Singles Bar Business Plan

Colloquy Grog Shop

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Financial Plan

The following sections will outline important financial information.

7.1 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

7.2 Break-even Analysis

The Break-even Analysis indicates that approximately $25,000 will be needed in monthly revenue to reach the break-even point.
Break-even Analysis
Monthly Revenue Break-even $24,867
Assumptions:
Average Percent Variable Cost 32%
Estimated Monthly Fixed Cost $16,969

7.3 Projected Profit and Loss

The following table will indicate projected profit and loss.
Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $175,829 $450,282 $492,811
Direct Cost of Sales $55,842 $143,005 $156,512
Other Production Expenses $0 $0 $0
Total Cost of Sales $55,842 $143,005 $156,512
Gross Margin $119,987 $307,277 $336,299
Gross Margin % 68.24% 68.24% 68.24%
Expenses
Payroll $144,900 $162,980 $167,980
Sales and Marketing and Other Expenses $2,400 $2,400 $2,400
Depreciation $9,996 $9,996 $9,996
Permits $1,200 $1,200 $1,200
Utilities $2,400 $2,400 $2,400
Insurance $3,000 $3,000 $3,000
Rent $18,000 $18,000 $18,000
Payroll Taxes $21,735 $24,447 $25,197
Other $0 $0 $0
Total Operating Expenses $203,631 $224,423 $230,173
Profit Before Interest and Taxes ($83,644) $82,854 $106,126
EBITDA ($73,648) $92,850 $116,122
Interest Expense $0 $0 $0
Taxes Incurred $0 $24,856 $31,838
Net Profit ($83,644) $57,997 $74,288
Net Profit/Sales -47.57% 12.88% 15.07%

7.4 Projected Cash Flow

The following chart and table will indicate projected cash flow.
Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $175,829 $450,282 $492,811
Subtotal Cash from Operations $175,829 $450,282 $492,811
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 $175,829 $450,282 $492,811
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $144,900 $162,980 $167,980
Bill Payments $92,562 $213,297 $238,801
Subtotal Spent on Operations $237,462 $376,277 $406,781
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 $237,462 $376,277 $406,781
Net Cash Flow ($61,633) $74,004 $86,030
Cash Balance $7,217 $81,221 $167,251

7.5 Projected Balance Sheet

The following chart and table will indicate projected cash flow.
Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $7,217 $81,221 $167,251
Other Current Assets $0 $0 $0
Total Current Assets $7,217 $81,221 $167,251
Long-term Assets
Long-term Assets $50,000 $50,000 $50,000
Accumulated Depreciation $9,996 $19,992 $29,988
Total Long-term Assets $40,004 $30,008 $20,012
Total Assets $47,221 $111,229 $187,263
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $12,015 $18,025 $19,771
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $12,015 $18,025 $19,771
Long-term Liabilities $0 $0 $0
Total Liabilities $12,015 $18,025 $19,771
Paid-in Capital $120,000 $120,000 $120,000
Retained Earnings ($1,150) ($84,794) ($26,796)
Earnings ($83,644) $57,997 $74,288
Total Capital $35,206 $93,204 $167,492
Total Liabilities and Capital $47,221 $111,229 $187,263
Net Worth $35,206 $93,204 $167,492

7.6 Business Ratios

Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 156.09% 9.45% 7.60%
Percent of Total Assets
Other Current Assets 0.00% 0.00% 0.00% 35.60%
Total Current Assets 15.28% 73.02% 89.31% 43.70%
Long-term Assets 84.72% 26.98% 10.69% 56.30%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 25.44% 16.21% 10.56% 32.70%
Long-term Liabilities 0.00% 0.00% 0.00% 28.50%
Total Liabilities 25.44% 16.21% 10.56% 61.20%
Net Worth 74.56% 83.79% 89.44% 38.80%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 68.24% 68.24% 68.24% 60.50%
Selling, General & Administrative Expenses 115.81% 55.36% 53.17% 39.80%
Advertising Expenses 0.68% 0.27% 0.24% 3.20%
Profit Before Interest and Taxes -47.57% 18.40% 21.53% 0.70%
Main Ratios
Current 0.60 4.51 8.46 0.98
Quick 0.60 4.51 8.46 0.65
Total Debt to Total Assets 25.44% 16.21% 10.56% 61.20%
Pre-tax Return on Net Worth -237.58% 88.90% 63.36% 1.70%
Pre-tax Return on Assets -177.13% 74.49% 56.67% 4.30%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin -47.57% 12.88% 15.07% n.a
Return on Equity -237.58% 62.23% 44.35% n.a
Activity Ratios
Accounts Payable Turnover 8.70 12.17 12.17 n.a
Payment Days 27 25 29 n.a
Total Asset Turnover 3.72 4.05 2.63 n.a
Debt Ratios
Debt to Net Worth 0.34 0.19 0.12 n.a
Current Liab. to Liab. 1.00 1.00 1.00 n.a
Liquidity Ratios
Net Working Capital ($4,798) $63,196 $147,480 n.a
Interest Coverage 0.00 0.00 0.00 n.a
Additional Ratios
Assets to Sales 0.27 0.25 0.38 n.a
Current Debt/Total Assets 25% 16% 11% n.a
Acid Test 0.60 4.51 8.46 n.a
Sales/Net Worth 4.99 4.83 2.94 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
Break-even Analysis
Monthly Revenue Break-even $24,867
Assumptions:
Average Percent Variable Cost 32%
Estimated Monthly Fixed Cost $16,969
Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $175,829 $450,282 $492,811
Direct Cost of Sales $55,842 $143,005 $156,512
Other Production Expenses $0 $0 $0
Total Cost of Sales $55,842 $143,005 $156,512
Gross Margin $119,987 $307,277 $336,299
Gross Margin % 68.24% 68.24% 68.24%
Expenses
Payroll $144,900 $162,980 $167,980
Sales and Marketing and Other Expenses $2,400 $2,400 $2,400
Depreciation $9,996 $9,996 $9,996
Permits $1,200 $1,200 $1,200
Utilities $2,400 $2,400 $2,400
Insurance $3,000 $3,000 $3,000
Rent $18,000 $18,000 $18,000
Payroll Taxes $21,735 $24,447 $25,197
Other $0 $0 $0
Total Operating Expenses $203,631 $224,423 $230,173
Profit Before Interest and Taxes ($83,644) $82,854 $106,126
EBITDA ($73,648) $92,850 $116,122
Interest Expense $0 $0 $0
Taxes Incurred $0 $24,856 $31,838
Net Profit ($83,644) $57,997 $74,288
Net Profit/Sales -47.57% 12.88% 15.07%
Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $175,829 $450,282 $492,811
Subtotal Cash from Operations $175,829 $450,282 $492,811
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 $175,829 $450,282 $492,811
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $144,900 $162,980 $167,980
Bill Payments $92,562 $213,297 $238,801
Subtotal Spent on Operations $237,462 $376,277 $406,781
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 $237,462 $376,277 $406,781
Net Cash Flow ($61,633) $74,004 $86,030
Cash Balance $7,217 $81,221 $167,251
Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $7,217 $81,221 $167,251
Other Current Assets $0 $0 $0
Total Current Assets $7,217 $81,221 $167,251
Long-term Assets
Long-term Assets $50,000 $50,000 $50,000
Accumulated Depreciation $9,996 $19,992 $29,988
Total Long-term Assets $40,004 $30,008 $20,012
Total Assets $47,221 $111,229 $187,263
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $12,015 $18,025 $19,771
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $12,015 $18,025 $19,771
Long-term Liabilities $0 $0 $0
Total Liabilities $12,015 $18,025 $19,771
Paid-in Capital $120,000 $120,000 $120,000
Retained Earnings ($1,150) ($84,794) ($26,796)
Earnings ($83,644) $57,997 $74,288
Total Capital $35,206 $93,204 $167,492
Total Liabilities and Capital $47,221 $111,229 $187,263
Net Worth $35,206 $93,204 $167,492
Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 156.09% 9.45% 7.60%
Percent of Total Assets
Other Current Assets 0.00% 0.00% 0.00% 35.60%
Total Current Assets 15.28% 73.02% 89.31% 43.70%
Long-term Assets 84.72% 26.98% 10.69% 56.30%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 25.44% 16.21% 10.56% 32.70%
Long-term Liabilities 0.00% 0.00% 0.00% 28.50%
Total Liabilities 25.44% 16.21% 10.56% 61.20%
Net Worth 74.56% 83.79% 89.44% 38.80%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 68.24% 68.24% 68.24% 60.50%
Selling, General & Administrative Expenses 115.81% 55.36% 53.17% 39.80%
Advertising Expenses 0.68% 0.27% 0.24% 3.20%
Profit Before Interest and Taxes -47.57% 18.40% 21.53% 0.70%
Main Ratios
Current 0.60 4.51 8.46 0.98
Quick 0.60 4.51 8.46 0.65
Total Debt to Total Assets 25.44% 16.21% 10.56% 61.20%
Pre-tax Return on Net Worth -237.58% 88.90% 63.36% 1.70%
Pre-tax Return on Assets -177.13% 74.49% 56.67% 4.30%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin -47.57% 12.88% 15.07% n.a
Return on Equity -237.58% 62.23% 44.35% n.a
Activity Ratios
Accounts Payable Turnover 8.70 12.17 12.17 n.a
Payment Days 27 25 29 n.a
Total Asset Turnover 3.72 4.05 2.63 n.a
Debt Ratios
Debt to Net Worth 0.34 0.19 0.12 n.a
Current Liab. to Liab. 1.00 1.00 1.00 n.a
Liquidity Ratios
Net Working Capital ($4,798) $63,196 $147,480 n.a
Interest Coverage 0.00 0.00 0.00 n.a
Additional Ratios
Assets to Sales 0.27 0.25 0.38 n.a
Current Debt/Total Assets 25% 16% 11% n.a
Acid Test 0.60 4.51 8.46 n.a
Sales/Net Worth 4.99 4.83 2.94 n.a
Dividend Payout 0.00 0.00 0.00 n.a