Surf Clothing and Sportswear Business Plan
Hang Toes Surfing is a new player in the surf wear and active wear apparel industry in the United States. Composed of surfers and designers, Hang Toes Surfing creates quality products for surfing, skating, and other active lifestyles. The company aims to establish itself as a cool-to-wear logo and apparel brand.
Based in Florida, Hang Toes Surfing strategically chose this location to receive credible product feedback due to its reputation as the Hispanic South American blend capital of the United States.
Products:
Hang Toes Surfing offers both surfing and active-wear clothing lines, soon to be available for distribution in the United States.
Market:
Hang Toes Surfing can supply quality apparel to the rapidly growing active-wear specialty market. The clothing lines cater to five segments: surfing, recreational, fitness, speed (cycling), leisure, and extreme skaters.
Management Team:
The company’s management team consists of sports-oriented individuals who design products to match their own active lifestyles. The President, who also serves as the President of the South American manufacturer, has 25 years of surfing experience. The Vice President and CEO in the United States became involved while supporting their children’s participation in ice hockey and skateboarding.
Hang Toes Surfing is an exciting business that leverages their individual sports passions for the company’s success and for the benefit of all sports-active individuals and their lifestyles.
Sales for the first year are forecasted to reach $765,000, with robust profits projected by year three.
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Contents
Objectives
- Provide specialty surfing stores with high-quality active-wear products
- Develop and manufacture new products to create brand awareness
- Expand the sales force throughout the United States
- Achieve sales of $700,000 by the end of the first year in business, with monthly sales exceeding $50,000
- Sponsor local community sports events
- Create products that attract buyers and consumers
- Build a solid e-commerce market to maximize profit margin
Mission
Hang Toes Surfing focuses on fulfilling the need for after-market products. This market has been identified based on the large volume of specialty stores opening throughout the United States.
Hang Toes Surfing adapts its product line for various recreational activities, including sports, leisure, and casual lifestyles. The mission is to:
- Offer top-selling product lines against competitors such as Billabong, Quicksilver/Roxy, and Reef
- Utilize surfing industry experience to identify products that attract consumers to specialty stores
Keys to Success
- Solicit feedback from customers (kids, teens, and young adults) to develop a successful clothing line meeting their needs and tastes
- Create a niche market for unique apparel (bags, beanies, hats, and surf boards)
- Maximize profits through online sales
- Maintain low overhead costs by monitoring and scheduling production
- Implement a marketing campaign to inform existing clients and the public of the new image
- Build brand image and equity through marketing efforts
Company Summary
Hang Toes Surfing is a start-up branch of an established clothing manufacturing firm in South America. Conceived by a professional surfer and clothing designer, Hang Toes Surfing creates practical designs for surf wear, in-line skating, and skateboarding. As avid health and fitness advocates, they promote a clothing line suitable for any active lifestyle.
Hang Toes Surfing will be managed by two executives in the United States, with support from the president of the South American manufacturing. They bring experience in Marketing, International Sales, Accounting, and Public Relations, perceiving an opportunity to acquire significant market share by focusing on the needs of the active-wear clothing industry and providing superior service to distributors and sales representatives. It will be organized as a closely-held corporation with the majority of shares held by the two principals.
The company plans to raise approximately $120,000 in start-up loans and maintains close contact with its manufacturer in South America.
Company Ownership
The company is a closely-held corporation with two principal shareholders forming the Board of Directors. Within the next five years, there are plans for a public offering to acquire additional financing. The principle owners intend to retain the majority of the company’s stock. The company is incorporated in Florida.
Currently, (names removed for confidentiality) serve as Chief Executive Officer and Vice President, respectively.
Start-up Summary
Start-up costs primarily include inventory, trade shows, marketing, trademark acquisition, leasing a company vehicle, operating and administrative expenses, and establishing a professional e-commerce website.
After receiving a loan for the first month of operation, the company plans extensive advertising through the Internet, surfing, skating, and snowboarding publications, as well as sponsorship of community events.
The start-up costs are illustrated in the following table.
Start-up Requirements
Legal: $4,000
Office Supplies: $800
Rent: $1,375
Computer, Internet Services & Hosting, Internet Merchant Acct.: $5,950
Marketing: Catalogues, Brochures, Posters, Magazine Ads, Expos: $27,500
Travel and Communication: $9,000
Customer Account Management: $5,500
Accounting: $1,500
Sponsorship Programs: $10,000
Product Shipping and Delivery: $10,000
Total Start-up Expenses: $75,625
Start-up Assets
Cash Required: $75,000
Start-up Inventory: $48,000
Other Current Assets: $50,000
Long-term Assets: $100,000
Total Assets: $273,000
Total Requirements: $348,625
Products
Hang Toes Surfing offers the following product lines:
1. Clothing line (street wear, dry-fit wear, surfing wear, snow wear, casual wear)
2. Accessories line (surf boards, fins, bags, socks, dry-fit hats, stickers, wallets)
3. Private labels for specialty stores, making their name wear an investment with direct profit for them
Other ideas for products are under development pending patent applications.
Market Analysis Summary
The increase in the number of independent specialty stores provides an opportunity to introduce a new clothing line. Our target market is customers of specialty stores who want comfortable quality clothing for both surfing and everyday wear.
Specialty retail stores are represented by large American companies like Quicksilver/Roxy, Billabong, etc. They are willing to pay more for quality products and attract young teens and their parents.
Board-Trac’s 2003 survey found that 47% of skateboarders and 50% of surfers surveyed also snowboard. Participation in snowboarding has jumped from 7.96 million in 2001 to 9.9 million in just three years. (*sources www.asrbiz.com, Transworld Magazine)
Retail shops are trying to hold customers year-round and are looking to bring in products that will keep customer loyalty from season to season.
There is a growing trend towards fitness skateboarding, serious street skating, wakeboarding, snowboarding, cycling, and surfing. Our targeted clothing and apparel lines will address their lifestyle needs.
Market Segmentation
Surfing, skateboarding, and in-line skating now have more participation than football, softball, skiing, and snowboarding combined. Surf Expo draws buyers from across the U.S., the Caribbean, and around the world.
Our aim is to penetrate this market by promoting our clothing line in Florida’s geographical location and be viewed as an asset to the state. Our target market will be family-oriented consumers, teenagers that want to buy clothes to match current trends, and the local specialty stores who cater to these customers.
Target Market Segment Strategy
Our target markets are teens, young adults, skaters, surfers, snowboarders, and the health and fitness enthusiast. This segment can be reached over the Internet and through TransWorld Business – Skate* Surf *Snow Magazine.
We plan on developing the specialty stores market through inexpensive postcard mailings. Direct mailing ads/coupons with priority codes is one of the most cost-effective ways to reach potential retail store customers. Offering gift certificates to specialty store owners will also help attract their attention.
Our skating and surfing sales have undergone tremendous growth and distribution throughout South America, and we want to do the same with Hang Toes Surfing in the United States. We will focus on Internet marketing and direct sales to specialty stores. The Internet is one of the best communication mediums for surfers, skaters, and snowboarders worldwide.
Our website will attract consumers and future distributors. We want our online presence to be strong.
Competition and Buying Patterns
The purchase decision for our customers is based on trust in our services, professionalism, and quality products. We have established relationships with overseas customers and our products have the highest quality standards.
Each segment of specialty stores has its own buying patterns depending on its own needs.
Strategy and Implementation Summary
Hang Toes Surfing will expand production capabilities to fulfill the requests of overseas customers. We will maximize the quantity of products offered and establish additional accounts through targeted marketing efforts on the West and East coasts of the United States.
Our competitive edge comes from having established relationships with Japanese, Italian, and Brazilian franchise and distributors. We offer a larger variety of clothing lines and purchase materials direct from original suppliers.
Our company’s competitive edge exists because we address the needs of our specialty retailers and their customers. Accessories such as fins, surfboards, and bags encourage customers to give us a second look.
Our marketing strategy will include targeted online and print media advertising and direct selling to customers and retailers in the United States. We will position ourselves as a differentiated provider of quality active-wear products.
The key to our marketing strategy is focusing on dry-fit clothing lines for active consumers such as cyclists, surfers, skaters, and fitness enthusiasts.
Sales Strategy
Our sales strategy focuses on meeting the increased demand of specialty stores in the United States and international companies with whom we have established relationships. We will focus on increasing volume in the United States while working on international marketing.
We sell our products through our website and target specialty shops with our Hang Toes Surfing clothing line. Visibility will be important, and we will sponsor sporting events to gain exposure.
We project sales to grow by ten to fifteen percent in 2006, reaching maximum production capacity in 2007. We will leverage contracts through direct sales methods and utilize advertising to create product awareness. Eventually, we will seek sales representation to increase sales.
Sales Forecast
Year 1 Year 2 Year 3
Sales
Boardshorts $284,520 $270,000 $275,000
Bikinis $172,790 $165,000 $168,000
Surfboards $96,460 $110,000 $120,000
Hats & Beanies$91,860 $100,000 $115,000
T-Shirts $120,000 $122,000 $125,000
Other $0 $120,000 $130,000
Total Sales $765,630 $887,000 $933,000
Direct Cost of Sales
Year 1 Year 2 Year 3
Freight $60,000 $44,000 $45,000
Processing $180,000 $150,000 $165,000
Subtotal Direct Cost of Sales $240,000 $194,000 $210,000
Milestones
The following milestones table outlines the key projects we need to focus on within our first year. We want to have a strong presence at both SurfExpos, make contact with key distributors, and specialty retail shops that cater to our customer base.
Milestones
Milestone Start Date End Date Budget Manager Department
Graphics for SurfExpo 8/26/2009 6/1/2005 $3,500 Graphic/Expo MKT
SURFEXPO 11/20/2005 12/10/2005 $10,000 M.S MKT
Marketing 5/1/2005 12/10/2005 $50,000 P.C MKT
SURF EXPO SEPT 9/21/2005 12/10/2005 $10,000 R.G MKT
Sales Mailing System 8/26/2009 12/1/2005 $600 P.C MKT
Service Direct Mail 8/26/2009 12/1/2005 $500 P.C SURF EXPO, MKT
Direct Mail 8/26/2009 12/12/2005 $300 L.B SURFEXPO, MKT
Poster, Business Cards 8/26/2009 10/1/2005 $200 P.C CEO, VP, ACCT
T-shirts & Hats Give Away 8/26/2009 9/25/2009 $500 P.C MKT
Totals $75,600
Web Plan Summary
Hang Toes Surfing views its website as a dynamic marketing tool for sales and direct e-mail marketing. The goal is to implement a functional and professionally-designed website that provides information about new product lines, sponsorship, a web cam for target customers and potential business partners, and new product updates. As the company grows, recruiting needs can be addressed by posting career opportunities and FAQs about the company. The website will also communicate company news to create and maintain positive public relations with the surfing community.
Website Marketing Strategy
We will maintain a two-way link between our website and our product suppliers. In addition to using the page as a sales tool, we will develop a monthly newsletter and coordinate with related sites to link to our site, allowing us to reach more customers directly. We will also maintain two-way links between supporters of sports events and event organizations through our website. This will include a schedule of relevant sporting events that we believe will appeal to our target customers.
Development Requirements
The initial creative design of the Hang Toes Surfing website will be handled by (NAME REMOVED) with experience in web design, and (NAME REMOVED) with experience in graphic design. They will work together to conceptualize the design and use of the company logo. Future redesign and ongoing support of the website will be handled by an outside contractor.
Management Summary
Chief Executive Officer and Founder
(Background information removed) Will concentrate on sales, Internet, e-commerce, and promotion. She will oversee product development and production by ordering the necessary products to maintain a smooth flow. She will also ensure that orders are filled and shipped.
Vice President
(Background information removed) Will be in charge of administrative functions, including public relations.
Vice President
(Background information removed) With a background in accounting, he will incorporate his expertise in areas such as marketing relations management and negotiations for future large accounts such as Burdine’s/Macy’s, Ron Jon.
Our team will collaborate to ensure the smooth operation of the company.
Personnel Plan
Our aim is to increase salaries and compensation in line with projected sales and profit growth. Our overall personnel costs for the first 12 months will be $48,000 for the first 12 months, which includes key employees only. The personnel cost figure is subject to change as required by the business demands. If our projected summer sales growth is realized, we will consider adding one more employee to assist with increased administrative demands.
Personnel Plan
Year 1 Year 2 Year 3
CEO $48,000 $50,000 $55,000
Vice President $42,000 $45,000 $48,000
Total People 0 0 0
Total Payroll $90,000 $95,000 $103,000
With an increase in sales, we expect to apply for a credit line of up to $150,000, supported by assets.
Our strong points:
– Financing growth mainly through cash flow, recognizing the need for a slower pace to invest in more advertising.
– Efficient inventory turnover to control costs.
– Credit card sales over the internet resulting in payment to our bank account within two days. Credit sales account for 25% of our total sales.
Start-up Funding
Our initial startup expenses will amount to approximately $75,000. The anticipated funding sources are detailed in the table below.
Start-up Funding
Start-up Expenses to Fund $75,625
Start-up Assets to Fund $273,000
Total Funding Required $348,625
Assets
Non-cash Assets from Start-up $198,000
Cash Requirements from Start-up $75,000
Additional Cash Raised $0
Cash Balance on Starting Date $75,000
Total Assets $273,000
Liabilities and Capital
Liabilities
Current Borrowing $0
Long-term Liabilities $120,000
Accounts Payable (Outstanding Bills) $48,000
Other Current Liabilities (interest-free) $0
Total Liabilities $168,000
Capital
Planned Investment
Owner $180,625
Investor $0
Additional Investment Requirement $0
Total Planned Investment $180,625
Loss at Start-up (Start-up Expenses) ($75,625)
Total Capital $105,000
Total Capital and Liabilities $273,000
Total Funding $348,625
The table below shows our monthly break-even point, including costs associated with maintaining our business such as rent and payroll.
Break-even Analysis:
Monthly Revenue Break-even: $52,056.
Assumptions:
– Average Percent Variable Cost: 31%.
– Estimated Monthly Fixed Cost: $35,738.
Projected Profit and Loss:
Hang Toes Surfing expects steady growth over the next three years, with an estimated net profit of nearly 15% for years two and three.
Pro Forma Profit and Loss:
| Pro Forma Profit and Loss | |||
| Year 1 | Year 2 | Year 3 | |
| Sales | $765,630 | $887,000 | $933,000 |
| Direct Cost of Sales | $240,000 | $194,000 | $210,000 |
| Other Costs of Sales | $60,000 | $65,000 | $70,000 |
| Total Cost of Sales | $300,000 | $259,000 | $280,000 |
| Gross Margin | $465,630 | $628,000 | $653,000 |
| Gross Margin % | 60.82% | 70.80% | 69.99% |
| Expenses | |||
| Payroll | $90,000 | $95,000 | $103,000 |
| Marketing/Promotion | $162,920 | $165,000 | $170,000 |
| Depreciation | $43,414 | $48,000 | $50,000 |
| Rent | $16,500 | $16,500 | $16,500 |
| Office utility, supplies | $56,023 | $50,000 | $50,000 |
| Insurance | $60,000 | $60,000 | $65,000 |
| Other | $0 | $0 | $0 |
| Total Operating Expenses | $428,857 | $434,500 | $454,500 |
| Profit Before Interest and Taxes | $36,773 | $193,500 | $198,500 |
| EBITDA | $80,187 | $241,500 | $248,500 |
| Interest Expense | $11,110 | $8,448 | $5,998 |
| Taxes Incurred | $7,699 | $55,516 | $57,751 |
| Net Profit | $17,964 | $129,536 | $134,751 |
| Net Profit/Sales | 2.35% | 14.60% | 14.44% |
Projected Cash Flow:
The financial outlook is positive as the company rolls out and meets its milestones. Initially, our cash flow will fluctuate with negative cash flow in some months during the first year. However, Hang Toes Surfing expects to be cash flow positive in years two and three.
- We aim to finance our first year’s growth through a loan.
- The most important indicator is inventory turnover. Our ability to schedule production from month to month will help control inventory costs.
- Collection is not an issue for our direct sales since we will receive payment in two days from our credit card company for internet sales.
- Selling our products online will allow us to maximize profit by charging full retail price.
Pro Forma Cash Flow
| Cash Flow | |||
| Year 1 | Year 2 | Year 3 | |
| Cash Received | |||
| Cash from Operations | |||
| Cash Sales | $574,223 | $665,250 | $699,750 |
| Cash from Receivables | $166,175 | $217,750 | $231,734 |
| Subtotal Cash from Operations | $740,398 | $883,000 | $931,484 |
| Additional Cash Received | |||
| Sales Tax, VAT, HST/GST Received | $45,938 | $53,220 | $55,980 |
| New Current Borrowing | $16,072 | $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 | $802,407 | $936,220 | $987,464 |
| Expenditures | Year 1 | Year 2 | Year 3 |
| Expenditures from Operations | |||
| Cash Spending | $90,000 | $95,000 | $103,000 |
| Bill Payments | $631,193 | $588,145 | $658,819 |
| Subtotal Spent on Operations | $721,193 | $683,145 | $761,819 |
| Additional Cash Spent | |||
| Sales Tax, VAT, HST/GST Paid Out | $42,859 | $53,000 | $56,000 |
| Principal Repayment of Current Borrowing | $16,072 | $0 | $0 |
| Other Liabilities Principal Repayment | $0 | $0 | $0 |
| Long-term Liabilities Principal Repayment | $23,521 | $24,000 | $25,000 |
| Purchase Other Current Assets | $0 | $0 | $0 |
| Purchase Long-term Assets | $0 | $0 | $0 |
| Dividends | $0 | $0 | $0 |
| Subtotal Cash Spent | $803,645 | $760,145 | $842,819 |
| Net Cash Flow | ($1,237) | $176,075 | $144,645 |
| Cash Balance | $73,763 | $249,838 | $394,483 |
Projected Balance Sheet
Hang Toes Surfing’s projected balance sheet follows.
| Balance Sheet | |||
| Year 1 | Year 2 | Year 3 | |
| Assets | |||
| Current Assets | |||
| Cash | $73,763 | $249,838 | $394,483 |
| Accounts Receivable | $25,232 | $29,232 | $30,748 |
| Inventory | $48,000 | $40,511 | $58,724 |
| Other Current Assets | $50,000 | $50,000 | $50,000 |
| Total Current Assets | $196,995 | $369,581 | $533,956 |
| Long-term Assets | |||
| Long-term Assets | $100,000 | $100,000 | $100,000 |
| Accumulated Depreciation | $43,414 | $91,414 | $141,414 |
| Total Long-term Assets | $56,586 | $8,586 | ($41,414) |
| Total Assets | $253,581 | $378,167 | $492,542 |
| Liabilities and Capital | Year 1 | Year 2 | Year 3 |
| Current Liabilities | |||
| Accounts Payable | $31,059 | $49,888 | $54,531 |
| Current Borrowing | $0 | $0 | $0 |
| Other Current Liabilities | $3,079 | $3,299 | $3,279 |
| Subtotal Current Liabilities | $34,138 | $53,188 | $57,810 |
| Long-term Liabilities | $96,479 | $72,479 | $47,479 |
| Total Liabilities | $130,617 | $125,667 | $105,290 |
| Paid-in Capital | $180,625 | $180,625 | $180,625 |
| Retained Earnings | ($75,625) | ($57,661) | $71,876 |
| Earnings | $17,964 | $129,536 | $134,751 |
| Total Capital | $122,964 | $252,501 | $387,252 |
| Total Liabilities and Capital | $253,581 | $378,167 | $492,542 |
| Net Worth | $122,964 | $252,501 | $387,252 |
Standard business ratios are included in the table below. The ratios show an aggressive plan for growth to reach maximum production within three years. Return on investment increases each year as we bring the new facility to maximum capacity and production. Return on sales and assets remain strong while the cost of goods decreases.
| Ratio Analysis | ||||
| Year 1 | Year 2 | Year 3 | Industry Profile | |
| Sales Growth | n.a. | 15.85% | 5.19% | 6.06% |
| Percent of Total Assets | ||||
| Accounts Receivable | 9.95% | 7.73% | 6.24% | 6.51% |
| Inventory | 18.93% | 10.71% | 11.92% | 56.31% |
| Other Current Assets | 19.72% | 13.22% | 10.15% | 22.81% |
| Total Current Assets | 77.69% | 97.73% | 108.41% | 85.63% |
| Long-term Assets | 22.31% | 2.27% | -8.41% | 14.37% |
| Total Assets | 100.00% | 100.00% | 100.00% | 100.00% |
| Current Liabilities | ||||
| Accounts Payable | 31.05% | 49.89% | 54.53% | 30.47% |
| Current Borrowing | 0.00% | 0.00% | 0.00% | 0.00% |
| Other Current Liabilities | 3.08% | 3.29% | 3.28% | 3.27% |
| Subtotal Current Liabilities | 34.13% | 53.19% | 57.81% | 43.06% |
| Long-term Liabilities | 96.48% | 72.48% | 47.48% | 12.59% |
| Total Liabilities | 130.62% | 125.67% | 105.29% | 43.06% |
| Net Worth | 48.49% | 66.77% | 78.62% | 56.94% |
| Percent of Sales | ||||
| Sales | 100.00% | 100.00% | 100.00% | 100.00% |
| Gross Margin | 60.82% | 70.80% | 69.99% | 40.20% |
| Selling, General & Administrative Expenses | 58.47% | 56.20% | 55.55% | 19.35% |
| Advertising Expenses | 0.00% | 0.00% | 0.00% | 3.27% |
| Profit Before Interest and Taxes | 4.80% | 21.82% | 21.28% | 1.20% |
| Main Ratios | ||||
| Current | 5.77 | 6.95 | 9.24 | 2.60 |
| Quick | 4.36 | 6.19 | 8.22 | 0.71 |
| Total Debt to Total Assets | 51.51% | 33.23% | 21.38% | 59.60% |
| Pre-tax Return on Net Worth | 20.87% | 73.29% | 49.71% | 3.62% |
| Pre-tax Return on Assets | 10.12% | 48.93% | 39.08% | 8.97% |
| Additional Ratios | Year 1 | Year 2 | Year 3 | |
| Net Profit Margin | 2.35% | 14.60% | 14.44% | n.a |
| Return on Equity | 14.61% | 51.30% | 34.80% | n.a |
| Activity Ratios | ||||
| Accounts Receivable Turnover | 7.59 | 7.59 | 7.59 | n.a |
| Collection Days | 58 | 45 | 47 | n.a |
| Inventory Turnover | 3.87 | 4.38 | 4.23 | n.a |
| Accounts Payable Turnover | 19.78 | 12.17 | 12.17 | n.a |
| Payment Days | 29 | 24 | 29 | n.a |
| Total Asset | ||||
| 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 | ||
| CEO | 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 |
| Vice President | 0% | $3,500 | $3,500 | $3,500 | $3,500 | $3,500 | $3,500 | $3,500 | $3,500 | $3,500 | $3,500 | $3,500 | $3,500 |
| Total People | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
| Total Payroll | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | |
| 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 | $47,480 | $47,480 | $47,480 | $47,480 | $47,480 | $96,720 | $96,720 | $99,000 | $81,070 | $52,080 | $51,320 | $51,320 | |
| Direct Cost of Sales | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | $20,000 | |
| Other Costs of Sales | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | $5,000 | |
| Total Cost of Sales | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | $25,000 | |
| Gross Margin | $22,480 | $22,480 | $22,480 | $22,480 | $22,480 | $71,720 | $71,720 | $74,000 | $56,070 | $27,080 | $26,320 | $26,320 | |
| Gross Margin % | 47.35% | 47.35% | 47.35% | 47.35% | 47.35% | 74.15% | 74.15% | 74.75% | 69.16% | 52.00% | 51.29% | 51.29% | |
| Expenses | |||||||||||||
| Payroll | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | $7,500 | |
| Marketing/Promotion | $10,000 | $13,440 | $9,840 | $7,920 | $13,200 | $5,000 | $15,840 | $12,000 | $15,840 | $22,880 | $18,240 | $18,720 | |
| Depreciation | $640 | $1,270 | $3,594 | $10,000 | $1,900 | $1,900 | $1,200 | $3,000 | $1,690 | $14,000 | $2,740 | $1,480 | |
| Rent | $1,375 | $1,375 | $1,375 | $1,375 | $1,375 | $1,375 | $1,375 | $1,375 | |||||
| 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 | $75,000 | $55,270 | $16,007 | $26,331 | $4,167 | $13,137 | $62,847 | $48,678 | $92,939 | $79,978 | $93,299 | $109,837 | $73,763 |
| Accounts Receivable | $0 | $11,870 | $23,344 | $23,344 | $23,344 | $23,344 | $35,654 | $47,554 | $48,124 | $44,193 | $32,612 | $25,416 | $25,232 |
| Inventory | $48,000 | $76,000 | $56,000 | $84,000 | $64,000 | $44,000 | $72,000 | $52,000 | $80,000 | $60,000 | $40,000 | $68,000 | $48,000 |
| Other Current Assets | $50,000 | $50,000 | $50,000 | $50,000 | $50,000 | $50,000 | $50,000 | $50,000 | $50,000 | $50,000 | $50,000 | $50,000 | $50,000 |
| Total Current Assets | $173,000 | $193,140 | $145,352 | $183,676 | $141,512 | $130,481 | $220,501 | $198,232 | $271,063 | $234,170 | $215,911 | $253,253 | $196,995 |
| Long-term Assets | |||||||||||||
| Long-term Assets | $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 |
| Accumulated Depreciation | $0 | $640 | $1,910 | $5,504 | $15,504 | $17,404 | $19,304 | $20,504 | $23,504 | $25,194 | $39,194 | $41,934 | $43,414 |
| Total Long-term Assets | $100,000 | $99,360 | $98,090 | $94,496 | $84,496 | $82,596 | $80,696 | $79,496 | $76,496 | $74,806 | $60,806 | $58,066 | $56,586 |
| Total Assets | $273,000 | $292,500 | $243,442 | $278,172 | $226,008 | $213,077 | $301,197 | $277,728 | $347,559 | $308,976 | $276,717 | $311,319 | $253,581 |
| 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 | $48,000 | $70,311 | $25,333 | $68,523 | $19,175 | $25,401 | $81,012 | $41,876 | $86,113 | $38,111 | $29,815 | $77,047 | $31,059 |
| Current Borrowing | $0 | $1,696 | $7,072 | $7,072 | $16,072 | $7,072 | $7,072 | $0 | $0 | $0 | $0 | $0 | $0 |
| Other Current Liabilities | $0 | $2,849 | $2,849 | $2,849 | $2,849 | $2,849 | $5,803 | $5,803 | $5,940 | $4,864 | $3,125 | $3,079 | $3,079 |
| Subtotal Current Liabilities | $48,000 | $74,856 | $35,254 | $78,443 | $38,095 | $35,322 | $93,888 | $47,679 | $92,053 | $42,976 | $32,940 | $
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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!