Market Analysis Summary PC Repair will provide computer support in both a consulting and technical capacity to small business

owners as well as home PC users. Since PC Repair is currently a one man operation, its growth in the first three months will be limited by the owner's capacity to complete work. However, these first three months are critical for establishing our credibility and a reputation for getting the job done quickly and well. We will focus on delivering excellent service, and using the good word of mouth from this initial period to network with other potential clients. Personal market research by the owner indicates an attractive market niche for our services, of which PC Repair will take full advantage. The very nature of the computing industry, with its extraordinary rate of technological development, creates a constant need for businesses skilled in updating and advising customers on computer-related issues. National chains, such as "Geeks on Call," and Best Buy's "Geek Squad" have seen rapid growth in demand for these services in the last few years. Customers are seeking skilled help with everything from installation of software and hardware components, to networking, to transferring files from an old computer to a new one. Those who can often enlist their tech-savvy children's help, but others are not so fortunate, and small-business owners need reliable and quick help with all their computer needs, since every hour down may mean an hour or more of lost revenue, especially for any business with a website or those doing e-commerce. 4.1 Market Segmentation The existing computer service market is so extensive that categorizing it is rather difficult. We have broken our potential market down into two groups, based on their needs: home PC users and small business clients. Home PC User Our home PC user market includes non-tech-savvy residents of the local area (15 mile radius), generally between the ages of 30 and 70, with at least one home computer. We are not expecting income from users below 30, who tend to be more comfortable with technology and willing to attempt repairs and upgrades on their own, without seeking professional assistance. Such home users generally own a computer to do email, play games, write letters, scan and print photos, and occasionally to do bookkeeping or taxes. Home PC users with more sophisticated applications generally have enough tech savvy, from tech experience at work, to do their own repairs and upgrades. Their hardware needs will include the computer itself, monitors, keyboards, mouse, printer, and scanner.

This group is growing slightly faster than the overall population growth in our area, in part due to the increasing demand for computers among retired people and young families, about 7% a year. Small Business Users Small business users will provide the majority of our business revenue. The small business market will be defined as customers within a 15 mile radius, with 2 or more computers or a network which they use for business purposes at least 25% of the time. Their business use may include minor usage, such as updating a business website for a brick-and-mortar store, keeping the books, designing graphics or ad campaigns, and writing copy for press releases. It may also be more extensive, incorporating inventory tracking, POS systems, customer databases, online product/service delivery, or product development. The more intensive their computer usage for business, the more critical it is to them that their technology work well and reliably, and that quality repairs and support are available in a crisis. Their hardware needs will include the same items as home users, plus servers, backup systems, data storage, and wireless networking. The portion of the small business market we are targeting is growing at around 2% a year.

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Market Analysis Year 1 Year 2 Year 3 Year 4 Year 5 Potential Customers Growth CAGR Home PC Users 7% 25,000 26,750 28,623 30,626 32,770 7.00% Small Business Users 2% 10,000 10,100 10,201 10,303 10,406 1.00% Other 0% 0 0 0 0 0 0.00% Total 5.39% 35,000 36,850 38,824 40,929 43,176 5.39% Need real financials? We recommend using LivePlan as the easiest way to create automatic financials for your own business plan. Create your own business plan 4.2 Target Market Segment Strategy Although there are more potential customers among home PC users, we expect the majority of our revenue to come from small business clients, since their need for our services is more urgent, and they are willing to invest in technology as part of their business plan. The majority of our marketing efforts will thus be focused on small business owners. These customers typically don't have a full-time IT person, but have full-time IT needs. Home PCs are often used by multiple people, and serve multiple purposes. Our home PC users need help with managing their settings to integrate the different needs of all household members as much as they need technical assistance. ComputingNet magazine recently reported on the substantial need for timely and cost-effective computer upgrades and repairs in this region; Jack Hacker has seen this market need in person, as frustrated clients waited for days or weeks for their critical components to be returned to full capacity, with no inexpensive alternative to the existing computer repair shops. All of our clients need technical assistance, but we are also selling peace of mind: our clients will know that friendly, efficient help is just a phone call away. As more and more companies switch their support services to automated call centers or touch-tone menus, the simple reassurance of hearing another human voice on the phone within a few rings is immeasurable. Even better is knowing that within a few hours, someone will show up and take care of their problem.

Both the software and hardware side of the computer industry continue to turn out new and revised computer components at alarming rates. For PC Repair this means job security well into the future. As reported by the Wall Street Journal, there seems to be no end to the development of the computer market. Business Week expects the computing industry to grow at a rate of 12% and the processor speeds to continue to expand for years to come. 4.3 Service Business Analysis Secondary market research shows computer service customers tend to be very loyal to providers that do good work and satisfy their needs. An analysis of PC Repair's main competitors shows no overwhelming strengths that would be significant barriers to entry into the market, as our local competitors have serious weaknesses. The computer maintenance and repair industry is fragmented, with a few large, national players and hundreds of small, local stores. While most computers are actually repaired in-store, near the customer, parts for the repair come from major manufacturers and distributors; delays in receiving necessary parts can significantly slow down the repair process. Large chains have solved this problem by keeping vast amounts of inventory in stock at all times, while local stores offer customers the trade-off of personal interaction and trust that may make up for some delay. PC Repair has established a relationship with a local distributor to do rapid special-ordering; although this capability is more expensive than normal channels, it will enable us to quickly establish a reputation as efficient and responsive to customer needs, particularly for our small business users. We will leverage this customer loyalty into great word of mouth marketing and steady growth. 4.3.1 Competition and Buying Patterns Customers choose computer repair and assistance services based on reputation, previous experience, and price. They may choose to return to a mediocre provider with whom they're familiar, rather than try out a new unknown company about whom they've heard nothing. Large stores, especially the service departments of national chains, have a great advantage simply in their affiliation with an established brand. Establishing our brand identity and a great reputation in the first few months is critical to our success. Once we have broken in to the local market, our great service will turn new clients into permanent clients. Our services will be second to no one and our prices will be very reasonable for the high quality service we offer. By providing superior service, word of mouth alone will bring in many new clients. The satisfaction our consumers find will keep

them coming back. There are two main competitors for the computer upgrade and repair business in this area: 1. Competitor A. They are a well established provider of computer upgrades and services, and do quick work. However, they have a high staff turnover, a young and inexperienced staff, and are more interested in selling new components than in maintaining existing machines or finding custom solutions. They do not offer any kind of pick-up and drop-off service, and do not offer on-site help. They really only offer hardware support.

2. Competitor B. Smaller and less known then A, B provides many services for residents living in east and south parts of town. They are more willing to spend time with a client, figuring out exactly what his or her needs are, and suggesting new options than competitor A. However, they have an inefficient ordering system and an unkempt shop, which deters potential customers and can turn existing customers to the competition. They also do not offer on-site services, although they are considering instituting a trial pick-up/drop-off service. They are in the best position to copy our innovations and steal customers, but their management is complacent and may not respond to competition. Both of these companies charge rates in excess of PC Repair; we will be able to attract the price-sensitive market without much work.

Strategy and Implementation Summary Our Strategy and Implementation turn on three points: 1. A value proposition of timely and practical solutions, at a reasonable rate, coupled with a 100% guarantee.

2. Exploiting our competitors weaknesses: a competitive edge based on quick, effective, and sympathetic customer service, which meets the customer where his needs are, rather than trying to fit him into an existing box.

3. Quickly establishing a brand identity and developing a great reputation among local customers to generate word of mouth advertising. 5.1 Competitive Edge

Quick response: PC Repair will provide same day and after hours service.

A flat rate policy: This undermines the competition, who charge by the hour. The pricing has been set to reflect the average amount of time it takes to perform the task. With this strategy we can undercut most competitors and gain local market power.

On-site and pick-up/drop-off services: This will minimize the time and effort a customer needs to put into dealing with his computer problem.

Suprisingly, our small size is an advantage: customers will recognize me (and future employees), and will know they will get the same great service every time they call. To develop good business strategies, perform a SWOT analysis of your business. It's easy with our free guide and template. Learn how to perform a SWOT analysis 5.2 Marketing Strategy Our marketing strategy will aggressively exploit our competitors' weaknesses. During the start-up phase, we will run large ads in the business section of the local newspaper, asking, "Are you fed up with poor customer service for your computer needs?" These ads will focus on our advantages, including on-site service, competitive rates, and quick response and turn-around times. They will announce our opening date, and include a coupon for free diagnostic service for the first 20 customers. We will follow up on these opening ads with a smaller direct-marketing campaign to small business owners, with lists drawn from the local Chamber of Commerce. Jack will use his contacts with business customers from his years as a manager to create a "buzz" about this new business. We will continue periodic advertisements, including several promotions (discounts, free diagnosis, etc.) throughout the first year. We expect a small but steady response from home PC users who see our ads elsewhere, but will also run monthly ads in sections other than the business one. We will offer a promotion during the first 90 days of business to generate business traffic and word of mouth. Our promo is Spyware removal on any

desktop PC for $70 including tax and software. Spyware is a huge problem for a lot of residential and small business customers, and the offer should draw a lot of interest. 5.3 Sales Strategy Our marketing strategy will generate customer inquiries. We will close the deals by offering an outstanding service and a very reasonable price. Happy customers generate repeat business and word of mouth. Our toll free number is operational 24 hours a day, seven days a week, and from 8am to 9pm, I will be available to answer calls. At other times, or when I am on the phone, an answering service we have hired will catch callers and give them an estimated wait time for a call-back; this is another step towards delivering a complete solution to our customers. Sales forecast figures are based on industry figures for the typical growth of a start-up and reflect repeat business generated through meeting customer needs. 5.3.1 Sales Forecast The sales strategy is a prediction of controllable growth for the first year. PC Repair will focus on quality and attention to detail to avoid some potential pitfalls encountered by many new businesses. The predicted growth is moderate in the home PC market and in the small business arena. However, with aggressive advertising and word of mouth, this will increase. Our agressive TV advertising will increase our residential and small business customer base as well as word of mouth within the first year. Within a few months we will have the need for additional employees to handle the work load. At that time, we will move into a leased space with additional square footage, and buy a company vehicle to help with the on-site calls. Our competitors average 75+ calls a month. Given that our advertising will be aggressive, we expect the same results. The sales forecast is conservative, which gives us a chance to gauge our experience and adjust the plan accordingly. We will service all of Ramsford-on-Bitstream, and the surrounding area. We expect that the majority of our jobs will be performed in the immediate town area. A service technician can perform an average of 3 jobs per day. Our sales forecast predictions are less than that. With our agressive advertising campaign we expect nominal growth. We predict it will take a few weeks for the marketing to settle in with customers. However, we are going to offer a promo for our services which should generate some substantial results. The one element of sales not represented in the table below is direct costs for our maintenance contracts. We estimate these costs at 12% of sales revenue, but expect a delayed occurrence - that is, we will sell maintenance contracts starting

in February, but do not expect to actually perform maintenance on computers guaranteed under them for the first few months. We will incur more and more costs from these as time goes on, and the computers age - most of the service in a maintenance contract is performed within the last quarter of the specified period. Projections for the direct costs for these contracts can be found in the Profit and Loss Table, as other costs of sales.

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Need actual charts? We recommend using LivePlan as the easiest way to create graphs for your own business plan. Create your own business plan Sales Forecast Year 1 Unit Sales Home PC Unit Small Business Unit Promo Maintenance Contracts Total Unit Sales Unit Prices Home PC Unit Small Business Unit Promo Maintenance Contracts Sales Home PC Unit Small Business Unit 166 264 235 32 697 Year 1 $280.00 $500.00 $50.00 $400.00 Year 2 200 300 0 60 560 Year 2 $300.00 $600.00 $0.00 $600.00 Year 3 225 350 0 85 660 Year 3 $300.00 $600.00 $0.00 $600.00 $67,500 $210,000

$46,480 $60,000 $132,000 $180,000

Promo $11,750 $0 $0 Maintenance Contracts $12,800 $36,000 $51,000 Total Sales $203,030 $276,000 $328,500 Direct Unit Costs Year 1 Year 2 Year 3 Home PC Unit $84.00 $90.00 $90.00 Small Business Unit $105.00 $126.00 $126.00 Promo $4.00 $0.00 $0.00 Maintenance Contracts $0.00 $0.00 $0.00 Direct Cost of Sales Home PC Unit $13,944 $18,000 $20,250 Small Business Unit $27,720 $37,800 $44,100 Promo $940 $0 $0 Maintenance Contracts $0 $0 $0 Subtotal Direct Cost of Sales $42,604 $55,800 $64,350 Need real financials? We recommend using LivePlan as the easiest way to create automatic financials for your own business plan. Create your own business plan 5.4 Milestones Our milestones, listed in the table below, outline the major events that will promote, as well as insure the success of PC Repair and keep it a going concern well into the future. We will measure our success in meeting these milestones every month, and adjust the plan to keep up with our objectives. Name recognition, in particular, is very important to breaking into this market - we will conduct a survey by calling 200 randomly selected small businesses from the Chamber of Commerce listings on the specified dates and asking them whether they have heard of PC Repair, and if so, what their impression is of our service. If any of the respondents have actually used our services, we will elicit feedback on their experience with us, and suggestions for improvement. We will also ask if they would recommend us to a colleague.

Need actual charts? We recommend using LivePlan as the easiest way to create graphs for your own business plan. Create your own business plan Milestones Milestone Start Date End Date Budget Manager Department Procurement of materials for opening 12/1/2004 2/1/2005 $1,200 JMH Department Start-up Ad Campaign 12/15/2004 2/6/2005 $1,200 JMH Department Get Loan Approved 1/1/2005 1/17/2005 $0 JMH Department Open Business 2/7/2005 2/8/2005 $0 JMH Department Name Recognition by 5% of potential market 2/28/2005 2/28/2005 $0 JMH Department Meet with Leasing 3/1/2005 3/10/2005 $0 JMH Department

Agent Interview potential Techs 3/1/2005 4/25/2005 $0 Move into Leased Space 4/1/2005 4/10/2005 $2,000 Sign on Leased Vehicle 4/15/2005 4/20/2005 $6,000 Targeted Ads Begin 4/15/2005 5/15/2005 $4,000 1st Tech Starts 5/1/2005 5/1/2005 $0 2nd Round Tech Interviews 7/1/2005 7/31/2005 $0 Direct marketing to Small Businesses 7/1/2005 9/30/2005 $8,000 Increase Name Recognition to 20% 8/1/2005 8/2/2005 $0 2nd Tech Starts 8/1/2005 8/7/2005 $0 Totals $22,400

JMH Department

JMH Department

JMH Department JMH Department JMH Department

JMH Department

JMH Department

JMH Department JMH Department

Management Summary PC Repair will be owned and managed by Jack Hacker. Jack has 10 years of experience in the fields of technical support, networking, and computer training and repair. Jack has also spent the last three years as the manager of a custom

computer building and repair store, and understands the computer needs of small businesses. Jack is adept at managing his time, and at quickly responding to multiple customer calls and needs. For the first three months, Jack will be in charge of all aspects of the business. In the third month, when another tech is hired, Jack will shift some of his energy from directly responding to customer needs, to training and managing others to do this work effectively. Jack will maintain direct control over inventory ordering and bookkeeping, and will try to do as many of the on-site calls as possible himself. Part of our brand recognition strategy is to identify PC Repair with Jack's efficiency, friendliness, and technical expertise. The easiest way to associate the two is for Jack to be a major part of many customers' experiences with us. He will delegate technical repairs later in the year to the techs working in the leased office space, and will also train them in his method of direct phone support. Jack has worked extensively with computer technicians and support staff in the past, and knows that they work best when given free rein within a set of mutually-agreed-upon guidelines. The first week of each tech's employment will be dedicated to helping them understand PC Repair's guidelines: the customer needs help, and we're here to help them; the customer is frustrated, upset, or confused - but that doesn't make the customer a problem; the customer needs reassurance as well as solutions. Within this framework, the techs can solve the customer's problem the best way they see fit - Jack is not a micro manager. 6.1 Personnel Plan Jack Hacker will be the only employee for the first few months; his salary is directly related to the success of the business, and will never exceed 18% of sales revenue. In the third month, we will move to a leased office space and hire a second employee, with a third hire planned for August, if projections are on target. We plan to hire additional part-time employees in the second year, to better handle the increasing sales. Our employees will be skilled professionals, with equally strong technical and people skills. It is very important to Jack that they be paid salaries commensurate with their abilities and dedication- happy tech support people make for happy customers. To that end, our full-time employees will receive health benefits (premiums split between the employee and PC Repair), paid holidays, and sick time. Those benefits are included in the payroll totals listed below.

Personnel Plan Owner Tech1 Tech2 Part Time Total People Total Payroll Need real financials? We recommend using LivePlan as the easiest way to create automatic financials for your own business plan. Create your own business plan Year 1 $33,000 $21,600 $14,400 $0 3 $69,000 Year 2 $38,000 $30,000 $30,000 $12,000 5 $110,000 Year 3 $40,000 $30,000 $30,000 $15,000 5 $115,000

Financial Plan The following sections include the annual estimates for the standard set of financial tables. Detailed monthly pro-forma tables are included in the appendix. Our financial plan calls for limited growth in the first three months, followed by much higher sales when we move and hire additional employees. These projections are based on sound market research and ratios for comparable businesses. As we grow, we will keep our operating expenses down, and maintain a positive cash balance as we repay our three-year loan. 7.1 Important Assumptions PC Repair's customer base would fluctuate if there was a recess in the economy or other extenuating circumstances that pertain directly to consumer or industry behavior. However, given the steady increase in computer users despite the recent recession, we assume that sales forecasts are unlikely to be dramatically altered by economic events. The table below shows some of our other assumptions.

General Assumptions Year 1 Year 2 Year 3

Plan Month Current Interest Rate Long-term Interest Rate Tax Rate Other

1 7.00% 10.00% 30.00% 0

2 70.00% 10.00% 30.00% 0

3 70.00% 10.00% 30.00% 0

Need real financials? We recommend using LivePlan as the easiest way to create automatic financials for your own business plan. Create your own business plan 7.2 Break-even Analysis Fixed costs are projected at a monthly average for the first year. This includes payroll, moving expenses and rent, purchase of a company vehicle, and other necessities like cell phones and the answering service. Variable costs (inventory used in repairing or servicing computers) are projected as well. At these levels, what we need to bring in per month to break even is shown in the table and chart below. We will reach our break-even point mid-year, although we expect sales in November and December to dip below this level because of holidays.

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Break-even Analysis Monthly Units Break-even Monthly Revenue Break-even Assumptions: Average Per-Unit Revenue Average Per-Unit Variable Cost Estimated Monthly Fixed Cost $291.29 $70.00 $11,479 52 $15,110

7.3 Projected Profit and Loss The table below shows our projected profit and loss. There are two lines for direct cost of sales - the second line shows projected inventory costs of fulfilling our maintenance contracts. The marketing/promotion line shows our planned advertising program expenses. Although these are aggressive, we must spend heavily in the first year in order to establish the brand recognition that will help us break in to the local market. This table also shows our projected expense increases as we hire more employees and move into a larger rented space. Before the move, the owner will absorb expenses related to utilities. In years two and three, we have budgeted for additional expensed equipment to expand our diagnostic and repair capabilities to keep up with orders. We are seeking a modest net profit in the first year. As our reputation grows, we will see higher revenues and net profit over the next three years.

Need actual charts? We recommend using LivePlan as the easiest way to create graphs for your own business plan. Create your own business plan

Need actual charts? We recommend using LivePlan as the easiest way to create graphs for your own business plan. Create your own business plan

Need actual charts? We recommend using LivePlan as the easiest way to create graphs for your own business plan. Create your own business plan

Need actual charts?

We recommend using LivePlan as the easiest way to create graphs for your own business plan. Create your own business plan

Pro Forma Profit and Loss Year 1 Sales Direct Cost of Sales Costs of Fulfilling Maintenance Contracts Total Cost of Sales Gross Margin Gross Margin % Expenses Payroll Marketing/Promotion Depreciation Lease Expensed Equipment Insurance Website $69,000 $28,000 $0 $10,000 $0 $3,150 $2,080 $110,000 $6,000 $0 $12,000 $10,000 $1,200 $480 $115,000 $12,000 $0 $12,000 $12,000 $1,200 $480 $203,030 $42,604 Year 2 $276,000 $55,800 Year 3 $328,500 $64,350

$1,488 $44,092 $158,938 78.28%

$4,320 $60,120 $215,880 78.22%

$6,120 $70,470 $258,030 78.55%

Answering Service Mileage Vehicles Cell Phones Utilities Internet Moving Expenses Total Operating Expenses Profit Before Interest and Taxes EBITDA Interest Expense Taxes Incurred Net Profit Net Profit/Sales

$200 $2,660 $13,200 $1,260 $5,000 $1,200 $2,000 $137,750

$2,400 $5,400 $15,000 $1,260 $6,000 $1,200 $0 $170,940

$2,400 $5,400 $17,000 $1,260 $7,000 $1,200 $0 $186,940

$21,188 $21,188 $1,097 $6,027 $14,064 6.93%

$44,940 $44,940 $6,570 $11,511 $26,859 9.73%

$71,090 $71,090 $2,139 $20,685 $48,266 14.69%

7.4 Projected Cash Flow The Cash Flow chart, below, shows our projected cash position for the first year; the table following it shows highlights for the first three years. With the requested start-up funding, we will maintain a positive cash balance throughout, and repay the loan within three years.

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Pro Forma Cash Flow Year 1 Cash Received Cash from Operations Cash Sales $203,030 $276,000 $328,500 $328,500 Year 2 Year 3

Subtotal Cash from Operations $203,030 $276,000 Additional Cash Received Sales Tax, VAT, HST/GST Received New Current Borrowing

$0 $0

$0 $0

$0 $0

New Other Liabilities (interestfree) 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

$0 $0 $0 $0 $0

$0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $328,500 Year 3

$203,030 $276,000 Year 1 Year 2

$69,000 $110,000 $110,873 $141,877 $179,873 $251,877

$115,000 $164,115 $279,115

$0

$0

$0

$6,564

$6,550

$6,111

$0

$0

$0

$0

$0

$0

Purchase Other Current Assets Purchase Long-term Assets Dividends Subtotal Cash Spent Net Cash Flow Cash Balance

$0 $0 $0

$0 $0 $0

$0 $0 $0 $285,226 $43,274 $105,440

$186,437 $258,427 $16,593 $44,593 $17,573 $62,165

7.5 Business Ratios Business ratios for the years of this plan are shown below. Industry profile ratios based on the Standard Industrial Classification (SIC) code 7379, Computer Related Services, (NAICS 811212) are shown for comparison. Our projected growth is much higher than the industry average; in part, this is because we are a start-up, growing sales steadily in these first three years. We are sure that our sales forecast is conservative, given the dissatisfaction among local computer users with existing options, and our planned aggressive marketing campaign.

Ratio Analysis Industry Profile 5.23%

Year 1 Sales Growth Percent of Total Assets Inventory Other Current Assets Total Current Assets 8.22%

Year 2

Year 3 19.02%

0.00% 35.94%

8.15%

6.01% 8.14%

2.79% 51.19% 75.09%

16.81% 12.73%

100.00% 100.00% 100.00%

Long-term Assets Total Assets Current Liabilities Long-term Liabilities Total Liabilities Net Worth Percent of Sales Sales Gross Margin Selling, General & Administrative Expenses Advertising Expenses Profit Before Interest and Taxes Main Ratios Current Quick Total Debt to Total Assets Pre-tax Return on Net Worth Pre-tax Return on Assets

0.00%

0.00%

0.00%

24.91% 100.00% 31.75% 18.48% 50.23% 49.77%

100.00% 100.00% 100.00% 42.77% 22.49% 0.00% 0.00% 11.12% 0.00% 11.12%

42.77% 22.49%

57.23% 77.51% 88.88%

100.00% 100.00% 100.00% 78.28% 78.22% 78.55%

100.00% 100.00%

38.70% 65.72% 0.00% 0.00%

64.96% 0.00%

80.06% 1.23%

10.44% 16.28%

21.64%

1.95%

2.34 2.15

4.45 4.08

8.99 8.45 11.12%

1.53 1.24 57.27%

42.77% 22.49%

59.02% 63.01% 33.78% 48.84%

63.16% 56.14%

2.73% 6.39%

Additional Ratios Net Profit Margin Return on Equity Activity Ratios Inventory Turnover Accounts Payable Turnover Payment Days Total Asset Turnover Debt Ratios Debt to Net Worth Current Liab. to Liab. Liquidity Ratios Net Working Capital Interest Coverage Additional Ratios Assets to Sales Current Debt/Total Assets Acid Test Sales/Net Worth

Year 1 6.93%

Year 2 9.73%

Year 3 14.69% 44.21% n.a n.a

41.32% 44.10%

10.25

9.88

9.33

n.a

9.67 27 3.41

12.17 32 3.51

12.17 28 2.67

n.a n.a n.a

0.75 1.00

0.29 1.00

0.13 1.00

n.a n.a

$34,039 $60,898 $109,163 19.32 6.84 33.24

n.a n.a

0.29 43% 2.15 5.96

0.28 22% 4.08 4.53

0.37 11% 8.45 3.01

n.a n.a n.a n.a

Dividend Payout

0.00

0.00

0.00

n.a

Need real financials? We recommend using LivePlan as the easiest way to create automatic financials for your own business plan. Create your own business plan 7.6 Projected Balance Sheet The Balance Sheet shows a steadily increasing net worth over the next three years. Since we are planning to rent, and because computer technology changes so rapidly, we will have only short-term assets, such as computer equipment and furniture. This will make our net worth much more liquid than many similar businesses.

Pro Forma Balance Sheet Year 1 Assets Current Assets Cash Inventory Other Current Assets Total Current Assets Long-term Assets Long-term Assets Accumulated Depreciation Total Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $44,593 $4,890 $10,000 $59,482 $62,165 $6,404 $10,000 $78,569 $105,440 $7,385 $10,000 $122,825 Year 2 Year 3

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

$59,482 Year 1

$78,569 Year 2

$122,825 Year 3

$12,783 $12,661 $0 $25,444 $0 $25,444 $23,000 ($3,025) $14,064 $34,039 $59,482 $34,039

$11,561 $6,111 $0 $17,672 $0 $17,672 $23,000 $11,039 $26,859 $60,898 $78,569 $60,898

$13,662 $0 $0 $13,662 $0 $13,662 $23,000 $37,898 $48,266 $109,163 $122,825 $109,163