furnishing it, purchasing a truck as well as payment of employee salaries utility bills.

Generating Funding / Startup Capital for Motown Mechanical Engineering Firm

Motown Mechanical Engineering Firm is owned by a foremost mechanical engineer and businessman, Mr. Don Perrine, who has over 20 years experience in the engineering industry as well as in the business sector. Don intends to source for funds from various sources in order to be able to generate the needed capital for his business.

Some of the sources where he intends to generate the required funds for his business are;

  • 30% of the total capital from sale of personal stock
  • 70% of the total capital from the commercial bank

N/B: From the sale of his personal stock, he was able to generate the sum of $369,300. The bank which Mr. Don Perrine has approached has agreed to lend him the sum of $861,700 after looking through his business plan. The bank loan will be repaid after 7 years with a 2.5% interest rate.

All the loan documents have been signed and approved, and the money would soon be credited to the company account before the end of the work week.

14. Sustainability and Expansion Strategy

Sustaining a business in order to grow and expand it is very vital and as such we have carried out measures to ensure that our mechanical engineering firm is effectively sustained. The measures we intend to deploy in implementing our sustainability are business structure, customer loyalty and re-investment strategy.

Building a solid business structure is very important to us because we would like to do away with any hitches whatsoever in the bid to offer our services to our clients, and to this effect, we are sourcing for and hiring professional and competent employees.

Our employees are not only professionals; they also understand our corporate values and objectives and are willing to work to ensure that we are able to achieve them. We would be offering our employees the best welfare packages better than what similar mechanical engineering firms are offering their own employees.

Also, we would ensure that we conduct periodical trainings for our employees in order to not only enhance their skills but also to ensure that that productivity rate for our firm is increased.

Having loyal customers is very important to our business knowing our customers can make or mar a business, and so we would ensure that we treat our customers very well and give them the attention that they deserve. All our staffs understand this and have been trained to ensure that all our customers are satisfied with our every service.

Finally, we intend to re-invest 30% of our profit back into the business as we know that this will help us have a strong bottom line that will be highly beneficial to our business and allow us suitably expand our services which will in turn bring in more earnings.

Check List / Milestone

  • Business Name Availability Check: Completed
  • Business Registration: Completed
  • Opening of Corporate Bank Accounts: Completed
  • Securing Point of Sales (POS) Machines: Completed
  • Opening Mobile Money Accounts: Completed
  • Opening Online Payment Platforms: Completed
  • Application and Obtaining Tax Payer’s ID: In Progress
  • Application for business license and permit: Completed
  • Purchase of Insurance for the Business: Completed
  • Conducting feasibility studies: Completed
  • Generating capital from family members: Completed
  • Applications for Loan from the bank: In Progress
  • Writing of Business Plan: Completed
  • Drafting of Employee’s Handbook: Completed
  • Drafting of Contract Documents and other relevant Legal Documents: In Progress
  • Design of The Company’s Logo: Completed
  • Graphic Designs and Printing of Packaging Marketing / Promotional Materials: In Progress
  • Recruitment of employees: In Progress
  • Creating Official Website for the Company: In Progress
  • Creating Awareness for the business both online and around the community: In Progress
  • Health and Safety and Fire Safety Arrangement (License): Secured
  • Opening party / launching party planning: In Progress
  • Establishing business relationship with vendors – wholesale suppliers / merchants: In Progress
  • Purchase of trucks: Completed