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TRANSCRIPT
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Business Plan
for
Blue Waffle Technology CC
Nigeria & South Africa
www awoofshop com
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www awoofshop com
Confidentiality Agreement
The undersigned reader acknowledges that the information provided by Blue Waffle Technology inthis business plan is confidential; therefore, reader agrees not to disclose it without the expresswritten permission of Blue Waffle Technology.
It is acknowledged by reader that information to be furnished in this business plan is in all respects
confidential in nature, other than information which is in the public domain through other means andthat any disclosure or use of same by reader, may cause serious harm or damage to Blue WaffleTechnology.
Upon request, this document is to be immediately returned to Blue Waffle Technology.
___________________
Signature
___________________
Name (typed or printed)
___________________
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Table of Contents
1.0 Executive Summary......................................................................................................................................1Chart: Highlights..............................................................................................................................2
1.1 Objectives............................................................................................................................................31.2 Mission ................................................................................................................................................41.3 Keys to Success ..................................................................................................................................5
2.0 Company Summary ......................................................................................................................................62.1 Company Ownership ..........................................................................................................................72.2 Start-up Summary...............................................................................................................................8
Table: Start-up.................................................................................................................................9
Chart: Start-up...............................................................................................................................103.0 Products ......................................................................................................................................................114.0 Market Analysis Summary ..........................................................................................................................16
4.1 Market Segmentation........................................................................................................................17Table: Market Analysis ..................................................................................................................18Chart: Market Analysis (Pie)..........................................................................................................19
4.2 Target Market Segment Strategy......................................................................................................204.3 Industry Analysis ...............................................................................................................................21
4.3.1 Competition and Buying Patterns.........................................................................................22
5.0 Web Plan Summary....................................................................................................................................235.1 Website Marketing Strategy..............................................................................................................245.2 Development Requirements .............................................................................................................25
6.0 Strategy and Implementation Summary .....................................................................................................266.1 SWOT Analysis .................................................................................................................................27
6.1.1 Strengths ..............................................................................................................................286.1.2 Weaknesses.........................................................................................................................296.1.3 Opportunities ........................................................................................................................306.1.4 Threats..................................................................................................................................31
6.2 Competitive Edge..............................................................................................................................326.3 Marketing Strategy ............................................................................................................................336.4 Sales Strategy ...................................................................................................................................34
6.4.1 Sales Forecast......................................................................................................................35
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Table of Contents8.6 Projected Balance Sheet ...................................................................................................................58
Table: Balance Sheet ....................................................................................................................598.7 Business Ratios.................................................................................................................................60
Table: Ratios .................................................................................................................................61Table: Sales Forecast .........................................................................................................................................1Table: Personnel .................................................................................................................................................2Table: Profit and Loss .........................................................................................................................................3Table: Cash Flow ................................................................................................................................................4Table: Balance Sheet..........................................................................................................................................5
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1.0 Executive Summary
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1.1 Objectives
The objects of Blue Waffle Technology are:
1. To become the major distributor of P.C. and hand-held equipment covers in Africa.
2. To exploit the exclusive agreement we have with the manufacturer of the accessories we areselling.
3. To develop a wholesale network in South and West Africa.
4. To turnover 5,000 Units in the first year.
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1.2 Mission
Blue Waffle Mission is to:
Provide effective artistic protection for electronic items throughout Africa.
Operate and grow at a significant rate through sound economic decisions.
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1.3 Keys to Success
The Keys to success in Blue Waffle Business is:
1. Offer items not available elsewhere
2. Maintain current items with suitable artwork and designs, taking account of sporting events,news items. fashion etc.
3. Good customer relations and recommendations, delivering excellent service, on time, withquick replacement guarantee.
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2.0 Company Summary
Blue Waffle Technology is a importer/distributor of computer accessories throughout Africa. Thecompany has minimal operating costs having at present two partners. Most of the companiesbusiness is operated via Web Site but contact with wholesalers/retailers will also be pursued inthe future.
The companies base in Nigeria but is already active in Kenya, South Africa and other Africanstates.
The products imported are exclusive to Blue Waffle in the African continent and similar qualityitems are not available for any other supplier. The products are made in Singapore.
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2.1 Company Ownership
The two owners of the company will form a legal partnership on beginning of this plan. One ofthe partners, Chike Igwebe is already active in the industry. The second partner BernardEkwunife will be joining the effort as soon as practicable.
Both owners are Nigerian nationals.
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2.2 Start-up Summary
The company will have minimal startup costs, the main costs will be the preparation of anagreement between the partners, company formation, traveling and stationary. The remainder ofthe costs will be the purchase of the initial stock.
The purpose of the plan is to secure the 10,000$ needed to secure the opening stockand advertising. after this stage profits will be returned to the company to pay for future stockpurchase.
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Table: Start-up
Start-up
Requirements
Start-up Expenses
Legal $150
Stationery etc. $150
Company Formation $250
Rent $0
Computer $2,000Other $200
Total Start-up Expenses $2,750
Start-up Assets
Cash Required $4,000
Other Current Assets $0
Long-term Assets $0
Total Assets $4,000
Total Requirements $6,750
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3.0 Products
The Blue Waffle Technology product range is a collection of computer covers. These are printedin attractive designs and protect the device from dust, moisture and impact damage, thecovers also make the equipment more attractive. The covers are produced for the followingitems:
Playstation
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Apple Computers
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Laptops
XBox
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4.0 Market Analysis Summary
The MArket for our products will be mainly the African states, beginning with Nigeria, Kenyaand South Africa, later extending to other African countries.
Although figures are sketchy, the following figures come from the CIA factbook.
Country Population Estimated LaptopOwnership
Nigeria 150,000,000 2,000,000
Kenya 39,000,000 1,500,000
South Africa 50,000,000 2,500,000
Total Initial Market 6,000,000
The above figures do not include ownership of games consoles and Ipods etc.
Growth in ownership of laptop computers is estimated at 20% per year.
At present laptop covers are relativly unknow in these countries, we have the exclusive rightsto sell a well known brand in African countries.
We intend to aquire .5% of the laptop market in our first year by online agressive marketingusing search engine optimisation and some internet medium such as adwords.
A further possibility is to send a few samples to Education Institutions where laptop ownershipwill be high, once the covers are seen as fashionable then this should attract further sales.
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4.1 Market Segmentation
The initial sales drive will be aimed at the following segments:-
Higher end education establishments
Computer Accesory Shops and Dealers
On line sales via web site
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Table: Market Analysis
Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential Customers Growth CAGR
Nigeria 20% 10,000 12,000 14,400 17,280 20,736 20.00%
Kenya 20% 7,500 9,000 10,800 12,960 15,552 20.00%
South Africa 25% 12,500 15,625 19,531 24,414 30,518 25.00%
Total 22.16% 30,000 36,625 44,731 54,654 66,806 22.16%
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4.2 Target Market Segment Strategy
Higher end educational establishments, where a significant number of students have laptopswill be marketed directly by distributing a few sample covers. Once these have seen by otherlaptop users, the protection and fashion statement will increase the popularity and addsignificant sales.
Computer distributors and accessory shops. We will be offering generous quantity discounts to
distribution companies and providing some in store display such as bubble packs and someadvertising.
Internet Sales. This will be the majot focus of the sales campaign, we are already selling asmall quantity of covers via the internet site, at present this is limited volume due to theinvestment required to hold sufficient stock. Once we have financing then we will exploitseveral mediums to increase sales, such as Adwods campaigns, SEO optimisation, improvedspecific sales site.
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4.3 Industry Analysis
The computer accessories Industry is well developed in the Western World, whilst in Africa thetrend of purchasing add ons for computers and mobile phones is yet to be fully established. Thsiis due in part to the difficulty in purchasing worldwide from African countries, also the limitedamount of retail outlets accessable to users of electronic equipment.
The conditions in African countries lend themselves to our products perfectly.
The sometimes dusty conditions in transport are conducive to protecting any largeelectronic investment.
The low cost of our accessories are affordable improvements to existing hardware. Our accessories can be purchased on the net, inside African Countries.
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4.3.1 Competition and Buying Patterns
At present there is little or no significant competition in our business sector, our test salesindicate there is a need for our products initially in the large connurbations later in the moreremote cities.
The competative advantages of Blue Waffle Technology:-
The exclusive agreement we have with a major manufacturer in Singapore.
Virtually untapped market with a prospective 6,000,000 users.
Fashionable item that can be produced in any design very quickly.
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5.0 Web Plan Summary
Blue Waffle has already developed a web presence with e-commerce to its business model.The Blue Waffle website, www.awoofshop.com and www.awoofshop.co.za will be a secondarychannel of business serving as virtual business card and portfolio for the company, as well asits online "home."
The website will showcase the products on offer available for purchase, and provide design andtrend information appropriate to the computer accesories market. Additional tips andinspirational ideas will focus on gifts and gift giving. To further show off its expertise, The BlueWaffle website will provide a resources area, offering articles, research, product informationand website links of interest to its customers.
The key to the website strategy will be combining a well designed front-end, with a back-endcapable of capturing "hits" and customer data for use in future marketing endeavors.
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5.1 Website Marketing Strategy
Market strategy in an Internet retail business depends on recognition of expertise by theconsumer. For Blue Waffle, it will start with our existing customer base, informing them of ourInternet presence and encouraging their word-of-mouth recommendations to others. Furtherawareness will be heightened by utilizing search engine marketing, banner advertising, and
affiliates.
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5.2 Development Requirements
Costs that The Blue Waffle will expect to incur with development of its website include:
Development Costs
New site design and SEO optimisation - $500. Site Implementation - Free. Blue Waffle will utilise the programming services of Chike
Igwegbe, he has extensive experience in Web development.
Ongoing Costs
Website name registration - $70 per year.
Site Hosting - $30 or less per month. Search Engine Registration - $100 per year.
Site Design Changes - Changes in the site, such as photography costs, are consideredto be part of Marketing and Advertising.
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6.0 Strategy and Implementation Summary
Blue Waffle Technology will pursue a differentiation strategy by offering a specific line offashionable, practical covers for laptops, games consoles and mobile phones to the selectedcustomer segments in the geographical area of Nigeria, Kenya and South Africa.
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6.1 SWOT Analysis
Blue Waffle Technology have a valuable inventory of strengths that will help it succeded Thesestrengths include: A nnowledgable entrepreneur in the same young grouping as the majority ofBW target customers, knowledge of the medium, no Competitors in the region, Understandingof the culture and easy product returns/guarantees policy. These strengths are valuable but itis also important to recognise weaknesses Blue Waffle must address. These weaknesses include:limited Capital availability and the dependence on quickly changing fashion item.
Blue Waffles strengths will help it capitalise on emerging oppertunities. These opportunitiesinclude, but not limited to, a growing young population of laptop users, Increasingly fashionconcous target group, a me too mentality on our type of products and local market knowledge.Threats that we face are limited to the threats facing any business in terms of emergingcompetitors.
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6.1.1 Strengths
Knowledgable entrepreneur in the same young grouping as the majority of BW targetcustomers.
Knowledge of the medium, particularly the internet and search engine optimisation
No Competitors in the region. Understanding of the culture and selling from a local source with short delivery times.
Easy product returns/guarantees policy due to localisation.
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6.1.2 Weaknesses
Limited Capital will result in restricted growth.
Dependence on quickly changing fashion item.
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6.1.3 Opportunities
Growing young population of laptop users.
Increasingly fashion concous target group.
Me too mentality on our type of products, many laptop users are in contact with other laptopusers.
Local knowledge of market, distribution and population.
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6.1.4 Threats
Emerging local competitoras, if BW can move fast than competitors will find it more difficult tomove into the market.
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6.2 Competitive Edge
Blue Waffle Technology are already researching the market and making sales in person and onthe web site, this has given us a unique understanding of the market we are entering over thelast few months.
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6.3 Marketing Strategy
The following sections illuminate the procing, promotion and distribution strategies for BlueWaffle Technologies.
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6.4 Sales Strategy
Key to the sales strategy is the distribution amongst african laptop owners of a high qualityproduct with practical and lifestyle advantages.
We will focus much of our effort with our existing web site, modifying the layout to exclusivelysell our products, also to interact with our customers and distributors. We envisage a sitewhere we run design competitions with new skins being suggested by customers, with themes
from Footbal to Country Acheivements, Popular Music and virtually anything that is current.
Our company is alread identifying distribution networks within our initial target countries.
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6.4.1 Sales Forecast
Sales projections reflect reasonable success from BW marketing efforts explained earlier. It isassumed that these efforts will result in the unit sales shown in the documentation. We expectthat 60% or sales will come via the internet whilst the remainder will be concluded byditribution networks.
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Table: Sales ForecastSales Forecast
Year 1 Year 2 Year 3
Unit Sales
Laptop Skins 2,525 3,500 4,500
Phone Skins 968 1,200 1,450
Games Console Skins 532 750 1,000
Own Brand PC's 0 25 75
Total Unit Sales 4,025 5,475 7,025
Unit Prices Year 1 Year 2 Year 3Laptop Skins $20.00 $20.00 $20.00
Phone Skins $18.00 $18.00 $18.00
Games Console Skins $40.00 $40.00 $40.00
Own Brand PC's $0.00 $0.00 $0.00
Sales
Laptop Skins $50,500 $70,000 $90,000
Phone Skins $17,424 $21,600 $26,100
Games Console Skins $21,280 $30,000 $40,000
Own Brand PC's $0 $0 $0
Total Sales $89,204 $121,600 $156,100
Direct Unit Costs Year 1 Year 2 Year 3
Laptop Skins $8.00 $8.00 $8.00
Phone Skins $7.20 $7.20 $7.20
Games Console Skins $16.00 $16.00 $16.00
Own Brand PC's $0.00 $0.00 $0.00
Direct Cost of Sales
Laptop Skins $20,200 $28,000 $36,000
Phone Skins $6,970 $8,640 $10,440
Games Console Skins $8,512 $12,000 $16,000
Own Brand PC's $0 $0 $0Subtotal Direct Cost of Sales $35,682 $48,640 $62,440
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7.0 Management Summary
The management of Blue Waffle is made up of the Chike Igwegbe and one other member whostill needs to be added. This plan calls for the owner to concentrate efforts firstly on sales. Themany administrative functions of Blue Waffle would become the primary focus of the otherteam member.
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7.1 Personnel Plan
Blue Waffle' sales targets can only be reached if the owner's time is freed up to spend virtually100% of his time selling to new customers and managing the accounts he has already sold to.
Is is intended that two people will joint the company withing the fist six months of operation.These people will be marketeers and resonsibe for thew sales effort. The salary costs will be inthe region of $200 per month each.
We also expect to hire a representative in South Africa, this person will be responsible fordistribution in S.A. and take care of local business for BWT.
An admin assistant will be taken on in Month 4, initially part time later becoming full time
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Table: PersonnelPersonnel Plan
Year 1 Year 2 Year 3
Directors $8,400 $10,200 $11,500
Country Representative $2,000 $2,100 $2,200
Sales & Marketing $3,800 $4,000 $4,200
Admin Assistants $1,150 $1,400 $1,600
Total People 5 5 5
Total Payroll $15,350 $17,700 $19,500
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8.0 Financial Plan
It is assumed that the owner's private resources will be sufficient to finance any monthly cash-flow shortage. However, it would be advisable to establish a bank relationship as soon aspossible. Sales could very well increase at a much sharper rate than assumed in theseconservative projections. Sharper sales will result in a greater need for funds in support of
inventory and receivables. An over-draft line of credit of $10,000-15,000 would be an excellentcushion to fall back on.
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8.1 Start-up Funding
Blue Waffle Technologies start-up costs are detailed above, in the Start-up Table. The followingtable shows how these start-up costs will be funded by owner and investor capital or Bank loan.
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Table: Start-up FundingStart-up Funding
Start-up Expenses to Fund $2,750
Start-up Assets to Fund $4,000
Total Funding Required $6,750
Assets
Non-cash Assets from Start-up $0
Cash Requirements from Start-up $4,000
Additional Cash Raised $3,250
Cash Balance on Starting Date $7,250Total Assets $7,250
Liabilities and Capital
Liabilities
Current Borrowing $10,000
Long-term Liabilities $0
Other Current Liabilities (interest-free) $0
Total Liabilities $10,000
Capital
Planned Investment
Owner $0
Investor $0
Additional Investment Requirement $0
Total Planned Investment $0
Loss at Start-up (Start-up Expenses) ($2,750)
Total Capital ($2,750)
Total Capital and Liabilities $7,250
Total Funding $10,000
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8.2 Important Assumptions
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8.3 Break-even Analysis
A break-even analysis table has been completed on the basis of average costs/prices. Withfixed costs of $2,500, ~$43 in average sales, and $20 in an average variable costs, we need$4,682 per month in sales to break even.
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Table: Break-even AnalysisBreak-even Analysis
Monthly Units Break-even 123
Monthly Revenue Break-even $2,716
Assumptions:
Average Per-Unit Revenue $22.16
Average Per-Unit Variable Cost $8.86
Estimated Monthly Fixed Cost $1,629
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8.4 Projected Profit and Loss
There are many factors to include when determining a projected profit and loss statement,these are included in the following table.
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Table: Profit and LossPro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $89,204 $121,600 $156,100
Direct Cost of Sales $35,682 $48,640 $62,440
Other Costs of Sales $0 $0 $0
Total Cost of Sales $35,682 $48,640 $62,440
Gross Margin $53,522 $72,960 $93,660
Gross Margin % 60.00% 60.00% 60.00%
Expenses
Payroll $15,350 $17,700 $19,500
Marketing/Promotion $1,900 $2,200 $2,500
Depreciation $0 $0 $0
Rent $0 $0 $0
Utilities $0 $0 $0
Insurance $0 $0 $0
Payroll Taxes $2,303 $2,655 $2,925
Other $0 $0 $0
Total Operating Expenses $19,553 $22,555 $24,925
Profit Before Interest and Taxes $33,970 $50,405 $68,735
EBITDA $33,970 $50,405 $68,735
Interest Expense $1,500 $1,500 $1,500
Taxes Incurred $3,247 $4,891 $6,723
Other Income
Other Income (1) $0 $0 $0
Other Income (2) $0 $0 $0
Total Other Income $0 $0 $0
Other Expense
Other Expense (1) $0 $0 $0
Other Expense (2) $0 $0 $0
Total Other Expense $0 $0 $0
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8.5 Projected Cash Flow
Our projected cash flow is outlined in the following chart and table.
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Table: Cash Flow
Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $89,204 $121,600 $156,100
Subtotal Cash from Operations $89,204 $121,600 $156,100
Additional Cash Received
Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0
New Long-term Liabilities $0 $0 $0
Sales of Other Current Assets $0 $0 $0
Sales of Long-term Assets $0 $0 $0
New Investment Received $0 $0 $0
Subtotal Cash Received $89,204 $121,600 $156,100
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $59,981 $77,586 $95,589Subtotal Spent on Operations $59,981 $77,586 $95,589
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $0 $0 $0
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $59,981 $77,586 $95,589
Net Cash Flow $29,223 $44,015 $60,512
Cash Balance $36,473 $80,487 $140,999
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8.6 Projected Balance Sheet
The table below outlines the projected balance sheet.
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Table: Balance Sheet
Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $36,473 $80,487 $140,999
Other Current Assets $0 $0 $0
Total Current Assets $36,473 $80,487 $140,999
Long-term Assets
Long-term Assets $0 $0 $0
Accumulated Depreciation $0 $0 $0
Total Long-term Assets $0 $0 $0
Total Assets $36,473 $80,487 $140,999
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Current Borrowing $10,000 $10,000 $10,000
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $10,000 $10,000 $10,000
Long-term Liabilities $0 $0 $0
Total Liabilities $10,000 $10,000 $10,000
Paid-in Capital $0 $0 $0
Retained Earnings ($2,750) $26,473 $70,487
Earnings $29,223 $44,015 $60,512
Total Capital $26,473 $70,487 $130,999
Total Liabilities and Capital $36,473 $80,487 $140,999
Net Worth $26,473 $70,487 $130,999
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Table: Ratios
Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 36.32% 28.37% -0.84%
Percent of Total Assets
Other Current Assets 0.00% 0.00% 0.00% 30.64%
Total Current Assets 100.00% 100.00% 100.00% 88.46%
Long-term Assets 0.00% 0.00% 0.00% 11.54%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 27.42% 12.42% 7.09% 43.21%
Long-term Liabilities 0.00% 0.00% 0.00% 21.84%
Total Liabilities 27.42% 12.42% 7.09% 65.05%
Net Worth 72.58% 87.58% 92.91% 34.95%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 60.00% 60.00% 60.00% 38.34%
Selling, General & Administrative Expenses 27.24% 23.80% 21.24% 16.49%Advertising Expenses 2.13% 1.81% 1.60% 1.24%
Profit Before Interest and Taxes 38.08% 41.45% 44.03% 7.37%
Main Ratios
Current 3.65 8.05 14.10 1.83
Quick 3.65 8.05 14.10 1.19
Total Debt to Total Assets 27.42% 12.42% 7.09% 65.05%
Pre-tax Return on Net Worth 122.65% 69.38% 51.32% 65.51%
Pre-tax Return on Assets 89.02% 60.76% 47.68% 22.89%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin 32.76% 36.20% 38.76% n.a
Return on Equity 110.39% 62.44% 46.19% n.a
Activity Ratios
Accounts Payable Turnover 6.66 12.17 12.17 n.a
Total Asset Turnover 2.45 1.51 1.11 n.a
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Page 1
Table: Sales Forecast
Sales Forecast
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Unit Sales
Laptop Skins 60 75 90 120 140 180 220 240 280 320 380 420
Phone Skins 25 35 40 50 65 70 85 98 110 120 130 140
Games Console Skins 0 0 12 25 25 50 55 55 65 75 80 90Own Brand PC's 0 0 0 0 0 0 0 0 0 0 0 0
Total Unit Sales 85 110 142 195 230 300 360 393 455 515 590 650
Unit Prices Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Laptop Skins $20.00 $20.00 $20.00 $20.00 $20.00 $20.00 $20.00 $20.00 $20.00 $20.00 $20.00 $20.00
Phone Skins $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00
Games Console Skins $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 $40.00
Own Brand PC's $0.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00
Sales
Laptop Skins $1,200 $1,500 $1,800 $2,400 $2,800 $3,600 $4,400 $4,800 $5,600 $6,400 $7,600 $8,400
Phone Skins $450 $630 $720 $900 $1,170 $1,260 $1,530 $1,764 $1,980 $2,160 $2,340 $2,520
Games Console Skins $0 $0 $480 $1,000 $1,000 $2,000 $2,200 $2,200 $2,600 $3,000 $3,200 $3,600
Own Brand PC's $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Total Sales $1,650 $2,130 $3,000 $4,300 $4,970 $6,860 $8,130 $8,764 $10,180 $11,560 $13,140 $14,520
Direct Unit Costs Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Laptop Skins 40.00% $8.00 $8.00 $8.00 $8.00 $8.00 $8.00 $8.00 $8.00 $8.00 $8.00 $8.00 $8.00
Phone Skins 40.00% $7.20 $7.20 $7.20 $7.20 $7.20 $7.20 $7.20 $7.20 $7.20 $7.20 $7.20 $7.20
Games Console Skins 40.00% $16.00 $16.00 $16.00 $16.00 $16.00 $16.00 $16.00 $16.00 $16.00 $16.00 $16.00 $16.00
Own Brand PC's 50.00% $175.00 $175.00 $175.00 $175.00 $175.00 $175.00 $175.00 $175.00 $175.00 $175.00 $175.00 $175.00
Direct Cost of Sales
Laptop Skins $480 $600 $720 $960 $1,120 $1,440 $1,760 $1,920 $2,240 $2,560 $3,040 $3,360
Phone Skins $180 $252 $288 $360 $468 $504 $612 $706 $792 $864 $936 $1,008
Games Console Skins $0 $0 $192 $400 $400 $800 $880 $880 $1,040 $1,200 $1,280 $1,440
Own Brand PC's $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Direct Cost of Sales $660 $852 $1,200 $1,720 $1,988 $2,744 $3,252 $3,506 $4,072 $4,624 $5,256 $5,808
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Page 2
Table: Personnel
Personnel Plan
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Directors $700 $700 $700 $700 $700 $700 $700 $700 $700 $700 $700 $700
Country Representative $0 $0 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200
Sales & Marketing $0 $0 $200 $400 $400 $400 $400 $400 $400 $400 $400 $400
Admin Assistants $0 $0 $0 $100 $100 $100 $100 $150 $150 $150 $150 $150Total People 1 1 3 3 4 4 5 5 5 5 5 5
Total Payroll $700 $700 $1,100 $1,400 $1,400 $1,400 $1,400 $1,450 $1,450 $1,450 $1,450 $1,450
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Table: Profit and Loss
Pro Forma Profit and Loss
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Sales $1,650 $2,130 $3,000 $4,300 $4,970 $6,860 $8,130 $8,764 $10,180 $11,560 $13,140 $14,520
Direct Cost of Sales $660 $852 $1,200 $1,720 $1,988 $2,744 $3,252 $3,506 $4,072 $4,624 $5,256 $5,808
Other Costs of Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Cost of Sales $660 $852 $1,200 $1,720 $1,988 $2,744 $3,252 $3,506 $4,072 $4,624 $5,256 $5,808
Gross Margin $990 $1,278 $1,800 $2,580 $2,982 $4,116 $4,878 $5,258 $6,108 $6,936 $7,884 $8,712
Gross Margin % 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00%
Expenses
Payroll $700 $700 $1,100 $1,400 $1,400 $1,400 $1,400 $1,450 $1,450 $1,450 $1,450 $1,450
Marketing/Promotion $300 $150 $150 $150 $150 $100 $100 $100 $200 $200 $200 $100
Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Rent $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Utilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Insurance $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Payroll Taxes 15% $105 $105 $165 $210 $210 $210 $210 $218 $218 $218 $218 $218
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Operating Expenses $1,105 $955 $1,415 $1,760 $1,760 $1,710 $1,710 $1,768 $1,868 $1,868 $1,868 $1,768
Profit Before Interest and Taxes ($115) $323 $385 $820 $1,222 $2,406 $3,168 $3,491 $4,241 $5,069 $6,017 $6,945
EBITDA ($115) $323 $385 $820 $1,222 $2,406 $3,168 $3,491 $4,241 $5,069 $6,017 $6,945
Interest Expense $125 $125 $125 $125 $125 $125 $125 $125 $125 $125 $125 $125
Taxes Incurred ($24) $20 $26 $70 $110 $228 $304 $337 $412 $494 $589 $682
Other Income
Other Income (1) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Income (2) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Other Income $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Expense
Other Expense (1) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Other Expense (2) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Other Expense $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Net Other Income $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Net Profit ($216) $178 $234 $626 $987 $2,053 $2,739 $3,029 $3,704 $4,449 $5,302 $6,138
Net Profit/Sales -13.09% 8.37% 7.80% 14.55% 19.87% 29.93% 33.69% 34.57% 36.38% 38.49% 40.35% 42.27%
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Table: Cash Flow
Pro Forma Cash Flow
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Cash Received
Cash from Operations
Cash Sales $1,650 $2,130 $3,000 $4,300 $4,970 $6,860 $8,130 $8,764 $10,180 $11,560 $13,140 $14,520Subtotal Cash from Operations $1,650 $2,130 $3,000 $4,300 $4,970 $6,860 $8,130 $8,764 $10,180 $11,560 $13,140 $14,520
Additional Cash Received
Sales Tax, VAT, HST/GST Received 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Current Borrowing $0 $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 Current 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 $1,650 $2,130 $3,000 $4,300 $4,970 $6,860 $8,130 $8,764 $10,180 $11,560 $13,140 $14,520
Expenditures Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Expenditures from Operations
Cash Spending $1,866 $1,952 $2,766 $3,675 $3,983 $4,807 $5,391 $5,735 $6,476 $7,111 $7,838 $8,382
Subtotal Spent on Operations $1,866 $1,952 $2,766 $3,675 $3,983 $4,807 $5,391 $5,735 $6,476 $7,111 $7,838 $8,382
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 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
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 Current 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
Subtotal Cash Spent $1,866 $1,952 $2,766 $3,675 $3,983 $4,807 $5,391 $5,735 $6,476 $7,111 $7,838 $8,382
Net Cash Flow ($216) $178 $234 $626 $987 $2,053 $2,739 $3,029 $3,704 $4,449 $5,302 $6,138Cash Balance $7,034 $7,212 $7,446 $8,072 $9,059 $11,112 $13,851 $16,880 $20,584 $25,033 $30,335 $36,473
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Appendix
Table: Balance Sheet
Pro Forma Balance Sheet
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Assets Starting Balances
Current Assets
Cash $7,250 $7,034 $7,212 $7,446 $8,072 $9,059 $11,112 $13,851 $16,880 $20,584 $25,033 $30,335 $36,473Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Current Assets $7,250 $7,034 $7,212 $7,446 $8,072 $9,059 $11,112 $13,851 $16,880 $20,584 $25,033 $30,335 $36,473
Long-term Assets
Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Accumulated Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Assets $7,250 $7,034 $7,212 $7,446 $8,072 $9,059 $11,112 $13,851 $16,880 $20,584 $25,033 $30,335 $36,473
Liabilities and Capital Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Current Liabilities
Current Borrowing $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000
Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Current Liabilities $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000
Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Liabilities $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000
Paid-in Capital $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Retained Earnings ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750)
Earnings $0 ($216) ($38) $196 $822 $1,809 $3,862 $6,601 $9,630 $13,334 $17,783 $23,085 $29,223
Total Capital ($2,750) ($2,966) ($2,788) ($2,554) ($1,928) ($941) $1,112 $3,851 $6,880 $10,584 $15,033 $20,335 $26,473
Total Liabilities and Capital $7,250 $7,034 $7,212 $7,446 $8,072 $9,059 $11,112 $13,851 $16,880 $20,584 $25,033 $30,335 $36,473
Net Worth ($2,750) ($2,966) ($2,788) ($2,554) ($1,928) ($941) $1,112 $3,851 $6,880 $10,584 $15,033 $20,335 $26,473