Edit This Plan

General Freight Trucking Business Plan

Mike's Trucking Service

This sample business plan can be edited directly in Business Plan Pro software.

previous
next
Page 1   2   3   4   5   6   7   8  

Financial Plan

Funding Requirements and Uses

The company is raising $125,000 for the purpose of financing equipment purchases to meet a growing demand for its services. The company management has reason to believe that an increased truck fleet will assist the company in its effort to widen its market offering and increase sales.

7.1 Important Assumptions

The following table highlights the important general assumptions of Mike's Trucking. Interest rates, tax rates, and personnel burden are based on conservative assumptions.

General Assumptions
2000 2001 2002
Plan Month 1 2 3
Current Interest Rate 10.00% 10.00% 10.00%
Long-term Interest Rate 10.00% 10.00% 10.00%
Tax Rate 25.42% 25.00% 25.42%
Other 0 0 0

7.2 Break-even Analysis

The break-even chart and table below indicate our break-even point.

Break-even Analysis
Monthly Revenue Break-even $6,206
Assumptions:
Average Percent Variable Cost 20%
Estimated Monthly Fixed Cost $4,965

7.3 Projected Profit and Loss

The table below summarizes our projected income statement for the first three years of plan implementation, fiscal years 2000, 2001, and 2002. As with the other tables, the Profit and Loss table is projected to be quite conservative. The detailed monthly projection can be found in the appendix.

Pro Forma Profit and Loss
2000 2001 2002
Sales $100,000 $250,000 $400,000
Direct Cost of Sales $20,000 $50,000 $80,000
Other $0 $0 $0
Total Cost of Sales $20,000 $50,000 $80,000
Gross Margin $80,000 $200,000 $320,000
Gross Margin % 80.00% 80.00% 80.00%
Expenses
Payroll $30,000 $50,000 $90,000
Sales and Marketing and Other Expenses $7,080 $13,000 $18,500
Depreciation $4,800 $5,000 $5,500
Depreciation $0 $0 $0
Fuel & Maintenance $6,000 $12,000 $20,000
Utilities $2,400 $3,000 $3,500
Insurance $4,800 $5,000 $6,000
Payroll Taxes $4,500 $7,500 $13,500
Other $0 $0 $0
Total Operating Expenses $59,580 $95,500 $157,000
Profit Before Interest and Taxes $20,420 $104,500 $163,000
EBITDA $25,220 $109,500 $168,500
Interest Expense $12,218 $14,760 $13,360
Taxes Incurred $2,024 $22,435 $38,034
Net Profit $6,178 $67,305 $111,606
Net Profit/Sales 6.18% 26.92% 27.90%

7.4 Projected Cash Flow

The projected cash flow is presented in the chart and table below. The long-term loan in the amount of $125,000 is expected to be received in May, 2000, which is reflected in the increase of the long-term borrowing row for that month. The company is planning to purchase two trucks (one in June and one in July) in the first year of plan implementation, 2000; corresponding transactions are reflected in the capital expenditure rows. Monthly repayments on the $125,000 loan will be made in the amount of $1,500.

The monthly cash flow is presented in the illustration, with one bar representing cash flow per month, and the other the monthly balance. The annual cash flow can be found in the table below, and are in monthly detail in the appendix.

Pro Forma Cash Flow
2000 2001 2002
Cash Received
Cash from Operations
Cash Sales $80,000 $200,000 $320,000
Cash from Receivables $26,067 $44,100 $74,100
Subtotal Cash from Operations $106,067 $244,100 $394,100
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 $125,000 $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 $231,067 $244,100 $394,100
Expenditures 2000 2001 2002
Expenditures from Operations
Cash Spending $30,000 $50,000 $90,000
Bill Payments $56,922 $122,800 $187,535
Subtotal Spent on Operations $86,922 $172,800 $277,535
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $3,600 $7,000 $5,000
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $11,300 $8,000 $8,000
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $125,000 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $226,822 $187,800 $290,535
Net Cash Flow $4,245 $56,300 $103,565
Cash Balance $4,745 $61,045 $164,610

7.5 Balance Sheet

The table below shows Mike's Trucking balance sheets for 2000-2002.

Pro Forma Balance Sheet
2000 2001 2002
Assets
Current Assets
Cash $4,745 $61,045 $164,610
Accounts Receivable $3,933 $9,833 $15,733
Other Current Assets $0 $0 $0
Total Current Assets $8,678 $70,879 $180,344
Long-term Assets
Long-term Assets $165,000 $165,000 $165,000
Accumulated Depreciation $8,800 $13,800 $19,300
Total Long-term Assets $156,200 $151,200 $145,700
Total Assets $164,878 $222,079 $326,044
Liabilities and Capital 2000 2001 2002
Current Liabilities
Accounts Payable $5,600 $10,495 $15,854
Current Borrowing $16,400 $9,400 $4,400
Other Current Liabilities $500 $500 $500
Subtotal Current Liabilities $22,500 $20,395 $20,754
Long-term Liabilities $138,700 $130,700 $122,700
Total Liabilities $161,200 $151,095 $143,454
Paid-in Capital $0 $0 $0
Retained Earnings ($2,500) $3,678 $70,983
Earnings $6,178 $67,305 $111,606
Total Capital $3,678 $70,983 $182,590
Total Liabilities and Capital $164,878 $222,079 $326,044
Net Worth $3,678 $70,983 $182,590

7.6 Business Ratios

The following table includes Industry Profile statistics for the trucking industry, as determined by the Standard Industry Classification (SIC) Index. The SIC Code for this plan is 4213, and the SIC Description is Trucking except local. These statistics show a comparison of industry standards and key ratios for this plan.

Ratio Analysis
2000 2001 2002 Industry Profile
Sales Growth 66.67% 150.00% 60.00% 5.60%
Percent of Total Assets
Accounts Receivable 2.39% 4.43% 4.83% 19.70%
Other Current Assets 0.00% 0.00% 0.00% 22.30%
Total Current Assets 5.26% 31.92% 55.31% 43.00%
Long-term Assets 94.74% 68.08% 44.69% 57.00%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 13.65% 9.18% 6.37% 30.80%
Long-term Liabilities 84.12% 58.85% 37.63% 27.00%
Total Liabilities 97.77% 68.04% 44.00% 57.80%
Net Worth 2.23% 31.96% 56.00% 42.20%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 80.00% 80.00% 80.00% 100.00%
Selling, General & Administrative Expenses 73.85% 53.08% 51.94% 82.10%
Advertising Expenses 1.20% 1.20% 1.25% 0.20%
Profit Before Interest and Taxes 20.42% 41.80% 40.75% 1.10%
Main Ratios
Current 0.39 3.48 8.69 1.32
Quick 0.39 3.48 8.69 1.07
Total Debt to Total Assets 97.77% 68.04% 44.00% 57.80%
Pre-tax Return on Net Worth 222.99% 126.42% 81.95% 2.50%
Pre-tax Return on Assets 4.97% 40.41% 45.90% 6.00%
Additional Ratios 2000 2001 2002
Net Profit Margin 6.18% 26.92% 27.90% n.a
Return on Equity 167.97% 94.82% 61.12% n.a
Activity Ratios
Accounts Receivable Turnover 5.08 5.08 5.08 n.a
Collection Days 64 50 58 n.a
Accounts Payable Turnover 10.54 12.17 12.17 n.a
Payment Days 29 23 25 n.a
Total Asset Turnover 0.61 1.13 1.23 n.a
Debt Ratios
Debt to Net Worth 43.83 2.13 0.79 n.a
Current Liab. to Liab. 0.14 0.13 0.14 n.a
Liquidity Ratios
Net Working Capital ($13,822) $50,483 $159,590 n.a
Interest Coverage 1.67 7.08 12.20 n.a
Additional Ratios
Assets to Sales 1.65 0.89 0.82 n.a
Current Debt/Total Assets 14% 9% 6% n.a
Acid Test 0.21 2.99 7.93 n.a
Sales/Net Worth 27.19 3.52 2.19 n.a
Dividend Payout 0.00 0.00 0.00 n.a
previous
next
Edit This Plan
Share this page:
General Assumptions
2000 2001 2002
Plan Month 1 2 3
Current Interest Rate 10.00% 10.00% 10.00%
Long-term Interest Rate 10.00% 10.00% 10.00%
Tax Rate 25.42% 25.00% 25.42%
Other 0 0 0
Break-even Analysis
Monthly Revenue Break-even $6,206
Assumptions:
Average Percent Variable Cost 20%
Estimated Monthly Fixed Cost $4,965
Pro Forma Profit and Loss
2000 2001 2002
Sales $100,000 $250,000 $400,000
Direct Cost of Sales $20,000 $50,000 $80,000
Other $0 $0 $0
Total Cost of Sales $20,000 $50,000 $80,000
Gross Margin $80,000 $200,000 $320,000
Gross Margin % 80.00% 80.00% 80.00%
Expenses
Payroll $30,000 $50,000 $90,000
Sales and Marketing and Other Expenses $7,080 $13,000 $18,500
Depreciation $4,800 $5,000 $5,500
Depreciation $0 $0 $0
Fuel & Maintenance $6,000 $12,000 $20,000
Utilities $2,400 $3,000 $3,500
Insurance $4,800 $5,000 $6,000
Payroll Taxes $4,500 $7,500 $13,500
Other $0 $0 $0
Total Operating Expenses $59,580 $95,500 $157,000
Profit Before Interest and Taxes $20,420 $104,500 $163,000
EBITDA $25,220 $109,500 $168,500
Interest Expense $12,218 $14,760 $13,360
Taxes Incurred $2,024 $22,435 $38,034
Net Profit $6,178 $67,305 $111,606
Net Profit/Sales 6.18% 26.92% 27.90%
Pro Forma Cash Flow
2000 2001 2002
Cash Received
Cash from Operations
Cash Sales $80,000 $200,000 $320,000
Cash from Receivables $26,067 $44,100 $74,100
Subtotal Cash from Operations $106,067 $244,100 $394,100
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 $125,000 $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 $231,067 $244,100 $394,100
Expenditures 2000 2001 2002
Expenditures from Operations
Cash Spending $30,000 $50,000 $90,000
Bill Payments $56,922 $122,800 $187,535
Subtotal Spent on Operations $86,922 $172,800 $277,535
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $3,600 $7,000 $5,000
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $11,300 $8,000 $8,000
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $125,000 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $226,822 $187,800 $290,535
Net Cash Flow $4,245 $56,300 $103,565
Cash Balance $4,745 $61,045 $164,610
Pro Forma Balance Sheet
2000 2001 2002
Assets
Current Assets
Cash $4,745 $61,045 $164,610
Accounts Receivable $3,933 $9,833 $15,733
Other Current Assets $0 $0 $0
Total Current Assets $8,678 $70,879 $180,344
Long-term Assets
Long-term Assets $165,000 $165,000 $165,000
Accumulated Depreciation $8,800 $13,800 $19,300
Total Long-term Assets $156,200 $151,200 $145,700
Total Assets $164,878 $222,079 $326,044
Liabilities and Capital 2000 2001 2002
Current Liabilities
Accounts Payable $5,600 $10,495 $15,854
Current Borrowing $16,400 $9,400 $4,400
Other Current Liabilities $500 $500 $500
Subtotal Current Liabilities $22,500 $20,395 $20,754
Long-term Liabilities $138,700 $130,700 $122,700
Total Liabilities $161,200 $151,095 $143,454
Paid-in Capital $0 $0 $0
Retained Earnings ($2,500) $3,678 $70,983
Earnings $6,178 $67,305 $111,606
Total Capital $3,678 $70,983 $182,590
Total Liabilities and Capital $164,878 $222,079 $326,044
Net Worth $3,678 $70,983 $182,590
Ratio Analysis
2000 2001 2002 Industry Profile
Sales Growth 66.67% 150.00% 60.00% 5.60%
Percent of Total Assets
Accounts Receivable 2.39% 4.43% 4.83% 19.70%
Other Current Assets 0.00% 0.00% 0.00% 22.30%
Total Current Assets 5.26% 31.92% 55.31% 43.00%
Long-term Assets 94.74% 68.08% 44.69% 57.00%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 13.65% 9.18% 6.37% 30.80%
Long-term Liabilities 84.12% 58.85% 37.63% 27.00%
Total Liabilities 97.77% 68.04% 44.00% 57.80%
Net Worth 2.23% 31.96% 56.00% 42.20%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 80.00% 80.00% 80.00% 100.00%
Selling, General & Administrative Expenses 73.85% 53.08% 51.94% 82.10%
Advertising Expenses 1.20% 1.20% 1.25% 0.20%
Profit Before Interest and Taxes 20.42% 41.80% 40.75% 1.10%
Main Ratios
Current 0.39 3.48 8.69 1.32
Quick 0.39 3.48 8.69 1.07
Total Debt to Total Assets 97.77% 68.04% 44.00% 57.80%
Pre-tax Return on Net Worth 222.99% 126.42% 81.95% 2.50%
Pre-tax Return on Assets 4.97% 40.41% 45.90% 6.00%
Additional Ratios 2000 2001 2002
Net Profit Margin 6.18% 26.92% 27.90% n.a
Return on Equity 167.97% 94.82% 61.12% n.a
Activity Ratios
Accounts Receivable Turnover 5.08 5.08 5.08 n.a
Collection Days 64 50 58 n.a
Accounts Payable Turnover 10.54 12.17 12.17 n.a
Payment Days 29 23 25 n.a
Total Asset Turnover 0.61 1.13 1.23 n.a
Debt Ratios
Debt to Net Worth 43.83 2.13 0.79 n.a
Current Liab. to Liab. 0.14 0.13 0.14 n.a
Liquidity Ratios
Net Working Capital ($13,822) $50,483 $159,590 n.a
Interest Coverage 1.67 7.08 12.20 n.a
Additional Ratios
Assets to Sales 1.65 0.89 0.82 n.a
Current Debt/Total Assets 14% 9% 6% n.a
Acid Test 0.21 2.99 7.93 n.a
Sales/Net Worth 27.19 3.52 2.19 n.a
Dividend Payout 0.00 0.00 0.00 n.a