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Crest Systems

Executive Summary

Crest Systems is a new Value Added Reseller (VAR). The company is focused on marketing speciality inventory software products to over 1,200 VARs that sell in vertical markets. Each market is distinct and serves a particular speciality industry. In addition to the software, Crest will sell the inventory data collection hardware that will operate the software. Traditionally, VARs who sell to these vertical markets focus solely on the industry’s unique product line or service. Though their customers have inventory controls needs, these VARs have not had a product they could offer until now.

Critical to the product’s success is the ability to sell the customer an inventory management solution that costs less than $5,000. Crest Systems has signed a strategic alliance agreement with Promerit Engineering to sell its software products through these VARs. The first product is Promerit Inventory Basic and will be released in May. Crest Systems projects sales of 20,000 units in 36 months. The product will sell for $850.

The VAR will receive $400 from the sale. Crest Systems will receive $250 on the sale of each unit. Crest Systems will also sell hardware that will use the software. Crest Systems will sell portable data collection units from Symbol and PSC. The cost of the hardware will be between $2,000 to $3,200 per unit. Crest Systems receives between $600 – $900 on each unit. The total package of software and hardware will be less than $5,000.

Though the company is focused on the vertical markets, VARs who sell warehouse are also interested in a low-end data collection solution. Crest Systems will assemble 1,000 plus warehouse management VARs to sell Promerit Inventory Basic.

Crest Systems will also develop specialty software modules that can be integrated with Promerit Inventory Basic software. These modules will sell for $800 to $1,000. Crest Systems plans to solidify a strong business relationship with its VARs customers that will lead to providing additional software and hardware products.

Richard Torres, owner of Crest System, has over twelve years of experience selling to vertical markets. Last year, he was Cycon Systems top salesperson with over $3 million in sales.

Computers reseller business plan, executive summary chart image

1.1 Objectives

The objectives of Crest Systems are to:

  • Sell 8,000 units during the first year.
  • Establish strong relationships with the VARs critical to sales.
  • Build the software module business by 15% each year.
  • Maintain effective communication with Promerit Systems in order to improve product quality and customer satisfaction.

1.2 Keys to Success

The keys to success in Crest Systems are:

  1. Offering inexpensive inventory control solutions that cost less than $5,000 to implement.
  2. Reliable and timely response to VARs’ questions and requests.
  3. A reliable administration that is ready to serve VARs, prepare accurate billing, follow-up on orders and other documentation, and maintain a close watch on expenses and collection of accounts receivable.
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Company Summary

Crest Systems is a Value Added Reseller (VAR) that is focused on selling low-end inventory software and hardware products. The company markets Promerit Engineering software products to over 1,200 VARs that sell products in vertical markets. In addition, Crest Systems will market the software product to warehouse systems VARs who are looking for a low-end inventory software product.

2.1 Company Ownership

Richard Torres is the owner of Crest Systems. The company will be set up as a C Corporation. It is expected that this form of incorporation will allow room for growth and be an effective vehicle for acquiring additional capital in five to seven years.

2.2 Start-up Summary

The start-up cost of Crest Systems will consist primarily establishing an account receivable system and communication system for salespeople. Richard Torres will invest $50,000. He will also secure a $100,000 loan.

Computers reseller business plan, company summary chart image

Start-up
Requirements
Start-up Expenses
Legal $1,000
Stationery etc. $300
Brochures $2,000
Office Equipment $6,000
Insurance $3,000
Rent $2,000
Phone System $2,000
Total Start-up Expenses $16,300
Start-up Assets
Cash Required $133,700
Other Current Assets $0
Long-term Assets $0
Total Assets $133,700
Total Requirements $150,000
Start-up Funding
Start-up Expenses to Fund $16,300
Start-up Assets to Fund $133,700
Total Funding Required $150,000
Assets
Non-cash Assets from Start-up $0
Cash Requirements from Start-up $133,700
Additional Cash Raised $0
Cash Balance on Starting Date $133,700
Total Assets $133,700
Liabilities and Capital
Liabilities
Current Borrowing $0
Long-term Liabilities $100,000
Accounts Payable (Outstanding Bills) $0
Other Current Liabilities (interest-free) $0
Total Liabilities $100,000
Capital
Planned Investment
Investor 1 $50,000
Other $0
Additional Investment Requirement $0
Total Planned Investment $50,000
Loss at Start-up (Start-up Expenses) ($16,300)
Total Capital $33,700
Total Capital and Liabilities $133,700
Total Funding $150,000

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Products

Crest Systems’ products are as follows:

  • Promerit Inventory Basic.
  • Software modules that integrate Promerit Inventory Basic.
  • Data Collection Hardware.

We have a team of experienced and proven salespeople in marketing a company’s products to VARs that serve vertical markets.

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Market Analysis Summary

There are thousands of small businesses that are dissatisfied with the choice of inventory control products that are available to them. Most of these businesses exist below the water line for software companies. Selling to a market that can only spend $5,000 on an inventory control solution is considered too small a return for the sales activity.

If a salesperson can spend a day winning a $50,000 contract rather than a $5,000 contact, she will disregard the smaller opportunity. Many sales organizations have overlooked this opportunity. If a cost effective method can be established to attack this market, the sales can be enormous.

It is Crest Systems plan to sell to the VARs that serve the vertical markets as well as the VARs that sell warehouse products and services. Crest Systems will sell the hardware directly to customers when the software is purchased by the vertical VARs’ customer. The company will use this opportunity to build purchasing relationships with businesses with growing inventories.

4.1 Market Segmentation

Crest Systems will focus on two customer groups:

  • Warehouse Products and Services VARs: These VARs offer warehouse management hardware and software. Though their primary focus is on larger contracts, an inexpensive product focused on the low end of the market will be attractive if the payoff is large enough. The VARs retain $500 on each product sold. There is no other software product that is focused on our target customers that rewards better for the sale.
  • Vertical Market VARs: These VARs traditional don’t sell inventory management products to their customers. Inventory control products are not their focus, rather it is whatever item or product particular to that industry that is used in manufacturing or assembly of their final product. Yet they have thousands of customers. If the payoff is large enough, their access to the market would lead to enormous sales. Like the warehouse product VARs, the vertical market VARs would retain $500 on each product sold.
Computers reseller business plan, market analysis summary chart image

Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential Customers Growth CAGR
Warehouse Products VARs 15% 1,400 1,610 1,852 2,130 2,450 15.02%
Vertical Market VARs 15% 1,100 1,265 1,455 1,673 1,924 15.00%
Total 15.01% 2,500 2,875 3,307 3,803 4,374 15.01%

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Strategy and Implementation Summary

Crest Systems will aggressively market Promerit Inventory Basic to VARs. It is our belief that the payoff to the VARs on each sale will make the product attractive. We will train their salespeople so that they will be successful in demonstrating the products to customers. This will be especially important with vertical market VARs that will not normally offer software products to their customers.

5.1 Competitive Edge

Richard Torres is the competitive edge of Crest Systems. Richard has worked for Cycon Systems for the past ten years. He served as the company’s manager of sales to vertical market VARs.

During the past five years Richard was responsible for over $15 million dollars worth of sales to vertical market VARs. His strength is his customer relation skills and he has been successful in expanding the number of vertical market VARs that bought Cycon System products.

Another competitive edge for Crest Systems is the ability to create specialized software modules for customers that will customize the software. he company believes that one fourth of all software customers will request a customized module to be added to the software after purchase.

5.2 Sales Strategy

Crest Systems’ sales strategy is to take the first 60 days of operation to train VARs and put the resources in place to facilitate sales. We anticipate that sales will begin during our third month of operation.

5.2.1 Sales Forecast

The following is the sales forecast for the next three years.

Computers reseller business plan, strategy and implementation summary chart image

Computers reseller business plan, strategy and implementation summary chart image

Sales Forecast
Year 1 Year 2 Year 3
Sales
Promerit Inventory Basic $1,450,000 $1,700,000 $2,000,000
Hardware $909,000 $1,200,000 $1,500,000
Software Modules $129,000 $180,000 $220,000
Other $0 $0 $0
Total Sales $2,488,000 $3,080,000 $3,720,000
Direct Cost of Sales Year 1 Year 2 Year 3
Promerit Inventory Basic $1,087,000 $1,200,000 $1,400,000
Hardware $580,000 $770,000 $930,000
Software Modules $0 $0 $0
Other $0 $0 $0
Subtotal Direct Cost of Sales $1,667,000 $1,970,000 $2,330,000

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Management Summary

Richard Torres will manage the day to day operations of Crest Systems.

6.1 Personnel Plan

The personnel plan for Crest Systems is as follows:

  • Manager;
  • Accounts Manager;
  • Sales Staff (3);
  • Software Engineer (1).

Crest Systems anticipates that another software engineer will be hired in September of this year.

Personnel Plan
Year 1 Year 2 Year 3
Manager $60,000 $70,000 $80,000
Accounting Manager $42,000 $44,000 $46,000
Sales Staff $180,000 $200,000 $230,000
Software Engineers $85,000 $100,000 $104,000
Other $0 $0 $0
Total People 0 0 0
Total Payroll $367,000 $414,000 $460,000

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Financial Plan

The following is the financial plan for Crest Systems.

7.1 Break-even Analysis

The monthly break-even point is shown below.

Computers reseller business plan, financial plan chart image

Break-even Analysis
Monthly Revenue Break-even $143,373
Assumptions:
Average Percent Variable Cost 67%
Estimated Monthly Fixed Cost $47,311

7.2 Projected Profit and Loss

The following table and charts will highlight projected profit and loss for the next three years.

Computers reseller business plan, financial plan chart image

Computers reseller business plan, financial plan chart image

Computers reseller business plan, financial plan chart image

Computers reseller business plan, financial plan chart image

Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $2,488,000 $3,080,000 $3,720,000
Direct Cost of Sales $1,667,000 $1,970,000 $2,330,000
Other Production Expenses $0 $0 $0
Total Cost of Sales $1,667,000 $1,970,000 $2,330,000
Gross Margin $821,000 $1,110,000 $1,390,000
Gross Margin % 33.00% 36.04% 37.37%
Expenses
Payroll $367,000 $414,000 $460,000
Sales and Marketing and Other Expenses $120,000 $160,000 $200,000
Depreciation $0 $0 $0
Leased Equipment $0 $0 $0
Utilities $1,680 $1,680 $1,680
Insurance $0 $0 $0
Rent $24,000 $24,000 $24,000
Payroll Taxes $55,050 $62,100 $69,000
Other $0 $0 $0
Total Operating Expenses $567,730 $661,780 $754,680
Profit Before Interest and Taxes $253,270 $448,220 $635,320
EBITDA $253,270 $448,220 $635,320
Interest Expense $8,903 $6,962 $4,936
Taxes Incurred $73,310 $132,378 $189,115
Net Profit $171,057 $308,881 $441,269
Net Profit/Sales 6.88% 10.03% 11.86%

7.3 Projected Cash Flow

The following table and chart highlight the projected cash flow for three years.

Computers reseller business plan, financial plan chart image

Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $622,000 $770,000 $930,000
Cash from Receivables $1,330,125 $2,182,493 $2,652,154
Subtotal Cash from Operations $1,952,125 $2,952,493 $3,582,154
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 $66,000 $0 $0
Subtotal Cash Received $2,018,125 $2,952,493 $3,582,154
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $367,000 $414,000 $460,000
Bill Payments $1,632,460 $2,480,866 $2,780,790
Subtotal Spent on Operations $1,999,460 $2,894,866 $3,240,790
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 $20,256 $20,256 $20,256
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $2,019,716 $2,915,122 $3,261,046
Net Cash Flow ($1,591) $37,370 $321,108
Cash Balance $132,109 $169,480 $490,587

7.4 Projected Balance Sheet

The following table highlights the projected balance sheet for three years.

Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $132,109 $169,480 $490,587
Accounts Receivable $535,875 $663,382 $801,228
Other Current Assets $0 $0 $0
Total Current Assets $667,984 $832,862 $1,291,815
Long-term Assets
Long-term Assets $0 $0 $0
Accumulated Depreciation $0 $0 $0
Total Long-term Assets $0 $0 $0
Total Assets $667,984 $832,862 $1,291,815
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $317,483 $193,736 $231,677
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $317,483 $193,736 $231,677
Long-term Liabilities $79,744 $59,488 $39,232
Total Liabilities $397,227 $253,224 $270,909
Paid-in Capital $116,000 $116,000 $116,000
Retained Earnings ($16,300) $154,757 $463,638
Earnings $171,057 $308,881 $441,269
Total Capital $270,757 $579,638 $1,020,907
Total Liabilities and Capital $667,984 $832,862 $1,291,815
Net Worth $270,757 $579,638 $1,020,907

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 5045, Computers, peripherals and software, are shown for comparison.

Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 23.79% 20.78% 5.80%
Percent of Total Assets
Accounts Receivable 80.22% 79.65% 62.02% 29.30%
Other Current Assets 0.00% 0.00% 0.00% 21.50%
Total Current Assets 100.00% 100.00% 100.00% 86.80%
Long-term Assets 0.00% 0.00% 0.00% 13.20%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 47.53% 23.26% 17.93% 43.70%
Long-term Liabilities 11.94% 7.14% 3.04% 11.20%
Total Liabilities 59.47% 30.40% 20.97% 54.90%
Net Worth 40.53% 69.60% 79.03% 45.10%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 33.00% 36.04% 37.37% 24.80%
Selling, General & Administrative Expenses 26.12% 26.01% 25.50% 15.60%
Advertising Expenses 2.41% 2.60% 2.69% 0.50%
Profit Before Interest and Taxes 10.18% 14.55% 17.08% 2.70%
Main Ratios
Current 2.10 4.30 5.58 1.93
Quick 2.10 4.30 5.58 0.92
Total Debt to Total Assets 59.47% 30.40% 20.97% 54.90%
Pre-tax Return on Net Worth 90.25% 76.13% 61.75% 5.50%
Pre-tax Return on Assets 36.58% 52.98% 48.80% 12.20%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin 6.88% 10.03% 11.86% n.a
Return on Equity 63.18% 53.29% 43.22% n.a
Activity Ratios
Accounts Receivable Turnover 3.48 3.48 3.48 n.a
Collection Days 55 95 96 n.a
Accounts Payable Turnover 6.14 12.17 12.17 n.a
Payment Days 27 40 28 n.a
Total Asset Turnover 3.72 3.70 2.88 n.a
Debt Ratios
Debt to Net Worth 1.47 0.44 0.27 n.a
Current Liab. to Liab. 0.80 0.77 0.86 n.a
Liquidity Ratios
Net Working Capital $350,501 $639,126 $1,060,139 n.a
Interest Coverage 28.45 64.38 128.71 n.a
Additional Ratios
Assets to Sales 0.27 0.27 0.35 n.a
Current Debt/Total Assets 48% 23% 18% n.a
Acid Test 0.42 0.87 2.12 n.a
Sales/Net Worth 9.19 5.31 3.64 n.a
Dividend Payout 0.00 0.00 0.00 n.a

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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
Promerit Inventory Basic 0% $0 $0 $70,000 $80,000 $120,000 $120,000 $160,000 $160,000 $160,000 $140,000 $200,000 $240,000
Hardware 0% $0 $0 $54,000 $60,000 $75,000 $75,000 $105,000 $105,000 $105,000 $80,000 $100,000 $150,000
Software Modules 0% $0 $0 $0 $11,000 $13,000 $15,000 $15,000 $15,000 $15,000 $10,000 $15,000 $20,000
Other 0% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Sales $0 $0 $124,000 $151,000 $208,000 $210,000 $280,000 $280,000 $280,000 $230,000 $315,000 $410,000
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
Promerit Inventory Basic $0 $0 $57,000 $60,000 $90,000 $90,000 $120,000 $120,000 $120,000 $90,000 $150,000 $190,000
Hardware $0 $0 $36,000 $40,000 $50,000 $50,000 $63,000 $63,000 $63,000 $50,000 $65,000 $100,000
Software Modules $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Direct Cost of Sales $0 $0 $93,000 $100,000 $140,000 $140,000 $183,000 $183,000 $183,000 $140,000 $215,000 $290,000
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% $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000
Accounting Manager 0% $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500
Sales Staff 0% $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000
Software Engineers 0% $5,000 $5,000 $5,000 $5,000 $5,000 $0 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000
Other 0% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total People 0 0 0 0 0 0 0 0 0 0 0 0
Total Payroll $28,500 $28,500 $28,500 $28,500 $28,500 $23,500 $33,500 $33,500 $33,500 $33,500 $33,500 $33,500

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 $0 $0 $124,000 $151,000 $208,000 $210,000 $280,000 $280,000 $280,000 $230,000 $315,000 $410,000
Direct Cost of Sales $0 $0 $93,000 $100,000 $140,000 $140,000 $183,000 $183,000 $183,000 $140,000 $215,000 $290,000
Other Production Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Cost of Sales $0 $0 $93,000 $100,000 $140,000 $140,000 $183,000 $183,000 $183,000 $140,000 $215,000 $290,000
Gross Margin $0 $0 $31,000 $51,000 $68,000 $70,000 $97,000 $97,000 $97,000 $90,000 $100,000 $120,000
Gross Margin % 0.00% 0.00% 25.00% 33.77% 32.69% 33.33% 34.64% 34.64% 34.64% 39.13% 31.75% 29.27%
Expenses
Payroll $28,500 $28,500 $28,500 $28,500 $28,500 $23,500 $33,500 $33,500 $33,500 $33,500 $33,500 $33,500
Sales and Marketing and Other Expenses $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000
Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Leased Equipment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Utilities $140 $140 $140 $140 $140 $140 $140 $140 $140 $140 $140 $140
Insurance $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Rent $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000
Payroll Taxes 15% $4,275 $4,275 $4,275 $4,275 $4,275 $3,525 $5,025 $5,025 $5,025 $5,025 $5,025 $5,025
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Operating Expenses $44,915 $44,915 $44,915 $44,915 $44,915 $39,165 $50,665 $50,665 $50,665 $50,665 $50,665 $50,665
Profit Before Interest and Taxes ($44,915) ($44,915) ($13,915) $6,085 $23,085 $30,835 $46,335 $46,335 $46,335 $39,335 $49,335 $69,335
EBITDA ($44,915) ($44,915) ($13,915) $6,085 $23,085 $30,835 $46,335 $46,335 $46,335 $39,335 $49,335 $69,335
Interest Expense $819 $805 $791 $777 $763 $749 $735 $721 $707 $693 $679 $665
Taxes Incurred ($13,720) ($13,716) ($4,412) $1,592 $6,697 $9,026 $13,680 $13,684 $13,688 $11,593 $14,597 $20,601
Net Profit ($32,014) ($32,004) ($10,294) $3,716 $15,625 $21,060 $31,920 $31,930 $31,940 $27,050 $34,059 $48,069
Net Profit/Sales 0.00% 0.00% -8.30% 2.46% 7.51% 10.03% 11.40% 11.40% 11.41% 11.76% 10.81% 11.72%

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 $0 $0 $31,000 $37,750 $52,000 $52,500 $70,000 $70,000 $70,000 $57,500 $78,750 $102,500
Cash from Receivables $0 $0 $0 $3,100 $93,675 $114,675 $156,050 $159,250 $210,000 $210,000 $208,750 $174,625
Subtotal Cash from Operations $0 $0 $31,000 $40,850 $145,675 $167,175 $226,050 $229,250 $280,000 $267,500 $287,500 $277,125
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 $66,000 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash Received $0 $0 $31,000 $106,850 $145,675 $167,175 $226,050 $229,250 $280,000 $267,500 $287,500 $277,125
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 $28,500 $28,500 $28,500 $28,500 $28,500 $23,500 $33,500 $33,500 $33,500 $33,500 $33,500 $33,500
Bill Payments $117 $3,514 $6,914 $106,227 $120,287 $163,927 $167,078 $214,580 $214,570 $213,057 $172,050 $250,140
Subtotal Spent on Operations $28,617 $32,014 $35,414 $134,727 $148,787 $187,427 $200,578 $248,080 $248,070 $246,557 $205,550 $283,640
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 $1,688 $1,688 $1,688 $1,688 $1,688 $1,688 $1,688 $1,688 $1,688 $1,688 $1,688 $1,688
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 $30,305 $33,702 $37,102 $136,415 $150,475 $189,115 $202,266 $249,768 $249,758 $248,245 $207,238 $285,328
Net Cash Flow ($30,305) ($33,702) ($6,102) ($29,565) ($4,800) ($21,940) $23,784 ($20,518) $30,242 $19,255 $80,262 ($8,203)
Cash Balance $103,395 $69,693 $63,591 $34,026 $29,226 $7,286 $31,070 $10,553 $40,795 $60,050 $140,312 $132,109
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 $133,700 $103,395 $69,693 $63,591 $34,026 $29,226 $7,286 $31,070 $10,553 $40,795 $60,050 $140,312 $132,109
Accounts Receivable $0 $0 $0 $93,000 $203,150 $265,475 $308,300 $362,250 $413,000 $413,000 $375,500 $403,000 $535,875
Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Current Assets $133,700 $103,395 $69,693 $156,591 $237,176 $294,701 $315,586 $393,320 $423,553 $453,795 $435,550 $543,312 $667,984
Long-term Assets
Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Accumulated Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Assets $133,700 $103,395 $69,693 $156,591 $237,176 $294,701 $315,586 $393,320 $423,553 $453,795 $435,550 $543,312 $667,984
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 $3,397 $3,387 $102,268 $114,825 $158,412 $159,925 $207,427 $207,418 $207,408 $163,802 $239,193 $317,483
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 $3,397 $3,387 $102,268 $114,825 $158,412 $159,925 $207,427 $207,418 $207,408 $163,802 $239,193 $317,483
Long-term Liabilities $100,000 $98,312 $96,624 $94,936 $93,248 $91,560 $89,872 $88,184 $86,496 $84,808 $83,120 $81,432 $79,744
Total Liabilities $100,000 $101,709 $100,011 $197,204 $208,073 $249,972 $249,797 $295,611 $293,914 $292,216 $246,922 $320,625 $397,227
Paid-in Capital $50,000 $50,000 $50,000 $50,000 $116,000 $116,000 $116,000 $116,000 $116,000 $116,000 $116,000 $116,000 $116,000
Retained Earnings ($16,300) ($16,300) ($16,300) ($16,300) ($16,300) ($16,300) ($16,300) ($16,300) ($16,300) ($16,300) ($16,300) ($16,300) ($16,300)
Earnings $0 ($32,014) ($64,018) ($74,312) ($70,597) ($54,971) ($33,911) ($1,991) $29,939 $61,879 $88,928 $122,988 $171,057
Total Capital $33,700 $1,686 ($30,318) ($40,612) $29,103 $44,729 $65,789 $97,709 $129,639 $161,579 $188,628 $222,688 $270,757
Total Liabilities and Capital $133,700 $103,395 $69,693 $156,591 $237,176 $294,701 $315,586 $393,320 $423,553 $453,795 $435,550 $543,312 $667,984
Net Worth $33,700 $1,686 ($30,318) ($40,612) $29,103 $44,729 $65,789 $97,709 $129,639 $161,579 $188,628 $222,688 $270,757

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