Executive
Summary
Sample Bakery (SB) is a start-up
coffee and bakery retail establishment located in southwest Washington. SB
expects to catch the interest of a regular loyal customer base with its broad
variety of coffee and pastry products. The company plans to build a strong
market position in the town, due to the partners' industry experience and mild
competitive climate in the area.
SB aims to offer its products at a
competitive price to meet the demand of the middle-to higher-income local
market area residents and tourists.
The Company
SB is incorporated in the state of
Washington. It is equally owned and managed by its two partners.
Mr. Austin Patterson has extensive
experience in sales, marketing, and management, and was vice president of
marketing with both Daniels & Daniels and Super Foods. Mrs. Stella Mavins
brings experience in the area of finance and administration, including a stint
as chief financial officer with both Bimma Roasters and the national coffee
store chain, Slide-Plates.
The company intends to hire two
full-time pastry bakers and six part-time baristas to handle customer service
and day to day operations.
Products and Services
SB offers a broad range of coffee
and espresso products, all from high quality Columbian grown imported coffee
beans. SB caters to all of its customers by providing each customer coffee and
espresso products made to suit the customer, down to the smallest detail.
The bakery provides freshly prepared
bakery and pastry products at all times during business operations. Six to
eight moderate batches of bakery and pastry products are prepared during the
day to assure fresh baked goods are always available.
The Market
The retail coffee industry in the
U.S. has recently experienced rapid growth. The cool marine climate in
southwest Washington stimulates consumption of hot beverages throughout the
year.
SB wants to establish a large
regular customer base, and will therefore concentrate its business and
marketing on local residents, which will be the dominant target market. This
will establish a healthy, consistent revenue base to ensure stability of the
business. In addition, tourist traffic is expected to comprise approximately
35% of the revenues. High visibility and competitive products and service are critical
to capture this segment of the market.
Financial Considerations
SB expects to raise $110,000 of its
own capital, and to borrow $100,000 guaranteed by the SBA as a ten-year loan.
This provides the bulk of the current financing required.
SB anticipates sales of about
$491,000 in the first year, $567,000 in the second year, and $655,000 in the
third year of the plan. SB should break even by the fourth month of its
operation as it steadily increases its sales. Profits for this time period are
expected to be approximately $13,000 in year 1, $36,000 by year 2, and $46,000
by year 3. The company does not anticipate any cash flow problems.
1.1
Mission
SB aims to offer high quality
coffee, espresso, and pastry products at a competitive price to meet the demand
of the middle- to higher-income local market area residents and tourists.
1.2
Keys to Success
Keys to success for SB will include:
- Providing the highest quality product with personal customer service.
- Competitive pricing.
Company Summary
SB is a bakery and coffee
shop managed by two partners. These partners represent sales/management
and finance/administration areas, respectively. The partners will provide
funding from their own savings, which will cover start-up expenses and provide
a financial cushion for the first months of operation. A ten-year Small
Business Administration (SBA) loan will cover the rest of the required
financing. The company plans to build a strong market position in the town, due
to the partners' industry experience and mild competitive climate in the area.
2.1
Company Ownership
SB is incorporated in the state of
Washington. It is equally owned by its two partners.
2.2
Start-up Summary
SB is a start-up company. Financing
will come from the partners' capital and a ten-year SBA loan. The following
chart and table illustrate the company's projected initial start-up costs.
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Start-up Requirements
|
|
Start-up Expenses
|
|
Legal
|
$3,000
|
Premise renovation
|
$20,000
|
Expensed equipment
|
$40,000
|
Other
|
$1,000
|
Total Start-up Expenses
|
$64,000
|
Start-up Assets
|
|
Cash Required
|
$70,000
|
Other Current Assets
|
$12,000
|
Long-term Assets
|
$65,000
|
Total Assets
|
$147,000
|
Total Requirements
|
$211,000
|
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Start-up Funding
|
|
Start-up Expenses to Fund
|
$64,000
|
Start-up Assets to Fund
|
$147,000
|
Total Funding Required
|
$211,000
|
Assets
|
|
Non-cash Assets from Start-up
|
$77,000
|
Cash Requirements from Start-up
|
$70,000
|
Additional Cash Raised
|
$0
|
Cash Balance on Starting Date
|
$70,000
|
Total Assets
|
$147,000
|
Liabilities and Capital
|
|
Liabilities
|
|
Current Borrowing
|
$0
|
Long-term Liabilities
|
$100,000
|
Accounts Payable (Outstanding
Bills)
|
$1,000
|
Other Current Liabilities
(interest-free)
|
$0
|
Total Liabilities
|
$101,000
|
Capital
|
|
Planned Investment
|
|
Patterson
|
$55,000
|
Fields
|
$55,000
|
Other
|
$0
|
Additional Investment Requirement
|
$0
|
Total Planned Investment
|
$110,000
|
Loss at Start-up (Start-up
Expenses)
|
($64,000)
|
Total Capital
|
$46,000
|
Total Capital and Liabilities
|
$147,000
|
Total Funding
|
$211,000
|
Products
SB offers a broad range of coffee
and espresso products, all from high quality Columbian grown imported coffee
beans. SB caters to all of its customers by providing each customer coffee and
espresso products made to suit the customer, down to the smallest detail.
The bakery provides freshly prepared
bakery and pastry products at all times during business operations. Six to
eight moderate batches of bakery and pastry products are prepared during the
day to assure fresh baked goods are always available.
Market Analysis Summary
SB's focus is on meeting the demand
of a regular local resident customer base, as well as a significant level of
tourist traffic from nearby highways.
4.1
Market Segmentation
SB focuses on the middle- and
upper-income markets. These market segments consume the majority
of coffee and espresso products.
Local Residents
SB wants to establish a large
regular customer base. This will establish a healthy, consistent revenue
base to ensure stability of the business.
Tourists
Tourist traffic comprises
approximately 35% of the revenues. High visibility and competitive
products and service are critical to capture this segment of the market.
4.1.1
Market Analysis
The chart and table below outline
the total market potential of the above described customer segments.
4.2
Target Market Segment Strategy
The dominant target market for SB is
a regular stream of local residents. Personal and expedient customer service at
a competitive price is key to maintaining the local market share of this target
market.
4.2.1
Market Needs
Because Washington has a cool
climate for eight months out of the year, hot coffee products are very much in
demand. During the remaining warmer four months of the year, iced coffee
products are in significantly high demand, along with a slower but consistent
demand for hot coffee products. Much of the day's activity occurs in the
morning hours before ten a.m., with a relatively steady flow for the remainder
of the day.
4.3
Service Business Analysis
The retail coffee industry in the
U.S. has recently experienced rapid growth. The cool marine climate in
southwest Washington stimulates consumption of hot beverages throughout the
year. Coffee drinkers in the Pacific Northwest are finicky about the
quality of beverages offered at the numerous coffee bars across the region.
Despite low competition in the immediate area, SB will position itself as a
place where customers can enjoy a cup of delicious coffee with a fresh pastry
in a relaxing environment.
4.3.1
Competition and Buying Patterns
Competition in the local area is
somewhat sparse and does not provide nearly the level of product quality and
customer service as SB. Local customers are looking for a high quality
product in a relaxing atmosphere. They desire a unique, classy experience.
Leading competitors purchase
and roast high quality, whole-bean coffees and, along with Italian-style
espresso beverages, cold-blended beverages, a variety of pastries and
confections, coffee-related accessories and equipment, and a line of premium
teas, sell these items primarily through company-operated retail stores. In
addition to sales through company-operated retail stores, leading competitors
sell coffee and tea products through other channels of distribution (specialty
operations).
Larger chains vary
their product mix depending upon the size of each store and its
location. Larger stores carry a broad selection of whole bean coffees in
various sizes and types of packaging, as well as an assortment of coffee- and
espresso-making equipment and accessories such as coffee grinders, coffee
makers, espresso machines, coffee filters, storage containers, travel tumblers
and mugs. Smaller stores and kiosks typically sell a full line of coffee
beverages, a more limited selection of whole-bean coffees, and a few
accessories such as travel tumblers and logo mugs. During fiscal year
2000, industry retail sales mix by product type was approximately
73% beverages, 14% food items, eight percent whole-bean coffees, and
five percent coffee-making equipment and accessories.
Technologically savvy competitors make fresh coffee and coffee-related products conveniently available via mail order and online. Additionally, mail order catalogs offering coffees, certain food items, and select coffee-making equipment and accessories, have been made available by a few larger competitors. Websites offering online stores that allow customers to browse for and purchase coffee, gifts, and other items via the Internet have become more commonplace as well.
Technologically savvy competitors make fresh coffee and coffee-related products conveniently available via mail order and online. Additionally, mail order catalogs offering coffees, certain food items, and select coffee-making equipment and accessories, have been made available by a few larger competitors. Websites offering online stores that allow customers to browse for and purchase coffee, gifts, and other items via the Internet have become more commonplace as well.
Strategy and Implementation Summary
SB will succeed by offering
consumers high quality coffee, espresso, and bakery products with personal
service at a competitive price.
5.1
Competitive Edge
SB's competitive edge is the
relatively low level of competition in the local area in this particular
niche.
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5.2
Sales Strategy
As the chart and table show, SB anticipates
sales of about $491,000 in the first year, $567,000 in the second year,
and $655,000 in the third year of the plan.
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Sales Forecast
|
|||
Year
1
|
Year
2
|
Year
3
|
|
Unit Sales
|
|||
Espresso Drinks
|
135,000
|
148,500
|
163,350
|
Pastry Items
|
86,000
|
94,600
|
104,060
|
Other
|
0
|
0
|
0
|
Total Unit Sales
|
221,000
|
243,100
|
267,410
|
Unit Prices
|
Year
1
|
Year
2
|
Year
3
|
Espresso Drinks
|
$3.00
|
$3.15
|
$3.31
|
Pastry Items
|
$1.00
|
$1.05
|
$1.10
|
Other
|
$0.00
|
$0.00
|
$0.00
|
Sales
|
|||
Espresso Drinks
|
$405,000
|
$467,775
|
$540,280
|
Pastry Items
|
$86,000
|
$99,330
|
$114,726
|
Other
|
$0
|
$0
|
$0
|
Total Sales
|
$491,000
|
$567,105
|
$655,006
|
Direct Unit Costs
|
Year
1
|
Year
2
|
Year
3
|
Espresso Drinks
|
$0.25
|
$0.26
|
$0.28
|
Pastry Items
|
$0.50
|
$0.53
|
$0.55
|
Other
|
$0.00
|
$0.00
|
$0.00
|
Direct Cost of Sales
|
|||
Espresso Drinks
|
$33,750
|
$38,981
|
$45,023
|
Pastry Items
|
$43,000
|
$49,665
|
$57,363
|
Other
|
$0
|
$0
|
$0
|
Subtotal Direct Cost of Sales
|
$76,750
|
$88,646
|
$102,386
|
Management Summary
Austin Patterson has
extensive experience in sales, marketing, and management, and was vice
president of marketing with both Daniels & Daniels and Super
Foods. Stella Mavins brings experience in the area of finance and
administration, including a stint as chief financial officer with
both Bimma Roasters and the national coffee store chain, Slide-Plates.
6.1
Personnel Plan
As the personnel plan shows, SB
expects to make significant investments in sales, sales support, and product
development personnel.
Personnel Plan
|
|||
Year
1
|
Year
2
|
Year
3
|
|
Managers
|
$100,000
|
$105,000
|
$110,250
|
Pastry Bakers
|
$40,800
|
$42,840
|
$44,982
|
Baristas
|
$120,000
|
$126,000
|
$132,300
|
Other
|
$0
|
$0
|
$0
|
Total People
|
10
|
10
|
10
|
Total Payroll
|
$260,800
|
$273,840
|
$287,532
|
Financial Plan
SB expects to raise $110,000 of
its own capital, and to borrow $100,000 guaranteed by the SBA as a
ten-year loan. This provides the bulk of the current financing required.
7.1
Break-even Analysis
SB's Break-even Analysis is based on
the average of the first-year figures for total sales by units, and by
operating expenses. These are presented as per-unit revenue, per-unit cost, and
fixed costs. These conservative assumptions make for a more accurate
estimate of real risk. SB should break even by the fourth month of its
operation as it steadily increases its sales.
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Break-even Analysis
|
|
Monthly Units Break-even
|
17,255
|
Monthly Revenue Break-even
|
$38,336
|
Assumptions:
|
|
Average Per-Unit Revenue
|
$2.22
|
Average Per-Unit Variable Cost
|
$0.35
|
Estimated Monthly Fixed Cost
|
$32,343
|
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7.2
Projected Profit and Loss
As the Profit and Loss table
shows, SB expects to continue its steady growth in profitability
over the next three years of operations.
Pro Forma Profit and Loss
|
|||
Year
1
|
Year
2
|
Year
3
|
|
Sales
|
$491,000
|
$567,105
|
$655,006
|
Direct Cost of Sales
|
$76,750
|
$88,646
|
$102,386
|
Other
|
$0
|
$0
|
$0
|
Total Cost of Sales
|
$76,750
|
$88,646
|
$102,386
|
Gross Margin
|
$414,250
|
$478,459
|
$552,620
|
Gross Margin %
|
84.37%
|
84.37%
|
84.37%
|
Expenses
|
|||
Payroll
|
$260,800
|
$273,840
|
$287,532
|
Sales and Marketing and Other
Expenses
|
$27,000
|
$35,200
|
$71,460
|
Depreciation
|
$60,000
|
$69,000
|
$79,350
|
Utilities
|
$1,200
|
$1,260
|
$1,323
|
Payroll Taxes
|
$39,120
|
$41,076
|
$43,130
|
Other
|
$0
|
$0
|
$0
|
Total Operating Expenses
|
$388,120
|
$420,376
|
$482,795
|
Profit Before Interest and Taxes
|
$26,130
|
$58,083
|
$69,825
|
EBITDA
|
$86,130
|
$127,083
|
$149,175
|
Interest Expense
|
$10,000
|
$9,500
|
$8,250
|
Taxes Incurred
|
$3,111
|
$12,146
|
$15,650
|
Net Profit
|
$13,019
|
$36,437
|
$45,925
|
Net Profit/Sales
|
2.65%
|
6.43%
|
7.01%
|
7.3
Projected Cash Flow
The cash flow projection shows
that provisions for ongoing expenses are adequate to meet SB's needs as
the business generates cash flow sufficient to support operations.
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Pro Forma Cash Flow
|
|||
Year
1
|
Year
2
|
Year
3
|
|
Cash Received
|
|||
Cash from Operations
|
|||
Cash Sales
|
$491,000
|
$567,105
|
$655,006
|
Subtotal Cash from Operations
|
$491,000
|
$567,105
|
$655,006
|
Additional Cash Received
|
|||
Sales Tax, VAT, HST/GST Received
|
$0
|
$0
|
$0
|
New Current Borrowing
|
$0
|
$0
|
$0
|
New Other Liabilities
(interest-free)
|
$0
|
$0
|
$0
|
New Long-term Liabilities
|
$0
|
$0
|
$0
|
Sales of Other Current Assets
|
$0
|
$0
|
$0
|
Sales of Long-term Assets
|
$0
|
$0
|
$0
|
New Investment Received
|
$0
|
$0
|
$0
|
Subtotal Cash Received
|
$491,000
|
$567,105
|
$655,006
|
Expenditures
|
Year
1
|
Year
2
|
Year
3
|
Expenditures from Operations
|
|||
Cash Spending
|
$260,800
|
$273,840
|
$287,532
|
Bill Payments
|
$143,607
|
$186,964
|
$237,731
|
Subtotal Spent on Operations
|
$404,407
|
$460,804
|
$525,263
|
Additional Cash Spent
|
|||
Sales Tax, VAT, HST/GST Paid Out
|
$0
|
$0
|
$0
|
Principal Repayment of Current
Borrowing
|
$0
|
$0
|
$0
|
Other Liabilities Principal
Repayment
|
$0
|
$0
|
$0
|
Long-term Liabilities Principal
Repayment
|
$0
|
$10,000
|
$15,000
|
Purchase Other Current Assets
|
$0
|
$0
|
$0
|
Purchase Long-term Assets
|
$0
|
$20,000
|
$20,000
|
Dividends
|
$0
|
$0
|
$0
|
Subtotal Cash Spent
|
$404,407
|
$490,804
|
$560,263
|
Net Cash Flow
|
$86,593
|
$76,301
|
$94,744
|
Cash Balance
|
$156,593
|
$232,894
|
$327,637
|
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7.4
Balance Sheet
The following is a projected Balance
Sheet for SB.
Pro Forma Balance Sheet
|
|||
Year
1
|
Year
2
|
Year
3
|
|
Assets
|
|||
Current Assets
|
|||
Cash
|
$156,593
|
$232,894
|
$327,637
|
Other Current Assets
|
$12,000
|
$12,000
|
$12,000
|
Total Current Assets
|
$168,593
|
$244,894
|
$339,637
|
Long-term Assets
|
|||
Long-term Assets
|
$65,000
|
$85,000
|
$105,000
|
Accumulated Depreciation
|
$60,000
|
$129,000
|
$208,350
|
Total Long-term Assets
|
$5,000
|
($44,000)
|
($103,350)
|
Total Assets
|
$173,593
|
$200,894
|
$236,287
|
Liabilities and Capital
|
Year
1
|
Year
2
|
Year
3
|
Current Liabilities
|
|||
Accounts Payable
|
$14,574
|
$15,438
|
$19,907
|
Current Borrowing
|
$0
|
$0
|
$0
|
Other Current Liabilities
|
$0
|
$0
|
$0
|
Subtotal Current Liabilities
|
$14,574
|
$15,438
|
$19,907
|
Long-term Liabilities
|
$100,000
|
$90,000
|
$75,000
|
Total Liabilities
|
$114,574
|
$105,438
|
$94,907
|
Paid-in Capital
|
$110,000
|
$110,000
|
$110,000
|
Retained Earnings
|
($64,000)
|
($50,981)
|
($14,544)
|
Earnings
|
$13,019
|
$36,437
|
$45,925
|
Total Capital
|
$59,019
|
$95,456
|
$141,381
|
Total Liabilities and Capital
|
$173,593
|
$200,894
|
$236,287
|
Net Worth
|
$59,019
|
$95,456
|
$141,381
|
7.5
Business Ratios
The following table represents key
ratios for the retail bakery and coffee shop industry. These ratios are
determined by the Standard Industry Classification (SIC) Index code 5812,
Eating Places.
Ratio Analysis
|
||||
Year
1
|
Year
2
|
Year
3
|
Industry
Profile
|
|
Sales Growth
|
0.00%
|
15.50%
|
15.50%
|
7.60%
|
Percent of Total Assets
|
||||
Other Current Assets
|
6.91%
|
5.97%
|
5.08%
|
35.60%
|
Total Current Assets
|
97.12%
|
121.90%
|
143.74%
|
43.70%
|
Long-term Assets
|
2.88%
|
-21.90%
|
-43.74%
|
56.30%
|
Total Assets
|
100.00%
|
100.00%
|
100.00%
|
100.00%
|
Current Liabilities
|
8.40%
|
7.68%
|
8.42%
|
32.70%
|
Long-term Liabilities
|
57.61%
|
44.80%
|
31.74%
|
28.50%
|
Total Liabilities
|
66.00%
|
52.48%
|
40.17%
|
61.20%
|
Net Worth
|
34.00%
|
47.52%
|
59.83%
|
38.80%
|
Percent of Sales
|
||||
Sales
|
100.00%
|
100.00%
|
100.00%
|
100.00%
|
Gross Margin
|
84.37%
|
84.37%
|
84.37%
|
60.50%
|
Selling, General &
Administrative Expenses
|
74.74%
|
71.43%
|
71.39%
|
39.80%
|
Advertising Expenses
|
0.49%
|
1.76%
|
6.87%
|
3.20%
|
Profit Before Interest and Taxes
|
5.32%
|
10.24%
|
10.66%
|
0.70%
|
Main Ratios
|
||||
Current
|
11.57
|
15.86
|
17.06
|
0.98
|
Quick
|
11.57
|
15.86
|
17.06
|
0.65
|
Total Debt to Total Assets
|
66.00%
|
52.48%
|
40.17%
|
61.20%
|
Pre-tax Return on Net Worth
|
27.33%
|
50.90%
|
43.55%
|
1.70%
|
Pre-tax Return on Assets
|
9.29%
|
24.18%
|
26.06%
|
4.30%
|
Additional Ratios
|
Year
1
|
Year
2
|
Year
3
|
|
Net Profit Margin
|
2.65%
|
6.43%
|
7.01%
|
n.a
|
Return on Equity
|
22.06%
|
38.17%
|
32.48%
|
n.a
|
Activity Ratios
|
||||
Accounts Payable Turnover
|
10.79
|
12.17
|
12.17
|
n.a
|
Payment Days
|
27
|
29
|
27
|
n.a
|
Total Asset Turnover
|
2.83
|
2.82
|
2.77
|
n.a
|
Debt Ratios
|
||||
Debt to Net Worth
|
1.94
|
1.10
|
0.67
|
n.a
|
Current Liab. to Liab.
|
0.13
|
0.15
|
0.21
|
n.a
|
Liquidity Ratios
|
||||
Net Working Capital
|
$154,019
|
$229,456
|
$319,731
|
n.a
|
Interest Coverage
|
2.61
|
6.11
|
8.46
|
n.a
|
Additional Ratios
|
||||
Assets to Sales
|
0.35
|
0.35
|
0.36
|
n.a
|
Current Debt/Total Assets
|
8%
|
8%
|
8%
|
n.a
|
Acid Test
|
11.57
|
15.86
|
17.06
|
n.a
|
Sales/Net Worth
|
8.32
|
5.94
|
4.63
|
n.a
|
Dividend Payout
|
0.00
|
0.00
|
0.00
|
n.a
|
Appendix
Sales Forecast
|
|||||||||||||
Month 1
|
Month 2
|
Month 3
|
Month 4
|
Month 5
|
Month 6
|
Month 7
|
Month 8
|
Month 9
|
Month 10
|
Month 11
|
Month 12
|
||
Unit Sales
|
|||||||||||||
Espresso Drinks
|
0%
|
5,000
|
7,500
|
10,000
|
12,500
|
12,500
|
12,500
|
12,500
|
12,500
|
12,500
|
12,500
|
12,500
|
12,500
|
Pastry Items
|
0%
|
2,000
|
3,000
|
6,000
|
8,333
|
8,333
|
8,333
|
8,333
|
8,333
|
8,333
|
8,333
|
8,333
|
8,333
|
Other
|
0%
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
Total Unit Sales
|
7,000
|
10,500
|
16,000
|
20,833
|
20,833
|
20,833
|
20,833
|
20,833
|
20,833
|
20,833
|
20,833
|
20,833
|
|
Unit Prices
|
Month 1
|
Month 2
|
Month 3
|
Month 4
|
Month 5
|
Month 6
|
Month 7
|
Month 8
|
Month 9
|
Month 10
|
Month 11
|
Month 12
|
|
Espresso Drinks
|
$3.00
|
$3.00
|
$3.00
|
$3.00
|
$3.00
|
$3.00
|
$3.00
|
$3.00
|
$3.00
|
$3.00
|
$3.00
|
$3.00
|
|
Pastry Items
|
$1.00
|
$1.00
|
$1.00
|
$1.00
|
$1.00
|
$1.00
|
$1.00
|
$1.00
|
$1.00
|
$1.00
|
$1.00
|
$1.00
|
|
Other
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
|
Sales
|
|||||||||||||
Espresso Drinks
|
$15,000
|
$22,500
|
$30,000
|
$37,500
|
$37,500
|
$37,500
|
$37,500
|
$37,500
|
$37,500
|
$37,500
|
$37,500
|
$37,500
|
|
Pastry Items
|
$2,000
|
$3,000
|
$6,000
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
|
Other
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Total Sales
|
$17,000
|
$25,500
|
$36,000
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
|
Direct Unit Costs
|
Month 1
|
Month 2
|
Month 3
|
Month 4
|
Month 5
|
Month 6
|
Month 7
|
Month 8
|
Month 9
|
Month 10
|
Month 11
|
Month 12
|
|
Espresso Drinks
|
0.00%
|
$0.25
|
$0.25
|
$0.25
|
$0.25
|
$0.25
|
$0.25
|
$0.25
|
$0.25
|
$0.25
|
$0.25
|
$0.25
|
$0.25
|
Pastry Items
|
0.00%
|
$0.50
|
$0.50
|
$0.50
|
$0.50
|
$0.50
|
$0.50
|
$0.50
|
$0.50
|
$0.50
|
$0.50
|
$0.50
|
$0.50
|
Other
|
0.00%
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
Direct Cost of Sales
|
|||||||||||||
Espresso Drinks
|
$1,250
|
$1,875
|
$2,500
|
$3,125
|
$3,125
|
$3,125
|
$3,125
|
$3,125
|
$3,125
|
$3,125
|
$3,125
|
$3,125
|
|
Pastry Items
|
$1,000
|
$1,500
|
$3,000
|
$4,167
|
$4,167
|
$4,167
|
$4,167
|
$4,167
|
$4,167
|
$4,167
|
$4,167
|
$4,167
|
|
Other
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Subtotal Direct Cost of Sales
|
$2,250
|
$3,375
|
$5,500
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
|
Need
real financials?
We recommend using LivePlan as the
easiest way to create automatic financials for your own business plan.
Personnel Plan
|
|||||||||||||
Month 1
|
Month 2
|
Month 3
|
Month 4
|
Month 5
|
Month 6
|
Month 7
|
Month 8
|
Month 9
|
Month 10
|
Month 11
|
Month 12
|
||
Managers
|
0%
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
$8,333
|
Pastry Bakers
|
0%
|
$3,400
|
$3,400
|
$3,400
|
$3,400
|
$3,400
|
$3,400
|
$3,400
|
$3,400
|
$3,400
|
$3,400
|
$3,400
|
$3,400
|
Baristas
|
0%
|
$10,000
|
$10,000
|
$10,000
|
$10,000
|
$10,000
|
$10,000
|
$10,000
|
$10,000
|
$10,000
|
$10,000
|
$10,000
|
$10,000
|
Other
|
0%
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
Total People
|
10
|
10
|
10
|
10
|
10
|
10
|
10
|
10
|
10
|
10
|
10
|
10
|
|
Total Payroll
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
|
General Assumptions
|
|||||||||||||
Month 1
|
Month 2
|
Month 3
|
Month 4
|
Month 5
|
Month 6
|
Month 7
|
Month 8
|
Month 9
|
Month 10
|
Month 11
|
Month 12
|
||
Plan Month
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
10
|
11
|
12
|
|
Current Interest Rate
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
|
Long-term Interest Rate
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
10.00%
|
|
Tax Rate
|
30.00%
|
25.00%
|
25.00%
|
25.00%
|
25.00%
|
25.00%
|
25.00%
|
25.00%
|
25.00%
|
25.00%
|
25.00%
|
25.00%
|
|
Other
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
|
Pro Forma Profit and Loss
|
|||||||||||||
Month 1
|
Month 2
|
Month 3
|
Month 4
|
Month 5
|
Month 6
|
Month 7
|
Month 8
|
Month 9
|
Month 10
|
Month 11
|
Month 12
|
||
Sales
|
$17,000
|
$25,500
|
$36,000
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
|
Direct Cost of Sales
|
$2,250
|
$3,375
|
$5,500
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
|
Other
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Total Cost of Sales
|
$2,250
|
$3,375
|
$5,500
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
$7,292
|
|
Gross Margin
|
$14,750
|
$22,125
|
$30,500
|
$38,542
|
$38,542
|
$38,542
|
$38,542
|
$38,542
|
$38,542
|
$38,542
|
$38,542
|
$38,542
|
|
Gross Margin %
|
86.76%
|
86.76%
|
84.72%
|
84.09%
|
84.09%
|
84.09%
|
84.09%
|
84.09%
|
84.09%
|
84.09%
|
84.09%
|
84.09%
|
|
Expenses
|
|||||||||||||
Payroll
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
|
Sales and Marketing and Other
Expenses
|
$2,250
|
$2,250
|
$2,250
|
$2,250
|
$2,250
|
$2,250
|
$2,250
|
$2,250
|
$2,250
|
$2,250
|
$2,250
|
$2,250
|
|
Depreciation
|
15%
|
$5,000
|
$5,000
|
$5,000
|
$5,000
|
$5,000
|
$5,000
|
$5,000
|
$5,000
|
$5,000
|
$5,000
|
$5,000
|
$5,000
|
Utilities
|
5%
|
$100
|
$100
|
$100
|
$100
|
$100
|
$100
|
$100
|
$100
|
$100
|
$100
|
$100
|
$100
|
Payroll Taxes
|
15%
|
$3,260
|
$3,260
|
$3,260
|
$3,260
|
$3,260
|
$3,260
|
$3,260
|
$3,260
|
$3,260
|
$3,260
|
$3,260
|
$3,260
|
Other
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Total Operating Expenses
|
$32,343
|
$32,343
|
$32,343
|
$32,343
|
$32,343
|
$32,343
|
$32,343
|
$32,343
|
$32,343
|
$32,343
|
$32,343
|
$32,343
|
|
Profit Before Interest and Taxes
|
($17,593)
|
($10,218)
|
($1,843)
|
$6,198
|
$6,198
|
$6,198
|
$6,198
|
$6,198
|
$6,198
|
$6,198
|
$6,198
|
$6,198
|
|
EBITDA
|
($12,593)
|
($5,218)
|
$3,157
|
$11,198
|
$11,198
|
$11,198
|
$11,198
|
$11,198
|
$11,198
|
$11,198
|
$11,198
|
$11,198
|
|
Interest Expense
|
$833
|
$833
|
$833
|
$833
|
$833
|
$833
|
$833
|
$833
|
$833
|
$833
|
$833
|
$833
|
|
Taxes Incurred
|
($5,528)
|
($2,763)
|
($669)
|
$1,341
|
$1,341
|
$1,341
|
$1,341
|
$1,341
|
$1,341
|
$1,341
|
$1,341
|
$1,341
|
|
Net Profit
|
($12,899)
|
($8,289)
|
($2,007)
|
$4,024
|
$4,024
|
$4,024
|
$4,024
|
$4,024
|
$4,024
|
$4,024
|
$4,024
|
$4,024
|
|
Net Profit/Sales
|
-75.87%
|
-32.50%
|
-5.58%
|
8.78%
|
8.78%
|
8.78%
|
8.78%
|
8.78%
|
8.78%
|
8.78%
|
8.78%
|
8.78%
|
|
Pro Forma Cash Flow
|
|||||||||||||
Month 1
|
Month 2
|
Month 3
|
Month 4
|
Month 5
|
Month 6
|
Month 7
|
Month 8
|
Month 9
|
Month 10
|
Month 11
|
Month 12
|
||
Cash Received
|
|||||||||||||
Cash from Operations
|
|||||||||||||
Cash Sales
|
$17,000
|
$25,500
|
$36,000
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
|
Subtotal Cash from Operations
|
$17,000
|
$25,500
|
$36,000
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
|
Additional Cash Received
|
|||||||||||||
Sales Tax, VAT, HST/GST Received
|
0.00%
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
New Current Borrowing
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
New Other Liabilities
(interest-free)
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
New Long-term Liabilities
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Sales of Other Current Assets
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Sales of Long-term Assets
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
New Investment Received
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Subtotal Cash Received
|
$17,000
|
$25,500
|
$36,000
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
$45,833
|
|
Expenditures
|
Month 1
|
Month 2
|
Month 3
|
Month 4
|
Month 5
|
Month 6
|
Month 7
|
Month 8
|
Month 9
|
Month 10
|
Month 11
|
Month 12
|
|
Expenditures from Operations
|
|||||||||||||
Cash Spending
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
$21,733
|
|
Bill Payments
|
$1,106
|
$3,295
|
$7,196
|
$11,401
|
$15,076
|
$15,076
|
$15,076
|
$15,076
|
$15,076
|
$15,076
|
$15,076
|
$15,076
|
|
Subtotal Spent on Operations
|
$22,839
|
$25,028
|
$28,929
|
$33,134
|
$36,810
|
$36,810
|
$36,810
|
$36,810
|
$36,810
|
$36,810
|
$36,810
|
$36,810
|
|
Additional Cash Spent
|
|||||||||||||
Sales Tax, VAT, HST/GST Paid Out
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Principal Repayment of Current
Borrowing
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Other Liabilities Principal
Repayment
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Long-term Liabilities Principal
Repayment
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Purchase Other Current Assets
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Purchase Long-term Assets
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Dividends
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
|
Subtotal Cash Spent
|
$22,839
|
$25,028
|
$28,929
|
$33,134
|
$36,810
|
$36,810
|
$36,810
|
$36,810
|
$36,810
|
$36,810
|
$36,810
|
$36,810
|
|
Net Cash Flow
|
($5,839)
|
$472
|
$7,071
|
$12,699
|
$9,024
|
$9,024
|
$9,024
|
$9,024
|
$9,024
|
$9,024
|
$9,024
|
$9,024
|
|
Cash Balance
|
$64,161
|
$64,633
|
$71,703
|
$84,403
|
$93,426
|
$102,450
|
$111,474
|
$120,498
|
$129,521
|
$138,545
|
$147,569
|
$156,593
|
|
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Pro Forma Balance Sheet
|
|||||||||||||
Month 1
|
Month 2
|
Month 3
|
Month 4
|
Month 5
|
Month 6
|
Month 7
|
Month 8
|
Month 9
|
Month 10
|
Month 11
|
Month 12
|
||
Assets
|
Starting Balances
|
||||||||||||
Current Assets
|
|||||||||||||
Cash
|
$70,000
|
$64,161
|
$64,633
|
$71,703
|
$84,403
|
$93,426
|
$102,450
|
$111,474
|
$120,498
|
$129,521
|
$138,545
|
$147,569
|
$156,593
|
Other Current Assets
|
$12,000
|
$12,000
|
$12,000
|
$12,000
|
$12,000
|
$12,000
|
$12,000
|
$12,000
|
$12,000
|
$12,000
|
$12,000
|
$12,000
|
$12,000
|
Total Current Assets
|
$82,000
|
$76,161
|
$76,633
|
$83,703
|
$96,403
|
$105,426
|
$114,450
|
$123,474
|
$132,498
|
$141,521
|
$150,545
|
$159,569
|
$168,593
|
Long-term Assets
|
|||||||||||||
Long-term Assets
|
$65,000
|
$65,000
|
$65,000
|
$65,000
|
$65,000
|
$65,000
|
$65,000
|
$65,000
|
$65,000
|
$65,000
|
$65,000
|
$65,000
|
$65,000
|
Accumulated Depreciation
|
$0
|
$5,000
|
$10,000
|
$15,000
|
$20,000
|
$25,000
|
$30,000
|
$35,000
|
$40,000
|
$45,000
|
$50,000
|
$55,000
|
$60,000
|
Total Long-term Assets
|
$65,000
|
$60,000
|
$55,000
|
$50,000
|
$45,000
|
$40,000
|
$35,000
|
$30,000
|
$25,000
|
$20,000
|
$15,000
|
$10,000
|
$5,000
|
Total Assets
|
$147,000
|
$136,161
|
$131,633
|
$133,703
|
$141,403
|
$145,426
|
$149,450
|
$153,474
|
$157,498
|
$161,521
|
$165,545
|
$169,569
|
$173,593
|
Liabilities and Capital
|
Month 1
|
Month 2
|
Month 3
|
Month 4
|
Month 5
|
Month 6
|
Month 7
|
Month 8
|
Month 9
|
Month 10
|
Month 11
|
Month 12
|
|
Current Liabilities
|
|||||||||||||
Accounts Payable
|
$1,000
|
$3,060
|
$6,820
|
$10,898
|
$14,574
|
$14,574
|
$14,574
|
$14,574
|
$14,574
|
$14,574
|
$14,574
|
$14,574
|
$14,574
|
Current Borrowing
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
Other Current Liabilities
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
$0
|
Subtotal Current Liabilities
|
$1,000
|
$3,060
|
$6,820
|
$10,898
|
$14,574
|
$14,574
|
$14,574
|
$14,574
|
$14,574
|
$14,574
|
$14,574
|
$14,574
|
$14,574
|
Long-term Liabilities
|
$100,000
|
$100,000
|
$100,000
|
$100,000
|
$100,000
|
$100,000
|
$100,000
|
$100,000
|
$100,000
|
$100,000
|
$100,000
|
$100,000
|
$100,000
|
Total Liabilities
|
$101,000
|
$103,060
|
$106,820
|
$110,898
|
$114,574
|
$114,574
|
$114,574
|
$114,574
|
$114,574
|
$114,574
|
$114,574
|
$114,574
|
$114,574
|
Paid-in Capital
|
$110,000
|
$110,000
|
$110,000
|
$110,000
|
$110,000
|
$110,000
|
$110,000
|
$110,000
|
$110,000
|
$110,000
|
$110,000
|
$110,000
|
$110,000
|
Retained Earnings
|
($64,000)
|
($64,000)
|
($64,000)
|
($64,000)
|
($64,000)
|
($64,000)
|
($64,000)
|
($64,000)
|
($64,000)
|
($64,000)
|
($64,000)
|
($64,000)
|
($64,000)
|
Earnings
|
$0
|
($12,899)
|
($21,187)
|
($23,195)
|
($19,171)
|
($15,147)
|
($11,124)
|
($7,100)
|
($3,076)
|
$948
|
$4,971
|
$8,995
|
$13,019
|
Total Capital
|
$46,000
|
$33,101
|
$24,813
|
$22,805
|
$26,829
|
$30,853
|
$34,876
|
$38,900
|
$42,924
|
$46,948
|
$50,971
|
$54,995
|
$59,019
|
Total Liabilities and Capital
|
$147,000
|
$136,161
|
$131,633
|
$133,703
|
$141,403
|
$145,426
|
$149,450
|
$153,474
|
$157,498
|
$161,521
|
$165,545
|
$169,569
|
$173,593
|
Net Worth
|
$46,000
|
$33,101
|
$24,813
|
$22,805
|
$26,829
|
$30,853
|
$34,876
|
$38,900
|
$42,924
|
$46,948
|
$50,971
|
$54,995
|
$59,019
|
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