Fat Cat Creations
Executive Summary
Fat Cat Creations is owned by Mary Baker. Mary has twenty plus years of experience in raku pottery. She creates hanging raku cat ornaments. Each cat ornament is created individually and personally signed. Fat Cat Creations will sell its ceramic cats in galleries and at arts and craft festivals along the West Coast, as well as nationally on the Fat Cat Creations website.
Ceramic art is a popular attraction of art and craft galleries and festivals. There are approximately 2,000 galleries on the West Coast that carry ceramic art. Each year, there are over 250 major arts and craft festivals on the West Coast. It is estimated that, annually, over 30 million shoppers visit these arts and craft festivals. These galleries and festivals represent millions of dollars in sales for ceramic artists.
In addition, Fat Cat Creations will establish a website where customers can buy the hanging raku cat ornaments.
1.1 Mission
Fat Cat Creations’ mission is to offer consumers one of a kind ceramic art that is fun. Whether the ceramic cats are hanging in the living room, kitchen, bathroom, or bedroom, they will add color and humor to the space.
1.2 Keys to Success
- Accessible website that is entertaining to surf. Since there is a variety of Fat Cats to choose from, the customer can have fun picking the cat and the cat’s color.
- Establishing a strong network of shops and galleries to sell Fat Cats.
- Maintain a strong presence in the regional arts and craft festivals on the West Coast.
Company Summary
Fat Cat Creations will offer customers a series of happy hanging Fat Cat ceramics that will come in assorted colors. Each Fat Cat piece will be unique and signed by the owner of Fat Cat Creations, Mary Baker. These ceramics will be sell in galleries and at festivals throughout the West, as well as on the Fat Cat Creations website.
2.1 Company Ownership
Mary Baker is the owner of Fat Cat Creations.
2.2 Start-up Summary
Fat Cat Creations’ start-up costs consists mostly of raku firing equipment, transport containers and website development. There will be two equity owners in the business–Mary Baker will invest $20,000 and her brother will invest $10,000 as a silent partner in the business. In addition, she will secure a $60,000 SBA loan.
| Start-up | |
| Requirements | |
| Start-up Expenses | |
| Legal | $1,000 |
| Stationery etc. | $300 |
| Brochures | $1,000 |
| Website | $10,000 |
| Insurance | $500 |
| Transport Containers | $5,000 |
| Ceramic Equipment | $15,000 |
| Total Start-up Expenses | $32,800 |
| Start-up Assets | |
| Cash Required | $30,200 |
| Start-up Inventory | $0 |
| Other Current Assets | $12,000 |
| Long-term Assets | $15,000 |
| Total Assets | $57,200 |
| Total Requirements | $90,000 |
| Start-up Funding | |
| Start-up Expenses to Fund | $32,800 |
| Start-up Assets to Fund | $57,200 |
| Total Funding Required | $90,000 |
| Assets | |
| Non-cash Assets from Start-up | $27,000 |
| Cash Requirements from Start-up | $30,200 |
| Additional Cash Raised | $0 |
| Cash Balance on Starting Date | $30,200 |
| Total Assets | $57,200 |
| Liabilities and Capital | |
| Liabilities | |
| Current Borrowing | $0 |
| Long-term Liabilities | $60,000 |
| Accounts Payable (Outstanding Bills) | $0 |
| Other Current Liabilities (interest-free) | $0 |
| Total Liabilities | $60,000 |
| Capital | |
| Planned Investment | |
| Mary Baker | $20,000 |
| Joshua Baker | $10,000 |
| Additional Investment Requirement | $0 |
| Total Planned Investment | $30,000 |
| Loss at Start-up (Start-up Expenses) | ($32,800) |
| Total Capital | ($2,800) |
| Total Capital and Liabilities | $57,200 |
| Total Funding | $90,000 |
2.3 Company Locations and Facilities
Fat Cat Creations will be located in Mary Baker’s home.
Products
Fat Cat Creations create hanging raku cat ornaments. Each cat ornament is made individually and personally signed. The cat ornaments can be bought individually, or in groups of three or five.
Fat Cat Creations offers five cat faces:
- Grinning Cat.
- Kissing Cat.
- Laughing Cat.
- Smiling Cat.
- Sleeping Cat.
The cats also come in a variety of glaze colors:
- Red.
- Teal.
- Blue.
- Honey.
- Gold.
- Silver.
- Pink.
- Purple.
Market Analysis Summary
Ceramic art is a popular attraction of art and craft galleries and festivals. There are approximately 2,000 galleries on the West Coast that carry ceramic art. Each year, there are over 250 major arts and craft festivals on the West Coast. It is estimated that, annually, over 30 million shoppers visit these arts and craft festivals. These galleries and festivals represent millions of dollars in sales for ceramic artists.
Most importantly, it is through festivals and galleries that customers can be introduced to the artist’s website where pieces can be purchased directly. This opens the artist’s product to millions of potential customers. A recent survey conducted by Craftmaster News, the leading publication for art & craft festivals in the Western U.S reported that 30% of festival shoppers have purchase art on the Internet. This represents a potential customer base of nine million West Coast shoppers.
The key to sales in popular ceramic art is to offer the customer something distinctive, yet affordable. Hanging raku cat ornaments satisfy both of these critical selling points with customers.
4.1 Market Segmentation
Fat Cat Creations will focus on three sales strategies:
- Galleries.
- Arts and craft festivals.
- Internet.
| Market Analysis | |||||||
| Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | |||
| Potential Customers | Growth | CAGR | |||||
| Galleries | 6% | 2,000 | 2,120 | 2,247 | 2,382 | 2,525 | 6.00% |
| Arts and Craft Festivals | 5% | 250 | 263 | 276 | 290 | 305 | 5.10% |
| Internet | 7% | 9,000,000 | 9,630,000 | 10,304,100 | 11,025,387 | 11,797,164 | 7.00% |
| Total | 7.00% | 9,002,250 | 9,632,383 | 10,306,623 | 11,028,059 | 11,799,994 | 7.00% |
Strategy and Implementation Summary
Fat Cat Creations has a three-step strategy for developing its customer base.
- The first step will be an aggressive plan of participating in the most popular arts and craft festivals on the West Coast. This will serve two purposes. It will introduce the hanging raku cat ornaments to thousands of customers and it will be a perfect vehicle to demonstrate to local galleries the sales potential of the product. In addition, we will begin to plant the seed of Internet sales.
- The second step is to focus on marketing the hanging raku cat ornaments to West Coast galleries.
- The third step is to focus on marketing the website to potential customers.
5.1 Competitive Edge
The competitive advantage of Fat Cat Creations is the following:
- We offer the customer a colorful, distinctive ceramic art piece that is unique, individualized and fun.
- The hanging raku cat ornaments are inexpensive.
- There are no comparable ceramic art pieces currently on the market.
5.2 Sales Strategy
The focus will be on arts and craft festivals for the first three months of business. During that time, Fat Cat Creations will also be establishing its website and marketing to galleries near the Festival sites. We anticipate that gallery orders will begin during the fourth month of operation. Internet orders are planned to begin during the same time frame.
5.2.1 Sales Forecast
The following is the sales forecast for three years.
| Sales Forecast | |||
| Year 1 | Year 2 | Year 3 | |
| Sales | |||
| Arts and Craft Festivals | $177,000 | $200,000 | $220,000 |
| Galleries | $110,000 | $170,000 | $200,000 |
| Internet | $52,000 | $90,000 | $120,000 |
| Total Sales | $339,000 | $460,000 | $540,000 |
| Direct Cost of Sales | Year 1 | Year 2 | Year 3 |
| Arts and Craft Festivals | $52,000 | $70,000 | $82,000 |
| Galleries | $22,900 | $38,000 | $47,000 |
| Internet | $11,540 | $20,000 | $26,000 |
| Subtotal Direct Cost of Sales | $86,440 | $128,000 | $155,000 |
Management Summary
Mary Baker will manage the staff of Fat Cat Creations. Mary has over twenty years experience in ceramic art. More importantly, she has been a popular arts teacher at the local community college. Her ability to manage people and maintain a disciplined but creative environment is one of her strongest hallmark as an artist and teacher. These skills will be invaluable as she assemble Fat Cat Creations’ team of artists.
6.1 Personnel Plan
Fat Cat Creations will have a staff of five:
- Manager.
- Bookkeeper/website administrator.
- Ceramic artists (3).
| Personnel Plan | |||
| Year 1 | Year 2 | Year 3 | |
| Manager | $36,000 | $40,000 | $44,000 |
| Bookkeeper/Website Administrator | $36,000 | $40,000 | $44,000 |
| Ceramic Artists (3) | $108,000 | $124,000 | $138,000 |
| Total People | 5 | 5 | 5 |
| Total Payroll | $180,000 | $204,000 | $226,000 |
Financial Plan
The following is the financial plan for Fat Cat Creations.
7.1 Break-even Analysis
The following table and chart show our break-even analysis.
| Break-even Analysis | |
| Monthly Revenue Break-even | $25,675 |
| Assumptions: | |
| Average Percent Variable Cost | 25% |
| Estimated Monthly Fixed Cost | $19,128 |
7.2 Projected Profit and Loss
The following table and charts show the projected profit and loss for three years.
| Pro Forma Profit and Loss | |||
| Year 1 | Year 2 | Year 3 | |
| Sales | $339,000 | $460,000 | $540,000 |
| Direct Cost of Sales | $86,440 | $128,000 | $155,000 |
| Other Production Expenses | $0 | $0 | $0 |
| Total Cost of Sales | $86,440 | $128,000 | $155,000 |
| Gross Margin | $252,560 | $332,000 | $385,000 |
| Gross Margin % | 74.50% | 72.17% | 71.30% |
| Expenses | |||
| Payroll | $180,000 | $204,000 | $226,000 |
| Sales and Marketing and Other Expenses | $18,000 | $30,000 | $55,000 |
| Depreciation | $2,136 | $2,136 | $2,136 |
| Leased Equipment | $0 | $0 | $0 |
| Utilities | $2,400 | $2,400 | $2,400 |
| Insurance | $0 | $0 | $0 |
| Rent | $0 | $0 | $0 |
| Payroll Taxes | $27,000 | $30,600 | $33,900 |
| Other | $0 | $0 | $0 |
| Total Operating Expenses | $229,536 | $269,136 | $319,436 |
| Profit Before Interest and Taxes | $23,024 | $62,864 | $65,564 |
| EBITDA | $25,160 | $65,000 | $67,700 |
| Interest Expense | $5,784 | $5,402 | $5,004 |
| Taxes Incurred | $5,172 | $17,238 | $18,168 |
| Net Profit | $12,068 | $40,223 | $42,392 |
| Net Profit/Sales | 3.56% | 8.74% | 7.85% |
7.3 Projected Cash Flow
The following table and chart show the projected cash flow for three years.
| Pro Forma Cash Flow | |||
| Year 1 | Year 2 | Year 3 | |
| Cash Received | |||
| Cash from Operations | |||
| Cash Sales | $339,000 | $460,000 | $540,000 |
| Subtotal Cash from Operations | $339,000 | $460,000 | $540,000 |
| 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 | $339,000 | $460,000 | $540,000 |
| Expenditures | Year 1 | Year 2 | Year 3 |
| Expenditures from Operations | |||
| Cash Spending | $180,000 | $204,000 | $226,000 |
| Bill Payments | $147,452 | $203,702 | $267,209 |
| Subtotal Spent on Operations | $327,452 | $407,702 | $493,209 |
| 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 | $3,984 | $3,984 | $3,984 |
| Purchase Other Current Assets | $0 | $0 | $0 |
| Purchase Long-term Assets | $0 | $0 | $0 |
| Dividends | $0 | $0 | $0 |
| Subtotal Cash Spent | $331,436 | $411,686 | $497,193 |
| Net Cash Flow | $7,564 | $48,314 | $42,807 |
| Cash Balance | $37,764 | $86,078 | $128,885 |
7.4 Projected Balance Sheet
The following table projects the balance sheet for three years.
| Pro Forma Balance Sheet | |||
| Year 1 | Year 2 | Year 3 | |
| Assets | |||
| Current Assets | |||
| Cash | $37,764 | $86,078 | $128,885 |
| Inventory | $7,130 | $10,558 | $12,785 |
| Other Current Assets | $12,000 | $12,000 | $12,000 |
| Total Current Assets | $56,894 | $108,636 | $153,670 |
| Long-term Assets | |||
| Long-term Assets | $15,000 | $15,000 | $15,000 |
| Accumulated Depreciation | $2,136 | $4,272 | $6,408 |
| Total Long-term Assets | $12,864 | $10,728 | $8,592 |
| Total Assets | $69,758 | $119,364 | $162,262 |
| Liabilities and Capital | Year 1 | Year 2 | Year 3 |
| Current Liabilities | |||
| Accounts Payable | $4,474 | $17,841 | $22,331 |
| Current Borrowing | $0 | $0 | $0 |
| Other Current Liabilities | $0 | $0 | $0 |
| Subtotal Current Liabilities | $4,474 | $17,841 | $22,331 |
| Long-term Liabilities | $56,016 | $52,032 | $48,048 |
| Total Liabilities | $60,490 | $69,873 | $70,379 |
| Paid-in Capital | $30,000 | $30,000 | $30,000 |
| Retained Earnings | ($32,800) | ($20,732) | $19,491 |
| Earnings | $12,068 | $40,223 | $42,392 |
| Total Capital | $9,268 | $49,491 | $91,883 |
| Total Liabilities and Capital | $69,758 | $119,364 | $162,262 |
| Net Worth | $9,268 | $49,491 | $91,883 |
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 7336, Commercial Art and Graphic Design, are shown for comparison.
| Ratio Analysis | ||||
| Year 1 | Year 2 | Year 3 | Industry Profile | |
| Sales Growth | 0.00% | 35.69% | 17.39% | 8.50% |
| Percent of Total Assets | ||||
| Inventory | 10.22% | 8.85% | 7.88% | 5.30% |
| Other Current Assets | 17.20% | 10.05% | 7.40% | 44.20% |
| Total Current Assets | 81.56% | 91.01% | 94.70% | 69.00% |
| Long-term Assets | 18.44% | 8.99% | 5.30% | 31.00% |
| Total Assets | 100.00% | 100.00% | 100.00% | 100.00% |
| Current Liabilities | 6.41% | 14.95% | 13.76% | 43.70% |
| Long-term Liabilities | 80.30% | 43.59% | 29.61% | 19.40% |
| Total Liabilities | 86.71% | 58.54% | 43.37% | 63.10% |
| Net Worth | 13.29% | 41.46% | 56.63% | 36.90% |
| Percent of Sales | ||||
| Sales | 100.00% | 100.00% | 100.00% | 100.00% |
| Gross Margin | 74.50% | 72.17% | 71.30% | 0.00% |
| Selling, General & Administrative Expenses | 70.94% | 63.43% | 63.45% | 81.30% |
| Advertising Expenses | 3.54% | 4.35% | 7.41% | 1.00% |
| Profit Before Interest and Taxes | 6.79% | 13.67% | 12.14% | 1.70% |
| Main Ratios | ||||
| Current | 12.72 | 6.09 | 6.88 | 1.60 |
| Quick | 11.12 | 5.50 | 6.31 | 1.23 |
| Total Debt to Total Assets | 86.71% | 58.54% | 43.37% | 63.10% |
| Pre-tax Return on Net Worth | 186.02% | 116.11% | 65.91% | 3.60% |
| Pre-tax Return on Assets | 24.71% | 48.14% | 37.32% | 9.80% |
| Additional Ratios | Year 1 | Year 2 | Year 3 | |
| Net Profit Margin | 3.56% | 8.74% | 7.85% | n.a |
| Return on Equity | 130.21% | 81.27% | 46.14% | n.a |
| Activity Ratios | ||||
| Inventory Turnover | 8.78 | 14.47 | 13.28 | n.a |
| Accounts Payable Turnover | 33.96 | 12.17 | 12.17 | n.a |
| Payment Days | 27 | 19 | 27 | n.a |
| Total Asset Turnover | 4.86 | 3.85 | 3.33 | n.a |
| Debt Ratios | ||||
| Debt to Net Worth | 6.53 | 1.41 | 0.77 | n.a |
| Current Liab. to Liab. | 0.07 | 0.26 | 0.32 | n.a |
| Liquidity Ratios | ||||
| Net Working Capital | $52,420 | $90,795 | $131,339 | n.a |
| Interest Coverage | 3.98 | 11.64 | 13.10 | n.a |
| Additional Ratios | ||||
| Assets to Sales | 0.21 | 0.26 | 0.30 | n.a |
| Current Debt/Total Assets | 6% | 15% | 14% | n.a |
| Acid Test | 11.12 | 5.50 | 6.31 | n.a |
| Sales/Net Worth | 36.58 | 9.29 | 5.88 | n.a |
| Dividend Payout | 0.00 | 0.00 | 0.00 | n.a |
Appendix
| 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 | ||
| Sales | |||||||||||||
| Arts and Craft Festivals | 0% | $8,000 | $8,000 | $10,000 | $21,000 | $24,000 | $26,000 | $17,000 | $25,000 | $30,000 | $0 | $0 | $8,000 |
| Galleries | 0% | $0 | $0 | $0 | $5,000 | $8,000 | $11,000 | $14,000 | $16,000 | $24,000 | $10,000 | $10,000 | $12,000 |
| Internet | 0% | $0 | $0 | $0 | $2,000 | $4,000 | $6,000 | $5,000 | $7,000 | $13,000 | $4,000 | $5,000 | $6,000 |
| Total Sales | $8,000 | $8,000 | $10,000 | $28,000 | $36,000 | $43,000 | $36,000 | $48,000 | $67,000 | $14,000 | $15,000 | $26,000 | |
| Direct Cost of Sales | Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | |
| Arts and Craft Festivals | $3,000 | $3,000 | $4,000 | $5,000 | $6,000 | $7,000 | $5,000 | $7,000 | $10,000 | $0 | $0 | $2,000 | |
| Galleries | $0 | $0 | $0 | $1,000 | $1,500 | $2,000 | $3,000 | $4,000 | $5,200 | $2,000 | $2,000 | $2,200 | |
| Internet | $0 | $0 | $0 | $400 | $1,000 | $1,500 | $1,250 | $1,800 | $2,000 | $890 | $1,200 | $1,500 | |
| Subtotal Direct Cost of Sales | $3,000 | $3,000 | $4,000 | $6,400 | $8,500 | $10,500 | $9,250 | $12,800 | $17,200 | $2,890 | $3,200 | $5,700 | |
| 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 | ||
| Manager | 0% | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 |
| Bookkeeper/Website Administrator | 0% | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 | $3,000 |
| Ceramic Artists (3) | 0% | $9,000 | $9,000 | $9,000 | $9,000 | $9,000 | $9,000 | $9,000 | $9,000 | $9,000 | $9,000 | $9,000 | $9,000 |
| Total People | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | 5 | |
| Total Payroll | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | |
| General Assumptions | |||||||||||||
| Month 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
| Plan Month | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | |
| Current Interest Rate | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | |
| Long-term Interest Rate | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | 10.00% | |
| 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 1 | Month 2 | Month 3 | Month 4 | Month 5 | Month 6 | Month 7 | Month 8 | Month 9 | Month 10 | Month 11 | Month 12 | ||
| Sales | $8,000 | $8,000 | $10,000 | $28,000 | $36,000 | $43,000 | $36,000 | $48,000 | $67,000 | $14,000 | $15,000 | $26,000 | |
| Direct Cost of Sales | $3,000 | $3,000 | $4,000 | $6,400 | $8,500 | $10,500 | $9,250 | $12,800 | $17,200 | $2,890 | $3,200 | $5,700 | |
| Other Production Expenses | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Total Cost of Sales | $3,000 | $3,000 | $4,000 | $6,400 | $8,500 | $10,500 | $9,250 | $12,800 | $17,200 | $2,890 | $3,200 | $5,700 | |
| Gross Margin | $5,000 | $5,000 | $6,000 | $21,600 | $27,500 | $32,500 | $26,750 | $35,200 | $49,800 | $11,110 | $11,800 | $20,300 | |
| Gross Margin % | 62.50% | 62.50% | 60.00% | 77.14% | 76.39% | 75.58% | 74.31% | 73.33% | 74.33% | 79.36% | 78.67% | 78.08% | |
| Expenses | |||||||||||||
| Payroll | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | |
| Sales and Marketing and Other Expenses | $1,500 | $1,500 | $1,500 | $1,500 | $1,500 | $1,500 | $1,500 | $1,500 | $1,500 | $1,500 | $1,500 | $1,500 | |
| Depreciation | $178 | $178 | $178 | $178 | $178 | $178 | $178 | $178 | $178 | $178 | $178 | $178 | |
| Leased Equipment | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Utilities | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | $200 | |
| Insurance | $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 | |
| Payroll Taxes | 15% | $2,250 | $2,250 | $2,250 | $2,250 | $2,250 | $2,250 | $2,250 | $2,250 | $2,250 | $2,250 | $2,250 | $2,250 |
| Other | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | |
| Total Operating Expenses | $19,128 | $19,128 | $19,128 | $19,128 | $19,128 | $19,128 | $19,128 | $19,128 | $19,128 | $19,128 | $19,128 | $19,128 | |
| Profit Before Interest and Taxes | ($14,128) | ($14,128) | ($13,128) | $2,472 | $8,372 | $13,372 | $7,622 | $16,072 | $30,672 | ($8,018) | ($7,328) | $1,172 | |
| EBITDA | ($13,950) | ($13,950) | ($12,950) | $2,650 | $8,550 | $13,550 | $7,800 | $16,250 | $30,850 | ($7,840) | ($7,150) | $1,350 | |
| Interest Expense | $497 | $494 | $492 | $489 | $486 | $483 | $481 | $478 | $475 | $472 | $470 | $467 | |
| Taxes Incurred | ($4,388) | ($4,387) | ($4,086) | $595 | $2,366 | $3,867 | $2,142 | $4,678 | $9,059 | ($2,547) | ($2,339) | $212 | |
| Net Profit | ($10,238) | ($10,236) | ($9,534) | $1,388 | $5,520 | $9,022 | $4,999 | $10,916 | $21,138 | ($5,943) | ($5,458) | $494 | |
| Net Profit/Sales | -127.97% | -127.95% | -95.34% | 4.96% | 15.33% | 20.98% | 13.89% | 22.74% | 31.55% | -42.45% | -36.39% | 1.90% | |
| 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 | $8,000 | $8,000 | $10,000 | $28,000 | $36,000 | $43,000 | $36,000 | $48,000 | $67,000 | $14,000 | $15,000 | $26,000 | |
| Subtotal Cash from Operations | $8,000 | $8,000 | $10,000 | $28,000 | $36,000 | $43,000 | $36,000 | $48,000 | $67,000 | $14,000 | $15,000 | $26,000 | |
| 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 | $8,000 | $8,000 | $10,000 | $28,000 | $36,000 | $43,000 | $36,000 | $48,000 | $67,000 | $14,000 | $15,000 | $26,000 | |
| 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 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | |
| Bill Payments | $212 | $6,250 | $3,138 | $5,743 | $14,192 | $17,725 | $20,782 | $14,827 | $26,135 | $34,403 | $1,882 | $2,165 | |
| Subtotal Spent on Operations | $15,212 | $21,250 | $18,138 | $20,743 | $29,192 | $32,725 | $35,782 | $29,827 | $41,135 | $49,403 | $16,882 | $17,165 | |
| 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 | $332 | $332 | $332 | $332 | $332 | $332 | $332 | $332 | $332 | $332 | $332 | $332 | |
| 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 | $15,544 | $21,582 | $18,470 | $21,075 | $29,524 | $33,057 | $36,114 | $30,159 | $41,467 | $49,735 | $17,214 | $17,497 | |
| Net Cash Flow | ($7,544) | ($13,582) | ($8,470) | $6,925 | $6,476 | $9,943 | ($114) | $17,841 | $25,533 | ($35,735) | ($2,214) | $8,503 | |
| Cash Balance | $22,656 | $9,074 | $605 | $7,530 | $14,006 | $23,949 | $23,835 | $41,677 | $67,210 | $31,475 | $29,261 | $37,764 | |
| 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 | $30,200 | $22,656 | $9,074 | $605 | $7,530 | $14,006 | $23,949 | $23,835 | $41,677 | $67,210 | $31,475 | $29,261 | $37,764 |
| Inventory | $0 | $3,300 | $3,300 | $4,400 | $7,040 | $9,350 | $11,550 | $10,175 | $14,080 | $18,920 | $16,030 | $12,830 | $7,130 |
| Other Current Assets | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 | $12,000 |
| Total Current Assets | $42,200 | $37,956 | $24,374 | $17,005 | $26,570 | $35,356 | $47,499 | $46,010 | $67,757 | $98,130 | $59,505 | $54,091 | $56,894 |
| Long-term Assets | |||||||||||||
| Long-term Assets | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 | $15,000 |
| Accumulated Depreciation | $0 | $178 | $356 | $534 | $712 | $890 | $1,068 | $1,246 | $1,424 | $1,602 | $1,780 | $1,958 | $2,136 |
| Total Long-term Assets | $15,000 | $14,822 | $14,644 | $14,466 | $14,288 | $14,110 | $13,932 | $13,754 | $13,576 | $13,398 | $13,220 | $13,042 | $12,864 |
| Total Assets | $57,200 | $52,778 | $39,018 | $31,471 | $40,858 | $49,466 | $61,431 | $59,764 | $81,333 | $111,528 | $72,725 | $67,133 | $69,758 |
| 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 | |||||||||||||
| Accounts Payable | $0 | $6,148 | $2,956 | $5,274 | $13,605 | $17,025 | $20,300 | $13,966 | $24,951 | $34,340 | $1,813 | $2,011 | $4,474 |
| Current Borrowing | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Other Current Liabilities | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $0 |
| Subtotal Current Liabilities | $0 | $6,148 | $2,956 | $5,274 | $13,605 | $17,025 | $20,300 | $13,966 | $24,951 | $34,340 | $1,813 | $2,011 | $4,474 |
| Long-term Liabilities | $60,000 | $59,668 | $59,336 | $59,004 | $58,672 | $58,340 | $58,008 | $57,676 | $57,344 | $57,012 | $56,680 | $56,348 | $56,016 |
| Total Liabilities | $60,000 | $65,816 | $62,292 | $64,278 | $72,277 | $75,365 | $78,308 | $71,642 | $82,295 | $91,352 | $58,493 | $58,359 | $60,490 |
| Paid-in Capital | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 | $30,000 |
| Retained Earnings | ($32,800) | ($32,800) | ($32,800) | ($32,800) | ($32,800) | ($32,800) | ($32,800) | ($32,800) | ($32,800) | ($32,800) | ($32,800) | ($32,800) | ($32,800) |
| Earnings | $0 | ($10,238) | ($20,473) | ($30,007) | ($28,619) | ($23,099) | ($14,077) | ($9,078) | $1,838 | $22,976 | $17,033 | $11,574 | $12,068 |
| Total Capital | ($2,800) | ($13,038) | ($23,273) | ($32,807) | ($31,419) | ($25,899) | ($16,877) | ($11,878) | ($962) | $20,176 | $14,233 | $8,774 | $9,268 |
| Total Liabilities and Capital | $57,200 | $52,778 | $39,018 | $31,471 | $40,858 | $49,466 | $61,431 | $59,764 | $81,333 | $111,528 | $72,725 | $67,133 | $69,758 |
| Net Worth | ($2,800) | ($13,038) | ($23,273) | ($32,807) | ($31,419) | ($25,899) | ($16,877) | ($11,878) | ($962) | $20,176 | $14,233 | $8,774 | $9,268 |
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