I am struggling trying to figure out how much revenue they expect to receive from a project and how the money works out. Let me warn you I worked up these numbers over breakfast on a iPad. I'm sure we have people in this group that have much more experience than I do. I would be curious as to your thoughts. Let's say we have a customer that we are paying 5k a month on electricity. We save them 20 percent. Sounds easy but have not researched it. $1000 We give them the 5 percent savings for 5 years. $250 month.
Cost of equipment and install is $30k I think this number is very reserved.. Cost CHRO for travel engineering etc to look at project. $5000.
So day one after install we have 35k invested. 30k is a 3rd party loan at 10 percent loan (fair)? Money is cheap right now but it still comes at a cost. 5k is Chro money. We have $750 difference to cover the loan and 5 k Chro spent. Loan interest a month $250 We clear average of $500 a month on one 5 year project.
Projects per year complete 52? One a week fair. Year one profit $312,000. This might cover a lawyer and back office support for the projects year 1. Year 2-5 look much better but we are currently burn a million a year.
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