Looking for a document storage business plan? You're in the right place.
A records storage business is paid slowly and spends early. A lender or investor will ask how many boxes you need in storage to cover the rent, how many pallet positions the warehouse can hold, how long the cash lasts while the base builds and when the first profit arrives, and what happens if your biggest customer leaves. A generic template has no answers to those questions.
In this article we'll walk through a complete sample business plan for a records storage and scanning company in Indianapolis, Indiana. We'll cover the executive summary, the SWOT analysis and, above all, the financials, down to the pallet positions behind every box.
Here's what the plan gives you to work from:
- The executive summary: see how to state the funding ask, the opening position and the first three years on a single page
- The market and competition tables: learn how to place a small records center against national operators, self-storage and cloud services without overstating the gap
- The capacity table: check that the racks can hold the boxes your revenue needs in every year, and see when each new phase of racking has to open
- The start-up budget and funding: find out how much cash a warehouse business needs before the boxes arrive, and how asset finance, a leased van and a standby credit line keep the equity ask smaller
- The first year, month by month: spot the months that lose money before you reach them, and plan the reserve around them
- The five-year profit, cash flow and balance sheet: understand how storage, handling and scanning revenue each carry fixed costs
- The downside cases: have an answer ready for "what if revenue is 20% short?" and "what if an anchor customer leaves?", with the steps the owner takes in response
If you're setting up a records center, read this before you write your own. The business is fictional, so take what fits your market and change the rest.
In this plan
If you need a document storage business plan template for your own plan, start it in the Toolkit.
Executive Summary
Shaw's Records Management is an Indiana records-management company that opens a leased warehouse in Indianapolis on 1 January 2027: 12,000 square feet at the start, with 4,000 more next door from month 19. It earns from three things: a monthly fee for each carton in storage, per-transaction fees to receive, retrieve and deliver boxes, and project fees to scan paper records into searchable files. Founder Dana Shaw holds 51% of the company and a local commercial property owner holds 49%.
Opening costs are covered by $785,000 of funding in all, $631,100 of it at launch: $235,000 from Dana's savings, $224,600 from the co-investor and $171,500 of racking and equipment finance. Racking, fit-out, fire protection, a scanner and systems take $305,500, legal work, licensing and the launch campaign take $31,000, a $25,000 fit-out for the extra space comes in month 19, and $269,600 stays in the bank as a reserve. The delivery van is leased. The other $153,900 is racking and scanner finance drawn as each purchase is made. There is no second equity round, and a $250,000 working-capital line stays undrawn in the base case. Equity is $459,600 of the total.
| Year 1 | Year 2 | Year 3 | |
|---|---|---|---|
| Revenue | $434,525 | $709,174 | $960,216 |
| Net income after start-up costs | ($134,619) | ($107,086) | $52,793 |
| Closing cash | $176,571 | $49,933 | $104,272 |
Storage revenue builds and then keeps. The company opens with 24,000 boxes from six anchor accounts, which move in over January to March, and adds about 1,700 net boxes a month after that, reaching 39,300 boxes by December 2027 and 100,000 by the end of Year 5. At 39,300 boxes the storage fee earns about $307,000 a year, still short of the rent and payroll in the first two years. Monthly EBITDA turns positive in September 2027, Year 3 is the first year with a net profit, and Years 4 and 5 stay profitable: net income is $166,643 in Year 4, and Year 5 reaches $1,302,621 of revenue and $176,903 of net income.
Two tests probe the plan. In the first, revenue runs 20% below forecast; Dana delays hiring, cuts marketing and her own pay, pushes back racking, the extra space and the second scanner, and draws the working-capital line. Cash stays positive in every year, with a low of $16,895. In the second, the largest anchor account (6,500 boxes) leaves after twelve months and nothing else changes; year-end cash dips to ($13,269) at the end of Year 3, about $13,000 short, and the line would cover it.
Three things set the company apart. The owner answers customers' calls, every handling charge is on a rate card, and the company can scan the records it stores, so a customer can move from paper to files without the boxes travelling twice.
The Company and Its Warehouse
Legal name: Shaw's Records Management, LLC, an Indiana limited liability company. Owners: Dana Shaw, 51%, and a co-investor, 49%. The co-investor has no operating role. Premises: 12,000 square feet of leased warehouse and office space in Indianapolis, extended by 4,000 square feet next door in month 19 under an option in the same lease. Start date: 1 January 2027, when the first anchor boxes transfer in; all 24,000 are in by the end of March. Stage: pre-launch. The lease, the racking order and the storage agreements with six anchor accounts are signed.
What the company is for
Keep a business's inactive records safe, indexed and back on the owner's desk within a working day.
Targets by year
- 39,300 boxes in storage by December 2027, with all 24,000 anchor boxes in by March.
- 59,500 boxes by December 2028, with the racks no more than 77% full in the month before each phase opens.
- Monthly EBITDA above zero from September 2027, and a net profit in 2029, the third year.
- 100,000 boxes and about $1.3 million of revenue in Year 5, with the racks about 91% full.
Three revenue lines
| Service | How it is priced | Year 1 share of revenue |
|---|---|---|
| Box storage | $0.65 per standard carton per month | 51% |
| Intake, retrieval, delivery and destruction handling | $2.50 to receive a carton, $4.75 to pull and $2.75 to refile a box, $16 per delivery stop | 32% |
| Scanning and digitization projects | $0.15 a page, quoted per project | 16% |
Questions a lender will ask
- Anchor agreements. Six storage agreements run for 36 months at $0.65 per box per month, with a price review after month 12. They hold 6,500, 5,000, 4,500, 3,500, 2,500 and 2,000 boxes, which is 61% of the Year 1 year-end total, and the largest alone is 17%. The plan has none ending early. The test in the financial section removes the largest at month 13.
- Lease in two steps. One seven-year lease covers 16,000 square feet. The company takes 12,000 square feet at the start, with the first four months of rent free, and the adjoining 4,000 square feet from month 19, so it pays for space only as the racks fill it.
- Landlord. The landlord is an unrelated institutional owner and the lease is on arm's-length terms. The co-investor owns other commercial property but not this building.
- Fire protection. The lease is conditional on written sign-off from a fire-protection engineer and the landlord's insurer for racked paper, before any racking is ordered. The lease allows the company to withdraw if sign-off is refused.
- Debt and covenants. The debt is asset finance on the racking and equipment, plus a $250,000 working-capital line that the base case never draws. The asset finance carries no cash-flow covenant in this plan, because debt service cover is below 1.0x in Years 1 and 2. The lender relies on the equipment and Dana's guarantee.
- Why borrow at all. Asset finance cuts the equity required by $325,400 over five years, at a cost of $15,000 to $22,000 of interest a year. Without it the same plan needs $785,000 of equity.
- Former employer. Dana left a regional records company in 2025, a year before opening. Her contract had a 12-month non-solicitation clause, which ended before her first approach to any customer, and her counsel has reviewed it. None of the six anchors was an account she managed.
Who owns the records, and who answers for them
The company operates as a bailee for customers' records and does not give legal advice on how long records must be kept. Retention periods come from statute, regulation and each customer's own policy, and the company sets destruction dates only on the customer's written instruction. HHS guidance treats a vendor that maintains protected health information for a healthcare provider as a business associate, which requires a written contract, so healthcare customers are expected to ask for one and the company drafts its procedures to meet it. Paper destruction is carried out by a certified partner, not in the warehouse.
The Records Storage Market
The standard carton
The unit of sale is the standard records carton. Iron Mountain lists it at 15 x 12 x 10 inches internally and 1.2 billable cubic feet. The company uses the same carton, so a customer moving from another provider does not need to repack.
Why boxes leave the office
A law firm, a medical practice, a school district office or a contractor accumulates boxes of records that it must keep and rarely opens. Keeping them in the office costs floor space at office rents. Outsourcing moves them to a warehouse where the cost per box is lower, and where a barcode and an index replace a search through a back room.
Records that must be kept for years are what make the revenue sticky. A box that stays seven years at the Year 3 rate of $0.67 a month earns about $56 in storage fees, before any retrieval or delivery, and the plan has only 5% of opening boxes leaving each year.
What a warehouse costs in Indianapolis
CBRE put the average direct asking rent for Indianapolis industrial space at $6.43 a square foot triple-net a year in the second quarter of 2026, with vacancy at 5.9%. The same report shows a higher average, $10.15, for buildings under 50,000 square feet, and $6.23 for distribution and logistics buildings. Rent is the largest non-payroll cost in this plan, so the lease is the decision that matters most. The plan sets rent at $9.75 triple-net plus $1.75 of charges, $11.50 in all, which is older bulk space priced a little below the small-building average.
Warehouse and driver wages
The Bureau of Labor Statistics reports a median of $38,220 a year for hand laborers and material movers and $43,950 for delivery truck drivers and driver/sales workers, both for May 2025. The company's technicians are paid $39,000 to $45,000, so they sit at or above those medians.
Who else holds the boxes
| Alternative | What it offers | Why a customer picks it | How Shaw's differs by design |
|---|---|---|---|
| National records-management companies | Storage, shredding and scanning at many sites | Brand, scale and one contract across several locations | Owner-run, one site, flexible on small and irregular orders |
| Other independent records centers | Storage and retrieval, often with shredding | Established relationships and an existing building | Scanning in the same building and a barcoded index from day one |
| Self-storage units | Space, with no index or retrieval service | Lowest monthly price | A customer pays per box for indexed retrieval and delivery |
| Document shredding companies | Destruction, sometimes storage | Already visit the customer | Storage is the main business, not an add-on |
| Scanning-only bureaus | Digitization projects | Fast, priced per page | Stored boxes can be scanned without leaving the building |
| Records kept in the customer's own office | No fee | No cost, in the short term | Frees floor space and removes the search time |
The table describes categories and how this company positions itself, not a ranking. Prices change often and are not quoted here; each provider publishes or quotes its own.
Strengths, weaknesses, opportunities, threats
| Strengths | Weaknesses |
|---|---|
| Six anchor accounts signed before opening | The anchors hold 61% of the boxes at the end of Year 1, the largest 17% |
| Racking sized to the box count in every year | Two years of losses before the base can carry the building |
| Scanning in the same building as the boxes | One site, so a fire or flood affects every customer |
| Opportunities | Threats |
|---|---|
| Customers looking for a smaller provider with a named contact | A larger provider discounting to win the anchors at renewal |
| Healthcare, legal and education records that must be kept for years | Customers digitizing and destroying paper faster than expected |
| Scanning back-files for customers who already store with the company | Industrial rents rising faster than 3% a year |
Who Stores With Us
Law firms, clinics and school offices
The Year 1 target is law firms, medical and dental practices, school and local-government offices, accounting and insurance agencies, title companies and construction firms with plan sets. The decision is usually made by an office manager or a practice administrator, with the owner approving the fee.
Where the boxes sit now
Most keep boxes in a back room, a basement or a rented self-storage unit. Some use a larger provider and want a closer relationship. Typical triggers for a move are a lease renewal on the office, a clear-out after a retirement or a merger, or a request that the records be found quickly.
What a storage account is worth
The plan uses an average new account of 250 boxes, a mix of small offices with 50 to 150 boxes and a few larger ones, with the six anchor accounts at 6,500, 5,000, 4,500, 3,500, 2,500 and 2,000. At the Year 2 rate a 250-box account pays about $1,980 a year in storage fees plus about $640 to take the boxes in.
What a storage buyer asks first
The records are secure. A requested box arrives the same working day. The fee is predictable. They can talk to a person.
Winning Storage Accounts
From site visit to signed agreement
A site visit to count and sample the boxes, a written quote per box within two working days, a storage agreement, and a first pick-up within a week. Dana takes every visit in Year 1 alongside running the company. An account executive joins in month 13 on a $48,000 base and takes over most visits, and referral partners are paid a fee on each account that signs.
Where the first 61 accounts come from
The six anchor accounts bring 24,000 boxes over January to March. The other 15,300 boxes in Year 1 come from about 61 new accounts at 250 boxes each, 6.8 a month from April. Scanning projects begin in May: about 12 projects averaging $6,000, 8 of them from customers who already store boxes, including back-files for the anchors.
| Lead source | New accounts | Share |
|---|---|---|
| Referral partners (attorneys, accountants, practice consultants, commercial brokers) | 23 | 38% |
| Direct visits and mail by Dana | 16 | 26% |
| Google search and Maps | 12 | 20% |
| Chamber and trade-association events | 10 | 16% |
The rate card
Storage is quoted per carton per month, from $0.65 in Year 1, with oversize items such as blueprints and tapes priced separately. Handling is a published rate card and scanning is quoted per project. Storage prices rise one cent a year, handling and scanning 3%. Storage agreements run for 36 months.
How the box count builds
The plan has 5% of opening boxes permanently withdrawn or destroyed each year. Growth comes from new accounts and from existing accounts sending more boxes.
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| Boxes in storage at year end | 39,300 | 59,500 | 78,500 | 91,000 | 100,000 |
| Gross boxes received in the year | 39,300 | 22,165 | 21,975 | 16,425 | 13,550 |
| New accounts a month at 250 boxes | 6.8 | 7.4 | 7.3 | 5.5 | 4.5 |
The pace is the hardest figure in the plan to hit. Six to seven new accounts a month is a steady flow from a referral network and one seller, then two from month 13, against larger providers, and the plan allows for no faster. The Year 1 figure counts from April, once the anchor boxes are in, and the 24,000 anchor boxes themselves come from agreements signed before opening. If it is slower, the box counts and revenue fall in proportion, which the 20% case in the financial section tests.
Finding Accounts
What Year 1 marketing spends
Marketing costs $37,000 in Year 1, made up of $15,000 paid out of the opening funds for the website, brochures and open day, and $22,000 of running spend. Together that is 8.5% of Year 1 revenue, or 5.1% for the running spend alone. The share falls to 3.1% by Year 3 and 2.6% by Year 5. Adding $4,000 of referral fees, the cost across about 61 new accounts is roughly $670 per account, against about $1,980 a year of storage fees from an average account. In Year 2, marketing of $28,000, $8,000 of fees and about $63,000 for the account executive spread over about 89 new accounts come to roughly $1,110 each.
| Channel | Year 1 spend | What it is expected to do |
|---|---|---|
| Website, brand and brochures (launch) | $9,000 | A site with a quote request form and pages for law, healthcare, education and construction |
| Open day and anchor-account transfer (launch) | $6,000 | Warehouse tours for prospects and referral partners, and the move of the six anchor accounts |
| Google Ads and local search | $6,000 | Searches such as "records storage Indianapolis" and "medical records storage"; about 12 accounts |
| Referral partner programme | $4,000 | Lunches, site tours and a short guide for attorneys, accountants and practice consultants; about 23 accounts |
| Chamber and trade-association memberships and events | $4,000 | Introductions in the legal, medical and education communities; about 10 accounts |
| Direct mail and email to target lists | $3,000 | Letters to practice managers and office managers, followed by a visit from Dana; about 16 accounts |
| Website content | $3,000 | One guide a month on retention schedules, indexing and scanning back-files |
| Branded cartons and sample boxes | $2,000 | A box left behind on each visit |
Dates to hit
- January to March 2027: 24,000 anchor boxes received and indexed.
- May 2027: first scanning project billed.
- September 2027: first month with positive EBITDA.
- December 2027: 39,300 boxes and monthly revenue of $46,543.
- January 2028 (month 13): racking phase 2 opens and the account executive starts.
- July 2028 (month 19): the adjoining 4,000 square feet are taken.
- December 2028 (month 24): racking phase 3 opens.
- 2029: first full year with a net profit.
Warehouse Operations
The building
12,000 square feet of warehouse and office space, at $11.50 a square foot a year including taxes, insurance and common-area charges ($92,000 in Year 1, after four months of free rent), with 24 feet of clear height, on a seven-year lease. The first fit-out costs $50,000 and covers access control and cameras, an alarm, lighting, a scanning room and a loading dock. A further $45,000 pays for sprinkler modifications and testing for racked paper. In month 19 the company takes 4,000 more square feet next door, with a $25,000 fit-out of which about $15,000 is the sprinkler extension.
Capacity
A pallet position holds 48 standard cartons. The company opens with 1,100 positions and adds three phases of racking, timed to the box count, so the racks are never more than 77% full in the month before a phase opens.
| End of | Pallet positions | Capacity at 48 boxes | Boxes in storage | Share full | Building |
|---|---|---|---|---|---|
| Year 1 | 1,100 | 52,800 | 39,300 | 74% | 12,000 sq ft |
| Year 2 | 2,000 | 96,000 | 59,500 | 62% | 16,000 sq ft |
| Year 3 | 2,285 | 109,680 | 78,500 | 72% | 16,000 sq ft |
| Year 4 | 2,285 | 109,680 | 91,000 | 83% | 16,000 sq ft |
| Year 5 | 2,285 | 109,680 | 100,000 | 91% | 16,000 sq ft |
Racking costs $105 to $112 a position installed, $245,400 for 2,285 positions across the four phases, mostly new. At about 7 square feet of building per position, including aisles, the dock and the scanning room, 12,000 square feet holds up to about 1,710 positions and 16,000 holds about 2,285, so each phase fits the space it is in. Phase 2 (500 positions) opens in month 13, phase 3 (400) in month 24 and phase 4 (285) in month 34. By Year 5 the racks are 91% full and the building has no room for more positions, so growth beyond 100,000 boxes would need a second site.
A box's route through the building
Each carton is barcoded on receipt, indexed to the customer's own file list and racked to a location code, so any box can be found by number. A retrieval request received before noon is delivered the same working day. Scanning follows a fixed route: preparation (removing staples and sorting), scanning, indexing, a quality check on a sample of every batch, and then return or destruction of the paper on the customer's written instruction. An operator completes about 500 pages an hour across all of those steps.
Racks, scanners and the van
A records-management system tracks every carton, request and chain-of-custody scan. Software subscriptions in total are $16,000 in Year 1, rising to $27,000 in Year 5. One production scanner and two preparation stations handle scanning, with a second scanner added in month 15, and a used reach truck, pallet jacks and carts handle the racks. One delivery van, leased for 48 months with shelving fitted, runs throughout.
Crew and hiring order
Two people at launch: Dana and a lead technician who drives the van. A scanning operator joins in month 4, a part-time billing coordinator in month 5 and a second warehouse technician in month 8, which makes four full-time people and a part-timer by the end of Year 1. The plan adds an account executive in month 13, a second scanning operator in month 16, a third in month 43 and a part-time assistant in month 44, and ends Year 5 with seven full-time people and two part-timers. Each hire follows the hours. Warehouse work comes to about 2,750 hours in Year 3 against about 3,400 paid, and scanning to about 1.45 million pages against capacity of about 1.7 million.
Chain of custody and insurance
- Indiana limited liability company registration, and any city and county registrations the company needs.
- Written chain-of-custody and visitor procedures, with access limited to staff and logged.
- Confidentiality undertakings from every employee, and background checks before they handle customers' records.
- A business associate agreement for each healthcare customer that asks for one.
- Property, general liability, legal liability for customers' records, commercial auto, cyber and umbrella insurance, budgeted at $34,000 in Year 1, plus workers' compensation (counted in payroll costs) and key-person life and disability cover on Dana.
- A certified partner for paper destruction, engaged on the customer's written instruction.
Who supplies the racks and the shredding
A racking installer, a carton supplier, a software vendor and the destruction partner. None is hard to replace, and the racking installer is paid on completion of each phase.
Owners and Management
Dana Shaw, founder and general manager
Dana spent ten years at a regional records-management company, the last five as operations manager for a site holding about 90,000 boxes. She has run a retrieval desk, a delivery route and a scanning room, has written a chain-of-custody procedure and has handled a customer's audit of the site. She holds 51% of the company and invested $235,000 of her savings.
The co-investor
A local commercial property owner holds 49% for $224,600, paid in full at launch with no second tranche, and has no operating role. The investor has agreed to the lease and the racking plan and receives quarterly accounts.
What Dana has not done before
Dana has not run a profit and loss account, built a sales pipeline or raised money before. The plan covers these with an outside accountant reviewing the books monthly, the referral-fee scheme and a quarterly review with the co-investor.
If Dana is out
Dana is the only manager and, until month 13, the only seller. The lead technician is trained to run the retrieval desk and delivery schedule in her absence, and the company carries key-person life and disability cover on her.
Outside help
An accountant who works with warehouse businesses reviews the first-year numbers every quarter, and a commercial lawyer reviews the storage agreement and each healthcare customer's business associate agreement.
Who owns what
Dana owns 51% and gives the lenders a personal guarantee. The working-capital line is guaranteed by Dana as well. Any distribution needs the lenders' consent while retained earnings are negative, and none is planned in the five years.
Funding and Five-Year Forecast
The forecast runs five years. Year 1 is shown month by month and Years 2 to 5 as annual totals. The inputs are listed ahead of the statements so each figure can be traced back to its source.
What it costs to open, and who pays
| Use of funds | Amount |
|---|---|
| Pallet racking, phase 1 (1,100 positions) | $115,500 |
| Warehouse fit-out: security and access control, lighting, scanning room, dock | $50,000 |
| Fire-protection work for racked paper (sprinkler modifications and testing) | $45,000 |
| Used reach truck, pallet jacks, carts, ladders and scales | $25,000 |
| Production scanner, prep stations and indexing software | $45,000 |
| Records-management system set-up, barcode printers and handheld scanners | $16,000 |
| Office furniture and computers | $9,000 |
| Business licences and registrations | $2,000 |
| Legal (entity, lease, customer contract), insurance broker and fire-protection engineer | $14,000 |
| Launch: website, brochures, anchor-account transfer, open day | $15,000 |
| Cash reserve for the build-up period | $269,600 |
| Expansion space (4,000 sq ft): fit-out and sprinkler extension | $25,000 |
| Pallet racking, phase 2 (500 positions) | $54,000 |
| Second production scanner | $24,000 |
| Pallet racking, phase 3 (400 positions) | $44,000 |
| Pallet racking, phase 4 (285 positions) | $31,900 |
| Total uses | $785,000 |
| Source of funds | Amount |
|---|---|
| Dana Shaw's savings | $235,000 |
| Co-investor | $224,600 |
| Racking finance, phase 1 (84 months) | $115,500 |
| Equipment finance (reach truck and scanner) | $56,000 |
| Racking finance, phase 2 (month 13) | $54,000 |
| Equipment finance, second scanner (month 15) | $24,000 |
| Racking finance, phase 3 (month 24) | $44,000 |
| Racking finance, phase 4 (month 34) | $31,900 |
| Total sources | $785,000 |
Total funding is $785,000, of which $631,100 arrives at launch. Dana Shaw puts in $235,000 of savings and a local commercial property owner (the co-investor) puts in $224,600, which gives Dana 51% of the company and the co-investor 49%. Two lenders advance the rest: $115,500 of racking finance over 84 months and $56,000 against the reach truck and scanner over 60 months, both at 9.5%. The delivery van is leased rather than bought, which keeps $48,000 out of the raise. Launch money pays for racking, fit-out and equipment ($305,500), the legal, licensing and launch costs ($31,000), a $25,000 fit-out for the adjoining 4,000 square feet in month 19, and a $269,600 reserve. The reserve is sized to the Year 1 and Year 2 losses: the company opens with 24,000 boxes from six anchor accounts but does not turn a profit until Year 3. Racking phases 2 to 4 and the second scanner cost $153,900 and are financed as they are bought, on the same terms. There is no second equity round. The plan also carries a $250,000 working-capital line of credit, arranged before opening and secured on receivables and Dana's guarantee. It is not drawn in the base case and is not counted in the $785,000; the downside case below draws it. All interest rates are set for this example. Equity is $459,600 of the total, and asset finance trims the equity needed by $325,400.
What the numbers rest on
- Boxes are standard cartons of 15 x 12 x 10 inches, which Iron Mountain lists at 1.2 billable cubic feet. Six anchor accounts with signed 36-month storage agreements move in 24,000 boxes over the first three months: 6,500, 5,000, 4,500, 3,500, 2,500 and 2,000. The month-end counts are 10,000 in January, 17,000 in February and 24,000 in March. From April net additions run at 1,700 boxes a month. Year-end box counts are 39,300, 59,500, 78,500, 91,000 and 100,000, and the anchors hold 61% of the Year 1 total.
- Storage is $0.65 per box per month in Year 1 and rises a cent a year to $0.69. Year 1 revenue is each month-end box count times $0.65. In Years 2 to 5 it is the average of opening and closing boxes, times 12, times that year's rate. Each year 5% of opening boxes leave for good, through withdrawal or destruction, and the counts above are already net of that. The rates are the company's own prices, not a published market rate.
- The average new account holds 250 boxes: many small offices with 50 to 150 boxes and a few larger ones. After the anchors, that works out to about 61 new accounts in Year 1 (6.8 a month from April), 89 in Year 2, 88 in Year 3, 66 in Year 4 and 54 in Year 5, or 7.4, 7.3, 5.5 and 4.5 a month from Year 2. Boxes received in a year equal the net increase plus the 5% replaced: 39,300, 22,165, 21,975, 16,425 and 13,550.
- Handling is charged per transaction. In Year 1 that is $2.50 to receive, barcode, index and rack a carton, $4.75 to pull a box, $2.75 to refile it, $16 per delivery stop and $3.50 to process a box for destruction. All rise 3% a year from Year 2. Ten percent of stored boxes are pulled each year, nine in ten of those come back, and a stop carries 2.2 boxes. Year 1 handling revenue of $139,750 includes $60,000 for taking in the 24,000 anchor boxes.
- Scanning is $0.15 a page in Year 1, covering preparation, scanning, indexing and checking, and rises 3% a year. One operator completes about 500 pages an hour across all four steps, or roughly 850,000 pages in 1,700 productive hours. Year 1 revenue of $71,500 is about 477,000 pages, or 190 boxes at 2,500 pages each. Year 5 revenue of $300,000 is about 1.78 million pages. The first project is billed in May, after the first operator starts in month 4. Much of the early work is back-file conversion for the anchor accounts, which is why scanning grows to $180,000 in Year 2.
- One pallet position holds 48 boxes. Racking goes in over four phases of 1,100, 500, 400 and 285 positions at $105, $108, $110 and $112 a position installed, mostly new. The building gives one position per 7 square feet including aisles, dock and scanning room: 12,000 square feet holds about 1,710 positions and 16,000 about 2,285. Capacity is 52,800, 76,800, 96,000 and 109,680 boxes, and the racks stand at no more than 77% in the month before a phase opens.
- Warehouse work is timed at 3 minutes to receive and rack a carton, 7.5 minutes to pull and refile a box and 15 minutes per delivery stop, against 1,700 productive hours per full-time person. That comes to roughly 2,650, 2,290, 2,750, 2,840 and 2,960 hours across Years 1 to 5, set against paid capacity of about 2,410, 3,400, 3,400, 3,830 and 4,440. Year 1 also uses $20,000 of temporary labor, about 870 hours, to move the anchor boxes in. The margin covers cycle counts, rack audits, the Year 2 expansion and leave cover.
- Employer costs add 27% to wages (15% for part-time roles) for payroll taxes, health cover, workers' compensation on warehouse work and a retirement match. The wages in the crew table are launch rates; 3% annual pay raises appear as their own line from Year 2. Warehouse and scanning pay of $39,000 to $45,000 sits at or above the Bureau of Labor Statistics medians for hand laborers and material movers ($38,220, May 2025) and for delivery truck drivers and driver/sales workers ($43,950, May 2025). Dana draws $65,000. The account executive is paid a $48,000 base from month 13, with referral fees and commissions on top.
- Rent is $9.75 a square foot triple-net plus $1.75 for taxes, insurance and common-area charges, $11.50 in all, rising 3% a year. CBRE reports an average asking rent of $10.15 triple-net for Indianapolis buildings under 50,000 square feet and $6.43 across all industrial space in the second quarter of 2026, so the plan prices older bulk space below the small-building average. The lease covers 12,000 square feet from 1 January 2027, with the first four months free, and an option on the adjoining 4,000 square feet that starts in month 19. Rent is $92,000 in Year 1 (eight paying months), $165,800 in Year 2 and $195,200 in Year 3, when all 16,000 square feet are paid for twelve months. Utilities run at about $1.15 a square foot. The van is leased at $900 a month with shelving fitted, over 48 months.
- The $45,000 fire-protection line allows for sprinkler changes and testing for racked paper in the first premises, and the $25,000 expansion fit-out includes about $15,000 of sprinkler work. Both are placeholders until a fire-protection engineer reports. Insurance starts at $34,000 and reaches $50,000, covering property and contents, general liability, legal liability for customers' records, commercial auto, cyber and professional liability, an umbrella policy and key-person life and disability cover on Dana. Business personal property tax starts at $5,500 on about $305,000 of racking, equipment and fit-out and reaches $11,000.
- Direct costs run at 2% of storage revenue (billing fees, barcode labels), 5% of handling revenue (cartons, tape, pallet wrap, tolls) and 10% of scanning revenue (consumables and overflow work). Labor sits in payroll, so the gross margin line is not comparable with a business that books labor as a direct cost.
- Clients take 30 days on average to pay. Storage is invoiced monthly in advance and handling and scanning on completion, mostly to businesses on 30-day terms. Bad debt is set aside at 0.3% to 0.4% of revenue.
- The model taxes profit at 21% federal and 4.9% Indiana, with early losses carried forward. The losses are used up during Year 4, so tax is $2,891 in Year 4 and $58,563 in Year 5. The model lets losses offset profit without limit, while real rules may cap how much of a year's profit they can cover, so cash tax could come sooner. An LLC taxed as a pass-through would put the tax on its owners' returns instead. No distributions are paid in the five years.
Revenue by line
| Revenue stream | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| Box storage (boxes in storage x monthly rate) | $223,275 | $391,248 | $554,760 | $691,560 | $790,740 |
| Intake, retrieval, delivery and destruction handling | $139,750 | $137,926 | $175,456 | $194,143 | $211,881 |
| Scanning and digitisation projects | $71,500 | $180,000 | $230,000 | $270,000 | $300,000 |
| Total revenue | $434,525 | $709,174 | $960,216 | $1,155,703 | $1,302,621 |
| Growth on prior year | – | 63% | 35% | 20% | 13% |
Storage carries the plan. It is the line that renews itself each month, and it grows from 51% of revenue in Year 1 to 58% in Year 3 and 61% in Year 5. Handling follows the box count and falls from 32% to 16% over the same span, since Year 1 includes $60,000 of intake fees on the anchor boxes. Scanning is project work at 16% of Year 1 revenue, 24% in Year 3 and 23% in Year 5, and it earns soonest once a scanner is running. Growth of 63% in Year 2 comes off a Year 1 base that averages about 28,600 boxes; later years add 35%, 20% and 13%. In Year 3 all three lines together earn $13.92 per stored box, against a storage-only fee of $8.04.
Month by month in Year 1
| Month | Box storage (boxes in storage x monthly rate) | Intake, retrieval, delivery and destruction handling | Scanning and digitisation projects | Total revenue | EBITDA |
|---|---|---|---|---|---|
| Jan 2027 | $6,500 | $26,208 | $0 | $32,708 | ($7,148) |
| Feb 2027 | $11,050 | $19,554 | $0 | $30,604 | ($9,162) |
| Mar 2027 | $15,600 | $20,400 | $0 | $36,000 | ($3,997) |
| Apr 2027 | $16,705 | $7,355 | $0 | $24,060 | ($15,426) |
| May 2027 | $17,810 | $7,560 | $4,000 | $29,370 | ($10,343) |
| Jun 2027 | $18,915 | $7,766 | $6,000 | $32,681 | ($7,174) |
| Jul 2027 | $20,020 | $7,971 | $8,000 | $35,991 | ($4,006) |
| Aug 2027 | $21,125 | $8,176 | $9,000 | $38,301 | ($1,795) |
| Sep 2027 | $22,230 | $8,382 | $10,000 | $40,612 | $417 |
| Oct 2027 | $23,335 | $8,587 | $11,000 | $42,922 | $2,629 |
| Nov 2027 | $24,440 | $8,793 | $11,500 | $44,733 | $4,362 |
| Dec 2027 | $25,545 | $8,998 | $12,000 | $46,543 | $6,094 |
January to March earn $30,604 to $36,000 a month, helped by $60,000 of intake fees on the 24,000 anchor boxes. April falls to $24,060 once the transfers end, and revenue then climbs every month as boxes accumulate and scanning is billed from May. EBITDA (profit before interest, depreciation and tax) is negative in each of the first eight months, with April the worst at ($15,426), and January to August together hold $59,051 of losses. September is the first month in profit at $417, and December reaches $6,094. Year 1 EBITDA is ($45,549). After allowing for invoices not yet paid, cash falls to a low of about $165,000 in Nov 2027.
Crew and payroll
| Role | Annual wage | Starts | Year 1 end | Year 2 end | Year 3 end | Year 4 end | Year 5 end |
|---|---|---|---|---|---|---|---|
| Founder and general manager | $65,000 | Month 1 | 1 | 1 | 1 | 1 | 1 |
| Warehouse technician and driver (lead) | $45,000 | Month 1 | 1 | 1 | 1 | 1 | 1 |
| Scanning operator | $40,000 | Month 4 | 1 | 1 | 1 | 1 | 1 |
| Customer service and billing coordinator (part time, 20 hours a week) | $26,000 | Month 5 | 0.5 | 0.5 | 0.5 | 0.5 | 0.5 |
| Account executive (new business) | $48,000 | Month 13 | – | 1 | 1 | 1 | 1 |
| Warehouse technician | $39,000 | Month 8 | 1 | 1 | 1 | 1 | 1 |
| Scanning operator (second) | $40,000 | Month 16 | – | 1 | 1 | 1 | 1 |
| Scanning operator (third) | $40,000 | Month 43 | – | – | – | 1 | 1 |
| Warehouse assistant (part time) | $21,000 | Month 44 | – | – | – | 0.5 | 0.5 |
| Total payroll incl. on-costs | $218,371 | $368,990 | $381,690 | $417,153 | $456,640 |
Dana and a lead technician who also drives the van start on day one. A first scanning operator starts in month 4, a part-time coordinator takes over billing and customer calls in month 5, and a second warehouse technician joins in month 8 for the anchor intake and the first full year of retrievals. An account executive starts in month 13 to take over new-business selling from Dana, a second scanning operator in month 16 as scanning outgrows one person's hours, a third in month 43 and a part-time warehouse assistant in month 44. Each hire is tied to the hours set out in the Warehouse Operations section. Part-time roles count as 0.5 and carry part-time salaries. Dana's $65,000 comes out before any profit is struck. Payroll is 50% of revenue in Year 1, 54% in Year 2 and 39% in Years 4 and 5.
Profit and loss
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| Revenue | $434,525 | $709,174 | $960,216 | $1,155,703 | $1,302,621 |
| Direct costs (cartons, fuel, contract labor and card fees) | ($18,603) | ($30,361) | ($41,109) | ($49,478) | ($55,768) |
| Gross profit | $415,922 | $678,813 | $919,107 | $1,106,225 | $1,246,853 |
| Payroll incl. on-costs | ($218,371) | ($368,990) | ($381,690) | ($417,152) | ($456,640) |
| Rent | ($92,000) | ($165,800) | ($195,200) | ($201,100) | ($207,100) |
| Utilities | ($13,800) | ($16,600) | ($19,500) | ($20,100) | ($20,700) |
| Marketing | ($22,000) | ($28,000) | ($30,000) | ($32,000) | ($34,000) |
| Insurance | ($34,000) | ($38,000) | ($42,000) | ($46,000) | ($50,000) |
| Professional fees | ($8,000) | ($8,500) | ($9,000) | ($9,500) | ($10,000) |
| Software subscriptions | ($16,000) | ($19,000) | ($22,000) | ($25,000) | ($27,000) |
| Van fuel, tolls and maintenance | ($6,500) | ($7,500) | ($8,500) | ($9,500) | ($10,500) |
| Delivery van lease, shelving included (48 months) | ($10,800) | ($10,800) | ($10,800) | ($10,800) | ($11,200) |
| Anchor-transfer crew (temporary labor and trucking) | ($20,000) | $0 | $0 | $0 | $0 |
| Sales commissions and referral fees | ($4,000) | ($8,000) | ($9,000) | ($9,000) | ($9,000) |
| Racking inspections, scanner service contracts and equipment replacement | ($4,000) | ($6,000) | ($9,000) | ($11,000) | ($14,000) |
| Business personal property tax | ($5,500) | ($7,500) | ($9,500) | ($10,500) | ($11,000) |
| Phones, supplies, uniforms and training | ($5,000) | ($6,500) | ($7,500) | ($8,000) | ($8,500) |
| Bad debt allowance | ($1,500) | ($2,500) | ($3,600) | ($4,600) | ($5,500) |
| Annual pay raises (3% a year) | $0 | ($11,070) | ($23,245) | ($38,681) | ($57,312) |
| EBITDA | ($45,549) | ($25,947) | $138,572 | $253,291 | $314,401 |
| Depreciation | ($42,693) | ($60,864) | ($64,054) | ($64,054) | ($64,054) |
| Interest | ($15,377) | ($20,274) | ($21,724) | ($19,703) | ($14,881) |
| Income tax | $0 | $0 | $0 | ($2,891) | ($58,563) |
| Net income before start-up costs | ($103,619) | ($107,086) | $52,793 | $166,643 | $176,903 |
| Start-up costs expensed at opening (legal, licensing, launch marketing) | ($31,000) | $0 | $0 | $0 | $0 |
| Net income after start-up costs | ($134,619) | ($107,086) | $52,793 | $166,643 | $176,903 |
Year 1 loses $103,619 before start-up costs and $134,619 after them, with payroll at half of revenue while the base holds only 10,000 to 39,300 boxes. Year 2 loses $107,086 as the account executive, the second scanning operator and the extra 4,000 square feet arrive ahead of the boxes that fill them, although EBITDA is only ($25,947). Year 3 is the first profitable year: EBITDA of $138,572 (14.4%) and net income of $52,793 (5.5%), because 69,000 average boxes now carry a building that costs $195,200. Year 4 earns $166,643 (14.4%) after $2,891 of tax, and Year 5 earns $176,903 (13.6%) after $58,563 of tax. Margins widen because the building, racks and scanners are mostly fixed and each added box pays about $8 a year in storage for little extra cost. Net income is similar in Years 4 and 5 because the carried-forward losses run out and tax starts.
Cash movements
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| Cash from operations | ($127,640) | ($68,795) | $96,214 | $214,630 | $228,882 |
| Racking, vans and equipment | ($305,500) | ($147,000) | ($31,900) | $0 | $0 |
| Funding received | $631,100 | $122,000 | $31,900 | $0 | $0 |
| Loan principal repaid | ($21,389) | ($32,842) | ($41,875) | ($48,588) | ($53,410) |
| Owner distributions | $0 | $0 | $0 | $0 | $0 |
| Net change in cash | $176,571 | ($126,638) | $54,339 | $166,042 | $175,471 |
| Closing cash | $176,571 | $49,933 | $104,272 | $270,314 | $445,785 |
Cash stays above zero throughout. The year-end low is $49,933 at the end of Year 2, and Year 1 closes at $176,571. Operations absorb $196,435 over Years 1 and 2, start-up costs included, and $96,106 of loan principal is repaid in Years 1 to 3. Racking phases 2 to 4 and the second scanner are paid for from the finance listed under Funding received, so the reserve is not drawn for them. The reserve does pay for the $25,000 expansion fit-out in month 19. There are no distributions in the five years, and the working-capital line is never drawn.
Balance sheet
| At year end | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| Cash | $176,571 | $49,933 | $104,272 | $270,314 | $445,785 |
| Accounts receivable | $35,714 | $58,288 | $78,922 | $94,989 | $107,065 |
| Racking, vans and equipment (net) | $262,807 | $348,943 | $316,789 | $252,734 | $188,680 |
| Total assets | $475,092 | $457,164 | $499,983 | $618,038 | $741,530 |
| Bank and equipment finance | $150,111 | $239,269 | $229,294 | $180,706 | $127,296 |
| Paid-in capital | $459,600 | $459,600 | $459,600 | $459,600 | $459,600 |
| Retained earnings | ($134,619) | ($241,705) | ($188,911) | ($22,268) | $154,634 |
| Total liabilities and equity | $475,092 | $457,164 | $499,983 | $618,038 | $741,530 |
Margins, cover and the break-even line
| Measure | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| EBITDA margin | -10.5% | -3.7% | 14.4% | 21.9% | 24.1% |
| Net margin (before start-up costs) | -23.8% | -15.1% | 5.5% | 14.4% | 13.6% |
| Payroll incl. pay raises as share of revenue | 50% | 54% | 42% | 39% | 39% |
| Revenue per full-time equivalent at year end | $96,561 | $109,104 | $147,726 | $144,463 | $162,828 |
| Average monthly revenue | $36,210 | $59,098 | $80,018 | $96,309 | $108,552 |
| Monthly revenue needed to cover operating costs | $40,176 | $61,357 | $67,954 | $74,257 | $81,180 |
| Debt service cover (EBITDA / interest + principal) | -1.2x | -0.5x | 2.2x | 3.7x | 4.6x |
The break-even line is the monthly revenue needed to cover operating costs, shown in the ratios table. Year 1 averages $36,210 a month against $40,176 needed and Year 2 $59,098 against $61,357. Year 3 is the first to clear it, at $80,018 against $67,954, and the gap widens to $108,552 against $81,180 in Year 5. Debt service cover is negative in Years 1 and 2, then reaches 2.2x in Year 3 and 4.6x in Year 5. A 1.0x covenant would have failed in Years 1 and 2, so the asset finance carries none: the lender relies on the equipment and Dana's guarantee. Revenue per full-time equivalent climbs from $96,561 to $162,828 as boxes fill racks that are already built.
If boxes and fees run 20% short
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
|---|---|---|---|---|---|
| Revenue | $347,620 | $567,339 | $768,173 | $924,562 | $1,042,097 |
| Net income before start-up costs | ($163,493) | ($140,149) | ($92,406) | $870 | $88,415 |
| Net income after start-up costs | ($194,493) | ($140,149) | ($92,406) | $870 | $88,415 |
| Closing cash | $123,839 | $212,075 | $57,972 | $16,895 | $54,231 |
Every revenue line runs 20% below plan in every year. The owners respond in seven ways. Hires from month 13 start six months later, and the third scanning operator and the part-time assistant are not hired at all. Dana takes a 20% pay cut ($52,000). Marketing is cut 20% and no distribution is paid. The adjoining 4,000 square feet are taken in month 31 instead of month 19, phase 3 racking moves from month 24 to month 32, phase 4 from month 34 to month 46 and the second scanner from month 15 to month 22, each with its finance. Fuel, commissions and bad debt fall 20% with volume. The racks then stand at about 74% in the month before phase 3 opens and 73% before phase 4. Finally, the $250,000 working-capital line is drawn in month 17. Cash stays positive in every year and bottoms out at $16,895 at the end of Year 4. The company loses money in Years 1 to 3, breaks even in Year 4 and earns $88,415 in Year 5. Equity ends Year 1 at $265,107. Without the line, cash in this same case would be negative at the end of Year 3 ($83,988) and Year 4 ($60,841), so the line is what makes this case survivable; deferring the racks and the extra space saves cash but does not close the gap between a 20% fall in fees and a largely fixed cost base. A second test is run separately from the tables here, with no owner response: the largest anchor (6,500 boxes) leaves at month 13. Revenue is then $647,988 in Year 2 and $1,238,195 in Year 5, Year 3 EBITDA is $77,480 with a net loss of ($8,298), and year-end cash reaches a low of ($13,269) at the end of Year 3, about $13,000 short, which the working-capital line would cover. Year 4 returns to a net profit of $107,408.
Sources
- CBRE Research, Indianapolis Industrial Figures, Q2 2026 (average direct asking rent of $6.43 per square foot triple-net; $10.15 for buildings under 50,000 square feet; $6.23 distribution and logistics; vacancy 5.9%).
- Bureau of Labor Statistics, Hand laborers and material movers and Delivery truck drivers and driver/sales workers, Occupational Outlook Handbook, May 2025 median pay.
- Iron Mountain, Carton types and sizing (standard archive carton, 15 x 12 x 10 inches internal, 1.2 billable cubic feet).
- U.S. Department of Health and Human Services, Business associates (HIPAA guidance on vendors that maintain protected health information and the written contract they need).
- Indiana corporate income tax rate of 4.9%: Tax Foundation, Indiana (2026 tax rates).
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