Contents
Medicine Dispenser Business Plan
Sunapto will manufacture and market an automated pill dispensing unit, the MedCabinet, and a monitoring service to address medication compliance in the United States. Elderly patients often have multiple disease states and consume an average of four to five prescription drugs and two over-the-counter drugs daily. Approximately 67% of elderly patients fail to follow dosage instructions, resulting in a nearly six-fold increase in hospitalization risk compared to the general population.
Sunapto’s mission is to improve and enhance people’s lives through the use of technology. They will provide home medical systems that prioritize safety, ease of use, and a strong partnership with healthcare providers. Their target market is the 65 and older age group, which currently consists of 35 million Americans and is growing at a rate of 1% annually. Sunapto aims to establish itself as a leader and innovator in the home healthcare device industry.
Sunapto’s marketing strategy will include industry/trade and physician/pharmacist awareness campaigns, as well as targeted executions for specific customer segments. They plan to sell the MedCabinet directly to consumers for $700, ensuring the right medication is taken at the right time.
In the medication compliance market, Sunapto faces competition from reminder devices, automated medication dispensers, and compliance services. The closest competitor is a similar product in the automated medication dispenser and compliance service market. However, this competitor suffers from high costs, limited dosing events, and weak marketing and distribution channels, making it susceptible to an improved alternative.
Sunapto, located in the Midwest, USA, is in the pre-start-up stage and will be established as a start-up LLC. The management team possesses experience in growth-oriented technology, finance, business unit development, and team leadership. Motivated by personal experiences with medication compliance issues in their families, the management team is committed to being part of the solution for the elderly. Sunapto is actively seeking individuals with sales, marketing, and medical device product development experience to join the team.
The MedCabinet is currently in the concept development stage, with a working prototype expected five months after plan initiation and sales starting 12 months after plan initiation. The initial sales projections are 11,077 units in Year 2 and 13,419 units in Year 3.
Sunapto requires significant investment to bring the MedCabinet to market and plans to seek two rounds of financing. The founders have committed personal financial contributions for Round 1 but are also looking for outside investors before launching the company. Round 1 funds will be utilized for management team additions, prototype development, and initial product marketing expenses. Round 2 funding will be necessary in the seventh month of operations to cover management team needs, prototype to product development, product marketing, and contract manufacturing expenses. Sunapto anticipates that Round 2 outside investors will see a respectable annual return over three years.
1.1 Mission
Sunapto is a home healthcare technology company dedicated to bringing healthcare home and improving people’s lives. They provide home medical systems that prioritize safety, ease of use, independent lifestyles, and strong partnerships with healthcare providers. Sunapto aims to achieve fair yet aggressive profitability while establishing its brand as a leader and innovator in home healthcare devices. The company plans to finance continued growth through a combination of equity investment and internally generated cash flow. Once their marketing platform is established, Sunapto will expand through new product extensions. The company fosters a strong and cohesive work environment, driven by a shared ethos and a passion to grow with unwavering belief.
1.2 Keys to Success
Sunapto’s keys to success are:
- Product Quality: A safe, reliable, easy-to-use product with a well-engineered design, quality workmanship, easy-to-follow programming, accurate dispensing, and uncomplicated use.
- Marketing: Once a quality product is available, Sunapto’s success relies on effective marketing. The MedCabinet is a new product, and consumers must be educated to gain market penetration in a market with people who often have a harder time accepting new technology.
- Partnerships: Sunapto is a management/marketing/technology company, not a manufacturing company. They will rely on partners for production and delivery. The establishment and maintenance of partnerships will be crucial.
- Philosophy: Sunapto aims to earn a higher than normal return for its business partners. They will take a balanced approach in guiding the company, considering four perspectives: financial, customer, internal process, and learning & growth.
1.3 Objectives
- Increase sales to over 24,000 MedCabinet units by Year 3.
- Have seven percent of units subscribed to the monitoring and notification service by Year 3.
Company Summary
Sunapto is a start-up Limited Liability Company (LLC) located in the Midwest, USA. They will manufacture and market the MedCabinet automatic pill dispenser, targeting the 65 and over market segments. Initial market research has been completed, and this business plan will serve as the framework for bringing their product to market.
Sunapto is in the development stage, and its proposed operations are subject to all the risks inherent in the establishment of a new business enterprise, including the absence of an operating history. The likelihood of Sunapto’s success must be considered in light of the problems, expenses, difficulties, complications, and delays frequently encountered in connection with the formation of a new business, as well as the competitive and regulatory environment in which Sunapto will operate. Although forecast revenues and expenses are set forth in this Plan, the actual amounts may vary substantially from those projected, and no assurance can be given that the results forecasted in this Plan will be achieved.
2.1 Start-up Summary
Sunapto’s start-up costs are expected to be minimal, including stationery, legal costs, and expenses associated with opening their first office. The start-up costs will be financed by direct owner investment. The assumptions are shown in the Start-up Table.
Start-up Requirements
Start-up Expenses
Legal: $2,000
Stationery etc.: $500
Brochures: $0
Consultants: $0
Insurance: $0
Rent: $0
Research and Development: $0
Expensed Equipment: $0
Other: $213
Total Start-up Expenses: $2,713
Start-up Assets
Cash Required: $470,000
Start-up Inventory: $0
Other Current Assets: $0
Long-term Assets: $0
Total Assets: $470,000
Total Requirements: $472,713
Start-up Funding
Start-up Expenses to Fund: $2,713
Start-up Assets to Fund: $470,000
Total Funding Required: $472,713
Assets
Non-cash Assets from Start-up: $0
Cash Requirements from Start-up: $470,000
Additional Cash Raised: $0
Cash Balance on Starting Date: $470,000
Total Assets: $470,000
Liabilities and Capital
Liabilities
Current Borrowing: $0
Long-term Liabilities: $0
Accounts Payable (Outstanding Bills): $0
Other Current Liabilities (interest-free): $0
Total Liabilities: $0
Capital
Planned Investment
John P. Brush: $2,713
Founders: $50,000
Round 1 Investors: $420,000
Other: $0
Additional Investment Requirement: $0
Total Planned Investment: $472,713
Loss at Start-up (Start-up Expenses): ($2,713)
Total Capital: $470,000
Total Capital and Liabilities: $470,000
Total Funding: $472,713
Company Ownership
Sunapto will be structured as an LLC in MidWest, USA. Ownership will be distributed amongst the founding partners, who plan to sell limited ownership to outside private investors.
Company Locations and Facilities
Sunapto is currently operated out of the founder’s home. They plan to relocate to an office space in the greater MidWest, USA area. The initial office space will be small, serving management functions. As the company grows, they will acquire additional office space. Sunapto will search for a contract manufacturer for the MedCabinet, who will handle distribution.
Products and Services
Sunapto will develop and market the MedCabinet, an automatic pill dispensing system. The MedCabinet ensures medication compliance and solves common problems with medication usage. It dispenses the correct medication at the right time and notifies the user. The technology used in the MedCabinet is subject to patent protection.
Competitive Comparison
Current options for organizing daily medications include traditional weekly pillboxes and electronic versions. Both options require manual separation of pills and may not account for multiple medications with different intervals. Compliance aids, such as simple pillboxes, electronic devices, automated dispensers, computer programs and pagers, and telephone reminder services, are available. The cost varies widely.
Fulfillment
Sunapto develops product concepts and supplies the intelligence to these products through software development. They will partner with a contract manufacturer to develop and produce the MedCabinet. The contract manufacturer should have experience in the medical device field, dealing with the FDA, product development capabilities, manufacturing, order fulfillment, distribution, and depot and repair.
Technology
Sunapto’s contract manufacturer should monitor and implement changes in manufacturing technology. The MedCabinet uses hardware and software technology, carefully selected to match price and performance. The companion monitoring and notification service relies on Internet and database technologies. The MedCabinet will contain patentable items.
Sales Literature
Sales literature for Sunapto and the MedCabinet is yet to be developed.
Future Products and Services
Sunapto plans to develop additional capabilities and enhancements to the MedCabinet product line. They aim to innovate and market their products, expanding into other healthcare and medical device areas.
Market Analysis Summary
Sunapto targets the 65 and over age group. The growth in this age category is expected to be high as baby boomers age. Medication compliance in home settings is a major unsatisfied need, which will only increase with medication usage and life expectancy. The MedCabinet serves as a major asset to this target market.
Market Segmentation
Sunapto’s potential customers include individuals 65 and over using medications in independent living, as well as those under 65 needing assistance in medication compliance. The 65 and over age group accounts for two-thirds of prescription and over-the-counter medication use. Sunapto will initially focus on this age group.
Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5 CAGR
Potential Customers Growth CAGR
65 years and over 1% 35,303 35,676 36,052 36,432 36,816 1.05%
55 to 64 years 4% 26,113 27,229 28,393 29,607 30,872 4.27%
18 to 54 years 0% 147,955 148,625 149,298 149,975 150,655 0.45%
Under 18 years 0% 70,935 71,153 71,371 71,590 71,810 0.31%
Other 0% 0 0 0 0 0 0.00%
Total 0.87% 280,306 282,683 285,114 287,604 290,153 0.87%
4.2 Target Market Segment Strategy
Sunapto’s choice of target markets is strategic. The 65 and over market have difficulty with memory and complicated dosage instructions for multiple medications. They have a large unsatisfied medical compliance need. This is an expanding age group. The U.S. Census Bureau estimates the 65 and over segment of the population will grow 3.7% from 2001-2005 and 9.2% from 2005-2010.
4.2.1 Market Needs
The elderly often have multiple chronic conditions and consume over one-third of prescription medications in the United States. The average individual in Sunapto’s target market consumes four to five prescription drugs and two OTC drugs per day. The risk of hospitalization due to adverse medication outcomes in elderly patients is estimated at 17%, almost six times greater than the general population.
Cognitive impairment may play a major role in drug-related problems in the elderly, making it difficult to follow medication directions. Other factors include lack of help with medication management, financial considerations, and vision decline affecting reading directions. Nearly 67% of patients fail to follow medication dosage instructions. Negative outcomes from drug-related problems include additional healthcare encounters, emergency department visits, and death.
The main customer need is medication compliance. The MedCabinet will address this need.
4.2.2 Market Trends
The U.S. population is becoming older due to improvements in healthcare and an aging baby boomer generation.
4.2.3 Market Growth
The U.S. Census Bureau estimates the mean age of the population will increase to 36.7 years from 2001-2005. The 65 and over segment of the population will grow approximately 1% each year from 2001-2005.
Although the population is aging, more individuals are leading independent lives. The percentage of elderly persons residing in nursing homes has decreased to 5.2%.
4.2.4 Market Concept Test
Sunapto’s preliminary concept test showed a market penetration potential of 10%. Sunapto estimates an initial market penetration of 2%. Market penetration is determined using the top two box method in which individuals indicated they would definitely or probably buy the product. Awareness is measured based on the target market’s knowledge of the product. ACV (All Commodity Volume) is a measure of distribution reach.
4.3 Service Business Analysis
The medication compliance industry is fragmented with small companies selling both electronic and traditional pill dispensers. There are no major medical device companies making or distributing devices similar to the MedCabinet. Consumers rely on expert advice from physicians and pharmacists when making purchasing decisions.
4.3.1 Distributing a Service
Electronic devices are sold online and listed in medical order guides, while non-electronic devices are sold in retail outlets, pharmacies, and through mail order. Distribution patterns are determined by buying and influencing groups in the healthcare industry.
4.3.2 Competition and Buying Patterns
Buyers in the home medical device market rely on advice from primary care physicians, pharmacists, and healthcare insurance providers. They are concerned about cost and insurance coverage. Awareness of automated pill dispensers is low, but plastic pill holders are well-known.
4.3.3 Main Competitors
Home Medical Services LLC is the main competitor in the medication compliance market. They offer a similar product but have weaknesses in cost, limited dosage options, and marketing/distribution channels.
4.3.4 Business Participants
There are no major medical device companies making or distributing devices similar to the MedCabinet. The market is fragmented with smaller companies selling electronic and traditional pill dispensers.
Strategy and Implementation Summary
Sunapto will pursue specific market segments with a multi-tiered, multi-channel approach. Marketing will follow broad awareness campaigns to specific target customer campaigns. Sunapto will sell directly to customers directed to them from their marketing campaigns.
Sunapto’s value proposition is unique. The MedCabinet addresses medication compliance issues in the target market and offers secure access to information for third parties.
5.2 Marketing Strategy
Marketing will begin with awareness campaigns and progress to targeted executions. Sunapto will work with healthcare providers and rely on word-of-mouth advertising. They will also consider retail partnerships for greater exposure and distribution.
5.2.1 Distribution Strategy
MedCabinet production will be outsourced, and an efficient ordering and delivery process will be implemented using internet technology. Initially, products will be shipped directly from the manufacturer. As demand increases, additional distribution centers may be considered.
5.2.2 Marketing Programs
Specific marketing programs are yet to be developed.
5.2.3 Pricing Strategy
The MedCabinet will be priced at $700 to encourage consumers with and without insurance to purchase the product. Sunapto plans to lobby insurance providers for coverage. The MedCabinet Monitor and Notification Service is priced at $19.95 per month.
5.2.4 Promotion Strategy
Public relations and industry media will help create awareness. Direct mail, advertisements, and sponsored events will target buying and influencing groups. Sunapto will work closely with physicians and home nursing professionals.
5.3 Competitive Edge
Sunapto has a competitive edge in technology, marketing/distribution, and their management team and advisory boards.
The MedCabinet helps individuals and caregivers avoid medication non-compliance by providing the right medication at the right time.
5.5 Sales Strategy
Sunapto will initially sell the MedCabinet directly to consumers. Once sales have reached a certain level, discussions with retail sales outlets will begin.
5.5.1 Sales Forecast
No sales are anticipated in Year 1. In Year 2, 11,077 MedCabinet units are expected to be sold, with 7% of customers purchasing companion services. Year 3 is projected to have 13,419 units sold, with 7% purchasing companion services. Sunapto estimates having 1,716 subscribers to the MedCabinet companion services by the end of Year 3.
Sales Forecast | |||
Year 1 | Year 2 | Year 3 | |
Unit Sales | |||
MedCabinet PMA | 0 | 11,077 | 13,419 |
MedCabinet Monitor & Notification Service | 0 | 776 | 940 |
MedCabinet M&N Service Renewal | 0 | 0 | 776 |
Other | 0 | 0 | 0 |
Total Unit Sales | 0 | 11,853 | 15,135 |
Unit Prices | Year 1 | Year 2 | Year 3 |
MedCabinet PMA | $0.00 | $700.00 | $700.00 |
MedCabinet Monitor & Notification Service | $0.00 | $301.06 | $301.06 |
MedCabinet M&N Service Renewal | $0.00 | $239.40 | $239.40 |
Other | $0.00 | $0.00 | $0.00 |
Sales | |||
MedCabinet PMA | $0 | $7,753,900 | $9,393,300 |
MedCabinet Monitor & Notification Service | $0 | $233,623 | $282,997 |
MedCabinet M&N Service Renewal | $0 | $0 | $185,774 |
Other | $0 | $0 | $0 |
Total Sales | $0 | $7,987,523 | $9,862,072 |
Direct Unit Costs | Year 1 | Year 2 | Year 3 |
MedCabinet PMA | $0.00 | $420.00 | $420.00 |
MedCabinet Monitor & Notification Service | $0.00 | $30.14 | $30.14 |
MedCabinet M&N Service Renewal | $0.00 | $24.00 | $24.00 |
Other | $0.00 | $0.00 | $0.00 |
Direct Cost of Sales | |||
MedCabinet PMA | $0 | $4,652,340 | $5,635,980 |
MedCabinet Monitor & Notification Service | $0 | $23,386 | $28,328 |
MedCabinet M&N Service Renewal | $0 | $0 | $18,624 |
Other | $0 | $0 | $0 |
Subtotal Direct Cost of Sales | $0 | $4,675,726 | $5,682,932 |
5.5.2 Sales Programs
Direct sales will be done through personal contact, direct mail, public relations, and media targeting key industry and customer segments. Electronic marketing will also be used when it aligns with the buying and influencing patterns of specific groups. A website and e-commerce site will be utilized to facilitate direct sales to industry groups and end consumers.
5.6 Strategic Alliances
Sunapto will rely on strategic alliances in the following areas:
- Contract sales organization for national healthcare market positioning and selling.
- Contract design and manufacturing for quality product development and delivery.
- Website developer and host for continuous customer access and support.
Web Plan Summary
The Sunapto MedCabinet website will serve as the company’s virtual business card, portfolio, and online "home." It will showcase the MedCabinet product and offer access to the monitor and notification service. The website is an integral part of Sunapto’s overall marketing strategy, providing information and service to existing customers and enabling new customers to make purchases online.
The website should have a simple yet classy design that aligns with the latest trends in user interface design. It should prioritize ease of use and avoid excessive use of flashy or outdated technologies like Shockwave or Flash.
Sunapto plans to outsource the development and hosting of the initial MedCabinet website.
6.1 Website Marketing Strategy
The MedCabinet content/commerce site will focus on providing customer service, access to the MedCabinet Monitor and Notification service, products, and product information to the healthcare community, caregivers, and customer segments. It will also offer informational and educational content related to medication compliance/adherence issues.
Sunapto’s website will have a fast loading and user-friendly user interface (UI) that appeals to the target audience. The UI will be simple and clean.
6.2 Development Requirements
Sunapto will contract out the development and hosting of the initial MedCabinet website. They will work closely with a selected website developer to create a simple, classy, and internet-focused site that meets the needs of their target groups.
Management Summary
Sunapto is a small company owned and operated by its founders. Despite its loose style, the company operates with organization and logic. The management is based on the following principles:
- Build and maintain a cohesive leadership team.
- Create organizational clarity.
- Over-communicate organizational clarity.
- Reinforce organizational clarity through human systems.
While Sunapto has a good team to cover the main points of the business plan, they lack marketing capabilities to position their company and product in the medical marketplace, as well as technical capabilities to manage engineering aspects of product development. They plan to address these gaps by building two advisory boards and hiring key management positions.
7.1 Organizational Structure
The general organizational structure of Sunapto is illustrated in the chart below:
7.2 Management Team
John P. Brush, President: 41 years old, founded Sunapto in 2002 to focus on using technology to enhance home healthcare. John spent sixteen years at SCS, Inc. before obtaining his MBA. He was part of the management team that grew SCS from 4 to 55 employees with $5 million in sales. John holds an MBA from the University of Notre Dame’s Mendoza College of Business and a BS in Computer Science from Rose-Hulman Institute of Technology.
Resumes for the management team can be found in the appendix.
7.3 Management Team Gaps
Sunapto needs to strengthen their marketing capabilities to position their company and product in the medical marketplace. They also need technical expertise to manage the engineering portion of product development. To address these gaps, Sunapto plans to build two advisory boards consisting of experienced individuals in healthcare, medical devices, elder care, business development, growth, and medical device product development.
Key management positions that need to be filled include:
Sales and Marketing Director – Develops strategic sales and marketing objectives, manages sales territories and quotas, and oversees marketing programs and materials. Requires a bachelor’s degree with 7-10 years of sales and marketing experience, familiarity with medical and internet business models, and expertise in product/brand management.
Controller – Responsible for directing accounting functions, preparing financial reports, and presenting findings and recommendations. Requires a bachelor’s degree and 7 years of direct experience.
Engineering Manager – Plans and directs engineering activities. Requires a bachelor’s degree in engineering and 8-10 years of experience in various engineering fields.
7.4 Personnel Plan
The Personnel Plan reflects the need to strengthen Sunapto’s capabilities. They expect to have 10 employees in Year 1 and 16 by Year 3. Detailed monthly projections can be found in the appendix.
Personnel Plan | |||
Year 1 | Year 2 | Year 3 | |
Production Personnel | |||
Engineering Manager | $94,908 | $97,755 | $100,688 |
Software Engineer III | $43,577 | $67,332 | $69,352 |
Software Engineer II | $25,524 | $52,583 | $54,160 |
Database Administrator | $28,656 | $58,902 | $60,669 |
Other | $0 | $0 | $0 |
Subtotal | $192,665 | $276,572 | $284,869 |
Sales and Marketing Personnel | |||
Sales and Marketing Director | $85,920 | $88,498 | $91,153 |
Other | $0
Break-even Analysis: Monthly Units Break-even: 624 Monthly Revenue Break-even: $412,750 Assumptions: – Average Per-Unit Revenue: $661.00 – Average Per-Unit Variable Cost: $384.00 – Estimated Monthly Fixed Cost: $172,968 Projected Profit and Loss: Barring unforeseen circumstances, Sunapto is expected to break-even by Year 2. Profits in future years will increase with higher sales volume, resulting in a good net profit in Year 2 and even better in Year 3. Pro Forma Profit and Loss: |
Pro Forma Profit and Loss | |||
Year 1 | Year 2 | Year 3 | |
Sales | $0 | $7,987,523 | $9,862,072 |
Direct Cost of Sales | $0 | $4,675,726 | $5,682,932 |
Production Payroll | $192,665 | $276,572 | $284,869 |
Research and Development | $175,000 | $180,250 | $185,658 |
Other Production Expenses | $0 | $0 | $0 |
Total Cost of Sales | $367,665 | $5,132,548 | $6,153,459 |
Gross Margin | ($367,665) | $2,854,975 | $3,708,613 |
Gross Margin % | 0.00% | 35.74% | 37.60% |
Operating Expenses | |||
Sales and Marketing Expenses | |||
Sales and Marketing Payroll | $85,920 | $88,498 | $91,153 |
Contract Sales Organization | $50,000 | $273,000 | $312,000 |
Advertising/Promotions | $143,775 | $177,517 | $216,284 |
Travel | $6,000 | $7,800 | $10,140 |
Sales Commissions | $0 | $116,309 | $140,900 |
Legal | $12,000 | $12,360 | $12,731 |
Miscellaneous | $2,400 | $2,472 | $2,546 |
Total Sales and Marketing Expenses | $300,095 | $677,955 | $785,753 |
Sales and Marketing % | 0.00% | 8.49% | 7.97% |
General and Administrative Expenses | |||
General and Administrative Payroll | $212,936 | $275,943 | $308,646 |
Sales and Marketing and Other Expenses | $0 | $0 | $0 |
Depreciation | $0 | $0 | $0 |
Leased Equipment | $0 | $0 | $0 |
Utilities | $36,000 | $37,080 | $38,192 |
Insurance | $12,000 | $12,360 | $12,731 |
Office Equipment | $30,000 | $9,000 | $9,000 |
Office Supplies | $6,000 | $6,180 | $6,365 |
Rent | $60,000 | $61,800 | $63,654 |
Payroll Taxes | $154,287 | $238,105 | $280,063 |
Other General and Administrative Expenses | $0 | $0 | $0 |
Total General and Administrative Expenses | $511,223 | $640,468 | $718,652 |
General and Administrative % | 0.00% | 8.02% | 7.29% |
Other Expenses: | |||
Other Payroll | $22,770 | $152,671 | $248,876 |
Consultants | $0 | $0 | $0 |
Contract/Consultants | $0 | $0 | $0 |
Total Other Expenses | $22,770 | $152,671 | $248,876 |
Other % | 0.00% | 1.91% | 2.52% |
Total Operating Expenses | $834,089 | $1,471,094 | $1,753,281 |
Profit Before Interest and Taxes | ($1,201,754) | $1,383,881 | $1,955,332 |
EBITDA | ($1,201,754) | $1,383,881 | $1,955,332 |
Interest Expense | $0 | $0 | $0 |
Taxes Incurred | $0 | $484,358 | $676,219 |
Net Profit | ($1,201,754) | $899,523 | $1,279,113 |
Net Profit/Sales | 0.00% | 11.26% | 12.97% |
Projected Cash Flow
The company’s cash flow will decline in the first year of operations due to capital investments and no sales. Sunapto expects negative net cash flows throughout Year 1 as they develop prototypes and prepare for production with their contract manufacturer. Two capital infusions will support Sunapto during this period, leading up to the start of production and sales in Year 2. A monthly breakdown of Year 1 cash flow can be found in the appendix.
Pro Forma Cash Flow
Pro Forma Cash Flow | |||
Year 1 | Year 2 | Year 3 | |
Cash Received | |||
Cash from Operations | |||
Cash Sales | $0 | $7,188,771 | $8,875,865 |
Subtotal Cash from Operations | $0 | $7,987,523 | $9,862,072 |
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 | $710,000 | $0 | $0 |
Subtotal Cash Received | $710,000 | $7,987,523 | $9,862,072 |
Expenditures | Year 1 | Year 2 | Year 3 |
Expenditures from Operations | |||
Cash Spending | $514,291 | $793,684 | $933,544 |
Bill Payments | $637,885 | $5,826,554 | $7,538,037 |
Subtotal Spent on Operations | $1,152,176 | $6,620,237 | $8,471,581 |
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 | $0 | $0 |
Purchase Other Current Assets | $0 | $0 | $0 |
Purchase Long-term Assets | $0 | $0 | $0 |
Dividends | $0 | $0 | $0 |
Subtotal Cash Spent | $1,152,176 | $6,620,237 | $8,471,581 |
Net Cash Flow | ($442,176) | $1,367,286 | $1,390,491 |
Cash Balance | $27,824 | $1,395,110 | $2,785,601 |
8.5 Projected Balance Sheet
The table below presents the Balance Sheet for Sunapto.
Pro Forma Balance Sheet | |||
Year 1 | Year 2 | Year 3 | |
Assets | |||
Current Assets | |||
Cash | $27,824 | $1,395,110 | $2,785,601 |
Accounts Receivable | $0 | $0 | $0 |
Inventory | $0 | $0 | $0 |
Other Current Assets | $0 | $0 | $0 |
Total Current Assets | $27,824 | $1,395,110 | $2,785,601 |
Long-term Assets | |||
Total Long-term Assets | $0 | $0 | $0 |
Total Assets | $27,824 | $1,395,110 | $2,785,601 |
Liabilities and Capital | Year 1 | Year 2 | Year 3 |
Current Liabilities | |||
Accounts Payable | $49,578 | $517,341 | $628,719 |
Current Borrowing | $0 | $0 | $0 |
Other Current Liabilities | $0 | $0 | $0 |
Total Current Liabilities | $49,578 | $517,341 | $628,719 |
Long-term Liabilities | $0 | $0 | $0 |
Total Liabilities | $49,578 | $517,341 | $628,719 |
Paid-in Capital | $1,182,713 | $1,182,713 | $1,182,713 |
Retained Earnings | ($2,713) | ($1,204,467) | ($304,944) |
Earnings | ($1,201,754) | $899,523 | $1,279,113 |
Total Capital | ($21,754) | $877,769 | $2,156,882 |
Total Liabilities and Capital | $27,824 | $1,395,110 | $2,785,601 |
Net Worth | ($21,754) | $877,769 | $2,156,882 |
8.6 Business Ratios
The table follows with Sunapto’s main business ratios. The Industry figures come from the Standard Industry Classification (SIC) Index Code 3845, Electromedical Equipment.
Ratio Analysis | ||||
Year 1 | Year 2 | Year 3 | Industry Profile | |
Sales Growth | 0.00% | 0.00% | 23.47% | 2.30% |
Percent of Total Assets | ||||
Accounts Receivable | 0.00% | 0.00% | 0.00% | 26.40% |
Inventory | 0.00% | 0.00% | 0.00% | 13.10% |
Other Current Assets | 0.00% | 0.00% | 0.00% | 47.70% |
Total Current Assets | 100.00% | 100.00% | 100.00% | 87.20% |
Long-term Assets | 0.00% | 0.00% | 0.00% | 12.80% |
Total Assets | 100.00% | 100.00% | 100.00% | 100.00% |
Current Liabilities | ||||
Accounts Payable | 0.00% | 0.00% | 0.00% | 38.10% |
Long-term Liabilities | 0.00% | 0.00% | 0.00% | 18.70% |
Total Liabilities | 0.00% | 0.00% | 0.00% | 56.80% |
Net Worth | -78.18% | 62.92% | 77.43% | 43.20% |
Percent of Sales | ||||
Sales | 100.00% | 100.00% | 100.00% | 100.00% |
Gross Margin | 0.00% | 35.74% | 37.60% | 53.30% |
Selling, General & Administrative Expenses | 0.00% | 23.43% | 22.90% | 34.50% |
Advertising Expenses | 0.00% | 3.42% | 3.16% | 1.80% |
Profit Before Interest and Taxes | 0.00% | 17.33% | 19.83% | 4.70% |
Main Ratios | ||||
Current | 0.56 | 2.70 | 4.43 | 1.97 |
Quick | 0.56 | 2.70 | 4.43 | 1.34 |
Total Debt to Total Assets | 0.00% | 0.00% | 0.00% | 56.80% |
Pre-tax Return on Net Worth | 5524.36% | 157.66% | 90.66% | 4.10% |
Pre-tax Return on Assets | -4319.14% | 99.20% | 70.19% | 9.40% |
Additional Ratios | Year 1 | Year 2 | Year 3 | |
Net Profit Margin | 0.00% | 11.26% | 12.97% | n.a |
Return on Equity | 0.00% | 102.48% | 59.30% | n.a |
Activity Ratios | ||||
Accounts Receivable Turnover | 0.00 | 0.00 | 0.00 | n.a |
Collection Days | 0 | 0 | 0 | Call Center Manager: $0, $0, $0, $0, $0, $0, $3,795 for months 7-12
-Customer Service Rep: $0 for all 12 months -Webmaster: $0 for all 12 months -Other: $0 for all 12 months Subtotal: $0, $0, $0, $0, $0, $0, $3,795 for months 7-12 Total People: 4 for all 12 months Total Payroll: $29,260, $29,260, $29,260, $29,261, $34,707, $40,799, $53,624 for months 1-12 General Assumptions: 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% 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% 10.00% Tax Rate 30.00% 35.00% 35.00% 35.00% 35.00% 35.00% 35.00% 35.00% 35.00% 35.00% 35.00% 35.00% 35.00% Other 0 0 0 0 0 0 0 0 0 0 0 0 0 Pro Forma Profit and Loss: Month 1 2 3 4 5 6 7 8 9 10 11 12 Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Direct Cost of Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Production Payroll $7,909 $7,909 $7,909 $7,910 $13,356 $13,356 $22,386 $22,386 $22,386 $22,386 $22,386 $22,386 $22,386 Research and Development $43,750 $0 $0 $43,750 $0 $0 $43,750 $0 $0 $43,750 $0 $0 $0 Other Production Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Total Cost of Sales $51,659 $7,909 $7,909 $51,660 $13,356 $13,356 $66,136 $22,386 $22,386 $66,136 $22,386 $22,386 $22,386 Gross Margin ($51,659) ($7,909) ($7,909) ($51,660) ($13,356) ($13,356) ($66,136) ($22,386) ($22,386) ($66,136) ($22,386) ($22,386) ($22,386) Gross Margin % 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% Operating Expenses: Sales and Marketing Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Sales and Marketing Payroll $7,160 $7,160 $7,160 $7,160 $7,160 $7,160 $7,160 $7,160 $7,160 $7,160 $7,160 $7,160 $7,160 Contract Sales Organization $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $25,000 $25,000 Advertising/Promotions $0 $0 $0 $47,925 $0 $0 $47,925 $0 $0 $47,925 $0 $0 $0 Travel $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 Sales Commissions $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $ Pro Forma Cash Flow |
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 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash from Operations | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
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 | $710,000 | $0 | $0 | $0 | $0 | $0 | |
Subtotal Cash Received | $0 | $0 | $0 | $0 | $0 | $0 | $710,000 | $0 | $0 | $0 | $0 | $0 | |
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 | $29,260 | $29,260 | $29,260 | $29,261 | $34,707 | $40,799 | $53,624 | $53,624 | $53,624 | $53,624 | $53,624 | $53,624 | |
Bill Payments | $2,491 | $72,870 | $18,978 | $22,134 | $110,552 | $20,873 | $32,124 | $135,207 | $26,287 | $29,343 | $115,740 | $51,287 | |
Subtotal Spent on Operations | $31,751 | $102,130 | $48,238 | $51,395 | $145,259 | $61,672 | $85,748 | $188,831 | $79,911 | $82,967 | $169,364 | $104,911 | |
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 | $31,751 | $102,130 | $48,238 | $51,395 | $145,259 | $61,672 | $85,748 | $188,831 | $79,911 | $82,967 | $169,364 | $104,911 | |
Net Cash Flow | ($31,751) | ($102,130
Business Plan Outline
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Hello!
I’m Andrew Brooks, a seasoned finance consultant from the USA and the mind behind phonenumber247.com.
My career is built on a foundation of helping individuals and businesses thrive financially in an ever-changing economic landscape. At phonenumber247.com, my aim is to demystify the complex world of finance, providing clear, actionable advice that can help you navigate your financial journey with confidence. Whether it’s personal finance management, investment strategies, or understanding the nuances of market dynamics, I’m here to share insights and tools that can propel you towards your financial goals.
Welcome to my digital space, where every piece of advice is a step closer to financial clarity and success!