Nightclub Resort Complex Business Plan
The EbonySun entertainment resort will be one of the world’s largest nightlife facilities in the Gotham/Metropolis area. The owner, Mr. Clubb, has successfully opened and run 12 Gotham nightclubs, casinos, and resorts. EbonySun will provide 10 unique nightclub themes, with a capacity for 10,000 to 17,000 people. The goal is to offer a unique nightlife experience for adults aged 21-40 in Gotham/Metropolis. The facility will include 4 themed restaurants, 10 nightclub rooms, 10 offices, conference rooms, 2 VIP rooms, and a large sports center for nearby businesses and colleges.
The facility will also have an outside beach pool with mountains and waterfalls for summer parties. It will provide parking for 50,000 people and 4 helicopter landing pads for high-profile business travelers. The resort’s proximity to 150 universities and colleges makes it attractive to college students.
The EbonySun Entertainment Resort will host live concerts and feature various themed club rooms, such as South America’s wildest party, the world’s largest dance floors, water bars, hot tub bars, Oxygen bars, New Orleans entertainment, 60’s & 70’s music, galaxy-themed rooms, country dance central, hip-hop and rock dance floors, and Broadway themes. The Sports Center will have 100 TV terminals showing world sports events and over 200 gaming machines.
The EbonySun Entertainment Resort aims to be a unique nightlife destination in the larger Gotham/Metropolis area, serving 8 million people. To fund construction and support its cash reserves, $7.96 Million in equity financing is being sought. Investors will receive dividends up to three times their initial investment.
Objectives:
– Become a leader in Nightlife Entertainment by creating a facility with 10 different themes, live concerts, multi-level bars, national theme rooms, large dance floors, and VIP luxury rooms
– Capitalize on an excellent location with no competitors at a large scale
– Maintain tight control of costs, operations, and cash flow
– Provide a unique customer experience and create satisfied customers
Mission:
EbonySun Entertainment Resort provides an unmatched, unique experience for nightlife entertainment. We offer high-quality entertainment in a wide range of theme-based nightclub rooms, wildest parties, and dance events. Our facility also provides high-quality food and customer service. Our goal is to be a step ahead of the competition and the leader in U.S. nightlife entertainment.
Keys to Success:
– Provide the highest quality service
– Manage finances to increase profit by reducing costs
– Have experienced management
– Create a unique entertainment experience to increase repeat customers
– Implement targeted marketing and leverage the facility’s uniqueness
– Maintain and grow referral networks
– Improve operational efficiency
– Offer price competitive service offerings
EbonySun Entertainment Resort, owned by BigBank Corporation, is an innovative entertainment facility funded through equity financing. A professional management team will oversee operations to enhance sales revenue and return on investment. The company is seeking $7.96 million in initial equity financing to construct the resort. Situated near 150 universities and colleges, the resort targets the college student market, promising attractive revenues and returns for investors.
The parent company, BigBank Corporation, intends to secure $7.96 million in equity financing to finance the new entertainment resort facility in Gotham/Gotham Metropolis area. Construction expenses will primarily be allocated to the resort facility. Long-term assets comprise the 400,000 square feet EbonySun resort structure and heavy-duty equipment like refrigeration units and kitchen equipment. Other current assets include furniture and fixtures for bars, restaurants, and dance halls within the structure. Lighting will be intricately designed to establish distinct ambiances in each area.
Start-up Requirements:
– Resort Construction Expenses: $500,000
– Audio/Lighting Lease Payment: $150,000
– Air Condition Upgrade: $500,000
– Bar Equipment: $475,000
– Bar Supply: $500,000
– Entertainment Artist Fees: $300,000
– Cash Reserves: $250,000
– Exterior Signage: $400,000
– Fees & Permits: $100,000
– FFE: $110,000
– Impact Fees: $40,000
– Initial Marketing: $100,000
– Kitchen Upgrade: $252,500
– Interior Refit: $800,000
– Legal: $100,000
– Opening Salaries Deposit: $490,000
– Paper Products: $60,000
– Point of Sale Systems: $122,500
– Other: $0
– Total Start-up Expenses: $5,250,000
Start-up Assets:
– Cash Required: $500,000
– Start-up Inventory: $10,000
– Other Current Assets: $200,000
– Long-term Assets: $2,000,000
– Total Assets: $2,710,000
Total Requirements: $7,960,000
Company Ownership:
The founder, Mr. Clubb, has over 30 years of experience in the entertainment, resort, nightclub, and casino industries. Mr. Clubb will retain 40% ownership of the venture and serve as the General Manager for the first three years. He is offering 60% equity ownership for the remaining $5.96 Million of investment necessary to start this project. Every $99,333 of investment will buy 1% equity ownership. Ideally, 2 investors would make up the bulk of the funding. They will start receiving dividends in the third year and would be eligible in the fifth year to opt for a buy-out option of their shares by Mr. Clubb.
Services:
The entertainment resort will have the following amenities:
– 10 individually-themed nightclub rooms
– 2 VIP Luxury rooms
– 4 Restaurants seating 300 and a midnight cafe
– 1 Sports Central Game room with over 100 TVs and over 200 Gaming devices
– 15 rooms for entertainment
– Outside beach pool with mountains and waterfalls
– Parking for 50,000 people, including 4 helicopter landing pads
Market Analysis Summary:
The EbonySun Entertainment Resort has a wide variety of young people as its target market. The facility with dance, music, bars, and restaurants will attract young people living in the local area along with visiting tourists. The Metropolis area, which has over 150 colleges and universities nearby, makes it easy to reach students through targeted advertising. The proximity of this area to universities increases the success rate of this project.
Market Segmentation:
The target market can be separated into the following six categories:
– College Students: EbonySun resort is close to various colleges and universities, attracting students in and around the Metropolis area. The unique dance and international themes will attract U.S. and international students.
– Single Young Business Professionals: Young business professionals in the area between 25 and 40 will spend their income on high-quality night entertainment.
– Married Couples: Married couples between the ages of 30 and 40, with or without kids, are targeted for occasional weekend parties.
– Tourists/Vacationers: The Metropolis area is an important tourist area for visitors from other states and international tourists. EbonySun offers a unique entertainment experience which can be included in vacation packages.
– Age Group within a 20-mile radius of Metropolis:
– 20 to 24 years: 372,591 estimate
– 25 to 34 years: 899,618 estimate
– 35 to 44 years: 911,494 estimate
Market Analysis:
The EbonySun Entertainment Resort is located in the Metropolis area of Gotham, which has over 150 colleges and universities nearby. The higher number of colleges in this area simplifies reaching the student market through targeted advertising. The proximity of this area to universities increases the success rate of this project. The high sales revenue involved with the sales of alcoholic beverages in the United States indicates the probability of success for EbonySun Entertainment Resort. The data is based on the 2002 Economic Census, including Sector 71: Arts, Entertainment, and Recreation, and 39202: Sales of alcoholic beverages.
Related Industries by Product Line:
– Number of establishments
– Sales, receipts, or revenue ($1,000)
– Performing arts companies
– Theater companies and dinner theaters
– Musical groups and artists
– Other performing arts companies
– Sports teams and clubs
– Promoters of performing arts, sports, and similar events with facilities
– Promoters of performing arts, sports, and similar events without facilities
– Agents and managers for artists, athletes, entertainers, and other public figures
– Independent artists, writers, and performers
– Museums, historical sites, and similar institutions
– Zoos and botanical gardens
– Nature parks and other similar institutions
– Amusement and recreation industries
– Golf courses and country clubs
– Fitness and recreational sports centers
– All other amusement and recreation industries
Market Analysis:
– Year 1, Year 2, Year 3, Year 4, Year 5
– Potential Customers, Growth, CAGR
– College Students, Young Business Professionals, Married Couples, Tourists/Vacationers, Total
Target Market Segment Strategy:
– College Students: Ages 18-26, interested in drinks and dance, value nightclub theme rooms. Attract with Vault, Ozone and Cloud Nine, Carnival, and Fat Tuesday themes.
– Single Young Business Professionals: Ages 25-40, interested in business parties, client meetings, etc. Attract with Sin City and Fat Tuesday New Orleans themes.
– Married Couples: Ages 30-40, spend weekends in bars and restaurants. Enjoy Throw Back Central, Carnival, Outer Limits, and Broadway themes.
– Tourists & Vacationers: People visiting the area. Target with various themes. Attract through travel agencies and billboard ads.
Service Business Analysis:
– EbonySun is in the nightlife entertainment industry.
– Competitors are local nightclubs, movie theaters, mini-golf, rock concerts, bowling, etc.
– Industry grows every year.
Competition and Buying Patterns:
– Compete against other local nightclubs, movie theaters, etc.
– Encourage customers to choose EbonySun over other options.
– People make choices based on environment, experience, drinks, and food.
Strategy and Implementation Summary:
– Marketing strategies: Differentiation by Innovation, Specialized Products & Service, Customer Incentive Programs, Aggressive Marketing, Keeping Cost Down, Focus on Local Market.
– Competitive Edge: Variety of theme-based nightclubs, no major competitors in the vicinity.
– Location: 150 colleges and universities within a 50 mile radius.
– Various marketing strategies and tactics to attract target market.
– EbonySun Mobile Party Units for transportation between colleges, malls, and venues.
– Advertising through EbonySun Mobile Party Units, promotional pricing for college students, media advertisement, banner ads, corporate tie-ups, direct mail campaigning, membership programs, travel agency & hotel chain tie-ups.
Sales Strategy:
– Make a sale and create repeat customers through long-term relationships.
– Structure sales force based on territorial control.
– Incentives based on new account creations, existing account maintenance, relationships, etc.
Sales Implementation:
– Promotional pricing, mobile party tours, separate parties and meeting areas for corporate customers, direct mail sales and marketing to local market.
– Sales revenue for each month and projected sales for next four years.
– Increase in revenue due to increased publicity.
– Seasonal business with highest revenue during spring and summer.
Sales Forecast
Unit Sales
– Beverage Sales: 1,608,104 (Year 1), 1,874,638 (Year 2), 2,212,072 (Year 3), 2,654,486 (Year 4), 3,292,562 (Year 5)
– Food Sales: 222,850 (Year 1), 248,709 (Year 2), 283,528 (Year 3), 334,563 (Year 4), 441,858 (Year 5)
– Cover Charges: 1,141,836 (Year 1), 1,241,327 (Year 2), 1,415,112 (Year 3), 1,669,832 (Year 4), 2,070,591 (Year 5)
– Total Unit Sales: 2,972,790 (Year 1), 3,364,674 (Year 2), 3,910,712 (Year 3), 4,658,881 (Year 4), 5,805,011 (Year 5)
Unit Prices
– Beverage Sales: $6.00 (Year 1-5)
– Food Sales: $12.00 (Year 1-5)
– Cover Charges: $20.00 (Year 1-5)
Sales
– Beverage Sales: $9,648,624 (Year 1), $11,247,828 (Year 2), $13,272,432 (Year 3), $15,926,916 (Year 4), $19,755,372 (Year 5)
– Food Sales: $2,674,200 (Year 1), $2,984,508 (Year 2), $3,402,336 (Year 3), $4,014,756 (Year 4), $5,302,296 (Year 5)
– Cover Charges: $22,836,720 (Year 1), $24,826,540 (Year 2), $28,302,240 (Year 3), $33,396,640 (Year 4), $41,411,820 (Year 5)
– Total Sales: $35,159,544 (Year 1), $39,058,876 (Year 2), $44,977,008 (Year 3), $53,338,312 (Year 4), $66,469,488 (Year 5)
Personnel Plan
– Security Guards: $518,400 (Year 1), $528,400 (Year 2), $538,400 (Year 3), $548,400 (Year 4), $558,400 (Year 5)
– Bar Personnel: $399,600 (Year 1), $409,600 (Year 2), $419,600 (Year 3), $429,600 (Year 4), $439,600 (Year 5)
– Waitress: $504,000 (Year 1), $512,000 (Year 2), $520,000 (Year 3), $528,000 (Year 4), $536,000 (Year 5)
– Kitchen Staff: $232,200 (Year 1), $237,200 (Year 2), $242,200 (Year 3), $247,200 (Year 4), $252,200 (Year 5)
– Back Office Staff: $126,000 (Year 1), $128,000 (Year 2), $130,000 (Year 3), $132,000 (Year 4), $134,000 (Year 5)
– Host & Hostess: $172,800 (Year 1), $175,800 (Year 2), $178,800 (Year 3), $181,800 (Year 4), $184,800 (Year 5)
– Cleaning Staff: $129,600 (Year 1), $130,000 (Year 2), $131,000 (Year 3), $132,000 (Year 4), $133,000 (Year 5)
– DJs: $540,000 (Year 1), $560,000 (Year 2), $580,000 (Year 3), $600,000 (Year 4), $620,000 (Year 5)
– General Manager: $120,000 (Year 1), $130,000 (Year 2), $140,000 (Year 3), $150,000 (Year 4), $160,000 (Year 5)
– Marketing & Advertising Manager: $96,000 (Year 1), $100,000 (Year 2), $105,000 (Year 3), $110,000 (Year 4), $115,000 (Year 5)
– HR & Administrations Manager: $72,000 (Year 1), $80,000 (Year 2), $85,000 (Year 3), $90,000 (Year 4), $95,000 (Year 5)
– Financial Operations Manager: $108,000 (Year 1), $118,000 (Year 2), $123,000 (Year 3), $128,000 (Year 4), $133,000 (Year 5)
– Security Manager: $72,000 (Year 1), $80,000 (Year 2), $83,000 (Year 3), $87,000 (Year 4), $91,000 (Year 5)
– Computer Staff: $120,000 (Year 1), $130,000 (Year 2), $140,000 (Year 3), $150,000 (Year 4), $160,000 (Year 5)
– Total Payroll: $3,210,600 (Year 1), $3,319,000 (Year 2), $3,416,000 (Year 3), $3,514,000 (Year 4), $3,612,000 (Year 5)
Start-up Funding
– Start-up Expenses to Fund: $5,250,000
– Start-up Assets to Fund: $2,710,000
– Total Funding Required: $7,960,000
– Non-cash Assets from Start-up: $2,210,000
– Cash Requirements from Start-up: $500,000
– Cash Balance on Starting Date: $500,000
– Total Assets: $2,710,000
– Total Capital: $2,710,000
– Total Capital and Liabilities: $2,710,000
– Total Funding: $7,960,000
– The Break-even analysis shows the number of units of sales required for the facility to make a profit over the fixed costs.
Break-even Analysis:
| Break-even Analysis | |
| Monthly Units Break-even | 246,142 |
| Monthly Revenue Break-even | $2,911,155 |
| Assumptions: | |
| Average Per-Unit Revenue | $11.83 |
| Average Per-Unit Variable Cost | $1.66 |
| Estimated Monthly Fixed Cost | $2,501,750 |
Projected Profit and Loss
The following table and charts show the projected Profit and Loss for EbonySun. We expect to become profitable in the second year as satisfied customers become repeat customers and word-of-mouth about the resort spreads. We expect an increase in the tourist contingent. As the Profit and Loss table shows, the company expects steady growth in profitability over the next five years.
The cash flow projection indicates that ongoing expenses are sufficient to support the company’s needs, as the business generates enough cash flow for operations. The table also displays dividends paid to investors in later years, distributed based on equity ownership percentages.
Pro Forma Cash Flow
| Pro Forma Cash Flow | |||||
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
| Cash Received | |||||
| Cash from Operations | |||||
| Cash Sales | $35,159,544 | $39,058,876 | $44,977,008 | $53,338,312 | $66,469,488 |
| Subtotal Cash from Operations | $35,159,544 | $39,058,876 | $44,977,008 | $53,338,312 | $66,469,488 |
| Additional Cash Received | |||||
| Sales Tax, VAT, HST/GST Received | $0 | $0 | $0 | $0 | $0 |
| New Current Borrowing | $0 | $0 | $0 | $0 | $0 |
| New Other Liabilities (interest-free) | $0 | $0 | $0 | $0 | $0 |
| New Long-term Liabilities | $0 | $0 | $0 | $0 | $0 |
| Sales of Other Current Assets | $0 | $0 | $0 | $0 | $0 |
| Sales of Long-term Assets | $0 | $0 | $0 | $0 | $0 |
| New Investment Received | $0 | $0 | $0 | $0 | $0 |
| Subtotal Cash Received | $35,159,544 | $39,058,876 | $44,977,008 | $53,338,312 | $66,469,488 |
| Expenditures | |||||
| Expenditures from Operations | |||||
| Cash Spending | $3,210,600 | $3,319,000 | $3,416,000 | $3,514,000 | $3,612,000 |
| Bill Payments | $29,823,471 | $34,349,588 | $38,437,107 | $43,361,819 | $49,565,055 |
| Subtotal Spent on Operations | $33,034,071 | $37,668,588 | $41,853,107 | $46,875,819 | $53,177,055 |
| Additional Cash Spent | |||||
| Sales Tax, VAT, HST/GST Paid Out | $0 | $0 | $0 | $0 | $0 |
| Principal Repayment of Current Borrowing | $0 | $0 | $0 | $0 | $0 |
| Other Liabilities Principal Repayment | $0 | $0 | $0 | $0 | $0 |
| Long-term Liabilities Principal Repayment | $0 | $0 | $0 | $0 | $0 |
| Purchase Other Current Assets | $0 | $0 | $0 | $0 | $0 |
| Purchase Long-term Assets | $0 | $0 | $0 | $0 | $0 |
| Dividends | $0 | $0 | $2,000,000 | $5,000,000 | $10,000,000 |
| Subtotal Cash Spent | $33,034,071 | $37,668,588 | $43,853,107 | $51,875,819 | $63,177,055 |
| Net Cash Flow | $2,125,473 | $1,390,288 | $1,123,901 | $1,462,493 | $3,292,433 |
| Cash Balance | $2,625,473 | $4,015,761 | $5,139,662 | $6,602,154 | $9,894,587 |
Projected Balance Sheet
The balance sheet shows healthy growth of net worth and a strong financial position. The net worth grows over the years, as shown in the following table.
| Pro Forma Balance Sheet | |||||
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |
| Assets | |||||
| Cash | $2,625,473 | $4,015,761 | $5,139,662 | $6,602,154 | $9,894,587 |
| Inventory | $391,812 | $541,134 | $643,957 | $786,195 | $1,035,061 |
| Other Current Assets | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 |
| Total Current Assets | $3,217,285 | $4,756,895 | $5,983,619 | $7,588,349 | $11,129,648 |
| Long-term Assets | $2,000,000 | $2,000,000 | $2,000,000 | $2,000,000 | $2,000,000 |
| Accumulated Depreciation | $60,000 | $120,000 | $180,000 | $240,000 | $300,000 |
| Total Long-term Assets | $1,940,000 | $1,880,000 | $1,820,000 | $1,760,000 | $1,700,000 |
| Total Assets | $5,157,285 | $6,636,895 | $7,803,619 | $9,348,349 | $12,829,648 |
| Liabilities and Capital | |||||
| Current Liabilities | |||||
| Accounts Payable | $2,407,468 | $2,860,488 | $3,185,966 | $3,597,838 | $4,116,467 |
| Current Borrowing | $0 | $0 | $0 | $0 | $0 |
| Other Current Liabilities | $0 | $0 | $0 | $0 | $0 |
| Subtotal Current Liabilities | $2,407,468 | $2,860,488 | $3,185,966 | $3,597,838 | $4,116,467 |
| Long-term Liabilities | $0 | $0 | $0 | $0 | $0 |
| Total Liabilities | $2,407,468 | $2,860,488 | $3,185,966 | $3,597,838 | $4,116,467 |
| Paid-in Capital | $7,960,000 | $7,960,000 | $7,960,000 | $7,960,000 | $7,960,000 |
| Retained Earnings | ($5,250,000) | ($5,210,183) | ($6,183,593) | ($8,342,347) | ($12,209,489) |
| Earnings | $39,817 | $1,026,589 | $2,841,246 | $6,132,859 | $12,962,670 |
| Total Capital | $2,749,817 | $3,776,407 | $4,617,653 | $5,750,511 | $8,713,181 |
| Total Liabilities and Capital | $5,157,285 | $6,636,895 | $7,803,619 | $9,348,349 | $12,829,648 |
| Net Worth | $2,749,817 | $3,776,407 | $4,617,653 | $5,750,511 | $8,713,181 |
Business ratios for the years of this plan are shown below. Industry profile ratios based on the Standard Industrial Classification (SIC) code 5813.02, Night Clubs, are shown for comparison. We expect to maintain healthy ratios for profitability, risk, and return.
| Ratio Analysis | ||||||
| Year
Sales Forecast (Unit Sales) Beverage Sales: 0%, 125,500, 128,800, 136,802, 138,800, 140,000, 137,802, 135,600, 132,200, 132,200, 130,200, 130,200 Food Sales: 0%, 15,200, 17,200, 19,200, 20,200, 22,500, 20,300, 18,550, 17,400, 17,400, 16,200, 16,200 Cover Charges: 0%, 90,984, 94,284, 96,284, 98,284, 99,800, 98,000, 96,800, 93,400, 90,400, 90,400 Total Unit Sales: 231,684, 240,284, 252,286, 257,284, 262,300, 256,102, 250,950, 243,000, 236,800 (Unit Prices) Beverage Sales: $6.00, $6.00, $6.00, $6.00, $6.00, $6.00, $6.00, $6.00, $6.00, $6.00, $6.00, $6.00 Food Sales: $12.00, $12.00, $12.00, $12.00, $12.00, $12.00, $12.00, $12.00, $12.00, $12.00, $12.00, $12.00 Cover Charges: $20.00, $20.00, $20.00, $20.00, $20.00, $20.00, $20.00, $20.00, $20.00, $20.00, $20.00, $20.00 (Sales) Beverage Sales: $753,000, $772,800, $820,812, $832,800, $840,000, $826,812, $813,600, $793,200, $781,200, $781,200 Food Sales: $182,400, $206,400, $230,400, $242,400, $270,000, $243,600, $222,600, $208,800, $194,400, $194,400 Cover Charges: $1,819,680, $1,885,680, $1,925,680, $1,965,680, $1,996,000, $1,960,000, $1,936,000, $1,868,000, $1,808,000 Total Sales: $2,755,080, $2,864,880, $2,976,892, $3,040,880, $3,106,000, $3,030,412, $2,972,200, $2,870,000, $2,783,600 Personnel Plan Security Guards: 0%, $43,200, $43,200, $43,200, $43,200, $43,200, $43,200, $43,200, $43,200, $43,200, $43,200 Bar Personnel: 0%, $33,300, $33,300, $33,300, $33,300, $33,300, $33,300, $33,300, $33,300, $33,300, $33,300 Waitress: 0%, $42,000, $42,000, $42,000, $42,000, $42,000, $42,000, $42,000, $42,000, $42,000, $42,000 Kitchen Staff: 0%, $19,350, $19,350, $19,350, $19,350, $19,350, $19,350, $19,350, $19,350, $19,350, $19,350 Back Office Staff: 0%, $10,500, $10,500, $10,500, $10,500, $10,500, $10,500, $10,500, $10,500, $10,500, $10,500 Host & Hostess: 0%, $14,400, $14,400, $14,400, $14,400, $14,400, $14,400, $14,400, $14,400, $14,400, $14,400 Cleaning Staff: 0%, $10,800, $10,800, $10,800, $10,800, $10,800, $10,800, $10,800, $10,800, $10,800, $10,800 DJ’s: 0%, $45,000, $45,000, $45,000, $45,000, $45,000, $45,000, $45,000, $45,000, $45,000, $45,000 General Manager: 0%, $10,000, $10,000, $10,000, $10,000, $10,000, $10,000, $10,000, $10,000, $10,000, $10,000 Marketing & Advertising Manager: 0%, $8,000, $8,000, $8,000, $8,000, $8,000, $8,000, $8,000, $8,000, $8,000, $8,000 HR & Administrations Manager: 0%, $6,000, $6,000, $6,000, $6,000, $6,000, $6,000, $6,000, $6,000, $6,000, $6,000 Financial Operations Manager: 0%, $9,000, $9,000, $9,000, $9,000, $9,000, $9,000, $9,000, $9,000, $9,000, $9,000 Security Manager: 0%, $6,000, $6,000, $6,000, $6,000, $6,000, $6,000, $6,000, $6,000, $6,000, $6,000 Computer Staff: 0%, $10,000, $10,000, $10,000, $10,000, $10,000, $10,000, $10,000, $10,000, $10,000, $10,000 Total People: 172, 172, 172, 172, 172, 172, 172, 172, 172, 172, 172, 172 Total Payroll: $267,550, $267,550, $267,550, $267,550, $267,550, $267,550, $267,550, $267,550, $267,550, $267,550, $267,550, $267,550, $267,550 Pro Forma Profit and Loss |
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| 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 | $2,755,080 | $2,864,880 | $2,976,892 | $3,040,880 | $3,106,000 | $3,106,000 | $3,030,412 | $2,972,200 | $2,870,000 | $2,870,000 | $2,783,600 | $2,783,600 | |
| Direct Cost of Sales | $378,332 | $395,162 | $421,087 | $430,442 | $442,980 | $442,980 | $428,572 | $416,298 | $402,564 | $402,564 | $391,812 | $391,812 | |
| Other Costs of Sales | $10,000 | $12,000 | $12,500 | $12,560 | $12,600 | $12,600 | $12,200 | $11,800 | $10,200 | $10,200 | $10,200 | $10,200 | |
| Total Cost of Sales | $388,332 | $407,162 | $433,587 | $443,002 | $455,580 | $455,580 | $440,772 | $428,098 | $412,764 | $412,764 | $402,012 | $402,012 | |
| Gross Margin | $2,366,748 | $2,457,718 | $2,543,305 | $2,597,878 | $2,650,420 | $2,650,420 | $2,589,640 | $2,544,102 | $2,457,236 | $2,457,236 | $2,381,588 | $2,381,588 | |
| Gross Margin % | 85.90% | 85.79% | 85.43% | 85.43% | 85.33% | 85.33% | 85.46% | 85.60% | 85.62% | 85.62% | 85.56% | 85.56% | |
| Expenses | |||||||||||||
| Payroll | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | |
| Sales and Marketing | $80,000 | $90,000 | $100,000 | $100,000 | $100,000 | $95,000 | $90,000 | $90,000 | $85,000 | $70,000 | $70,000 | $70,000 | |
| Depreciation | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | |
| Advertising | $800,000 | $800,000 | $800,000 | $800,000 | $800,000 | $800,000 | $800,000 | $800,000 | $700,000 | $600,000 | $500,000 | $600,000 | |
| Professional-Fees | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | |
| Office Supplies | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | |
| Excise Taxes paid out | $803,608 | $803,608 | $803,608 | $803,608 | $803,608 | $803,608 | $803,608 | $803,608 | $803,608 | $803,608 | $803,608 | $803,608 | |
| Utilities | $100,000 | $100,000 | $100,000 | $100,000 | $100,000 | $100,000 | $100,000 | $100,000 | $100,000 | $100,000 | $100,000 | $100,000 | |
| Telephone | $70,000 | $75,000 | $80,000 | $85,000 | $85,000 | $85,000 | $80,000 | $80,000 | $80,000 | $80,000 | $80,000 | $80,000 | |
| Insurance | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | $70,000 | |
| Property Taxes | $8,000 | $8,000 | $8,000 | $8,000 | $8,000 | $8,000 | $8,000 | $8,000 | $8,000 | $8,000 | $8,000 | $8,000 | |
| Web Development | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | |
| House Keeping Supplies | 15% | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,000 | $6,500 |
| Payroll Taxes | 15% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Net Profit | ($129,472) | ($76,293) | ($26,882) | $7,819 | $44,598 | $48,098 | $12,552 | ($19,324) | ($6,630) | $73,870 | $90,916 | $20,566 | |
| Net Profit/Sales | -4.70% | -2.66% | -0.90% | 0.26% | 1.44% | 1.55% | 0.41% | -0.65% | -0.23% | 2.57% | |||
| 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 | $2,755,080 | $2,864,880 | $2,976,892 | $3,040,880 | $3,106,000 | $3,106,000 | $3,030,412 | $2,972,200 | $2,870,000 | $2,870,000 | $2,783,600 | $2,783,600 | |
| Subtotal Cash from Operations | $2,755,080 | $2,864,880 | $2,976,892 | $3,040,880 | $3,106,000 | $3,106,000 | $3,030,412 | $2,972,200 | $2,870,000 | $2,870,000 | $2,783,600 | $2,783,600 | |
| 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 | $0 |
| New Other Liabilities (interest-free) | $0 | $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 | $0 |
| Sales of Other Current Assets | $0 | $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 | $0 |
| New Investment Received | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Subtotal Cash Received | $2,755,080 | $2,864,880 | $2,976,892 | $3,040,880 | $3,106,000 | $3,106,000 | $3,030,412 | $2,972,200 | $2,870,000 | $2,870,000 | $2,783,600 | $2,783,600 | |
| Expenditures | |||||||||||||
| Expenditures from Operations | |||||||||||||
| Cash Spending | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | $267,550 | |
| Bill Payments | $99,344 | $2,970,505 | $2,687,843 | $2,757,572 | $2,770,918 | $2,800,855 | $2,783,537 | $2,730,095 | $2,702,822 | $2,588,121 | $2,519,774 | $2,412,085 | |
| Subtotal Spent on Operations | $366,894 | $3,238,055 | $2,955,393 | $3,025,122 | $3,038,468 | $3,068,405 | $3,051,087 | $2,997,645 | $2,970,372 | $2,855,671 | $2,787,324 | $2,679,635 | |
| 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 | $0 |
| Other Liabilities Principal Repayment | $0 | $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 | $0 |
| Purchase Other Current Assets | $0 | $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 | $0 |
| Dividends | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Subtotal Cash Spent | $366,894 | $3,238,055 | $2,955,393 | $3,025,122 | $3,038,468 | $3,068,405 | $3,051,087 | $2,997,645 | $2,970,372 | $2,855,671 | $2,787,324 | $2,679,635 | |
| Net Cash Flow | $2,388,186 | ($373,175) | $21,499 | $15,758 | $67,532 | $37,595 | ($20,675) | ($25,445) | ($100,372) | $14,329 | ($3,724) | $103,965 | |
| Cash Balance | $2,888,186 | $2,515,010 | $2,536,509 | $2,552,267 | $2,619,799 | $2,657,395 | $2,636,720 | $2,611,275 | $2,510,903 | $2,525,232 | $2,521,509 | $2,625,473 | |
Pro Forma Balance Sheet
| 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 | $500,000 | $2,888,186 | $2,515,010 | $2,536,509 | $2,552,267 | $2,619,799 | $2,657,395 | $2,636,720 | $2,611,275 | $2,510,903 | $2,525,232 | $2,521,509 | $2,625,473 | ||||||||||
| Inventory | $10,000 | $378,332 | $395,162 | $421,087 | $430,442 | $442,980 | $442,980 | $428,572 | $416,298 | $402,564 | $402,564 | $391,812 | $391,812 | ||||||||||
| Other Current Assets | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | $200,000 | ||||||||||
| Total Current Assets | $710,000 | $3,466,518 | $3,110,173 | $3,157,596 | $3,182,710 | $3,262,779 | $3,300,375 | $3,265,292 | $3,227,573 | $3,113,467 | $3,127,796 | $3,113,321 | $3,217,285 | ||||||||||
| Long-term Assets | |||||||||||||||||||||||
| Long-term Assets | $2,000,000 | $2,000,000 | $2,000,000 | $2,000,000 | $2,000,000 | $2,000,000 | $2,000,000 | $2,000,000 | $2,000,000 | $2,000,000 | $2,000,000 | $2,000,000 | $2,000,000 | ||||||||||
| 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 | $2,000,000 | $1,995,000 | $1,990,000 | $1,985,000 | $1,980,000 | $1,975,000 | $1,970,000 | $1,965,000 | $1,960,000 | $1,955,000 | $1,950,000 | $1,945,000 | $1,940,000 | ||||||||||
| Total Assets | $2,710,000 | $5,461,518 | $5,100,173 | $5,142,596 | $5,162,710 | $5,237,779 | $5,270,375 | $5,230,292 | $5,187,573 | $5,068,467 | $5,077,796 | $5,058,321 | $5,157,285 | ||||||||||
General Assumptions
| 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 | 6.00% | 6.00% | 6.00% | 6.00% | 6.00% | 6.00% | 6.00% | 6.00% | 6.00% | 6.00% | 6.00% | 6.00% | 6.00% | ||||||||||
| 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% | 10.00% | ||||||||||
| Tax Rate | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | 30.00% | ||||||||||
| Other | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||
Business Plan Outline
- Executive Summary
- Company Summary
- Services
- Market Analysis Summary
- Strategy and Implementation Summary
- Web Plan Summary
- Management Summary
- Financial Plan
- Appendix
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I’m Andrew Brooks, a seasoned finance consultant from the USA and the mind behind phonenumber247.com.
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