Our inventory turnover is estimated at 7 days.Īll purchased equipment, as well as the build-out costs, will be expensed, which will reduce the asset base of the company. We estimate our payment days to be 30 days to our accounts payable. Our collections days are estimated at 2 days based on credit card (15% of sales) and cash (85% of sales) merchant account processing. We anticipate accounts payable for inventory to begin in July 2004. New accounts payable begin in July 2004 with the leasing of space and initial build-out expenses. Payroll taxes and employee benefits are forecast at 7% of payroll and identified in the Profit and Loss table of this financial plan. Our payroll expense begins in August 2004 as we prepare for our grand opening. Our tax rate is initially set at 0% pending further analysis. The company does not anticipate securing a conventional loan for funding purposes. The owner’s initial investment of $40,260 in start-up capital, along with paid-in capital of $150,000, results in a total investment of $190,260. In the event that net profitability cannot be attained, the owner will take sequential steps to exit the venture, as outlined in the Exit Strategy section of the Financial Plan. The owner will also review the return-on-investment for personally providing more paid-in capital. If the venture is undercapitalized and requires more working capital, the owner will consider bringing on investment partners. If the venture fails, the owner’s paid-in capital and expenses may not be recovered. The owner is aware of the highly risky nature of launching an entertainment-based restaurant establishment. We anticipate our accounting net worth at the end of our first year to be a negative ($10,031), increasing to $62,468 in our second year and $142,359 in our third year. ![]() We project ending our first year with a cash balance of $23,084, increasing to $126,748 in our second year and $208,905 in our third year. Our net cash flow for the first year is projected at $22,084, increasing to $103,664 in our second year and $82,157 in our third year. Start-up expenses of $40,260 and initial working capital of $150,000 has been provided by owner Wes Anthony. Our second year forecast shows a positive net profit of $122,498, increasing in our third year to $129,891. Total net profit for our first year is estimated at a negative ($161,031) due to start-up expenses. ![]() We estimate our monthly revenue break-even at $66,395, with a per-unit variable cost of 60% and fixed monthly costs of $26,558. The venture will be funded solely through paid-in capital provided by the owner. The purpose of this business plan is to estimate start-up and ongoing costs identify revenue streams and forecast net cash flow and profits.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |