Sample for retail office supplies

Executive Summary
Green Office addresses the market need of environmentally-friendly office supplies. Green Office has
been formed as an Illinois Corporation with Stan Cooksey as the main shareholder. Green Office will
service a wide range of customers including corporations and government agencies.

Products
Green Office will sell eco-friendly products that use recycled materials, reuse "recharged" existing
parts, or use non-toxic alternatives. Green Office will sell recycled paper ranging from notepads to
envelopes to copier paper, a wide range of laser toner, inkjet cartridges and common office supplies
such as correction fluid.

Customers
Green Office has identified three market segments. The first is corporations, with an 8% growth
rate and 12,000 potential customers. The second is government agencies, with a 11% growth rate and
7,886 possible customers. The last category is assorted customers with a 7% growth rate and 56,888
possible customers.

Competitive Edge
Green Office will offer a complete range of office supplies, to become a one-stop shopping place for
supply needs. Green Office will offer an unprecedented level of customer attention. It recognizes that
shopping must be the the most trouble free, pleasant experience if it expects to form long-term
relationships with customers.

Management
Green Office will be lead by Stan Cooksey. Stan received his undergraduate degree from the
University of Chicago. Stan worked for Symantec Software as the Regional Sales Manager for the
Government Agency Unit. While working at Symantec, Stan received his Executive MBA.

Green Office is supported by a proven business model, carefully identified market segments, and a top
notch management team. Green Office has forecasted sales for year two of $818,000, rising to
$1,004,000 in year three. We will become profitable in the second year.
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1.1 Objectives

 To become the premier source of environmentally-friendly office supplies.

 To offer green office supplies that cost no more than a 10% price premium, often at the same price
as non "green" supplies.

 Quickly grow in size and become a profitable business within the first two years.

1.2 Mission

It is Green Office's mission to become a leading vendor of environmentally-friendly office supplies.

Green Office will become a market leader offering a wide, price competitive selection with the finest
customer service.

1.3 Keys to Success

 Offer environmentally-friendly office supplies at competitive prices.

 Secure large contracts with corporations and government agencies.

 Ensure fiscal efficiency through strict financial controls.

Company Summary
Green Office is an Illinois corporation founded by Stan Cooksey.

2.1 Start-up Summary

Green Office will incur the following start up expenses:

 Office desk sets with chairs and assorted supplies (6)

 Workstations and a central file server, two laser printers, and Internet connection (6)
 Copier, fax machine
 Assorted pieces of office furniture
 Assorted shipping material
  Unit phone system with answer service (7)
 Shelving units for storage
 Used fork lift
 Intercom system
 Warehouse build out

Start-up funds will be supported predominantly through equity investment, but in addition Stan will
obtain a $50,000 SBA backed loan to assist in the purchase of start-up inventory.

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START-UP REQUIREMENTS

Start-up Expenses

Legal $3,000

Stationery etc. $500

Brochures $500

Insurance $300

Web Site Development $5,000

Research and Development $2,000

 Other $30,000

TOTAL START-UP EXPENSES $41,300

Start-up Assets

Cash Required $128,700

Start-up Inventory $46,000

Other Current Assets $3,500

Long-term Assets $43,500

TOTAL ASSETS $221,700

Total Requirements $263,000

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START-UP FUNDING

Start-up Expenses to Fund $41,300

Start-up Assets to Fund $221,700

TOTAL FUNDING REQUIRED $263,000

Assets

Non-cash Assets from Start-up $93,000

Cash Requirements from Start-up $128,700

Additional Cash Raised $0

Cash Balance on Starting Date $128,700

TOTAL ASSETS $221,700

Liabilities and Capital

Liabilities

Current Borrowing $0

Long-term Liabilities $50,000

Accounts Payable (Outstanding Bills) $0

Other Current Liabilities (interest-free) $0

TOTAL LIABILITIES $50,000

Capital

Planned Investment

Investor 1 $95,000

Investor 2 $68,000

Other $50,000

Additional Investment Requirement $0

TOTAL PLANNED INVESTMENT $213,000

 Loss at Start-up (Start-up Expenses) ($41,300)

TOTAL CAPITAL $171,700

TOTAL CAPITAL AND LIABILITIES $221,700

Total Funding $263,000

2.2 Company Ownership

Green Office is a privately held corporation owned by Stan Cooksey. Green Office has been
incorporated in Illinois

Products
Green Office offers a wide range of office supplies, all of which are environmentally friendly, they
either use recycled content materials, sustainable products, or substitute toxic chemicals with non-toxic
substitutes. Products include:

 Recycled clip boards

 Non-toxic correction fluid

 Recycled note pads (small and legal size)

 Recycled paper clips

 Recycled copier and printer paper

 Recycled envelopes

 Erasable boards

 Reusable coffee filters

 Recycled, refillable laser toner cartridges and inkjet cartridges

 Solar calculators

 Refillable pens and pencils made out of recyclable materials

 And many other items

Market Analysis Summary

Green Office believes that it faces a market with many opportunities and significant demand. Green
Office's three main customer segments will be corporations, government agencies, and others which is
a "catch all" category.

The office supply industry operates with several different large companies and many small ones.
Within the office supplies industry there exists a niche of environmentally-friendly companies that
Green Office competes against. Some of these companies serve local markets, others are Web-based
for broader coverage.

4.1 Market Segmentation

Green Office has identified three customer segments that it will go after:

 Corporations: This customer group is composed of companies, typically with at least 35

employees. This customer group makes purchases for the entire organization, however sometimes
different groups within the same organization will make purchases individually.

These customers are interested in the purchase of environmentally-friendly supplies because of a

decision by the owners for personal/corporate belief reasons or as part of a PR program that
communicates to their customers that the business is committed to the environment and makes
procurements based on environmental factors.

 Government Agencies: This segment is an ever expanding group. The foundation of this segment
is Former President Clinton's Executive Order (EO) 13101 entitled "Greening the Government
Through Recycling, Waste Prevention, and Federal Acquisition." This order requires the federal
government to buy recycled content and environmentally preferable products.

The order directs the head of each executive agency to incorporate waste prevention and recycling
and to increase and expand markets for recovered materials. The bottom line of this EO is that
federal government agencies are forced to make environmentally-friendly office supply purchases.
In addition, the majority of states have enacted similar legislation for their governmental agencies.
These legislative requirements for environmentally-friendly products has created a huge market for
Green Office.

 Other: This is a catch all segment that contains a wide range of entities such as small companies,
individuals, school districts, etc.

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 MARKET ANALYSIS

YEAR YEAR YEAR YEAR YEAR

1 2 3 4 5

Potential Customers Growth CAGR

Corporations 8% 12,009 12,970 14,008 15,129 16,339 8.00%

Government Agencies 3% 7,886 8,123 8,367 8,618 8,877 3.00%

Other 7% 56,888 60,870 65,131 69,690 74,568 7.00%

Total 6.77% 76,783 81,963 87,506 93,437 99,784 6.77%

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4.2 Target Market Segment Strategy

As mentioned previously in the Market Segmentation section, three customer groups have been
identified. Two of these, corporations and government agencies are quite attractive as customer
segments. The third is used as a "catch all" category. The strategy will be the use of a targeted sales
campaign that uses specific sales agents each of whom are responsible for a specific customer group.

The hiring process for these sales agents will be done with the specific group in mind. The agent
responsible for the government agencies will be chosen based on his past experience and proficiency in
selling to government agencies if possible. Green Office will therefore provide each experienced sales
person with an exclusive territory, assisting them in achieving high sales marks for the respective
customer group.

4.3 Industry Analysis

The broader industry that Green Office competes in the office supplies industry. Within that industry
there are several market leaders:

 Staples

 OfficeMax

 Office Depot
All three of these companies offer both local retail stores as well as mail order/Internet sales. These are
the leaders with a combined 59% market share. The remaining players in the market are made up of
both mail order/Internet competitors as well as local retailers. Within this market is a newly developed
niche of environmentally-friendly suppliers. The majority of companies competing in this niche are
mail order/Internet based.

4.3.1 Competition and Buying Patterns

Competition comes from two sources, direct and indirect competitors. Direct competitors are
companies that offer similar lines of environmentally-friendly products. The main companies are:

 Ecomall

 EcoProducts

 The Good Humans

The indirect competitors are companies within the office supplies industry who offer eco supplies, but
do not concentrate on these products. Customers' buying patterns are based on two main factors:

 Price: Both a relative comparison to standard office supplies as well as eco-friendly ones.

 Convenience: Ease of ordering, shipping schedule, variety of products.

Strategy and Implementation Summary

Green Office's goal of becoming a major vendor of environmentally-friendly office supplies is an
ambitious but achievable goal. Green Office will leverage its two part competitive edge to achieve this
goal. The first edge is an unbeatable selection of green office supplies.

This all inclusive product catalog creates a compelling one stop shopping venue. This wonderful
product selection will be supported by a customer-centric company culture. The marketing and sales
strategies support these two competitive edges.

The marketing strategy seeks to develop an awareness of Green Office and its ability to offer a wide
selection of eco-friendly office products. All products will be priced competitively, often at the same
low price as non eco-friendly products.

The sales strategy will use specially engineered economic incentives that channel account manager
behavior into the mode of ensuring, happy, long-term customers. This entire strategy is based on the
company's philosophy that it is far cheaper to maintain a current customer than it is to attract new ones.

5.1 Competitive Edge

Green Office competitive edge is two fold, a wide selection of office supplies making it a one stop
shopping place and a strong customer service oriented organization where the customers are assigned a
specific sales agent/account manager to assist them.
By offering a strong product catalog, customers are able to place all of their office supplies orders at
one place instead of having to contact multiple vendors each week or month, whatever the interval may
be. Creating the perception that all of the company's office supply needs can be met by one company,
Green Office has a competitive edge.

The second edge is Green Office's focus on customer service. The company recognizes that if long-
term sustainable growth is desired, the customers must feel like that they are being offered the finest
service. This will ensure the building of a loyal customer base that will assist Green Office in becoming
a sustainable operation.

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5.2 Marketing Strategy

The marketing strategy will be based on a communication effort that announces Green Office's two
competitive edges, their selection and customer service. To be able to order all of an office's supply
needs from one easy-to-work-with vendor is a significant value. Backing up the extensive product
catalog with top rate customer service will retain customers.

Green Office will undertake a marketing campaign that communicates its competitive edge. The
campaign will rely primarily on print advertising. The media outlets to be used will be determined
based on the readership levels and targeted companies. The campaign will develop an awareness of
Green Office to the targeted customers. The development of an awareness or image of Green Office is
the first step in the implementation strategy, the second step is the sales strategy detailed in the
following section.

5.3 Sales Strategy

Green Office's sales strategy will be based on the conversion of qualified sales leads into paying
customers. The key emphasis here is customer service. Green Office recognizes that customers desire
that their needs are taken care of.

Additionally, customers want a seemless experience where their expectations are managed. Green
Office will accomplish these lofty goals by assigning a specific account manager/sales agent to each
customer (assigned by the customer type). The sales agent receives a commission not just for the
individual sale but also using a complex formula that takes into account long-term customer
satisfaction of the client.

Green Office therefore has developed an economic incentive for its account managers to develop long-
term customers. This incentive based system is key to the sales strategy because it creates an incentive
for the sales agent to take into account Green Office's strategic survival, not just the agents short-term
compensation. In addition, long-term customers are more profitable than new customers.

5.3.1 Sales Forecast

Green Office adopted a conservative forecast for the business plan. These conservative estimates will
help ensure that the company does not face any cash flow shortages within the first couple of years The
sales forecast also takes into account that Green Office is a start-up organization and it will take time to
generate a level of sustainable sales. Sales will increase at a slow but steady rate. Please see the three
following table and charts for graphical representation of the sales forecasts.

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SALES FORECAST

YEAR 1 YEAR 2 YEAR 3

 Sales

Corporations $92,892 $298,887 $366,544

Government Agencies $107,470 $358,664 $439,853

Other $59,362 $161,399 $197,934

TOTAL SALES $259,724 $818,950 $1,004,331

Direct Cost of Sales Year 1 Year 2 Year 3

Corporations $47,380 $194,277 $238,254

Government Agencies $56,856 $233,132 $285,904

Other $25,585 $104,909 $128,657

Subtotal Direct Cost of Sales $129,821 $532,318 $652,815

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5.4 Milestones

Green Office has identified four specific milestones that will serve as goals for the organization to
achieve. While the milestones are lofty in terms of qualitative standards and the timeline deadline, they
are achievable.

 Business plan completion.

 First major government agency account.

 $200K in sales.

 Profitability.

MILESTONES
 Milestone Start Date End Date Budget Manager Department

Business plan completion 1/1/2004 2/15/2004 $0 Stan Business

Development

First major government 1/1/2004 4/1/2004 $0 Sales Sales

agency account Manager

$200K in sales 1/1/2004 2/15/2005 $0 Sales Sales

Manager

Profitability 1/1/2004 6/1/2005 $0 Stan Entire

company

Totals $0

Web Plan Summary

The website will be developed to offer customers a product catalog for online orders. The overriding
design philosophy of the site is ease of use. Green Office wants to make the process of placing an order
as easy and fast as possible thereby encouraging increased sales. Green Office will incorporate special
features such as a section that is specific to each customer so the customer can easily make purchases
of repeat items. Instead of going through the website every month and locating their monthly needs, the
site captures regularly ordered items for that specific customer, significantly speeding up the ordering
process. This ease-of-use feature will help increase sales as customers become more and more familiar
with the site and appreciate how easy it is to place an order.

6.1 Website Marketing Strategy

The marketing strategy for the website will begin initially with a simple strategy of search engine
submissions and the use of pay-per-clicks which is a service of Google and Overture where the
company pays the search engine every time a surfer clicks through to the Green Office site.

6.2 Development Requirements

Green Office has secured a start-up website design company to design and develop the site. As a result,
the company is able to negotiate a favorable rate for the development and maintenance of the site.

Management Summary
Green Office is lead by Stan Cooksey. Stan received his undergraduate degree of business from the
University of Chicago. After graduation Stan accepted a position from The Symantec Software
Corporation as the regional sales manager for the government agency group. After five years in this
group Stan enrolled in an Executive MBA Program at Loyola University. At the conclusion of this
program Stan received an advancement to become a vice president of sales for the United States. Stan
left his position at Symantec to start Green Office.

7.1 Personnel Plan

 Stan: Operations, business development, some finance, some accounting.

 Willma (Stan's wife): Procurement, marketing.

 Sales: Account manager functions.

 Accounting: Part-time accounting clerk.

 Shipping: Responsible for order filling.

 Administrative/customer support.

PERSONNEL PLAN

YEAR 1 YEAR 2 YEAR 3

Stan $20,000 $22,000 $24,200

Willma $20,000 $22,000 $24,200

Sales $15,000 $16,500 $18,150

Sales $12,000 $13,200 $14,520

Sales $9,000 $9,900 $10,890

Accounting $6,400 $7,040 $7,744

Shipping $15,000 $16,500 $18,150

Shipping $12,000 $13,200 $14,520

Shipping $7,000 $7,700 $8,470

Admin/customer support $10,000 $11,000 $12,100

Admin/customer support $4,800 $5,280 $5,808

 TOTAL PEOPLE 11 11 11

Total Payroll $131,200 $144,320 $158,752

Financial Plan

The following sections will outline important financial information.

8.1 Important Assumptions

The following table details important Financial Assumptions.

General Assumptions

Year 1 Year 2 Year 3

Plan Month 1 2 3

Current Interest Rate 9.00% 9.00% 9.00%

Long-term Interest Rate 8.00% 8.00% 8.00%

Tax Rate 30.00% 30.00% 30.00%

Other 0 0 0

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8.2 Break-even Analysis

The following table and chart show our break-even analysis.

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Break-even Analysis

Monthly Revenue Break-even $31,303

Assumptions:

Average Percent Variable Cost 50%

Estimated Monthly Fixed Cost $15,657

8.3 Projected Profit and Loss

The following table will indicate Projected Profit and Loss.

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Pro Forma Profit and Loss

Year 1 Year 2 Year 3

Sales $259,724 $818,950 $1,004,331

Direct Cost of Sales $129,821 $532,318 $652,815

Other Costs of Goods $0 $0 $0

Total Cost of Sales $129,821 $532,318 $652,815

 Gross Margin $129,903 $286,633 $351,516

Gross Margin % 50.02% 35.00% 35.00%

Expenses

Payroll $131,200 $144,320 $158,752

Sales and Marketing and Other Expenses $2,400 $2,400 $2,400

Depreciation $8,700 $8,700 $8,700

Rent $12,000 $12,000 $12,000

Utilities $6,000 $6,000 $6,000

Insurance $2,400 $2,400 $2,400

Payroll Taxes $19,680 $27,180 $28,080

Website Maintenance $5,500 $6,500 $7,500

Total Operating Expenses $187,880 $209,500 $225,832

Profit Before Interest and Taxes ($57,977) $77,133 $125,684

EBITDA ($49,277) $85,833 $134,384

Interest Expense $3,854 $3,731 $3,500

Taxes Incurred $0 $22,021 $36,655

Net Profit ($61,831) $51,381 $85,528

Net Profit/Sales -23.81% 6.27% 8.52%

8.4 Projected Cash Flow

The following chart and table will indicate Projected Cash Flow.
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Pro Forma Cash Flow

Year 1 Year 2 Year 3

Cash Received

Cash from Operations

Cash Sales $64,931 $204,738 $251,083

Cash from Receivables $151,445 $520,877 $722,308

Subtotal Cash from Operations $216,376 $725,615 $973,390

Additional Cash Received

Sales Tax, VAT, HST/GST Received $0 $0 $0

New Current Borrowing $0 $3,000 $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 $36,000 $0

Subtotal Cash Received $216,376 $764,615 $973,390

Expenditures Year 1 Year 2 Year 3

Expenditures from Operations

Cash Spending $131,200 $144,320 $158,752

Bill Payments $130,946 $601,459 $748,773

Subtotal Spent on Operations $262,146 $745,779 $907,525

Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out $0 $0 $0

Principal Repayment of Current Borrowing $0 $0 $2,234

Other Liabilities Principal Repayment $0 $0 $0

Long-term Liabilities Principal Repayment $3,403 $3,302 $3,324

Purchase Other Current Assets $0 $0 $0

Purchase Long-term Assets $0 $0 $0

Dividends $0 $0 $0

Subtotal Cash Spent $265,548 $749,080 $913,083

Net Cash Flow ($49,173) $15,534 $60,308

Cash Balance $79,527 $95,062 $155,369

8.5 Projected Balance Sheet

The following table will indicate the Projected Balance Sheet.

Pro Forma Balance Sheet

Year 1 Year 2 Year 3

Assets

Current Assets

Cash $79,527 $95,062 $155,369

Other Current Assets $3,500 $3,500 $3,500

Total Current Assets $141,788 $269,506 $368,509

Long-term Assets

Long-term Assets $43,500 $43,500 $43,500

Accumulated Depreciation $8,700 $17,400 $26,100

Total Long-term Assets $34,800 $26,100 $17,400

Total Assets $176,588 $295,606 $385,909

Liabilities and Capital Year 1 Year 2 Year 3

Current Liabilities

Accounts Payable $20,122 $52,060 $62,392

Current Borrowing $0 $3,000 $766

Other Current Liabilities $0 $0 $0

Subtotal Current Liabilities $20,122 $55,060 $63,158

Long-term Liabilities $46,597 $43,296 $39,972

Total Liabilities $66,719 $98,356 $103,131

Paid-in Capital $213,000 $249,000 $249,000

Retained Earnings ($41,300) ($103,131) ($51,750)

Earnings ($61,831) $51,381 $85,528

Total Capital $109,869 $197,250 $282,779

 Total Liabilities and Capital $176,588 $295,606 $385,909

Net Worth $109,869 $197,250 $282,779

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8.6 Business Ratios

The following table shows common Business Ratios, specific to Green Office as well as to the industry as a whole.

Ratio Analysis

Industry
Year 1 Year 2 Year 3
Profile

Sales Growth 0.00% 215.32% 22.64% 1.50%

Percent of Total Assets

Accounts Receivable 24.55% 46.24% 43.44% 38.65%

Inventory 8.73% 11.59% 10.89% 28.15%

Other Current Assets 1.98% 1.18% 0.91% 18.82%

Total Current Assets 80.29% 91.17% 95.49% 85.62%

Long-term Assets 19.71% 8.83% 4.51% 14.38%

Total Assets 100.00% 100.00% 100.00% 100.00%

Current Liabilities 11.39% 18.63% 16.37% 43.40%

Long-term Liabilities 26.39% 14.65% 10.36% 11.10%

Total Liabilities 37.78% 33.27% 26.72% 54.50%

Net Worth 62.22% 66.73% 73.28% 45.50%

Percent of Sales

Sales 100.00% 100.00% 100.00% 100.00%

Gross Margin 50.02% 35.00% 35.00% 22.64%

Selling, General & Administrative Expenses 96.00% 31.88% 28.47% 13.42%

Advertising Expenses 0.00% 0.00% 0.00% 0.26%

Profit Before Interest and Taxes -22.32% 9.42% 12.51% 1.70%

Main Ratios

Current 7.05 4.89 5.83 1.77

Quick 6.28 4.27 5.17 1.07

Total Debt to Total Assets 37.78% 33.27% 26.72% 5.52%

Pre-tax Return on Net Worth -56.28% 37.21% 43.21% 59.64%

Pre-tax Return on Assets -35.01% 24.83% 31.66% 13.69%

Additional Ratios Year 1 Year 2 Year 3

Net Profit Margin -23.81% 6.27% 8.52% n.a

Return on Equity -56.28% 26.05% 30.25% n.a

Activity Ratios

Accounts Receivable Turnover 4.49 4.49 4.49 n.a

Collection Days 56 53 74 n.a

Inventory Turnover 5.91 21.43 17.12 n.a

Accounts Payable Turnover 7.51 12.17 12.17 n.a

Payment Days 27 21 28 n.a

Total Asset Turnover 1.47 2.77 2.60 n.a

Debt Ratios

Debt to Net Worth 0.61 0.50 0.36 n.a

 Current Liab. to Liab. 0.30 0.56 0.61 n.a

Liquidity Ratios

Net Working Capital $121,666 $214,446 $305,351 n.a

Interest Coverage -15.04 20.67 35.91 n.a

Additional Ratios

Assets to Sales 0.68 0.36 0.38 n.a

Current Debt/Total Assets 11% 19% 16% n.a

Acid Test 4.13 1.79 2.52 n.a

Sales/Net Worth 2.36 4.15 3.55 n.a

Dividend Payout 0.00 0.00 0.00 n.a

Appendix

Sales Forecast

Mont Mont Month Month Month Month Month Month Month Month Month Month
h1 h2 3 4 5 6 7 8 9 10 11 12

Sales

Corporatio 0 $10,11 $10,41 $10,65

$0 $0 $7,645 $8,212 $8,455 $8,747 $9,212 $9,454 $9,987
ns % 2 4 4

Governmen 0 $10,09 $10,65 $10,94 $11,58 $11,73 $12,09 $12,38

$0 $0 $8,774 $9,454 $9,746
t Agencies % 6 4 5 4 4 7 5

0
Other $0 $0 $5,048 $5,354 $5,486 $5,643 $5,894 $6,025 $6,313 $6,380 $6,544 $6,673
%

$21,46 $23,02 $23,68 $24,48 $25,76 $26,42 $27,88 $28,22 $29,05 $29,71
Total Sales $0 $0
7 1 7 7 1 4 4 7 4 2

Direct Cost Mont Mont Month Month Month Month Month Month Month Month Month Month
of Sales h1 h2 3 4 5 6 7 8 9 10 11 12

Corporatio
$0 $0 $3,669 $4,038 $4,196 $4,386 $4,688 $4,845 $5,192 $5,273 $5,469 $5,625
ns

Governmen
$0 $0 $4,403 $4,845 $5,035 $5,263 $5,625 $5,814 $6,230 $6,327 $6,563 $6,750
t Agencies

Other $0 $0 $1,981 $2,180 $2,266 $2,368 $2,531 $2,616 $2,803 $2,847 $2,953 $3,038
Subtotal
$10,05 $11,06 $11,49 $12,01 $12,84 $13,27 $14,22 $14,44 $14,98 $15,41
Direct Cost $0 $0
4 4 6 6 5 6 5 7 5 3
of Sales

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Personnel Plan

Mont Mont Mont Mont Month Month Month Month Month Month Month Month
h1 h2 h3 h4 5 6 7 8 9 10 11 12

0 $2,00 $2,00
Stan $0 $0 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000
% 0 0

0 $2,00 $2,00
Willma $0 $0 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000
% 0 0

0 $1,50 $1,50
Sales $0 $0 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
% 0 0

0
Sales $0 $0 $0 $0 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
%

0
Sales $0 $0 $0 $0 $0 $0 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
%

0
Accounting $0 $0 $0 $0 $800 $800 $800 $800 $800 $800 $800 $800
%

0 $1,50 $1,50
Shipping $0 $0 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
% 0 0

0
Shipping $0 $0 $0 $0 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
%

0
Shipping $0 $0 $0 $0 $0 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000
%

Admin/custom 0 $1,00 $1,00

$0 $0 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000
er support % 0 0

Admin/custom 0
$0 $0 $0 $0 $0 $0 $800 $800 $800 $800 $800 $800
er support %

Total People 0 0 5 5 8 9 11 11 11 11 11 11

$8,00 $8,00 $11,80 $12,80 $15,10 $15,10 $15,10 $15,10 $15,10 $15,10
Total Payroll $0 $0
0 0 0 0 0 0 0 0 0 0

General Assumptions

Month Month Month Month Month Month Month Month Month Month Month Month
1 2 3 4 5 6 7 8 9 10 11 12

Plan
1 2 3 4 5 6 7 8 9 10 11 12
Month
Current
Interest 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00%
Rate

Long-
term
8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00%
Interest
Rate

Tax Rate 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00%

Other 0 0 0 0 0 0 0 0 0 0 0 0

Pro Forma Profit and Loss

Month Month Month Month Month Month Month Month Month Month Month Month
1 2 3 4 5 6 7 8 9 10 11 12

$21,46 $23,02 $23,68 $24,48 $25,76 $26,42 $27,88 $28,22 $29,05 $29,71
Sales $0 $0
7 1 7 7 1 4 4 7 4 2

Direct Cost $10,05 $11,06 $11,49 $12,01 $12,84 $13,27 $14,22 $14,44 $14,98 $15,41
$0 $0
of Sales 4 4 6 6 5 6 5 7 5 3

Other
Costs of $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Goods

Total Cost $10,05 $11,06 $11,49 $12,01 $12,84 $13,27 $14,22 $14,44 $14,98 $15,41
$0 $0
of Sales 4 4 6 6 5 6 5 7 5 3

Gross $11,41 $11,95 $12,19 $12,47 $12,91 $13,14 $13,66 $13,77 $14,06 $14,29
$0 $0
Margin 4 7 0 0 6 8 0 9 9 9

Gross 53.17 51.94 51.46 50.93 50.14 49.76 48.99 48.82 48.42 48.13
0.00% 0.00%
Margin % % % % % % % % % % %

Expenses

$11,80 $12,80 $15,10 $15,10 $15,10 $15,10 $15,10 $15,10

Payroll $0 $0 $8,000 $8,000
0 0 0 0 0 0 0 0

Sales and
Marketing
$200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200
and Other
Expenses

Depreciati
$725 $725 $725 $725 $725 $725 $725 $725 $725 $725 $725 $725
on

Rent $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000

Utilities $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500

Insurance $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200

Payroll 15
$0 $0 $1,200 $1,200 $1,770 $1,920 $2,265 $2,265 $2,265 $2,265 $2,265 $2,265
Taxes %

Website
Maintenan $0 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500
ce
Total
$12,32 $12,32 $16,69 $17,84 $20,49 $20,49 $20,49 $20,49 $20,49 $20,49
Operating $2,625 $3,125
5 5 5 5 0 0 0 0 0 0
Expenses

Profit
Before ($2,62 ($3,12 ($4,50 ($5,37 ($7,57 ($7,34 ($6,83 ($6,71 ($6,42 ($6,19
($911) ($368)
Interest 5) 5) 5) 5) 4) 2) 0) 1) 1) 1)
and Taxes

($1,90 ($2,40 ($3,78 ($4,65 ($6,84 ($6,61 ($6,10 ($5,98 ($5,69 ($5,46
EBITDA ($186) $357
0) 0) 0) 0) 9) 7) 5) 6) 6) 6)

Interest
$332 $330 $328 $326 $324 $322 $320 $318 $316 $315 $313 $311
Expense

Taxes
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Incurred

($2,95 ($3,45 ($1,23 ($4,82 ($5,69 ($7,89 ($7,66 ($7,14 ($7,02 ($6,73 ($6,50
Net Profit ($694)
7) 5) 9) 9) 7) 4) 0) 7) 5) 4) 1)

Net - - - - - - - -
Profit/Sale 0.00% 0.00% -5.77% -3.01% 20.39 23.26 30.64 28.99 25.63 24.89 23.18 21.88
s % % % % % % % %

Pro Forma Cash Flow

Month Month Month Month Month Month Month Month Month Month Month Month
1 2 3 4 5 6 7 8 9 10 11 12

Cash
Received

Cash from
Operations

Cash Sales $0 $0 $5,367 $5,755 $5,922 $6,122 $6,440 $6,606 $6,971 $7,057 $7,264 $7,428

Cash from
$19,85 $20,92 $21,19
Receivable $0 $0 $0 $537 $16,139 $17,282 $17,785 $18,397 $19,337
4 2 1
s

Subtotal
$26,91 $28,18 $28,61
Cash from $0 $0 $5,367 $6,292 $22,061 $23,404 $24,225 $25,003 $26,308
1 5 9
Operations

Additional
Cash
Received

Sales Tax,
VAT, 0.00
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
HST/GST %
Received

New
Current $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Borrowing

New Other
Liabilities
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
(interest-
free)
New Long-
term $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Liabilities

Sales of
Other
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Current
Assets

Sales of
Long-term $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Assets

New
Investment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Received

Subtotal
$26,91 $28,18 $28,61
Cash $0 $0 $5,367 $6,292 $22,061 $23,404 $24,225 $25,003 $26,308
1 5 9
Received

Expenditur Month Month Month Month Month Month Month Month Month Month Month Month
es 1 2 3 4 5 6 7 8 9 10 11 12

Expenditur
es from
Operations

Cash $15,10 $15,10 $15,10

$0 $0 $8,000 $8,000 $11,800 $12,800 $15,100 $15,100 $15,100
Spending 0 0 0

Bill $20,13 $19,67 $20,51

$74 $2,248 $2,770 $3,928 $3,945 $4,854 $15,401 $18,659 $18,739
Payments 9 8 1

Subtotal
$35,23 $34,77 $35,61
Spent on $74 $2,248 $10,770 $11,928 $15,745 $17,654 $30,501 $33,759 $33,839
9 8 1
Operations

Additional
Cash Spent

Sales Tax,
VAT,
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
HST/GST
Paid Out

Principal
Repaymen
t of $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Current
Borrowing

Other
Liabilities
Principal $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Repaymen
t

Long-term
Liabilities
Principal $273 $275 $277 $279 $281 $283 $284 $286 $288 $290 $292 $294
Repaymen
t

Purchase $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other
Current
Assets

Purchase
Long-term $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Assets

Dividends $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Subtotal $35,52 $35,07 $35,90

$348 $2,523 $11,047 $12,207 $16,026 $17,936 $30,785 $34,045 $34,127
Cash Spent 9 0 5

Net Cash ($2,523 ($5,680 ($5,915 ($6,560 ($9,043 ($7,819 ($8,61 ($6,88 ($7,28
($348) $6,035 $5,468
Flow ) ) ) ) ) ) 8) 5) 6)

Cash $128,35 $125,82 $120,14 $114,23 $120,27 $125,73 $119,17 $110,13 $102,31 $93,69 $86,81 $79,52
Balance 2 9 9 5 0 8 7 5 6 8 4 7

PRO FORMA BALANCE SHEET

MONTH MONTH MONTH

MONTH 1 MONTH 2 MONTH 3 MONTH 4 MONTH 5 MONTH 6 MONTH 7 MONTH 8 MONTH 9
10 11 12

Starting
Assets
Balances

Current Assets

Cash $128,700 $128,352 $125,829 $120,149 $114,235 $120,270 $125,738 $119,177 $110,135 $102,316 $93,698 $86,814 $79,527

Other Current
$3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500
Assets

TOTAL CURRENT
$178,200 $177,852 $175,329 $175,696 $175,447 $171,612 $176,792 $172,596 $165,405 $160,112 $153,032 $147,554 $141,788
ASSETS

Long-term Assets

Long-term Assets $43,500 $43,500 $43,500 $43,500 $43,500 $43,500 $43,500 $43,500 $43,500 $43,500 $43,500 $43,500 $43,500

Accumulated
$0 $725 $1,450 $2,175 $2,900 $3,625 $4,350 $5,075 $5,800 $6,525 $7,250 $7,975 $8,700
Depreciation

TOTAL LONG-
$43,500 $42,775 $42,050 $41,325 $40,600 $39,875 $39,150 $38,425 $37,700 $36,975 $36,250 $35,525 $34,800
TERM ASSETS

TOTAL ASSETS $221,700 $220,627 $217,379 $217,021 $216,047 $211,487 $215,942 $211,021 $203,105 $197,087 $189,282 $183,079 $176,588

Liabilities and
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Capital

Current Liabilities

Accounts Payable $0 $2,157 $2,639 $3,797 $3,795 $4,344 $14,779 $18,036 $18,067 $19,484 $18,995 $19,817 $20,122

Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Other Current
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Liabilities
SUBTOTAL
CURRENT $0 $2,157 $2,639 $3,797 $3,795 $4,344 $14,779 $18,036 $18,067 $19,484 $18,995 $19,817 $20,122
LIABILITIES

Long-term Liabilities $50,000 $49,727 $49,452 $49,175 $48,896 $48,615 $48,333 $48,048 $47,762 $47,474 $47,183 $46,891 $46,597

TOTAL
$50,000 $51,884 $52,090 $52,972 $52,691 $52,959 $63,112 $66,084 $65,829 $66,957 $66,178 $66,709 $66,719
LIABILITIES

Paid-in Capital $213,000 $213,000 $213,000 $213,000 $213,000 $213,000 $213,000 $213,000 $213,000 $213,000 $213,000 $213,000 $213,000

Retained Earnings ($41,300) ($41,300) ($41,300) ($41,300) ($41,300) ($41,300) ($41,300) ($41,300) ($41,300) ($41,300) ($41,300) ($41,300) ($41,300)

Earnings $0 ($2,957) ($6,411) ($7,650) ($8,344) ($13,173) ($18,870) ($26,764) ($34,424) ($41,571) ($48,596) ($55,329) ($61,831)

TOTAL CAPITAL $171,700 $168,743 $165,289 $164,050 $163,356 $158,527 $152,830 $144,936 $137,276 $130,129 $123,104 $116,371 $109,869

TOTAL
LIABILITIES AND $221,700 $220,627 $217,379 $217,021 $216,047 $211,487 $215,942 $211,021 $203,105 $197,087 $189,282 $183,079 $176,588
CAPITAL

Net Worth $171,700 $168,743 $165,289 $164,050 $163,356 $158,527 $152,830 $144,936 $137,276 $130,129 $123,104 $116,371 $109,869