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I Tech Solutions

Executive Summary

I Tech Solutions is a consulting-oriented company, intending to fill in the market need for a professional, customer-focused computer company. The company emphasizes service and support to differentiate itself from more price-oriented computer companies. We are on the brink of penetrating a lucrative market in a rapidly growing industry. The current trend towards an increase in the number of entrepreneurs and competition amongst existing companies presents an opportunity for I Tech Solutions to penetrate this market.

Located at (discussion omitted), we realize that, for us to prosper, we need to be flexible and responsive, to delight clients by providing them with what they want, when they want it, and before the competition can offer it. The company intends to achieve this through a solutions approach that is customer-centric, and in which the customer’s business objectives enjoy top priority.

Once the needs and processes are understood and described, leading edge products and best-of-industry skills will be applied to design and develop a fitting solution to enable the client’s business in the most cost effective way.

Our marketing strategy will be based mainly on ensuring that clients know what need the service(s) is able to fulfill, and making the right service and information available to the right target client. We intend to implement a market penetration strategy that will ensure that our services are well known and respected in our respective industry. Our strategy will convey a sense of quality and satisfaction in every picture, every promotion, and every publication. Our promotional strategy will involve traditional advertising, Internet marketing, personal selling, public relations, and direct marketing, details of which are provided in the marketing section of this plan.

It is important to recognize that make our intangible resources, such as our ability to relate to customers regarding their needs and wants, management style, corporate culture and commitment. These elements will differentiate us from our competitors and contribute towards the development of a sustainable competitive advantage.

In a nutshell, we don’t intend to just market and sell our product and services, but to provide customized services and products that will enable our clients to optimize their output and, assist in the attainment of their goals and objectives. However, for us to attain the above stated we shall need funding from outside investors.

Note: All currency values in the charts and tables are expressed in the Botswana Pula (P).

Computer support business plan, executive summary chart image

1.1 Objectives

Our business strategy will revolve around the need to provide quality products and services to our various target customers. This shall be undertaken through the establishment of a professional team and the provision of quality, custom-designed services, catering to the client’s particular needs.

We intend to attain the following objectives:

  1. Develop a follow-up strategy to gauge performance with all our clients.
  2. To continuously formalize and measure cross-functional working communication so as to ensure that the various departments work harmoniously towards attainment of company objectives.
  3. To instill a culture of continuous improvement in beating standards of customer satisfaction and efficiency.
  4. We are fully committed to supporting growth and development in the economy.

1.2 Keys to Success

The keys to the projects’ success will undoubtedly be effective market segmentation through identification of several niche markets and implementation strategies. The key success factors will include the following:

  1. Excellence in fulfilling the promise: completely confidential, reliable, trustworthy expertise, and service(s) through the provision of an uncompromising service. This dictates that we have the latest technology, hardware, software, and well-trained personnel so as to deliver this promise.
  2. Timeous response to clients’ orders: we cannot afford to delay our clients for whatever reason, as this will have a negative bearing on our image, reputation, and future business. We need to be continually communicating with the client, ensuring we provide needs-based solutions.
  3. Skill and depth of knowledge: Considering the nature of our services and their relative infancy on the market, the skill and depth of knowledge of our personnel is of utmost importance in determining the provision of the service(s) to the end-users.
  4. Clear product and marketing positioning: Not wanting to be associated with the numerous vendors on the market, we intend to aggressively market our business and the services we provide in order to be at the top of our clients’ minds.
  5. Leveraging from a large pool of expertise: The company’s various alliances with technological and training partners shall prove invaluable. The skills and intellectual capacity these partners will have in the fields of product support, design and system integration, implementation and execution, lifecycle support and understanding, training, and in the application of new technology are intangible benefits to I Tech Solutions.

1.3 Mission

Company Values

I Tech Solutions is committed to the fair and ethical treatment of employees and stakeholders. This shall be undertaken through implementation of the following company values:

  • We intend to be a responsible corporate citizen, fulfilling our obligations as an integral member of society. Our business decisions will give appropriate weight and consideration to social and environmental impacts.
  • We intend to provide products and services of uncompromising quality.
  • We intend to seek mutually beneficial and enduring relationships in all the commitments that we make, ensuring that they are straightforward and honest. Our communication will be open and accurate, both internally and externally.
  • We will intend to uphold all the above company values, promoting our employees to do likewise.

Through implementation of the company values, we believe that we will be able to attain our goals and objectives for the benefit of all concerned, in particular, the communities in which we will operate.

I Tech Solutions is built on the assumption that the management of information technology for business is like legal advice or accounting, in that it is not inherently a do-it-yourself prospect, and requires outside expertise to install and implement it. Smart business people need to find quality vendors of reliable hardware, software, service, and support. They need to use these quality vendors as they use their other professional service suppliers: as trusted allies.

I Tech Solutions intends to be such a solution provider. We will serve our clients as trusted allies, providing them with the loyalty of a business partner and the economics of an outside vendor. We want to make sure that our clients have what they need to run their businesses as well as possible, with maximum efficiency and reliability. Many of our information applications will be mission critical, so we will give our clients the assurance that we will be there when they need us. The above is well summarized in our mission statement which is as follows:

“The company is dedicated to leveraging emerging technologies to provide the highest level of quality products and services, customer service, and security.”

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Company Summary

I Tech Solutions was founded in November 2000 as a private limited company. For most of its initial existence, the company intends to establish close relationships with its various clients, with the intention of expanding in the near future.

2.1 Company Ownership

I Tech Solutions is a company incorporated at the Registrar of Companies by Mr. T, Mr. S, and Mr. P. Though relatively new, the directors realize their company’s vast potential market and opportunity for growth if given the necessary funding.

2.2 Start-up Summary

Total start-up capital and expenses covered include legal costs, business cards, stationery, and related expenses. Messrs. T., S., and P. have provided investment covering much of the starting assets, with the rest of required financing coming from a 5-year commercial loan obtained from Bank Z. The start-up table below itemizes the start-up expenses.

Note: All currency values in the charts and tables are expressed in the Botswana Pula (P).

Computer support business plan, company summary chart image

Start-up Funding
Start-up Expenses to Fund P207,749
Start-up Assets to Fund P492,251
Total Funding Required P700,000
Assets
Non-cash Assets from Start-up P0
Cash Requirements from Start-up P492,251
Additional Cash Raised P0
Cash Balance on Starting Date P492,251
Total Assets P492,251
Liabilities and Capital
Liabilities
Current Borrowing P0
Long-term Liabilities P600,000
Accounts Payable (Outstanding Bills) P0
Other Current Liabilities (interest-free) P0
Total Liabilities P600,000
Capital
Planned Investment
Investor 1 P40,000
Investor 2 P30,000
Investor 3 P30,000
Additional Investment Requirement P0
Total Planned Investment P100,000
Loss at Start-up (Start-up Expenses) (P207,749)
Total Capital (P107,749)
Total Capital and Liabilities P492,251
Total Funding P700,000
Start-up
Requirements
Start-up Expenses
Legal P1,400
Stationery etc. P2,000
Brochures P5,000
Consultants P4,500
Staff Engagement P4,000
Office Locatioin P2,600
Staff Training P5,000
Expensed equipment P171,349
Other P11,900
Total Start-up Expenses P207,749
Start-up Assets
Cash Required P492,251
Start-up Inventory P0
Other Current Assets P0
Long-term Assets P0
Total Assets P492,251
Total Requirements P700,000

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Products and Services

I Tech Solutions will provide computer products and services to small, medium, and large businesses. We will also be focused on providing network systems and services to businesses. The systems include both PC-based Land Area Networks (LAN) systems and minicomputer server-based systems. Our services include design and installation of network systems, training, and support.

3.1 Product and Service Description

I Tech Solutions intends to provide the following services:

  1. Financial Solutions (discussion omitted in this sample plan)
  2. Network Solutions (discussion omitted)
  3. Data Backup Solutions and Services (discussion omitted)
  4. E-commerce Solutions (discussion omitted)
  5. Hardware Supply and Technical Support (discussion omitted)
  6. Paperless Office Automation Solutions (discussion omitted)
  7. Training (discussion omitted)

3.2 Technology

I Tech Solutions will strive to maintain the latest hardware and software capabilities so as to ensure we are continuously at the forefront in our market arena. The one certainty in our industry is that technology will continue to evolve and develop, changing what we market, as well as how we market it. Our aim is to be aware of the implications of this new technology, and utilize it in our existing framework where possible. Complete presentation facilities for preparation and delivery of multimedia presentations on Macintosh or Windows machines, in formats that include on-disk presentation or video presentation are also possibilities.

3.3 Macro-environment

Our macro-environment is exciting. We are in the middle of an unprecedented boom in connectivity and communications, as the Internet offers information technology like we never dreamed of. We are concerned with real value, real changes in the way we deal with information.

Meanwhile, all other signs are positive. The current drive by the government towards a more diversified economy presents an opportunity for our business to propel and excel in our intended markets, benefiting from the support of the concerned institutions and trade bodies. In addition to Botswana becoming an increasing economic hub, we foresee the demand for high quality business communication solutions to be on the rise. Through the undertaking of our business activities, we foresee no difficulty, in gaining market acceptance, provided we deliver the final service timeously, of good quality, and  at competitive rates.

3.4 Future Products and Services

We must remain on top of any new technology, because this is our bread and butter. For networking, we need to provide better knowledge of cross platform technologies. Also, we will be under pressure to improve our understanding of direct-connect Internet and related communications.

In putting the company together, we have attempted to offer enough services to allow us to always be in demand by our clients. However, technological developments have provided us with a new era of opportunities for the various organizations in which we can only guess at the needs. For example, current rapid innovations/development of Wireless Application Protocol (WAP) technology presents an opportunity to be realized, particularly focusing on WAP-enabled cell phones that allow individuals to access or send email messages on a cell phone. However, the most important factor in developing future services will be market need. Our understanding of the needs of our target market segments will be one of our competitive advantages.

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Market Analysis Summary

The current drive and emphasis by the government on diversification of the industrial base away from the minerals sector presents an opportunity for I Tech Solutions to make a valuable contribution towards achieving this goal. This will result in the implementation of modern Information Technology (IT) services and techniques, transfer of knowledge, and availability of quality brands.

4.1 Market Segmentation

We will be focusing on proactive, market seeking organizations that want to ensure an efficient and effective IT system that will assist in the realization of their business objectives.

Our target companies are large enough to require the high-quality IT management we offer, but too small to have a separate computer management staff. However, our most important group of potential customers will be business executives in large, medium, and small corporations. These are marketing managers, general managers, sales managers, and other decision makers who often need to access company data and information in their various business decisions. They will not waste their time or money looking for bargain information, questionable expertise, or cheap computers and accessories. Our potential clients will include: (discussion omitted).

Another intention will be to offer an attractive development alternative to the company that is management constrained and unable to address opportunities in new markets and new market segments, due to technological shortfalls.

Computer support business plan, market analysis summary chart image

Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential Customers Growth CAGR
SOHO Executives 3% 100 103 106 109 112 2.87%
Government Institutions 12% 800 896 1,004 1,124 1,259 12.00%
Financial Institutions 17% 50 59 69 81 95 17.41%
Corporations 22% 3,000 3,660 4,465 5,447 6,645 22.00%
Professional Firms 3% 400 412 424 437 450 2.99%
Other 4% 200 208 216 225 234 4.00%
Total 17.91% 4,550 5,338 6,284 7,423 8,795 17.91%

4.2 Target Market Segment Strategy

Our marketing strategy will be based mainly on making the right service(s) available to the right target customer. We will ensure that our products and services’ prices take customers’ budgets into consideration, and that these people appreciate the product/service and know that it exists, including where to find it. One of our intentions will be to target those innovative or proactive companies contemplating transferring a part of their marketing activities on the Internet, in order to benefit from the advantages offered by this unique system of communication. We realize the need to focus our marketing message and our service offerings.

4.2.1 Market Needs

Since our target market is the product and service seeker, the most important market needs are support, service, training, and installation, in that order. One of the key points of our strategy will be the focus on target segments that know and understand these needs and are willing to pay to have them filled. We realize that all personal computer users need support and service. Many of our target customers are going to be those who cannot get good products or services from the major vendors who focus on high volume orders only.

Our target businesses are dependent on reliable information technology. They use the computers for a complete range of functions, beginning with the core administration information such as accounting and record entry, communications, and personal productivity. They are not, however, large enough to have dedicated computer personnel such as the Management Information System (MIS) departments in large businesses.

The most obvious trend in the market is the increasing number of IT firms on the market. This has been true for years, but the trend seems to be accelerating. We see the major brand-name manufacturers being established on the market mainly through agents. Secondly, the computer has become a basic necessity in the office environment and business set-up. The vast improvements in computer power and storage, means that owners are mandated to up-grade or buy new and improved systems, with the former often being much cheaper. A third trend is ever-greater connectivity. Everybody wants to be on the Internet, and every office is looking at having a LAN. However, the major stumbling block for the majority of theses companies is the high cost of installing such networks.

4.3 Service Business Analysis

The following sections provided discussions on who participates in the computer industry, what the competition provides, and what the customer has been purchasing.

4.3.1 Business Participants

We are part of the computer reselling business, which includes several kinds of businesses:

  1. Computer Dealers: Storefront computer resellers usually offer a minimum of software, and very little, if any service and support. They are concerned with moving as much stock as possible. Their prices are usually higher than the larger stores.
  2. Chain and Computer Stores: They often occupy a large area of space, decent walk-in service, and are often warehouse-like locations where people go to find products in boxes. They often however charge exorbitant prices for their brand products and maintenance service, if they provide any at all.
  3. Computer Consultants: These include consultancy companies that mainly specialize in the installation of new systems. Their consultant fees are often very high, especially for small- to medium-sized companies.

4.3.2 Competition and Buying Patterns

The vast majority of proactive, market-oriented businesses understand the value of having an efficient computer system, as well as the concept of service and support. They are much more likely to pay for them when the offering and benefits are clearly stated.

There is no doubt that we will compete more against the box pushers than other service providers. We need to effectively compete against the idea that once a computer is out-dated businesses should buy new ones, when with ongoing service and support, they can be upgraded.

The most important element of general competition, by far, is what it takes to keep clients for repeat business. It is worth making huge concessions in any single service to maintain a client relationship that brings the client back for future services.

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Strategy and Implementation Summary

I Tech Solutions intends to win and maintain customers by providing products and services that add value, safety, and are supported by a well-trained professional team with commercial expertise. This is important to the successful implementation of our overall strategy and the need to ensure that all divisions and functions in the organization are working harmoniously towards attainment of the goals and objectives.

Our marketing strategy emphasizes focus. The target customers will include key decision-makers in business, who often order or recommend on behalf of the whole organization, the aim being to obtain an initial order and fully satisfy the customer from then on.

  • We intend to initially build image and awareness through consistency and distinctiveness in our product and service provision.
  • We intend to focus on delivering quality products and services that produce good referrals, which can then generate revenue. We intend to have a heavy personal selling component, supported by regular advertising we will always be active in our personal relationships with clients and strategic allies, keeping abreast of their needs and wants.
  • We are focusing advertising on several key media.

We intend to achieve growth by creating a more enthusiastic customer culture than that of our competitors. The strategy is to grow the business by nurturing customers, differentiating the product/service offering through service and staff behavior.

Through the implementation of a fair, effective, and competitive remuneration policy we intend to optimize our human resource output and advancement. We need the right people in the right place at the right time if we are to ensure optimum growth. We intend to develop our team so that our people can grow as the company grows–a mutually beneficial relationship.

5.1 SWOT Analysis

The SWOT Analysis is a necessity to any start-up, it is an in-depth look at your Strengths, Weaknesses, Opportunities, and Threats. We are in a highly lucrative market in a growing economy. We foresee our strengths as the ability to respond to the market and to provide custom designed technological services. Our key personnel will have a wide and thorough knowledge of the technological services we intend to provide, which will go a long way towards penetrating the market. Below is a summary of the SWOT Analysis.

5.1.1 Weaknesses

  • The introduction of new organizational practices and personnel who have not previously worked together presents a challenge to the organization.
  • A limited financial base compared to the current major players in the IT industry.

5.1.2 Opportunities

  • The Internet. The increasing opportunities of the Internet offer us another area of strength in comparison to the box-on-the-shelf major stores. Our potential customers want more help with the Internet, and we intend to be in a better position to give it to them.
  • Service. As our target market needs more service, our competitors are less likely than ever to provide it. Their business model doesn’t include service, just selling the computers.
  • Emerging Technologies. The rate of new product introduction in IT presents an opportunity to be explored.

5.1.3 Threats

  • Innovation shortens life cycles and hence the need to act timeously on the market. This will recoup new service introductions in a shorter time frame.
  • Concerns of decision-makers over ease of access and overall security of electronic transactions may need to be addressed. The recent glitch of the Barclays electronic system, which enabled some clients to access other account holders’ accounts while upgrading the system, proves the very realistic security concerns regarding the use of the Internet.
  • The slow adoption rate of new technologies and products in these parts of the world does not bode well for our intended products and services.

5.1.4 Strengths

  • Knowledge. Our competitors are retailers, pushing boxes. We know systems, networks, connectivity, programming, and data management.
  • Relationship selling. We intend to get to know our customers, one by one. Our direct sales efforts will seek to maintain a relationship with our customers.
  • Diversified market segments. The diversity of the products and services we intend to provide will ensure the lack of dependency on one particular market.
  • Combination of skills in implementation. The management team intends to jointly develop business strategy and long-term plans with its strategic allies, having wide experience in their respective market and product know-how, and strong technical skills and business know-how.

5.2 Competitive Edge

Our competitive edge is our positioning as a strategic ally with our clients, who are clients more than customers. By building a business based on long-standing relationships with satisfied clients, we will simultaneously build defenses against competition. The longer the relationship stands, the more we help our clients understand what we offer them and why they need it. The delivery of whole, end-to-end solutions will have a significant impact on gaining commitment from the market at all levels. The company believes in partnering with its customers so as to provide customized solutions that are needs-based.

5.3 Marketing Strategy

One core element of our marketing strategy will be that of differentiation from our competitors. In terms of promotion, we intend to sell our company as a strategic ally, not just our products. We intend to offer extremely reasonable prices in comparison to competition, and we need to be able to sustain that. Market penetration through lower prices shall be undertaken where need be, while premium pricing in the case of the upper-end of the market.

We have developed two strategy foci, each based on one main fundamental strategy. The first strategy is about (discussion omitted).

Our second strategic focus, that of (discussion omitted).

5.3.1 Distribution Strategy

Service provision and consulting will be sold and purchased mainly on a word-of-mouth basis, with relationships and previous experience being, by far, the most important factor. In this regard we intend to provide a service that exceeds customer expectations so as to ensure they refer us to potential clients through word-of-mouth. New business shall be developed through industry associations, business associations, and, in some cases, social associations, such as country clubs.

5.3.2 Marketing Programs

Advertising

In view of the fact that we are new on the market, we intend to undertake extensive advertising of our name and products and services we offer. This is to instill awareness and knowledge of our existence in the marketplace, which shall convert into market share. We intend to advertise in business and IT magazines that are read by our target market and will ensure we are adequately exposed on the market. A constant lookout will be made of any special editions in these various publications, which may provide an opportunity for us to advertise our services and ourselves. Advertising will also be conducted through television, radio, newspapers/magazines, and the Internet. Sponsoring a technology discussion/call-in talk show is a possibility.

Personal Selling

Word of mouth is critical in this segment. We will have to make sure that once we gain a customer, we never lose him/her. To help accomplish this, we must work to establish and maintain relationships. Personal selling will be a powerful form of promotion due to the fact that its flexibility will enable us to match the customer’s needs to specific attributes of our services, as well as giving concise details of what we are able to offer.

Public Relations

Recognizing that we are relatively new on the market, there will be a need to organize an event introducing ourselves onto the market. To this we will invite potential customers, senior officials, possibly including a government minister and other stakeholders, so as to penetrate the market. In collaboration with this we, also intend to place news stories and features in magazines and newspapers to keep stakeholders updated on the latest developments and to increase awareness.

Events

The number of IT companies on the market dictates that the organization needs to promote itself through participation in trade shows and expositions. Not only will these increase awareness of our products and services, but if a particular product or service were to gain recognition, for example through being chosen No. 1 in innovativeness, the organization will be able to take advantage of this in all its promotional campaigns, adding leverage to its reputation and corporate image. An example of a trade show we intend to participate at is BITEC. These expositions will also be a good opportunity for us to network with various organizations and individuals.

Internet Marketing

The company will sell its services over the Internet as it is cost effective to reach a large number of potential clients, regionally and internationally. We also realize that customer/client research is needed before building an effective website, something which is rarely done by existing companies, in order to find out how customers will want to access information and journey through the site.

5.3.3 Positioning Statement

I Tech Solutions will position itself as a reliable solutions provider and trusted strategic ally who makes sure systems work, people are comfortable and conversant with the system, and down time is minimal. Unlike the other vendors/retail stores, we intend to know the customer and go to his or her site when needed, offering proactive support, service, training, and installation. In addition, I Tech Solutions is an ally to our clients’ businesses, and offers them a full range of services, from installation to support.

5.3.4 Pricing Strategy

We must charge appropriately for the high-end, high-quality service and support we offer. Our revenue structure has to match our cost structure, so the salaries we pay to assure good service and support must be balanced by the revenue we charge. Therefore, we must make sure that we deliver and charge for service and support. Training, service, installation, and networking support–all of this must be readily available and priced to sell and deliver revenue. We will charge (discussion omitted). This will ensure we penetrate the market upon entry.

5.3.5 Promotion Strategy

Our promotion strategy will be based primarily on informing potential customers of our existence and making the right information available to our target customer. I Tech Solutions intends to utilize an aggressive promotional campaign to introduce its products and services to the market. The intention will be to take advantage of several media sources in announcing the products and services and in the process enforcing awareness of our existence.

5.4 Sales Strategy

I Tech Solutions will receive its revenue streams from a combination of licensing agreements, sales commissions, monthly subscriptions, registration fees, network access charges, service fees, transaction charges, training, promotional incentive programs, and sales of hardware and software. The derived value of I Tech Solutions will come from the key partnerships established and developed in order to deliver a product and service provision of transactionally-based activities, providing opportunity to build brand and loyalty, around which relationship marketing will play a key role.

The sales forecast monthly summary is included in the appendix. The annual sales projections are provided in a table below. It should be noted that as we become established and known on the market we project sales to increase at a faster rate than the initial year.

Note: All currency values in the charts and tables are expressed in the Botswana Pula (P).

Computer support business plan, strategy and implementation summary chart image

Computer support business plan, strategy and implementation summary chart image

Sales Forecast
Year 1 Year 2 Year 3
Sales
Products/Services P1,422,225 P2,528,400 P3,034,080
Other P0 P0 P0
Total Sales P1,422,225 P2,528,400 P3,034,080
Direct Cost of Sales Year 1 Year 2 Year 3
Products/Services P711,114 P1,264,200 P1,517,040
Other P0 P0 P0
Subtotal Direct Cost of Sales P711,114 P1,264,200 P1,517,040

5.5 Strategic Alliances

I Tech Solutions intends to go into strategic alliances with several organizations. This will also reassure our customers that they are investing in “winning” products, technology, and service that are maintainable, flexible, and scalable enough to meet future demands.

At this writing, strategic alliances with several companies are possibilities, including X, given the content of existing interest and discussions. By going into strategic partnerships with suitable organizations, we will benefit from being able to concentrate on our core activities in the delivery of our products and services to the end-user, while ensuring that we do not have to compromise on quality of execution or the number of products and services we are able to deliver.

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Management Summary

The human resources element shall be an essential component in the delivery of the total service. By having enthusiastic, capable, and empowered people interacting with our clients, we intend to build the competitive advantage of being able to comprehensively meet our clients’ needs. We also intend to give our teams enough leverage in decision-making to ensure that clients are handled promptly and to reduce lead-time in actual delivery of the service. It will be necessary to evaluate jobs and remuneration packages against market benchmarks to employees for their tasks to ensure they are competitive.

6.1 Organizational Structure

Our management philosophy is based on responsibility and mutual respect. We recognize the need to be constantly changing so as to adapt to the prevailing environment. We will have a flexible structure allowing for the above to be undertaken swiftly and smoothly. Please find below the job titles and descriptions we intend to have in place for the key personnel. (table omitted)

6.2 Management Team

In a highly volatile industry with increasing competition, we recognize the need to be constantly changing to adapt to the prevailing environment. The management team extensive expertise and a broad knowledge of the products/services and markets, which, if well planned, will enable the business to realize its goals and objectives.

(profiles omitted)

The management style will reflect the participation of the shareholders. The company will respect its community and treat all employees well. We will develop and nurture the company as a community. We will not be hierarchical, especially considering the rate of change in our industry, which makes it mandatory for us to be highly flexible. Management’s ongoing initiatives to drive sales, market share and productivity will provide additional impetus.

6.3 Personnel Plan

The detailed monthly personnel plan for the first three years is included in the appendix. The annual personnel estimates are included here. We believe this plan is a fair compromise between fairness and expedience, and meets the commitments of our mission statement. We want the company to stay lean and flexible so that we can respond to our markets’ needs quickly. As we expand and increase in size we do expect to increase our personnel.

We will compensate our personnel well, so as to retain their invaluable expertise and ensure job satisfaction and enrichment through delegation of authority. Our compensation will include health care, generous profit sharing, and a minimum of 3 weeks vacation.

Note: All currency values in the charts and tables are expressed in the Botswana Pula (P).

Personnel Plan
Year 1 Year 2 Year 3
Directors P135,000 P180,000 P216,000
Personal Assistant P10,800 P13,200 P14,520
Cleaner P3,600 P6,000 P7,200
Total People 5 5 5
Total Payroll P149,400 P199,200 P237,720

6.4 Training

In-house training shall be continuous with regular external training being undertaken, particularly following any new developments in the market. This is to ensure that we are continuously able to anticipate our markets needs–a proactive approach, which is so essential if we are to gain and maintain a competitive advantage. External training will also be conducted to ensure we are aware of the latest products and technology. This will also ensure that our personnel are able to set high standards, or benchmark, using these organizations standards.

6.5 Feedback and Control

(a) We will encourage our employees to put forward any suggestions they might have regarding the improvement of any of the company’s functions–an open door philosophy. Such a culture will enhance innovativeness and creativity in turn leading to job satisfaction and enrichment.

(b) We undertake to continuously formalize and measure cross-functional working communication so as to ensure that the various departments work harmoniously towards attainment of corporate objectives

(c) Important notices and developments will be continuously communicated to employees so as to keep them abreast of developments and promoting a sense of belonging and oneness in the organization.

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Financial Plan

We want to finance growth mainly through cash flow and equity. We recognize that this means we will have to grow more slowly than we might like. The most important factor in our case is collection days. We can’t push our clients hard on collection days, because they are in larger companies and will normally have marketing authority, not financial authority. Therefore we need to develop a permanent system of receivables financing, using one of the established accounting systems. In turn we intend to ensure that our investors are compatible with our growth plan, management style, and vision. Compatibility in this regard means:

  1. A fundamental respect for giving our customers value, and for maintaining a healthy and congenial workplace
  2. Respect for realistic forecasts, conservative cash flow, and financial management
  3. Cash flow as first priority, growth second, profits third
  4. Willingness to follow the project objectives and contribute valuable input to strategy and implementation decisions.

Of these, only the last 2 are flexible.

7.1 Break-even Analysis

The following table and chart summarizes our Break-even Analysis. We don’t really expect to reach break-even until several months into the business operation, as illustrated in the financials.

Note: All currency values in the charts and tables are expressed in the Botswana Pula (P).

Computer support business plan, financial plan chart image

Break-even Analysis
Monthly Revenue Break-even P47,662
Assumptions:
Average Percent Variable Cost 50%
Estimated Monthly Fixed Cost P23,831

7.2 Important Assumptions

The financial plan depends on important assumptions. From the beginning, we recognize that collection days are critical, but not a factor we can influence easily. Interest rates, tax rates, and personnel burden are based on conservative assumptions.

Some of the more important underlying assumptions are:

  • We assume a strong economy, without major recession.
  • We assume that there are no unforeseen changes in economic policy to make our products and service immediately obsolete.

Others include 30-day average collection days, sales entirely on invoice basis, including a favorable deposit policy, expenses mainly on a net 30-day basis, 30 days on average for payment of invoices, and present-day interest rates.

General Assumptions
Year 1 Year 2 Year 3
Plan Month 1 2 3
Current Interest Rate 17.00% 17.00% 17.00%
Long-term Interest Rate 17.00% 17.00% 17.00%
Tax Rate 25.42% 25.00% 25.42%
Other 0 0 0

7.3 Key Financial Indicators

We foresee major growth in sales and operating expenses, and a bump in our collection days as we spread the business during expansion.

Collection days are very important. We do not want to let our average collection days get above 30 under any circumstances. This could cause a serious problem with cash flow, because our working capital situation is chronically tight. However, we recognize that we cannot control this factor easily, because of the relationship with our clients.

Computer support business plan, financial plan chart image

7.4 Projected Profit and Loss

Initial marketing and training expenses will be relatively high as we seek to become known on the market and staff get trained in provision of our services. This will be brought about by the development of sales literature, advertising expenses, and function expenses. As our market share increases and capital is generated, further marketing programs and the expansion of those in existence at the time will be undertaken, to ensure market development. However, with time, these programs will start generating revenue for the business, which we shall reinvest.

Our projected Profit and Loss is shown in the appendix, with sales increasing steadily from the first year through the second, and into the third year. We do expect to more than break-even in the first year of operation. Our cost of sales should be much lower, and gross margin higher, than in this projection.

Note: All currency values in the charts and tables are expressed in the Botswana Pula (P).

Computer support business plan, financial plan chart image

Computer support business plan, financial plan chart image

Computer support business plan, financial plan chart image

Computer support business plan, financial plan chart image

Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales P1,422,225 P2,528,400 P3,034,080
Direct Cost of Sales P711,114 P1,264,200 P1,517,040
Other P0 P0 P0
Total Cost of Sales P711,114 P1,264,200 P1,517,040
Gross Margin P711,111 P1,264,200 P1,517,040
Gross Margin % 50.00% 50.00% 50.00%
Expenses
Payroll P149,400 P199,200 P237,720
Sales and Marketing and Other Expenses P95,772 P154,140 P182,196
Depreciation P0 P0 P0
Utilities P3,600 P3,960 P4,356
Telephone P6,000 P6,600 P7,260
Insurance P14,400 P15,840 P17,424
Rent P16,800 P18,480 P20,328
Insurance P0 P0 P0
Payroll Taxes P0 P0 P0
Other P0 P0 P0
Total Operating Expenses P285,972 P398,220 P469,284
Profit Before Interest and Taxes P425,139 P865,980 P1,047,756
EBITDA P425,139 P865,980 P1,047,756
Interest Expense P92,497 P75,684 P58,140
Taxes Incurred P82,612 P197,574 P251,527
Net Profit P250,030 P592,722 P738,089
Net Profit/Sales 17.58% 23.44% 24.33%

7.5 Projected Cash Flow

The chart and table below present the cash flow projections for I Tech Solutions.

Note: All currency values in the charts and tables are expressed in the Botswana Pula (P).

Computer support business plan, financial plan chart image

Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales P426,668 P758,520 P910,224
Cash from Receivables P763,507 P1,589,396 P2,041,349
Subtotal Cash from Operations P1,190,174 P2,347,916 P2,951,573
Additional Cash Received
Sales Tax, VAT, HST/GST Received P0 P0 P0
New Current Borrowing P0 P0 P0
New Other Liabilities (interest-free) P0 P0 P0
New Long-term Liabilities P0 P0 P0
Sales of Other Current Assets P0 P0 P0
Sales of Long-term Assets P0 P0 P0
New Investment Received P0 P0 P0
Subtotal Cash Received P1,190,174 P2,347,916 P2,951,573
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending P149,400 P199,200 P237,720
Bill Payments P1,002,379 P1,773,057 P2,068,003
Subtotal Spent on Operations P1,151,779 P1,972,257 P2,305,723
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out P0 P0 P0
Principal Repayment of Current Borrowing P0 P0 P0
Other Liabilities Principal Repayment P0 P0 P0
Long-term Liabilities Principal Repayment P103,200 P103,200 P103,200
Purchase Other Current Assets P141,200 P0 P0
Purchase Long-term Assets P240,000 P0 P0
Dividends P0 P0 P0
Subtotal Cash Spent P1,636,179 P2,075,457 P2,408,923
Net Cash Flow (P446,005) P272,459 P542,650
Cash Balance P46,246 P318,705 P861,356

7.6 Projected Balance Sheet

The balance sheet shows healthy growth of net worth, and strong financial position. The three-year estimates are included in the appendix.

Note: All currency values in the charts and tables are expressed in the Botswana Pula (P).

Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash P46,246 P318,705 P861,356
Accounts Receivable P232,051 P412,535 P495,042
Inventory P92,708 P164,814 P197,777
Other Current Assets P141,200 P141,200 P141,200
Total Current Assets P512,205 P1,037,254 P1,695,374
Long-term Assets
Long-term Assets P240,000 P240,000 P240,000
Accumulated Depreciation P0 P0 P0
Total Long-term Assets P240,000 P240,000 P240,000
Total Assets P752,205 P1,277,254 P1,935,374
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable P113,124 P148,651 P171,882
Current Borrowing P0 P0 P0
Other Current Liabilities P0 P0 P0
Subtotal Current Liabilities P113,124 P148,651 P171,882
Long-term Liabilities P496,800 P393,600 P290,400
Total Liabilities P609,924 P542,251 P462,282
Paid-in Capital P100,000 P100,000 P100,000
Retained Earnings (P207,749) P42,281 P635,003
Earnings P250,030 P592,722 P738,089
Total Capital P142,281 P735,003 P1,473,092
Total Liabilities and Capital P752,205 P1,277,254 P1,935,374
Net Worth P142,281 P735,003 P1,473,092

7.7 Business Ratios

The following table shows important ratios from the computer related services industry, as determined by the Standard Industry Classification (SIC) Index #7379, Computer Related Services.

Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 77.78% 20.00% 7.20%
Percent of Total Assets
Accounts Receivable 30.85% 32.30% 25.58% 21.70%
Inventory 12.32% 12.90% 10.22% 3.50%
Other Current Assets 18.77% 11.05% 7.30% 46.70%
Total Current Assets 68.09% 81.21% 87.60% 71.90%
Long-term Assets 31.91% 18.79% 12.40% 28.10%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 15.04% 11.64% 8.88% 51.40%
Long-term Liabilities 66.05% 30.82% 15.00% 19.10%
Total Liabilities 81.08% 42.45% 23.89% 70.50%
Net Worth 18.92% 57.55% 76.11% 29.50%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 50.00% 50.00% 50.00% 0.00%
Selling, General & Administrative Expenses 32.96% 27.34% 26.62% 80.70%
Advertising Expenses 0.97% 0.42% 0.38% 1.20%
Profit Before Interest and Taxes 29.89% 34.25% 34.53% 1.70%
Main Ratios
Current 4.53 6.98 9.86 1.27
Quick 3.71 5.87 8.71 1.01
Total Debt to Total Assets 81.08% 42.45% 23.89% 70.50%
Pre-tax Return on Net Worth 233.79% 107.52% 67.18% 3.50%
Pre-tax Return on Assets 44.22% 61.87% 51.13% 11.80%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin 17.58% 23.44% 24.33% n.a
Return on Equity 175.73% 80.64% 50.10% n.a
Activity Ratios
Accounts Receivable Turnover 4.29 4.29 4.29 n.a
Collection Days 56 66 78 n.a
Inventory Turnover 10.91 9.82 8.37 n.a
Accounts Payable Turnover 9.86 12.17 12.17 n.a
Payment Days 27 26 28 n.a
Total Asset Turnover 1.89 1.98 1.57 n.a
Debt Ratios
Debt to Net Worth 4.29 0.74 0.31 n.a
Current Liab. to Liab. 0.19 0.27 0.37 n.a
Liquidity Ratios
Net Working Capital P399,081 P888,603 P1,523,492 n.a
Interest Coverage 4.60 11.44 18.02 n.a
Additional Ratios
Assets to Sales 0.53 0.51 0.64 n.a
Current Debt/Total Assets 15% 12% 9% n.a
Acid Test 1.66 3.09 5.83 n.a
Sales/Net Worth 10.00 3.44 2.06 n.a
Dividend Payout 0.00 0.00 0.00 n.a

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Contingency Plan

  1. We intend to watch our results very carefully. We may need to concentrate less on certain products and services than others, if we intend to get the margin up or clients become difficult to attract. We might be able to avoid straight competition with the major IT companies by focusing more on our prime services.
  2. Another possibility is the introduction of a company or several companies in our niche. The need to undertake aggressive marketing, networking, and delivering a value-added service in our organization is a fundamental one.
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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
Products/Services 0% P31,605 P31,605 P31,605 P105,350 P105,350 P105,350 P168,560 P168,560 P168,560 P168,560 P168,560 P168,560
Other 0% P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Total Sales P31,605 P31,605 P31,605 P105,350 P105,350 P105,350 P168,560 P168,560 P168,560 P168,560 P168,560 P168,560
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
Products/Services P15,803 P15,803 P15,803 P52,675 P52,675 P52,675 P84,280 P84,280 P84,280 P84,280 P84,280 P84,280
Other P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Subtotal Direct Cost of Sales P15,803 P15,803 P15,803 P52,675 P52,675 P52,675 P84,280 P84,280 P84,280 P84,280 P84,280 P84,280
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 0% P7,500 P7,500 P7,500 P7,500 P7,500 P7,500 P15,000 P15,000 P15,000 P15,000 P15,000 P15,000
Personal Assistant 0% P900 P900 P900 P900 P900 P900 P900 P900 P900 P900 P900 P900
Cleaner 0% P300 P300 P300 P300 P300 P300 P300 P300 P300 P300 P300 P300
Total People 5 5 5 5 5 5 5 5 5 5 5 5
Total Payroll P8,700 P8,700 P8,700 P8,700 P8,700 P8,700 P16,200 P16,200 P16,200 P16,200 P16,200 P16,200

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 17.00% 17.00% 17.00% 17.00% 17.00% 17.00% 17.00% 17.00% 17.00% 17.00% 17.00% 17.00%
Long-term Interest Rate 17.00% 17.00% 17.00% 17.00% 17.00% 17.00% 17.00% 17.00% 17.00% 17.00% 17.00% 17.00%
Tax Rate 30.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00%
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 P31,605 P31,605 P31,605 P105,350 P105,350 P105,350 P168,560 P168,560 P168,560 P168,560 P168,560 P168,560
Direct Cost of Sales P15,803 P15,803 P15,803 P52,675 P52,675 P52,675 P84,280 P84,280 P84,280 P84,280 P84,280 P84,280
Other P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Total Cost of Sales P15,803 P15,803 P15,803 P52,675 P52,675 P52,675 P84,280 P84,280 P84,280 P84,280 P84,280 P84,280
Gross Margin P15,802 P15,802 P15,802 P52,675 P52,675 P52,675 P84,280 P84,280 P84,280 P84,280 P84,280 P84,280
Gross Margin % 50.00% 50.00% 50.00% 50.00% 50.00% 50.00% 50.00% 50.00% 50.00% 50.00% 50.00% 50.00%
Expenses
Payroll P8,700 P8,700 P8,700 P8,700 P8,700 P8,700 P16,200 P16,200 P16,200 P16,200 P16,200 P16,200
Sales and Marketing and Other Expenses P6,300 P2,100 P2,100 P7,368 P7,368 P7,368 P10,528 P10,528 P10,528 P10,528 P10,528 P10,528
Depreciation P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Utilities P300 P300 P300 P300 P300 P300 P300 P300 P300 P300 P300 P300
Telephone P500 P500 P500 P500 P500 P500 P500 P500 P500 P500 P500 P500
Insurance P1,200 P1,200 P1,200 P1,200 P1,200 P1,200 P1,200 P1,200 P1,200 P1,200 P1,200 P1,200
Rent P1,400 P1,400 P1,400 P1,400 P1,400 P1,400 P1,400 P1,400 P1,400 P1,400 P1,400 P1,400
Insurance P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Payroll Taxes 0% P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Other P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Total Operating Expenses P18,400 P14,200 P14,200 P19,468 P19,468 P19,468 P30,128 P30,128 P30,128 P30,128 P30,128 P30,128
Profit Before Interest and Taxes (P2,598) P1,602 P1,602 P33,207 P33,207 P33,207 P54,152 P54,152 P54,152 P54,152 P54,152 P54,152
EBITDA (P2,598) P1,602 P1,602 P33,207 P33,207 P33,207 P54,152 P54,152 P54,152 P54,152 P54,152 P54,152
Interest Expense P8,378 P8,256 P8,135 P8,013 P7,891 P7,769 P7,647 P7,525 P7,404 P7,282 P7,160 P7,038
Taxes Incurred (P3,293) (P1,664) (P1,633) P6,299 P6,329 P6,360 P11,626 P11,657 P11,687 P11,718 P11,748 P11,779
Net Profit (P7,683) (P4,991) (P4,899) P18,896 P18,987 P19,079 P34,879 P34,970 P35,061 P35,153 P35,244 P35,336
Net Profit/Sales -24.31% -15.79% -15.50% 17.94% 18.02% 18.11% 20.69% 20.75% 20.80% 20.85% 20.91% 20.96%

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 P9,482 P9,482 P9,482 P31,605 P31,605 P31,605 P50,568 P50,568 P50,568 P50,568 P50,568 P50,568
Cash from Receivables P0 P737 P22,124 P22,124 P23,844 P73,745 P73,745 P75,220 P117,992 P117,992 P117,992 P117,992
Subtotal Cash from Operations P9,482 P10,219 P31,605 P53,729 P55,449 P105,350 P124,313 P125,788 P168,560 P168,560 P168,560 P168,560
Additional Cash Received
Sales Tax, VAT, HST/GST Received 0.00% P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
New Current Borrowing P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
New Other Liabilities (interest-free) P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
New Long-term Liabilities P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Sales of Other Current Assets P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Sales of Long-term Assets P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
New Investment Received P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Subtotal Cash Received P9,482 P10,219 P31,605 P53,729 P55,449 P105,350 P124,313 P125,788 P168,560 P168,560 P168,560 P168,560
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 P8,700 P8,700 P8,700 P8,700 P8,700 P8,700 P16,200 P16,200 P16,200 P16,200 P16,200 P16,200
Bill Payments P1,599 P47,302 P27,893 P30,821 P116,958 P77,660 P80,061 P151,085 P117,387 P117,296 P117,204 P117,113
Subtotal Spent on Operations P10,299 P56,002 P36,593 P39,521 P125,658 P86,360 P96,261 P167,285 P133,587 P133,496 P133,404 P133,313
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Principal Repayment of Current Borrowing P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Other Liabilities Principal Repayment P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Long-term Liabilities Principal Repayment P8,600 P8,600 P8,600 P8,600 P8,600 P8,600 P8,600 P8,600 P8,600 P8,600 P8,600 P8,600
Purchase Other Current Assets P0 P0 P141,200 P0 P0 P0 P0 P0 P0 P0 P0 P0
Purchase Long-term Assets P20,000 P20,000 P20,000 P20,000 P20,000 P20,000 P20,000 P20,000 P20,000 P20,000 P20,000 P20,000
Dividends P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Subtotal Cash Spent P38,899 P84,602 P206,393 P68,121 P154,258 P114,960 P124,861 P195,885 P162,187 P162,096 P162,004 P161,913
Net Cash Flow (P29,418) (P74,383) (P174,788) (P14,393) (P98,809) (P9,610) (P548) (P70,097) P6,373 P6,464 P6,556 P6,647
Cash Balance P462,833 P388,450 P213,662 P199,269 P100,460 P90,850 P90,303 P20,206 P26,579 P33,043 P39,599 P46,246
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 P492,251 P462,833 P388,450 P213,662 P199,269 P100,460 P90,850 P90,303 P20,206 P26,579 P33,043 P39,599 P46,246
Accounts Receivable P0 P22,124 P43,510 P43,510 P95,131 P145,032 P145,032 P189,279 P232,051 P232,051 P232,051 P232,051 P232,051
Inventory P0 P17,383 P17,383 P17,383 P57,943 P57,943 P57,943 P92,708 P92,708 P92,708 P92,708 P92,708 P92,708
Other Current Assets P0 P0 P0 P141,200 P141,200 P141,200 P141,200 P141,200 P141,200 P141,200 P141,200 P141,200 P141,200
Total Current Assets P492,251 P502,340 P449,343 P415,755 P493,543 P444,635 P435,025 P513,490 P486,165 P492,538 P499,002 P505,558 P512,205
Long-term Assets
Long-term Assets P0 P20,000 P40,000 P60,000 P80,000 P100,000 P120,000 P140,000 P160,000 P180,000 P200,000 P220,000 P240,000
Accumulated Depreciation P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Total Long-term Assets P0 P20,000 P40,000 P60,000 P80,000 P100,000 P120,000 P140,000 P160,000 P180,000 P200,000 P220,000 P240,000
Total Assets P492,251 P522,340 P489,343 P475,755 P573,543 P544,635 P555,025 P653,490 P646,165 P672,538 P699,002 P725,558 P752,205
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 P0 P46,373 P26,966 P26,878 P114,370 P75,074 P74,986 P147,172 P113,477 P113,389 P113,300 P113,212 P113,124
Current Borrowing P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Other Current Liabilities P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0 P0
Subtotal Current Liabilities P0 P46,373 P26,966 P26,878 P114,370 P75,074 P74,986 P147,172 P113,477 P113,389 P113,300 P113,212 P113,124
Long-term Liabilities P600,000 P591,400 P582,800 P574,200 P565,600 P557,000 P548,400 P539,800 P531,200 P522,600 P514,000 P505,400 P496,800
Total Liabilities P600,000 P637,773 P609,766 P601,078 P679,970 P632,074 P623,386 P686,972 P644,677 P635,989 P627,300 P618,612 P609,924
Paid-in Capital P100,000 P100,000 P100,000 P100,000 P100,000 P100,000 P100,000 P100,000 P100,000 P100,000 P100,000 P100,000 P100,000
Retained Earnings (P207,749) (P207,749) (P207,749) (P207,749) (P207,749) (P207,749) (P207,749) (P207,749) (P207,749) (P207,749) (P207,749) (P207,749) (P207,749)
Earnings P0 (P7,683) (P12,674) (P17,573) P1,322 P20,309 P39,388 P74,267 P109,237 P144,298 P179,451 P214,695 P250,030
Total Capital (P107,749) (P115,432) (P120,423) (P125,322) (P106,427) (P87,440) (P68,361) (P33,482) P1,488 P36,549 P71,702 P106,946 P142,281
Total Liabilities and Capital P492,251 P522,340 P489,343 P475,755 P573,543 P544,635 P555,025 P653,490 P646,165 P672,538 P699,002 P725,558 P752,205
Net Worth (P107,749) (P115,432) (P120,423) (P125,322) (P106,427) (P87,440) (P68,361) (P33,482) P1,488 P36,549 P71,702 P106,946 P142,281

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