Handyman Maintenance Business Plan

HandyMan Stan

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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 10.00% 10.00% 10.00%
Long-term Interest Rate 10.00% 10.00% 10.00%
Tax Rate 30.00% 30.00% 30.00%
Other 0 0 0

8.2 Projected Profit and Loss

The following table and charts will indicate Projected Profit and Loss.

Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $17,410 $53,500 $70,834
Direct Cost of Sales $1,707 $5,106 $6,761
Other Costs of Sales $0 $0 $0
Total Cost of Sales $1,707 $5,106 $6,761
Gross Margin $15,703 $48,394 $64,073
Gross Margin % 90.20% 90.46% 90.46%
Expenses
Payroll $20,000 $24,000 $30,000
Sales and Marketing and Other Expenses $1,800 $1,800 $1,800
Depreciation $1,596 $1,596 $1,596
License fees (electrical & plumbing) $360 $360 $360
Insurance $2,400 $2,400 $2,400
Payroll Taxes $3,000 $3,600 $4,500
Gas/other incidentals $1,800 $1,800 $1,800
Total Operating Expenses $30,956 $35,556 $42,456
Profit Before Interest and Taxes ($15,253) $12,838 $21,617
EBITDA ($13,657) $14,434 $23,213
Interest Expense $2,740 $2,279 $1,808
Taxes Incurred $0 $3,168 $5,943
Net Profit ($17,994) $7,391 $13,866
Net Profit/Sales -103.36% 13.82% 19.58%

8.3 Break-even Analysis

The Break-even Analysis indicates what will be needed in monthly revenue to reach the break-even point.

Break-even Analysis
Monthly Revenue Break-even $2,860
Assumptions:
Average Percent Variable Cost 10%
Estimated Monthly Fixed Cost $2,580

8.4 Projected Cash Flow

The following table and chart will indicate Projected Cash Flow.

Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $17,410 $53,500 $70,834
Subtotal Cash from Operations $17,410 $53,500 $70,834
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 $17,410 $53,500 $70,834
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $20,000 $24,000 $30,000
Bill Payments $12,484 $20,150 $24,972
Subtotal Spent on Operations $32,484 $44,150 $54,972
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 $4,868 $4,688 $4,727
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $37,352 $48,838 $59,699
Net Cash Flow ($19,943) $4,662 $11,135
Cash Balance $557 $5,220 $16,354

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 $557 $5,220 $16,354
Other Current Assets $0 $0 $0
Total Current Assets $557 $5,220 $16,354
Long-term Assets
Long-term Assets $8,000 $8,000 $8,000
Accumulated Depreciation $1,596 $3,192 $4,788
Total Long-term Assets $6,404 $4,808 $3,212
Total Assets $6,961 $10,028 $19,566
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $1,323 $1,686 $2,085
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $1,323 $1,686 $2,085
Long-term Liabilities $25,132 $20,444 $15,717
Total Liabilities $26,455 $22,130 $17,802
Paid-in Capital $0 $0 $0
Retained Earnings ($1,500) ($19,494) ($12,102)
Earnings ($17,994) $7,391 $13,866
Total Capital ($19,494) ($12,102) $1,764
Total Liabilities and Capital $6,961 $10,028 $19,566
Net Worth ($19,494) ($12,102) $1,764

8.6 Business Ratios

The following table indicates Business Ratios specific to HandyMan Stan as well as industry ratios for the Personal and Household Goods Repair and Maintenance industry, NAICS code 811490.

Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 207.30% 32.40% 9.27%
Percent of Total Assets
Other Current Assets 0.00% 0.00% 0.00% 27.35%
Total Current Assets 8.00% 52.05% 83.58% 66.95%
Long-term Assets 92.00% 47.95% 16.42% 33.05%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 19.00% 16.81% 10.66% 22.05%
Long-term Liabilities 361.03% 203.88% 80.33% 8.56%
Total Liabilities 380.03% 220.69% 90.98% 30.61%
Net Worth -280.03% -120.69% 9.02% 69.39%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 90.20% 90.46% 90.46% 18.28%
Selling, General & Administrative Expenses 193.55% 76.64% 70.88% 5.96%
Advertising Expenses 0.00% 0.00% 0.00% 0.65%
Profit Before Interest and Taxes -87.62% 24.00% 30.52% 67.63%
Main Ratios
Current 0.42 3.10 7.84 2.41
Quick 0.42 3.10 7.84 1.20
Total Debt to Total Assets 380.03% 220.69% 90.98% 34.25%
Pre-tax Return on Net Worth 92.31% -87.25% 1122.93% 244.58%
Pre-tax Return on Assets -258.49% 105.30% 101.24% 371.96%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin -103.36% 13.82% 19.58% n.a
Return on Equity 0.00% 0.00% 786.05% n.a
Activity Ratios
Accounts Payable Turnover 10.44 12.17 12.17 n.a
Payment Days 27 27 27 n.a
Total Asset Turnover 2.50 5.34 3.62 n.a
Debt Ratios
Debt to Net Worth 0.00 0.00 10.09 n.a
Current Liab. to Liab. 0.05 0.08 0.12 n.a
Liquidity Ratios
Net Working Capital ($766) $3,534 $14,269 n.a
Interest Coverage -5.57 5.63 11.96 n.a
Additional Ratios
Assets to Sales 0.40 0.19 0.28 n.a
Current Debt/Total Assets 19% 17% 11% n.a
Acid Test 0.42 3.10 7.84 n.a
Sales/Net Worth 0.00 0.00 40.15 n.a
Dividend Payout 0.00 0.00 0.00 n.a
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General Assumptions
Year 1 Year 2 Year 3
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 30.00% 30.00% 30.00%
Other 0 0 0
Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $17,410 $53,500 $70,834
Direct Cost of Sales $1,707 $5,106 $6,761
Other Costs of Sales $0 $0 $0
Total Cost of Sales $1,707 $5,106 $6,761
Gross Margin $15,703 $48,394 $64,073
Gross Margin % 90.20% 90.46% 90.46%
Expenses
Payroll $20,000 $24,000 $30,000
Sales and Marketing and Other Expenses $1,800 $1,800 $1,800
Depreciation $1,596 $1,596 $1,596
License fees (electrical & plumbing) $360 $360 $360
Insurance $2,400 $2,400 $2,400
Payroll Taxes $3,000 $3,600 $4,500
Gas/other incidentals $1,800 $1,800 $1,800
Total Operating Expenses $30,956 $35,556 $42,456
Profit Before Interest and Taxes ($15,253) $12,838 $21,617
EBITDA ($13,657) $14,434 $23,213
Interest Expense $2,740 $2,279 $1,808
Taxes Incurred $0 $3,168 $5,943
Net Profit ($17,994) $7,391 $13,866
Net Profit/Sales -103.36% 13.82% 19.58%
Break-even Analysis
Monthly Revenue Break-even $2,860
Assumptions:
Average Percent Variable Cost 10%
Estimated Monthly Fixed Cost $2,580
Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $17,410 $53,500 $70,834
Subtotal Cash from Operations $17,410 $53,500 $70,834
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 $17,410 $53,500 $70,834
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $20,000 $24,000 $30,000
Bill Payments $12,484 $20,150 $24,972
Subtotal Spent on Operations $32,484 $44,150 $54,972
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 $4,868 $4,688 $4,727
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $37,352 $48,838 $59,699
Net Cash Flow ($19,943) $4,662 $11,135
Cash Balance $557 $5,220 $16,354
Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $557 $5,220 $16,354
Other Current Assets $0 $0 $0
Total Current Assets $557 $5,220 $16,354
Long-term Assets
Long-term Assets $8,000 $8,000 $8,000
Accumulated Depreciation $1,596 $3,192 $4,788
Total Long-term Assets $6,404 $4,808 $3,212
Total Assets $6,961 $10,028 $19,566
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $1,323 $1,686 $2,085
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $1,323 $1,686 $2,085
Long-term Liabilities $25,132 $20,444 $15,717
Total Liabilities $26,455 $22,130 $17,802
Paid-in Capital $0 $0 $0
Retained Earnings ($1,500) ($19,494) ($12,102)
Earnings ($17,994) $7,391 $13,866
Total Capital ($19,494) ($12,102) $1,764
Total Liabilities and Capital $6,961 $10,028 $19,566
Net Worth ($19,494) ($12,102) $1,764
Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 207.30% 32.40% 9.27%
Percent of Total Assets
Other Current Assets 0.00% 0.00% 0.00% 27.35%
Total Current Assets 8.00% 52.05% 83.58% 66.95%
Long-term Assets 92.00% 47.95% 16.42% 33.05%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 19.00% 16.81% 10.66% 22.05%
Long-term Liabilities 361.03% 203.88% 80.33% 8.56%
Total Liabilities 380.03% 220.69% 90.98% 30.61%
Net Worth -280.03% -120.69% 9.02% 69.39%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 90.20% 90.46% 90.46% 18.28%
Selling, General & Administrative Expenses 193.55% 76.64% 70.88% 5.96%
Advertising Expenses 0.00% 0.00% 0.00% 0.65%
Profit Before Interest and Taxes -87.62% 24.00% 30.52% 67.63%
Main Ratios
Current 0.42 3.10 7.84 2.41
Quick 0.42 3.10 7.84 1.20
Total Debt to Total Assets 380.03% 220.69% 90.98% 34.25%
Pre-tax Return on Net Worth 92.31% -87.25% 1122.93% 244.58%
Pre-tax Return on Assets -258.49% 105.30% 101.24% 371.96%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin -103.36% 13.82% 19.58% n.a
Return on Equity 0.00% 0.00% 786.05% n.a
Activity Ratios
Accounts Payable Turnover 10.44 12.17 12.17 n.a
Payment Days 27 27 27 n.a
Total Asset Turnover 2.50 5.34 3.62 n.a
Debt Ratios
Debt to Net Worth 0.00 0.00 10.09 n.a
Current Liab. to Liab. 0.05 0.08 0.12 n.a
Liquidity Ratios
Net Working Capital ($766) $3,534 $14,269 n.a
Interest Coverage -5.57 5.63 11.96 n.a
Additional Ratios
Assets to Sales 0.40 0.19 0.28 n.a
Current Debt/Total Assets 19% 17% 11% n.a
Acid Test 0.42 3.10 7.84 n.a
Sales/Net Worth 0.00 0.00 40.15 n.a
Dividend Payout 0.00 0.00 0.00 n.a