Dental Laboratories Business Plan
Wright’s Dental Laboratory aims to provide dentists with high-quality restorations using state-of-the-art esthetic materials. Our focus is on understanding each doctor’s unique needs and providing creative solutions. With over twenty-five years of experience and investment in advanced techniques and implant systems, our products and services enhance restorative treatment plans for aesthetic, reinforced teeth.
Keys to Success:
1. Continuously adapt to evolving dentistry challenges and dental professional aspirations.
2. Maintain consistent product excellence as a core principle.
3. Develop opportunities for each team member to maximize their potential.
Objectives:
1. Increase annual sales significantly.
2. Aggressively expand the number of dentists using lab services.
3. Extend service area to include the entire LochJaw tri-county area.
Wright’s Dental Laboratory offers state-of-the-art dental restoration services. Founded by Charles and David Wright, who combined their expertise, the lab ensures leading-edge technologies and progressive services. Charles is committed to continuing education, having completed training in metal-free restoration techniques and all premier implant systems. David has over ten years of experience with esteemed practitioners and is proficient in fixed and removable techniques.
Start-up Summary:
The start-up cost primarily involves equipment. Charles and David will invest personal funds and secure a long-term loan.
Company Ownership:
Owned by Charles and David Wright, Wright’s Dental Laboratory operates as a general partnership. Located in an 8,000 square foot facility with advanced restoration production systems, the lab offers custom-designed services using the latest technologies.
Products:
Wright’s Dental Laboratory offers a range of products including ceramics, porcelain restorations, dentures, and other orthodontic appliances.
Market Analysis Summary:
The LochJaw tri-county area has over 300 dentists. We aim to provide cost-effective dental lab services since they are a significant expense for dentists. With only four full-service dental labs in the area, Wright’s Dental Laboratory can set a new standard by investing in the latest technology and materials, benefiting both children and seniors.
Market Segmentation:
Our target customers include dental professionals specializing in services for seniors, children, and general dental care.
Sales Strategy:
Wright’s Dental Laboratory will offer discounted services to dental professionals, focusing on new techniques and equipment that assist in serving special populations.
Sales are expected to grow rapidly after the initial establishment phase. The projected sales for the first three years are as follows:
Year 1: $615,000
Year 2: $750,000
Year 3: $880,000
Management Summary:
Charles and David Wright will be responsible for marketing, sales, customer relations, and managing the dental lab operation, respectively.
Personnel Plan:
The lab will initially have seven employees comprising a marketing/sales manager, lab manager, four lab techs, and one customer service representative. An additional customer service operator will be hired in the second year.
Start-up funding will come from personal investments by Charles and David, along with a long-term loan. The total funding required is $250,000.
Break-even Analysis:
The monthly break-even point is projected to be $49,013.
Projected Profit and Loss:
The expected profit and loss for the next three years are as follows:
Year 1: Profit of $69,587
Year 2: Profit of $93,161
Year 3: Profit of $106,198
Pro Forma Profit and Loss:
| Year 1 | Year 2 | Year 3 | |
| Sales | $615,000 | $750,000 | $880,000 |
| Direct Cost of Sales | $221,000 | $269,250 | $315,920 |
| Other Production Expenses | $0 | $0 | $0 |
| Total Cost of Sales | $221,000 | $269,250 | $315,920 |
| Gross Margin | $394,000 | $480,750 | $564,080 |
| Gross Margin % | 64.07% | 64.10% | 64.10% |
| Expenses | |||
| Payroll | $264,000 | $290,000 | $324,000 |
| Sales and Marketing and Other Expenses | $24,000 | $30,000 | $35,000 |
| Depreciation | $12,000 | $12,000 | $12,000 |
| Leased Equipment | $0 | $0 | $0 |
| Utilities | $6,000 | $6,000 | $6,000 |
| Insurance | $7,200 | $7,200 | $7,200 |
| Rent | $24,000 | $24,000 | $24,000 |
| Payroll Taxes | $39,600 | $43,500 | $48,600 |
| Other | $0 | $0 | $0 |
| Total Operating Expenses | $376,800 | $412,700 | $456,800 |
| Profit Before Interest and Taxes | $17,200 | $68,050 | $107,280 |
| EBITDA | $29,200 | $80,050 | $119,280 |
| Interest Expense | $12,463 | $12,520 | $11,777 |
| Taxes Incurred | $1,421 | $16,659 | $28,651 |
| Net Profit | $3,316 | $38,871 | $66,852 |
| Net Profit/Sales | 0.54% | 5.18% | 7.60% |
Projected Cash Flow:
The following table and chart highlight the projected cash flow for three years. It will be necessary for each Wright brother to loan the company additional funds mid-year.
| Year 1 | Year 2 | Year 3 | |
| Cash Received | |||
| Cash from Operations | |||
| Cash Sales | $153,750 | $187,500 | $220,000 |
| Cash from Receivables | $343,250 | $536,598 | $635,057 |
| Subtotal Cash from Operations | $497,000 | $724,098 | $855,057 |
| 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 | $40,000 | $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 | $537,000 | $724,098 | $855,057 |
| Expenditures | Year 1 | Year 2 | Year 3 |
| Expenditures from Operations | |||
| Cash Spending | $264,000 | $290,000 | $324,000 |
| Bill Payments | $314,168 | $418,284 | $475,335 |
| Subtotal Spent on Operations | $578,168 | $708,284 | $799,335 |
| 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 | $9,864 | $9,864 | $5,000 |
| Purchase Other Current Assets | $0 | $0 | $0 |
| Purchase Long-term Assets | $0 | $0 | $0 |
| Dividends | $0 | $0 | $0 |
| Subtotal Cash Spent | $588,032 | $718,148 | $804,335 |
| Net Cash Flow | ($51,032) | $5,950 | $50,722 |
| Cash Balance | $20,668 | $26,618 | $77,340 |
Projected Balance Sheet:
The following table highlights the projected balance sheet for three years.
| Year 1 | Year 2 | Year 3 | |
| Assets | |||
| Current Assets | |||
| Cash | $20,668 | $26,618 | $77,340 |
| Accounts Receivable | $118,000 | $143,902 | $168,846 |
| Inventory | $30,800 | $31,307 | $35,377 |
| Other Current Assets | $12,000 | $12,000 | $12,000 |
| Total Current Assets | $181,468 | $213,827 | $293,562 |
| Long-term Assets | |||
| Long-term Assets | $80,000 | $80,000 | $80,000 |
| Accumulated Depreciation | $12,000 | $24,000 | $36,000 |
| Total Long-term Assets | $68,000 | $56,000 | $44,000 |
| Total Assets | $249,468 | $269,827 | $337,562 |
| Liabilities and Capital | Year 1 | Year 2 | Year 3 |
| Current Liabilities | |||
| Accounts Payable | $42,317 | $33,669 | $39,552 |
| Current Borrowing | $0 | $0 | $0 |
| Other Current Liabilities | $0 | $0 | $0 |
| Subtotal Current Liabilities | $42,317 | $33,669 | $39,552 |
| Long-term Liabilities | $130,136 | $120,272 | $115,272 |
| Total Liabilities | $172,453 | $153,941 | $154,824 |
| 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 | ||
| Sales | |||||||||||||
| Dental Products | 0% | $0 | $30,000 | $30,000 | $40,000 | $40,000 | $50,000 | $60,000 | $65,000 | $70,000 | $70,000 | $80,000 | $80,000 |
| Other | 0% | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Total Sales | $0 | $30,000 | $30,000 | $40,000 | $40,000 | $50,000 | $60,000 | $65,000 | $70,000 | $70,000 | $80,000 | $80,000 | |
| Direct Cost of Sales | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
| Dental Products | $0 | $12,000 | $12,000 | $15,000 | $15,000 | $18,000 | $21,000 | $22,000 | $25,000 | $25,000 | $28,000 | $28,000 | |
| Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Subtotal Direct Cost of Sales | $0 | $12,000 | $12,000 | $15,000 | $15,000 | $18,000 | $21,000 | $22,000 | $25,000 | $25,000 | $28,000 | $28,000 | |
Personnel 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 | ||
| Marketing/Sales Mgr | 0% | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 |
| Lab Mgr | 0% | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 | $4,000 |
| 4 Lab Techs | 0% | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 |
| Customer Service | 0% | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 | $2,000 |
| Total People | 7 | 7 | 7 | 7 | 7 | 7 | 7 | 7 | 7 | 7 | 7 | 7 | |
| Total Payroll | $22,000 | $22,000 | $22,000 | $22,000 | $22,000 | $22,000 | $22,000 | $22,000 | $22,000 | $22,000 | $22,000 | $22,000 | |
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 | 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% | 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 | |
Pro Forma Profit and Loss
| 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 | $0 | $30,000 | $30,000 | $40,000 | $40,000 | $50,000 | $60,000 | $65,000 | $70,000 | $70,000 | $80,000 | $80,000 | ||
| Direct Cost of Sales | $0 | $12,000 | $12,000 | $15,000 | $15,000 | $18,000 | $21,000 | $22,000 | $25,000 | $25,000 | $28,000 | $28,000 | ||
| Other Production Expenses | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | ||
| Total Cost of Sales | $0 | $12,000 | $12,000 | $15,000 | $15,000 | $18,000 | $21,000 | $22,000 | $25,000 | $25,000 | $28,000 | $28,000 | ||
| Gross Margin | $0 | $18,000 | $18,000 | $25,000 | $25,000 | $32,000 | $39,000 | $43,000 | $45,000 | $45,000 | $52,000 | $52,000 | ||
| Gross Margin % | 0.00% | 60.00% | 60.00% | 62.50% | 62.50% | 64.00% | 65.00% | 66.15% | 64.29% | 64.29% | 65.00% | 65.00% | ||
| Expenses | ||||||||||||||
| Payroll | $22,000 | $22,000 | $22
Pro Forma Cash Flow Cash Received Cash from Operations Cash Sales Cash from Receivables Subtotal Cash from Operations Additional Cash Received Sales Tax, VAT, HST/GST Received New Current Borrowing New Other Liabilities (interest-free) New Long-term Liabilities Sales of Other Current Assets Sales of Long-term Assets New Investment Received Subtotal Cash Received Expenditures Expenditures from Operations Cash Spending Bill Payments Subtotal Spent on Operations Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out Principal Repayment of Current Borrowing Other Liabilities Principal Repayment Long-term Liabilities Principal Repayment Purchase Other Current Assets Purchase Long-term Assets Dividends Subtotal Cash Spent Net Cash Flow Cash Balance Pro Forma Balance Sheet Assets Starting Balances Current Assets Cash Accounts Receivable Inventory Other Current Assets Total Current Assets Long-term Assets Long-term Assets Accumulated Depreciation Total Long-term Assets Total Assets Liabilities and Capital Current Liabilities Accounts Payable Current Borrowing Other Current Liabilities Subtotal Current Liabilities Long-term Liabilities Total Liabilities Paid-in Capital Retained Earnings Earnings Total Capital Total Liabilities and Capital Net Worth |
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