January 2002

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 Table of Contents

1.0 Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

1.1 Objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Mission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.3 Keys to Success . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

2.0 Company Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

2.1 Company Ownership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.2 Company History . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.3 Company Locations and Facilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

3.0 Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

4.0 Market Analysis Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

4.1 Market Segmentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

5.0 Strategy and Implementation Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

5.1 Competitive Edge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
5.2 Sales Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
5.2.1 Sales Forecast . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

6.0 Management Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

6.1 Personnel Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

7.0 Financial Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

7.1 Break-even Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
7.2 Projected Profit and Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
7.3 Projected Cash Flow . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
7.4 Projected Balance Sheet . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
7.5 Business Ratios . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
 Justin Seafood Market

1.0 Executive Summary

Justin Seafood Market has been providing customers with the finest quality seafood for five
years. The business is primarily wholesale to area restaurants. We purchase seafood directly
from local fishermen and contacts all along the Florida panhandle. This allows us to pick from
the finest selection of seafood available anywhere. Currently, we sell to over sixty restaurants.
This a 10% increase over last year and we estimate that we will have additional restaurants as
customers next year.

Justin Seafood Market plans to expand our storefront and sell direct to the public. In our
expanded market, we will bring our commitment of quality, freshness and great prices to the
public. By purchasing in large quantities we are able to pass the savings on to our customer.

The planned renovation will cost $150,000. Additional service staff will be hired to assist
customers. Bill Justin, owner of Justin Seafood Market, will invest $50,000 in the expansion
and also secure a $100,000 short-term loan.

Highlights (Planned)

$1,600,000

$1,400,000

$1,200,000

$1,000,000
Sales
$800,000 Gross Margin

$600,000 Net Profit

$400,000

$200,000

$0
2002 2003 2004

1.1 Objectives

• Establish Justin Seafood Market as the leader in selling fresh seafood to the public.
• Increase the number of customers buying from Justin Seafood Market by 10% over the
next two years.
• Establish a Seafood Discount Club for customers that will build customer loyalty.

Page 1
 Justin Seafood Market

1.2 Mission

The mission of Justin Seafood Market is to offer customers the best seafood prices on the
highest quality seafood.

1.3 Keys to Success

• Superior products will promote customer loyalty.

• A location that will assure walk-in traffic.
• A program that will create customer loyalty.

2.0 Company Summary

Justin Seafood Market is primarily a wholesaler to area restaurants. Bill Justin, owner of Justin
Seafood Market, has utilized his wholesale background, his experience in the restaurant
industry, and his contacts with the area's fishermen to build a loyal customer base.

Bill wants to open a seafood market to the public by renovating the building's storefront to
accommodate the public.

2.1 Company Ownership

Bill Justin is the owner of Justin Seafood Market.

2.2 Company History

Bill Justin started Justin Seafood Market in 1996 in response to the dramatic growth of the
Florida panhandle. Over the past five years, the population has increased by 30% in
communities along the panhandle. But most importantly, tourists have returned to the area.
In 2000, tourists spent over 400 million dollars with panhandle businesses. A significant
portion of those sales were with the area's loyalty. Currently, there are over 1,350 restaurants
but that number grows by 15% annually.

Against this backdrop of growth, Bill Justin launched his market. Starting with ten customers in
1996, Justin Seafood Market now serves sixty restaurants.

Page 2
 Justin Seafood Market

Table: Past Performance

Past Performance
1999 2000 2001
Sales $560,000 $644,000 $710,600
Gross Margin $270,000 $320,000 $350,000
Gross Margin % 48.21% 49.69% 49.25%
Operating Expenses $150,000 $170,000 $190,000
Collection Period (Days) 0 0 0
Inventory Turnover 0.00 0.00 0.00

Balance Sheet
Short-term Assets 1999 2000 2001
Cash $40,000 $50,000 $50,000
Accounts Receivable $0 $0 $0
Inventory $0 $0 $0
Other Short-term Assets $20,000 $30,000 $50,000
Total Short-term Assets $60,000 $80,000 $100,000
Long-term Assets
Capital Assets $80,000 $80,000 $80,000
Accumulated Depreciation $5,000 $10,000 $15,000
Total Long-term Assets $75,000 $70,000 $65,000
Total Assets $135,000 $150,000 $165,000

Capital and Liabilities

1999 2000 2001
Accounts Payable $10,000 $12,000 $20,000
Current Borrowing $0 $0 $0
Other Short-term Liabilities $0 $0 $0
Subtotal Short-term Liabilities $10,000 $12,000 $20,000

Long-term Liabilities $30,000 $20,000 $20,000

Total Liabilities $40,000 $32,000 $40,000
Paid-in Capital $0 $0 $50,000
Retained Earnings $95,000 $118,000 $75,000
Earnings $0 $0 $0
Total Capital $95,000 $118,000 $125,000
Total Capital and Liabilities $135,000 $150,000 $165,000

Other Inputs 1999 2000 2001

Payment Days 0 0 0
Sales on Credit $0 $0 $0
Receivables Turnover 0.00 0.00 0.00

Past Performance

$800,000

$700,000

$600,000

$500,000
Sales
$400,000 Gross

$300,000 Net

$200,000

$100,000

$0
1999 2000 2001

Page 3
 Justin Seafood Market

2.3 Company Locations and Facilities

Justin Seafood Market is located at 3456 Main Street, Tallahassee, Florida. After renovation,
the market will have an additional 5,000 ft. of floor space that will be used for the new retail
operation.

3.0 Products

Justin Seafood Market currently provides numerous seafood products to restaurants in the
Florida panhandle. The market's new public retail outlet will focus on popular seafood
selections that will bring customers into the store.

Justin Seafood Market will have the following retail products:

• Jumbo Fresh Gulf Shrimp;

• Alaskan King Crab;
• Florida Lobster;
• Sea Scallops;
• Fresh Gulf Fish Filets;
• Yellowfin Tuna;
• Grouper;
• Snapper;
• Amberjack.

4.0 Market Analysis Summary

Tallahassee has a population of over 160,000 residents but the area receives thousands of day
tourists each year. Justin Seafood Market is located in the busiest commercial section of
Tallahassee with excellent foot traffic. Expanding the market's storefront by 5,000 ft. will
create an inviting environment for the public. The market's interior design will focus on the
motif of an open air fish market. We will advertise the market as a place where the public can
get quality seafood at wholesale prices.

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 Justin Seafood Market

4.1 Market Segmentation

Justin Seafood Market is focused on two customer groups:

• Urban professional working downtown.

• Day tourists.

Table: Market Analysis

Market Analysis
Potential Customers Growth 2002 2003 2004 2005 2006 CAGR
Urban Professionals 10% 30,000 33,000 36,300 39,930 43,923 10.00%
Day Tourists 0% 60,000 60,000 60,000 60,000 60,000 0.00%
Total 3.66% 90,000 93,000 96,300 99,930 103,923 3.66%

Market Analysis (Pie)

Urban Professionals
Day Tourists

5.0 Strategy and Implementation Summary

Justin Seafood Market will expand its storefront and sell direct to the public. The market is
known as a wholesale operation and we will use that identity to advertise the new service to
the public. We will ask the public "Why pay retail when you can get better quality at wholesale
prices!" Additional staff will be hired to serve the public.

Page 5
 Justin Seafood Market

5.1 Competitive Edge

The competitive edge of Justin Seafood Market is the market's commitment of quality,
freshness and great prices. The market's location also assures excellent tourist and resident
foot traffic.

5.2 Sales Strategy

Justin Seafood Market will employ two sales approaches for its target customers.

• For Urban Professional: The market will promote membership in its Seafood
Discount Club. Residents will be encouraged to join for $20 a year. As a member, all
purchases will be discounted $1 per pound. This will result in considerable saving for
members who shop regularly at the market.

• For the Day Tourist: The market will offer free 24-hour shipping of purchases in
excess of $100. The customer will be able to select the day the seafood will be shipped.
The customers will then receive a regular newsletter that will include an invitation to
purchase seafood again with same free shipping option.

5.2.1 Sales Forecast

The following is the sales forecast for three years.

Table: Sales Forecast (Planned)

Sales Forecast
Sales 2002 2003 2004
Over-counter $334,000 $350,000 $380,000
Shipped $122,000 $140,000 $155,000
Restaurant Deliveries $720,000 $800,000 $900,000
Total Sales $1,176,000 $1,290,000 $1,435,000

Direct Cost of Sales 2002 2003 2004

Over-counter $166,500 $173,000 $188,000
Shipped $64,100 $74,000 $81,000
Restaurant Deliveries $359,000 $409,000 $459,000
Subtotal Direct Cost of Sales $589,600 $656,000 $728,000

Page 6
 Justin Seafood Market

Sales Monthly (Planned)

$160,000

$140,000

$120,000

$100,000
Over-counter
$80,000
Shipped
$60,000 Restaurant Deliveries

$40,000

$20,000

$0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Sales by Year (Planned)

$1,600,000

$1,400,000

$1,200,000

$1,000,000
Over-counter
$800,000 Shipped
$600,000 Restaurant Deliveries

$400,000

$200,000

$0
2002 2003 2004

Page 7
 Justin Seafood Market

6.0 Management Summary

Prior to beginning Justin Seafood Market, Bill Justin worked as an account manager for
William's Wholesale Foods and Wilson Seafood for ten years. In his last position with Wilson
Seafood, Bill developed an excellent network of fishing contacts in the Florida panhandle,
generating sales in excess of $2 million annually. His strength has always been his customer
relation skills.

Bill Justin has a BA in marketing from Florida State University. His first position after
graduation was as a shift manager with Johnson Seafood Restaurant. In three years, he was
promoted to the manager position. During that time, Bill demonstrated the ability to effectively
manage a large staff.

6.1 Personnel Plan

The personnel for Justin Seafood Market is as follows:

• Manager;
• Market staff (4);
• Delivery crew (4);
• Sales staff (4);
• Cleanup crew (2);

Table: Personnel (Planned)

Personnel Plan
2002 2003 2004
Manager $36,000 $38,000 $40,000
Market Staff (4) $84,000 $90,000 $96,000
Clean-up Crew (2) $45,600 $47,000 $49,000
Delivery Staff (4) $96,000 $102,000 $108,000
Sales Staff (4) $120,000 $130,000 $140,000
Total Payroll $381,600 $407,000 $433,000

Total People 15 15 15
Payroll Burden $57,240 $61,050 $64,950
Total Payroll Expenditures $438,840 $468,050 $497,950

Page 8
 Justin Seafood Market

7.0 Financial Plan

The following is the financial plan for expansion of Justin Seafood Market to include a new
retail market space.

7.1 Break-even Analysis

The monthly break-even point is $85,740.

Table: Break-even Analysis

Break-even Analysis:
Monthly Units Break-even 429
Monthly Sales Break-even $85,740

Assumptions:
Average Per-Unit Revenue 200
Average Per-Unit Variable Cost 100
Estimated Monthly Fixed Cost 42,870

Break-even Analysis

$40,000

$20,000

$0

($20,000)

($40,000)

($60,000)
$0 $28,000 $56,000 $84,000 $112,000 $140,000

Monthly break-even point

Break-even point = where line intersects with 0

Page 9
 Justin Seafood Market

7.2 Projected Profit and Loss

The following table and charts highlight the projected profit and loss for three years.

Table: Profit and Loss (Planned)

Pro Forma Profit and Loss

2002 2003 2004
Sales $1,176,000 $1,290,000 $1,435,000
Direct Cost of Sales $589,600 $656,000 $728,000
Other Production Expenses $0 $0 $0
------------ ------------ ------------
Total Cost of Sales $589,600 $656,000 $728,000
Gross Margin $586,400 $634,000 $707,000
Gross Margin % 49.86% 49.15% 49.27%
Operating Expenses:
Advertising/Promotion $12,000 $15,000 $20,000
Travel $12,000 $15,000 $20,000
Miscellaneous $0 $0 $0
Payroll Expense $381,600 $407,000 $433,000
Payroll Burden $57,240 $61,050 $64,950
Depreciation $9,600 $9,600 $9,600
Leased Equipment $0 $0 $0
Utilities $6,000 $6,000 $6,000
Insurance $0 $0 $0
Rent $36,000 $36,000 $36,000
Contract/Consultants $0 $0 $0
------------ ------------ ------------
Total Operating Expenses $514,440 $549,650 $589,550
Profit Before Interest and Taxes $71,960 $84,350 $117,450
Interest Expense Short-term $8,830 $7,840 $7,840
Interest Expense Long-term $2,000 $920 ($1,240)
Taxes Incurred $18,339 $22,677 $33,255
Extraordinary Items $0 $0 $0
Net Profit $42,791 $52,913 $77,595
Net Profit/Sales 3.64% 4.10% 5.41%

Profit Monthly (Planned)

$20,000

$15,000

$10,000

$5,000

$0

($5,000)

($10,000)

($15,000)

($20,000)
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Page 10
 Justin Seafood Market

Profit Yearly (Planned)

$80,000

$70,000

$60,000

$50,000

$40,000

$30,000

$20,000

$10,000

$0
2002 2003 2004

7.3 Projected Cash Flow

The following table and chart highlight the projected cash flow for three years.

Page 11
 Justin Seafood Market

Table: Cash Flow (Planned)

Pro Forma Cash Flow 2002 2003 2004

Cash Received
Cash from Operations:
Cash Sales $705,600 $774,000 $861,000
From Receivables $397,600 $508,943 $565,024
Subtotal Cash from Operations $1,103,200 $1,282,943 $1,426,024

Additional Cash Received

Extraordinary Items $0 $0 $0
Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $100,000 $0 $0
New Other Liabilities (interest-free) $0 $0 $0
New Long-term Liabilities $0 $0 $0
Sales of other Short-term Assets $0 $0 $0
Sales of Long-term Assets $0 $0 $0
New Investment Received $0 $0 $0
Subtotal Cash Received $1,203,200 $1,282,943 $1,426,024

Expenditures 2002 2003 2004

Expenditures from Operations:
Cash Spent on Costs and Expenses $69,838 $76,097 $85,152
Wages, Salaries, Payroll Taxes, etc. $438,840 $468,050 $497,950
Payment of Accounts Payable $582,420 $678,946 $757,792
Subtotal Spent on Operations $1,091,097 $1,223,093 $1,340,894

Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $21,600 $0 $0
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $0 $21,600 $21,600
Purchase Other Short-term Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Adjustment for Assets Purchased on Credit $0 $0 $0
Subtotal Cash Spent $1,112,697 $1,244,693 $1,362,494

Net Cash Flow $90,503 $38,249 $63,530

Cash Balance $140,503 $178,752 $242,282

Cash (Planned)

$160,000

$140,000

$120,000

$100,000

$80,000

$60,000 Net Cash Flow

$40,000 Cash Balance

$20,000

$0

($20,000)

($40,000)
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Page 12
 Justin Seafood Market

7.4 Projected Balance Sheet

The following table highlights the projected balance sheet for three years.

Table: Balance Sheet (Planned)

Pro Forma Balance Sheet

Assets
Short-term Assets 2002 2003 2004
Cash $140,503 $178,752 $242,282
Accounts Receivable $72,800 $79,857 $88,833
Inventory $13,607 $15,140 $16,801
Other Short-term Assets $50,000 $50,000 $50,000
Total Short-term Assets $276,910 $323,749 $397,916
Long-term Assets
Long-term Assets $80,000 $80,000 $80,000
Accumulated Depreciation $24,600 $34,200 $43,800
Total Long-term Assets $55,400 $45,800 $36,200
Total Assets $332,310 $369,549 $434,116

Liabilities and Capital

2002 2003 2004
Accounts Payable $66,119 $72,045 $80,617
Current Borrowing $78,400 $78,400 $78,400
Other Short-term Liabilities $0 $0 $0
Subtotal Short-term Liabilities $144,519 $150,445 $159,017

Long-term Liabilities $20,000 ($1,600) ($23,200)

Total Liabilities $164,519 $148,845 $135,817

Paid-in Capital $50,000 $50,000 $50,000

Retained Earnings $75,000 $117,791 $170,704
Earnings $42,791 $52,913 $77,595
Total Capital $167,791 $220,704 $298,299
Total Liabilities and Capital $332,310 $369,549 $434,116
Net Worth $167,791 $220,704 $298,299

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 5146, Fish and Seafood, are shown for
comparison.

Page 13
 Justin Seafood Market

Table: Ratios (Planned)

Ratio Analysis
2002 2003 2004 Industry Profile
Sales Growth 65.49% 9.69% 11.24% 4.60%

Percent of Total Assets

Accounts Receivable 21.91% 21.61% 20.46% 33.30%
Inventory 4.09% 4.10% 3.87% 25.40%
Other Short-term Assets 15.05% 13.53% 11.52% 24.00%
Total Short-term Assets 83.33% 87.61% 91.66% 82.70%
Long-term Assets 16.67% 12.39% 8.34% 17.30%
Total Assets 100.00% 100.00% 100.00% 100.00%

Short-term Liabilities 43.49% 40.71% 36.63% 47.70%

Long-term Liabilities 6.02% -0.43% -5.34% 10.10%
Total Liabilities 49.51% 40.28% 31.29% 57.80%
Net Worth 50.49% 59.72% 68.71% 42.20%

Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 49.86% 49.15% 49.27% 14.20%
Selling, General & Administrative Expenses 46.23% 45.05% 43.86% 9.00%
Advertising Expenses 1.02% 1.16% 1.39% 0.30%
Profit Before Interest and Taxes 6.12% 6.54% 8.18% 0.80%

Main Ratios
Current 1.92 2.15 2.50 1.64
Quick 1.82 2.05 2.40 0.97
Total Debt to Total Assets 49.51% 40.28% 31.29% 57.80%
Pre-tax Return on Assets 24.91% 25.20% 28.58% 3.60%
Pre-tax Return on Net Worth 49.34% 42.19% 41.59% 8.40%

Business Vitality Profile 2002 2003 2004 Industry

Sales per Employee $78,400 $86,000 $95,667 $0
Survival Rate 0.00%

Additional Ratios 2002 2003 2004

Net Profit Margin 3.64% 4.10% 5.41% n.a
Return on Equity 25.50% 23.97% 26.01% n.a

Activity Ratios
Accounts Receivable Turnover 6.46 6.46 6.46 n.a
Collection Days 28 54 54 n.a
Inventory Turnover 86.66 45.64 45.58 n.a
Accounts Payable Turnover 9.51 9.51 9.51 n.a
Total Asset Turnover 3.54 3.49 3.31 n.a

Debt Ratios
Debt to Net Worth 0.98 0.67 0.46 n.a
Short-term Liab. to Liab. 0.88 1.01 1.17 n.a

Liquidity Ratios
Net Working Capital $132,391 $173,304 $238,899 n.a
Interest Coverage 6.64 9.63 17.80 n.a

Additional Ratios
Assets to Sales 0.28 0.29 0.30 n.a
Current Debt/Total Assets 43% 41% 37% n.a
Acid Test 1.32 1.52 1.84 n.a
Sales/Net Worth 7.01 5.84 4.81 n.a
Dividend Payout $0 0.00 0.00 n.a

Page 14
 Appendix

Appendix Table: Sales Forecast (Planned)

Sales Forecast
Sales Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Over-counter $10,000 $10,000 $16,000 $16,000 $21,000 $26,000 $30,000 $40,000 $45,000 $40,000 $40,000 $40,000
Shipped $2,000 $3,000 $5,000 $7,000 $9,000 $11,000 $14,000 $15,000 $17,000 $13,000 $10,000 $16,000
Restaurant Deliveries $30,000 $30,000 $50,000 $55,000 $55,000 $60,000 $70,000 $80,000 $80,000 $70,000 $70,000 $70,000
Total Sales $42,000 $43,000 $71,000 $78,000 $85,000 $97,000 $114,000 $135,000 $142,000 $123,000 $120,000 $126,000

Direct Cost of Sales Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Over-counter $5,000 $5,000 $8,000 $8,000 $10,000 $13,000 $15,000 $20,000 $22,500 $20,000 $20,000 $20,000
Shipped $1,100 $1,600 $2,600 $3,800 $4,500 $5,500 $7,500 $8,000 $8,500 $6,500 $6,000 $8,500
Restaurant Deliveries $15,000 $15,000 $25,000 $27,000 $27,000 $30,000 $35,000 $40,000 $40,000 $35,000 $35,000 $35,000
Subtotal Direct Cost of Sales $21,100 $21,600 $35,600 $38,800 $41,500 $48,500 $57,500 $68,000 $71,000 $61,500 $61,000 $63,500

Page 1
 Appendix

Appendix Table: Personnel (Planned)

Personnel Plan
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Manager $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Market Staff (4) $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000
Clean-up Crew (2) $3,800 $3,800 $3,800 $3,800 $3,800 $3,800 $3,800 $3,800 $3,800 $3,800 $3,800 $3,800
Delivery Staff (4) $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000
Sales Staff (4) $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000
Total Payroll $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800

Total People 15 15 15 15 15 15 15 15 15 15 15 15
Payroll Burden $4,770 $4,770 $4,770 $4,770 $4,770 $4,770 $4,770 $4,770 $4,770 $4,770 $4,770 $4,770
Total Payroll Expenditures $36,570 $36,570 $36,570 $36,570 $36,570 $36,570 $36,570 $36,570 $36,570 $36,570 $36,570 $36,570

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 Appendix

Appendix Table: Profit and Loss (Planned)

Pro Forma Profit and Loss

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Sales $42,000 $43,000 $71,000 $78,000 $85,000 $97,000 $114,000 $135,000 $142,000 $123,000 $120,000 $126,000
Direct Cost of Sales $21,100 $21,600 $35,600 $38,800 $41,500 $48,500 $57,500 $68,000 $71,000 $61,500 $61,000 $63,500
Other Production Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------
Total Cost of Sales $21,100 $21,600 $35,600 $38,800 $41,500 $48,500 $57,500 $68,000 $71,000 $61,500 $61,000 $63,500
Gross Margin $20,900 $21,400 $35,400 $39,200 $43,500 $48,500 $56,500 $67,000 $71,000 $61,500 $59,000 $62,500
Gross Margin % 49.76% 49.77% 49.86% 50.26% 51.18% 50.00% 49.56% 49.63% 50.00% 50.00% 49.17% 49.60%
Operating Expenses:
Advertising/Promotion $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000
Travel $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000
Miscellaneous $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Payroll Expense $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800
Payroll Burden $4,770 $4,770 $4,770 $4,770 $4,770 $4,770 $4,770 $4,770 $4,770 $4,770 $4,770 $4,770
Depreciation $800 $800 $800 $800 $800 $800 $800 $800 $800 $800 $800 $800
Leased Equipment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Utilities $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500
Insurance $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Rent $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Contract/Consultants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------
Total Operating Expenses $42,870 $42,870 $42,870 $42,870 $42,870 $42,870 $42,870 $42,870 $42,870 $42,870 $42,870 $42,870
Profit Before Interest and Taxes ($21,970) ($21,470) ($7,470) ($3,670) $630 $5,630 $13,630 $24,130 $28,130 $18,630 $16,130 $19,630
Interest Expense Short-term $818 $803 $788 $773 $758 $743 $728 $713 $698 $683 $668 $653
Interest Expense Long-term $167 $167 $167 $167 $167 $167 $167 $167 $167 $167 $167 $167
Taxes Incurred ($6,887) ($6,732) ($2,528) ($1,383) ($89) $1,416 $3,821 $6,975 $8,180 $5,334 $4,589 $5,643
Extraordinary Items $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Net Profit ($16,069) ($15,708) ($5,898) ($3,227) ($207) $3,304 $8,915 $16,275 $19,086 $12,446 $10,707 $13,167
Net Profit/Sales -38.26% -36.53% -8.31% -4.14% -0.24% 3.41% 7.82% 12.06% 13.44% 10.12% 8.92% 10.45%

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 Appendix

Appendix Table: Cash Flow (Planned)

Pro Forma Cash Flow Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Cash Received
Cash from Operations:
Cash Sales $25,200 $25,800 $42,600 $46,800 $51,000 $58,200 $68,400 $81,000 $85,200 $73,800 $72,000 $75,600
From Receivables $0 $8,960 $17,013 $23,173 $29,893 $32,693 $36,560 $42,427 $50,080 $55,493 $52,747 $48,560
Subtotal Cash from Operations $25,200 $34,760 $59,613 $69,973 $80,893 $90,893 $104,960 $123,427 $135,280 $129,293 $124,747 $124,160

Additional Cash Received

Extraordinary Items $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales Tax, VAT, HST/GST Received 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Current Borrowing $100,000 $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 Short-term 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 $0 $0 $0 $0 $0 $0
Subtotal Cash Received $125,200 $34,760 $59,613 $69,973 $80,893 $90,893 $104,960 $123,427 $135,280 $129,293 $124,747 $124,160

Expenditures Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Expenditures from Operations:
Cash Spent on Costs and Expenses $2,522 $2,145 $4,253 $4,454 $4,842 $5,783 $6,964 $8,361 $8,619 $7,115 $7,182 $7,600
Wages, Salaries, Payroll Taxes, etc. $36,570 $36,570 $36,570 $36,570 $36,570 $36,570 $36,570 $36,570 $36,570 $36,570 $36,570 $36,570
Payment of Accounts Payable $20,757 $22,585 $19,933 $38,335 $40,205 $43,856 $52,398 $63,098 $75,322 $77,117 $64,053 $64,760
Subtotal Spent on Operations $59,849 $61,299 $60,756 $79,359 $81,616 $86,208 $95,932 $108,029 $120,511 $120,802 $107,805 $108,930

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 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800
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 Short-term 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
Adjustment for Assets Purchased on Credit $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash Spent $61,649 $63,099 $62,556 $81,159 $83,416 $88,008 $97,732 $109,829 $122,311 $122,602 $109,605 $110,730

Net Cash Flow $63,551 ($28,339) ($2,943) ($11,186) ($2,523) $2,885 $7,228 $13,598 $12,969 $6,691 $15,142 $13,430
Cash Balance $113,551 $85,212 $82,270 $71,084 $68,561 $71,446 $78,673 $92,271 $105,240 $111,931 $127,073 $140,503

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 Appendix

Appendix Table: Balance Sheet (Planned)

Pro Forma Balance Sheet

Assets
Short-term Assets Starting Balances Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Cash $50,000 $113,551 $85,212 $82,270 $71,084 $68,561 $71,446 $78,673 $92,271 $105,240 $111,931 $127,073 $140,503
Accounts Receivable $0 $16,800 $25,040 $36,427 $44,453 $48,560 $54,667 $63,707 $75,280 $82,000 $75,707 $70,960 $72,800
Inventory $0 $4,521 $4,629 $7,629 $8,314 $8,893 $10,393 $12,321 $14,571 $15,214 $13,179 $13,071 $13,607
Other Short-term 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 Short-term Assets $100,000 $184,873 $164,881 $176,325 $173,851 $176,014 $186,505 $204,701 $232,122 $252,455 $250,817 $261,104 $276,910
Long-term Assets
Long-term Assets $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000
Accumulated Depreciation $15,000 $15,800 $16,600 $17,400 $18,200 $19,000 $19,800 $20,600 $21,400 $22,200 $23,000 $23,800 $24,600
Total Long-term Assets $65,000 $64,200 $63,400 $62,600 $61,800 $61,000 $60,200 $59,400 $58,600 $57,800 $57,000 $56,200 $55,400
Total Assets $165,000 $249,073 $228,281 $238,925 $235,651 $237,014 $246,705 $264,101 $290,722 $310,255 $307,817 $317,304 $332,310

Liabilities and Capital

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Accounts Payable $20,000 $21,941 $18,657 $36,999 $38,752 $42,121 $50,309 $60,590 $72,736 $74,983 $61,899 $62,480 $66,119
Current Borrowing $0 $98,200 $96,400 $94,600 $92,800 $91,000 $89,200 $87,400 $85,600 $83,800 $82,000 $80,200 $78,400
Other Short-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Short-term Liabilities $20,000 $120,141 $115,057 $131,599 $131,552 $133,121 $139,509 $147,990 $158,336 $158,783 $143,899 $142,680 $144,519

Long-term Liabilities $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000
Total Liabilities $40,000 $140,141 $135,057 $151,599 $151,552 $153,121 $159,509 $167,990 $178,336 $178,783 $163,899 $162,680 $164,519

Paid-in Capital $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
Retained Earnings $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000
Earnings $0 ($16,069) ($31,777) ($37,674) ($40,901) ($41,108) ($37,804) ($28,889) ($12,614) $6,472 $18,918 $29,624 $42,791
Total Capital $125,000 $108,932 $93,224 $87,326 $84,099 $83,893 $87,197 $96,111 $112,386 $131,472 $143,918 $154,624 $167,791
Total Liabilities and Capital $165,000 $249,073 $228,281 $238,925 $235,651 $237,014 $246,705 $264,101 $290,722 $310,255 $307,817 $317,304 $332,310
Net Worth $125,000 $108,932 $93,224 $87,326 $84,099 $83,893 $87,197 $96,111 $112,386 $131,472 $143,918 $154,624 $167,791

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