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Emerald Driving Range

Executive Summary

Emerald Driving Range (Emerald, EDR) is a new enterprise that provides state-of-the-art facilities that accommodate golfers of all levels. A first-class driving range with slots for 50 golfers along with two chipping greens and two putting greens will be available. EDR will focus on providing practice opportunities for golfers of all abilities. There will be a PGA Teaching Pro to give lessons on a daily basis. We will have a concessions area that will provide a variety of drinks and snack foods for golfers who need to take a break.

It is our purpose to set a strategic direction for our future and this is the primary purpose of this business plan. It will address location, finance, and service issues that will be key to the future success of the business. This process is challenging from the standpoint that there are several other driving ranges in the community and we are a start-up enterprise. What we have to offer in facilities is unique to the industry, and we are excited to serve the community.

Our market strategy is based on becoming a viable choice for people looking for a place to practice every aspect of the game of golf. The three target market segments Emerald is focusing on are Children, Adults, and Schools. Golf is becoming increasingly popular with children at younger ages. We will have programs in place to meet the needs of kids wanting to learn the game of golf. Our facility will also appeal to adults of all levels who want a quality place to practice or take lessons. Emerald will also build relationships with local schools and universities to hold classes at the range, and to use it as a practice facility for their golf teams. The marketing objective is to actively support continued growth and profitability through effective implementation of the strategy.

1.1 Mission

Emerald Driving Range is dedicated to providing a practice facility that is committed to serving golfers, both advanced and novice. It is our purpose to manage a facility that will help golfers of all levels develop their game. Emerald will strive to make each customer feel that they are important to our business and will give each customer value for their dollar. Emerald realizes that each employee is a valuable asset to the company and will encourage a team atmosphere and will treat each employee with respect.

1.2 Objectives

  1. Sales improving steadily through year three.
  2. Remarkably high Gross Margin.
  3. Net income/sales positively modest each year.
Golf driving range business plan, executive summary chart image

1.3 Keys to Success

  1. Provide excellent customer service with a proactive energetic staff.
  2. Provide a top notch facility that allows customers to work on every aspect of the game.
  3. Provide quality instruction from beginner to expert.
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Company Summary

Emerald Driving Range is a new enterprise that provides state-of-the-art facilities that will accommodate golfers of all levels. There will be an on-site PGA Teaching Pro giving lessons on a daily basis. Emerald will focus on providing practice opportunities to the recreational golfer as well as the serious competitive golfer. Arrangements will be made with local schools and universities to use the facility for their golf teams’ practices and golf classes. A first-class driving range is available with slots that accommodate 50 golfers at a time. Chipping greens with sand traps as well as two putting greens will be in place.

2.1 Start-up Summary

Total start-up expense (including development of facility) are shown below.  Long-term assets include a ball retrieving machine as well as other maintenance equipment. Other expenses include balls, clubs, towels, and misc. accessories. We will have a concessions area that will provide a variety of drinks and snack foods for golfers who need to take a break. The details are included in the following table.

Golf driving range business plan, company summary chart image

Start-up
Requirements
Start-up Expenses
Legal $1,000
Stationery etc. $500
Brochures $1,500
Consultants $3,000
Insurance $1,000
Rent $2,000
Research and Development $40,000
Expensed Equipment $10,000
Concessions $4,000
Total Start-up Expenses $63,000
Start-up Assets
Cash Required $40,000
Other Current Assets $0
Long-term Assets $27,000
Total Assets $67,000
Total Requirements $130,000
Start-up Funding
Start-up Expenses to Fund $63,000
Start-up Assets to Fund $67,000
Total Funding Required $130,000
Assets
Non-cash Assets from Start-up $27,000
Cash Requirements from Start-up $40,000
Additional Cash Raised $0
Cash Balance on Starting Date $40,000
Total Assets $67,000
Liabilities and Capital
Liabilities
Current Borrowing $0
Long-term Liabilities $0
Accounts Payable (Outstanding Bills) $0
Other Current Liabilities (interest-free) $0
Total Liabilities $0
Capital
Planned Investment
Stan Walker $70,000
Fred Fast $30,000
Jim Spade $30,000
Additional Investment Requirement $0
Total Planned Investment $130,000
Loss at Start-up (Start-up Expenses) ($63,000)
Total Capital $67,000
Total Capital and Liabilities $67,000
Total Funding $130,000

2.2 Company Ownership

Emerald Driving Range will be created as a partnership with Stan Walker owning 60%, Fred Fast 20%, and Jim Spade 20%. Stan Walker will act as president, with Fred Fast and Jim Spade on the management team, handling marketing/advertising and concessions/vendors respectively.

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Services

Emerald Driving Range provides golfers with a practice facility that will focus on all aspects of the game. We welcome golfers of all abilities, and have an on-site professional to give instruction to those who wish to do so. We will offer a variety of beverages and snack foods for our patrons to enjoy while they take a break from practicing.

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Market Analysis Summary

Emerald Driving Range will be focusing on golfers at all levels and all ages who want a good quality practice facility.

Our target groups include children (ages 6-17), and we are developing a program for them to participate in. Golf is becoming more and more popular and as kids are beginning to participate at younger ages we would like to give them opportunities to learn the game. Another target group is adults, both male and female, who have an interest in either learning the game of golf, or getting better at it. The last target group is comprised of high schools, local colleges, and universities who want a facility to have classes and instruction, as well as train their golf teams. The need for a state-of-the-art driving range in this community has been apparent for many years and Emerald Driving Range intends to satisfy that need.

4.1 Market Segmentation

The profile of our customers consists of the following Psychographic and Demographic factors.

Adults

  • 70% male.
  • Age range of 18 years to 65.
  • Average annual household income of $70,000.
  • Professional/white collar worker.
  • Plays for business as well as pleasure.

Children

  • Age 7 – 17.
  • Parents play golf.
  • Play other sports in addition to golf.

Schools

  • School sizes range between 500 – 2,000 students for high schools in the area.
  • Community colleges and university have approximately 40,000 students combined.
  • 10% of the local schools are private institutions.
  • 40% of high schools and colleges/universities have an active golf team.
Golf driving range business plan, market analysis summary chart image

Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential Customers Growth CAGR
Adults 10% 50,000 55,000 60,500 66,550 73,205 10.00%
Children 10% 60,000 66,000 72,600 79,860 87,846 10.00%
Schools 10% 5,000 5,500 6,050 6,655 7,321 10.00%
Total 10.00% 115,000 126,500 139,150 153,065 168,372 10.00%

4.2 Target Market Segment Strategy

Our market strategy is based on becoming a viable of choice for people looking for a place to practice every aspect of the game of golf. We will have a resident professional with an assistant to assist those customers who wish to have lessons. The target markets are separated into three segments; “Children,” “Adults,” and “Schools”.

Children – Age range of 9 – 17 years of age. Most of the parents of these children also play golf. In addition to golf many of this group plays other sports. Most of these kids also come from middle to upper-class families.

Adults – This group has an age range of 18 – 59 years of age. 70% of this group are males (professional/white collar worker) with an annual household income in excess of $70,000 dollars. It is common for this group to play for business as well as pleasure. Many companies also use golf as a company event for its employees.

Schools – Many local high schools in the area have golf teams that need local practice facilities. With a university and community college in the area the need for convenient practice facilities exists. Working with these institutions to provide facilities to hold classes and practice will fill this need. Local high schools typically have 500 to 2,000 students. With ten schools in the area we are looking at approximately 15,000 students. Private schools only make up about 10% of the schools in the area. The university and community college have combined enrollments of approximately 40,000 students.

4.3 Service Business Analysis

The Driving Range business entails providing a facility that allows for practice in every aspect of the game. Driving, chipping, and putting.

4.3.1 Competition and Buying Patterns

With the increased popularity of golf and the limited number of practice facilities in the area, people will welcome another choice.

Main competitors:

  • Fiddler’s Green — Par 3 18-hole golf course with a driving range and clubhouse selling golf equipment. On-site professional is available to give lessons. Driving range is small but well equiped. Location is not convenient for many people as it is out of town a few miles.
  • Riveridge — Regulation 18-hole course with a large driving range and pro shop. Located in town, it is convenient to get to and is a well run facility.
  • Laurelwood — A large nine-hole municipal course with a small driving range and pro shop. Convenient in town location but the driving range is very small and outdated.

All of the driving ranges in the area also have golf courses as part of the facility. The quality of the golf course is usually one of the main draws for people to come and practice. Location also plays a big part in how many consumers choose their practice facility. Driving ranges with an on-site professional draw people who are looking for instruction.

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Strategy and Implementation Summary

The primary sales and marketing strategy includes these factors:

  • A quality practice facility that allows a golfer to work on every part of his or her game.
  • Availability of quality instruction by a certified PGA Teaching Professional.
  • Open facility to high schools, colleges and universities to hold classes and team practice sessions.

5.1 Competitive Edge

Emerald Driving Range believes its competitive edge lies with two main differentiators.

  1. We do not have to deal with the day-to-day operations of running a golf course, so we can give more attention to our customers, as well as give more focus to the facility itself.
  2. Our facility is set up to accommodate more golfers at a time than most of our competitors. Our customer service will be top notch and we will have a good variety of beverages and snack foods for customers.

5.2 Marketing Strategy

Our marketing strategy is based on becoming the preferred choice for golfers of all ages who are looking for a practice facility that focuses on all phases of the game. Our marketing strategy is based on superior service in the following areas:

  • Quality facilities.
  • Quality instruction.
  • Customer service.

Our marketing strategy will create interest and appeal from our target market for what we offer our customers. Once they come to our facility we have no doubt that they will not only come back, but will bring their friends as well.

5.3 Sales Strategy

The primary sales and marketing strategy includes these factor:

  • A satisfying practice experience that provides excellent facilities and top notch customer service.
  • An on-site professional to give lessons and individual instruction.
  • Excellent location that is convenient to get to.

5.3.1 Sales Forecast

The Sales Forecast is broken down into three main revenue streams: Driving Range & Practice Facilities, Concessions, and Professional Lessons. The Sales Forecast for the upcoming year is based on a modest 5% growth rate for each of these revenue streams. In spite of any economic unpredictability in the future, we expect to have at least a 5% growth increase in the following two years.

Golf driving range business plan, strategy and implementation summary chart image

Golf driving range business plan, strategy and implementation summary chart image

Sales Forecast
Year 1 Year 2 Year 3
Sales
Driving Range & Practice Facilities $491,000 $540,100 $594,110
Concessions $108,223 $113,634 $119,316
Professional Lessons $126,000 $132,300 $138,915
Total Sales $725,223 $786,034 $852,341
Direct Cost of Sales Year 1 Year 2 Year 3
Driving Range & Practice Facilities $0 $0 $0
Concessions $43,289 $45,454 $47,726
Professional Lessons $0 $0 $0
Subtotal Direct Cost of Sales $43,289 $45,454 $47,726

5.4 Milestones

The Milestones table outlines key activities that will be critical to our success in the coming year.

Golf driving range business plan, strategy and implementation summary chart image

Milestones
Milestone Start Date End Date Budget Manager Department
Business Plan 1/1/2003 1/15/2003 $500 Stan Management
Marketing & Advertising 2/20/2003 6/10/2003 $1,500 Fred Management
Lesson Schedule 8/21/2003 11/25/2003 $500 Joe Golf Pro
Sourcing Food Vendors 5/20/2003 6/8/2003 $1,000 Jim Management
Web Plan 3/15/2003 4/18/2003 $500 Fred Management
Accounting Plan 5/1/2003 5/30/2003 $500 Stan Management
Maintenance Plan 7/14/2003 8/28/2003 $500 Jerry Maintenance
Totals $5,000

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Management Summary

Stan Walker oversees all of the operations at Emerald Driving Range. Stan is the majority owner with Fred Fast and Jim Spade each 20% co-owners in the enterprise. Fred has the responsibility for the marketing and advertising of the business along with the creation and implementation of the Web page. Jim is responsible for overseeing the concessions which includes all ordering and dealing with vendors.

Stan also handles the accounting for the driving range. Stan Walker has 15 years experience working as an active manager for the prestigious Mckenzie Golf Club. Stan managed the day-to-day operations including the driving range. Golf instruction has been a passion of Stan’s and through years of planning the idea of Emerald Driving Range was seen to fruition. Fred and Jim also have worked in the industry for the last 20 years, each in management capacities. Jim managed the Spring Creek driving range and has been a personal friend of Stan’s for many years. Fred has spent the last 10 years in the advertising business working with a golf magazine.

6.1 Personnel Plan

The personnel plan consists of Stan Walker taking a salary of $48,000 per year. Fred Fast and Jim Spade will each draw $36,000 out of the business for their contributions. Fred and Jim are not working at the site full time but will share a percentage of the profits at the end of the year. There will be one full-time greenskeeper making $2,500 per month, four full-time employees making $2,000 per month, and four part-time employees working 16 hours per week each, making $10.00 per hour. Our resident golf pro Joe Bain will draw a salary of $4,000 per month and Joe’s assistant Todd Smith will work part-time at $1,500 per month.

Salary increases in year 2005 and 2006 will be set conservatively at 5% to mirror projected sales increases.

Personnel Plan
Year 1 Year 2 Year 3
Stan Walker $48,000 $50,400 $52,920
Part-time Employees $36,000 $47,250 $59,535
Full-time Employees $126,000 $165,375 $208,373
Fred Fast $36,000 $37,800 $39,690
Golf Pros $66,000 $69,300 $72,765
Jim Spade $36,000 $37,800 $39,690
Total People 14 16 18
Total Payroll $348,000 $407,925 $472,973

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Financial Plan

The financial plan contains these essential factors:

  • A growth rate in sales of 5% for the year 2005, to $786,000 in total revenues.
  • An average sales per business day (340 days per year) in excess of $2,300.

Difficulties and Risks:

  • Slow sales resulting in less-than projected cash flow.
  • A parallel entry into the market by another competitor.
  • Unexpected cost increases compared with the forecasted sales.

7.1 Important Assumptions

The following assumptions will determine the potential for future success.

  • A healthy economy that supports a moderate level of growth in our market.
  • The ability to maintain at least a 5% growth each year.
  • Keeping operating costs low, particularly in the area of personnel and ongoing monthly expenses.
General Assumptions
Year 1 Year 2 Year 3
Plan Month 1 2 3
Current Interest Rate 8.00% 8.00% 8.00%
Long-term Interest Rate 7.50% 7.50% 7.50%
Tax Rate 28.17% 28.00% 28.17%
Other 0 0 0

7.2 Break-even Analysis

The following chart and table summarize our break-even analysis. We don’t really expect to reach break-even until a few months into the business operation. We will be charging $4.00 for a bucket of balls and we speculate that if for every two buckets of balls purchased we sell one drink at a cost of $2.00 we will have an average cost per unit of 25%.

Golf driving range business plan, financial plan chart image

Break-even Analysis
Monthly Revenue Break-even $43,860
Assumptions:
Average Percent Variable Cost 6%
Estimated Monthly Fixed Cost $41,242

7.3 Projected Profit and Loss

The following represents the projected profit and loss for Emerald Driving Range based on sales and expense projections for 2004 and beyond.

Golf driving range business plan, financial plan chart image

Golf driving range business plan, financial plan chart image

Golf driving range business plan, financial plan chart image

Golf driving range business plan, financial plan chart image

Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $725,223 $786,034 $852,341
Direct Cost of Sales $43,289 $45,454 $47,726
Other Costs of Sales $0 $0 $0
Total Cost of Sales $43,289 $45,454 $47,726
Gross Margin $681,934 $740,581 $804,615
Gross Margin % 94.03% 94.22% 94.40%
Expenses
Payroll $348,000 $407,925 $472,973
Sales and Marketing and Other Expenses $12,000 $17,000 $27,000
Depreciation $1,704 $1,714 $1,714
Rent $48,000 $36,000 $36,000
Utilities $12,000 $13,000 $13,000
Insurance $12,000 $13,000 $13,000
Payroll Taxes $52,200 $61,189 $70,946
Other $9,000 $10,000 $11,000
Total Operating Expenses $494,904 $559,828 $645,633
Profit Before Interest and Taxes $187,030 $180,753 $158,982
EBITDA $188,734 $182,467 $160,696
Interest Expense $0 $0 $0
Taxes Incurred $51,964 $50,611 $44,780
Net Profit $135,066 $130,142 $114,202
Net Profit/Sales 18.62% 16.56% 13.40%

7.4 Projected Cash Flow

The cash flow projections are outlined below. Again, these projections are based on our basic assumptions with revenue generation factors carrying the most significant weight regarding the outcome.

Golf driving range business plan, financial plan chart image

Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $725,223 $786,034 $852,341
Cash from Receivables $0 $0 $0
Subtotal Cash from Operations $725,223 $786,034 $852,341
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 $725,223 $786,034 $852,341
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $348,000 $407,925 $472,973
Bill Payments $227,159 $239,307 $262,039
Subtotal Spent on Operations $575,159 $647,232 $735,012
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 $40,000 $40,000
Subtotal Cash Spent $575,159 $687,232 $775,012
Net Cash Flow $150,064 $98,802 $77,329
Cash Balance $190,064 $288,866 $366,196

7.5 Projected Balance Sheet

Emerald Driving Range’s balance sheet is outlined below.

Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $190,064 $288,866 $366,196
Accounts Receivable $0 $0 $0
Other Current Assets $0 $0 $0
Total Current Assets $190,064 $288,866 $366,196
Long-term Assets
Long-term Assets $27,000 $27,000 $27,000
Accumulated Depreciation $1,704 $3,418 $5,132
Total Long-term Assets $25,296 $23,582 $21,868
Total Assets $215,360 $312,448 $388,064
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $13,294 $20,240 $21,654
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $13,294 $20,240 $21,654
Long-term Liabilities $0 $0 $0
Total Liabilities $13,294 $20,240 $21,654
Paid-in Capital $130,000 $130,000 $130,000
Retained Earnings ($63,000) $32,066 $122,208
Earnings $135,066 $130,142 $114,202
Total Capital $202,066 $292,208 $366,410
Total Liabilities and Capital $215,360 $312,448 $388,064
Net Worth $202,066 $292,208 $366,410

7.6 Business Ratios

Business Ratios for the years of this plan are shown below. Industry profile ratios based on the Standard Industrial Classification (SIC) code 7999-0202 Driving Ranges are shown for comparison. The following will enable us to keep on track. If we fail in any of these areas, we will need to re-evaluate our business model.

  • Gross margins at or above 80%.
  • Month-to-month annual comparisons indicate an increase of 5% or greater.
  • Do not depend on a credit line to meet cash requirements.
Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 8.39% 8.44% 5.73%
Percent of Total Assets
Accounts Receivable 0.00% 0.00% 0.00% 7.08%
Other Current Assets 0.00% 0.00% 0.00% 33.26%
Total Current Assets 88.25% 92.45% 94.36% 43.21%
Long-term Assets 11.75% 7.55% 5.64% 56.79%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 6.17% 6.48% 5.58% 21.91%
Long-term Liabilities 0.00% 0.00% 0.00% 28.81%
Total Liabilities 6.17% 6.48% 5.58% 50.72%
Net Worth 93.83% 93.52% 94.42% 49.28%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 94.03% 94.22% 94.40% 100.00%
Selling, General & Administrative Expenses 75.46% 77.66% 80.97% 76.43%
Advertising Expenses 0.00% 0.00% 0.00% 2.77%
Profit Before Interest and Taxes 25.79% 23.00% 18.65% 1.89%
Main Ratios
Current 14.30 14.27 16.91 1.18
Quick 14.30 14.27 16.91 0.80
Total Debt to Total Assets 6.17% 6.48% 5.58% 61.12%
Pre-tax Return on Net Worth 92.56% 61.86% 43.39% 1.76%
Pre-tax Return on Assets 86.85% 57.85% 40.97% 4.52%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin 18.62% 16.56% 13.40% n.a
Return on Equity 66.84% 44.54% 31.17% n.a
Activity Ratios
Accounts Receivable Turnover 0.00 0.00 0.00 n.a
Collection Days 0 0 0 n.a
Accounts Payable Turnover 18.09 12.17 12.17 n.a
Payment Days 27 25 29 n.a
Total Asset Turnover 3.37 2.52 2.20 n.a
Debt Ratios
Debt to Net Worth 0.07 0.07 0.06 n.a
Current Liab. to Liab. 1.00 1.00 1.00 n.a
Liquidity Ratios
Net Working Capital $176,770 $268,626 $344,542 n.a
Interest Coverage 0.00 0.00 0.00 n.a
Additional Ratios
Assets to Sales 0.30 0.40 0.46 n.a
Current Debt/Total Assets 6% 6% 6% n.a
Acid Test 14.30 14.27 16.91 n.a
Sales/Net Worth 3.59 2.69 2.33 n.a
Dividend Payout 0.00 0.31 0.35 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
Driving Range & Practice Facilities 0% $13,000 $16,000 $22,000 $30,000 $44,000 $52,000 $61,000 $61,000 $59,000 $56,000 $45,000 $32,000
Concessions 0% $5,000 $5,000 $8,820 $9,261 $9,724 $10,210 $10,721 $11,257 $11,820 $12,411 $9,000 $5,000
Professional Lessons 0% $5,000 $5,000 $8,000 $10,000 $11,000 $12,000 $15,000 $16,000 $15,000 $14,000 $10,000 $5,000
Total Sales $23,000 $26,000 $38,820 $49,261 $64,724 $74,210 $86,721 $88,257 $85,820 $82,411 $64,000 $42,000
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
Driving Range & Practice Facilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Concessions $2,000 $2,000 $3,528 $3,704 $3,890 $4,084 $4,288 $4,503 $4,728 $4,964 $3,600 $2,000
Professional Lessons $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Direct Cost of Sales $2,000 $2,000 $3,528 $3,704 $3,890 $4,084 $4,288 $4,503 $4,728 $4,964 $3,600 $2,000
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
Stan Walker 0% $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000
Part-time Employees 0% $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Full-time Employees 0% $10,500 $10,500 $10,500 $10,500 $10,500 $10,500 $10,500 $10,500 $10,500 $10,500 $10,500 $10,500
Fred Fast 0% $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Golf Pros 0% $5,500 $5,500 $5,500 $5,500 $5,500 $5,500 $5,500 $5,500 $5,500 $5,500 $5,500 $5,500
Jim Spade 0% $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Total People 14 14 14 14 14 14 14 14 14 14 14 14
Total Payroll $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000

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 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00% 8.00%
Long-term Interest Rate 7.50% 7.50% 7.50% 7.50% 7.50% 7.50% 7.50% 7.50% 7.50% 7.50% 7.50% 7.50%
Tax Rate 30.00% 28.00% 28.00% 28.00% 28.00% 28.00% 28.00% 28.00% 28.00% 28.00% 28.00% 28.00%
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 $23,000 $26,000 $38,820 $49,261 $64,724 $74,210 $86,721 $88,257 $85,820 $82,411 $64,000 $42,000
Direct Cost of Sales $2,000 $2,000 $3,528 $3,704 $3,890 $4,084 $4,288 $4,503 $4,728 $4,964 $3,600 $2,000
Other Costs of Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Cost of Sales $2,000 $2,000 $3,528 $3,704 $3,890 $4,084 $4,288 $4,503 $4,728 $4,964 $3,600 $2,000
Gross Margin $21,000 $24,000 $35,292 $45,557 $60,834 $70,126 $82,432 $83,754 $81,092 $77,446 $60,400 $40,000
Gross Margin % 91.30% 92.31% 90.91% 92.48% 93.99% 94.50% 95.06% 94.90% 94.49% 93.98% 94.38% 95.24%
Expenses
Payroll $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000
Sales and Marketing and Other Expenses $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000
Depreciation $142 $142 $142 $142 $142 $142 $142 $142 $142 $142 $142 $142
Rent $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000
Utilities $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000
Insurance $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000
Payroll Taxes 15% $4,350 $4,350 $4,350 $4,350 $4,350 $4,350 $4,350 $4,350 $4,350 $4,350 $4,350 $4,350
Other $750 $750 $750 $750 $750 $750 $750 $750 $750 $750 $750 $750
Total Operating Expenses $41,242 $41,242 $41,242 $41,242 $41,242 $41,242 $41,242 $41,242 $41,242 $41,242 $41,242 $41,242
Profit Before Interest and Taxes ($20,242) ($17,242) ($5,950) $4,315 $19,592 $28,884 $41,190 $42,512 $39,850 $36,204 $19,158 ($1,242)
EBITDA ($20,100) ($17,100) ($5,808) $4,457 $19,734 $29,026 $41,332 $42,654 $39,992 $36,346 $19,300 ($1,100)
Interest Expense $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Taxes Incurred ($6,073) ($4,828) ($1,666) $1,208 $5,486 $8,088 $11,533 $11,903 $11,158 $10,137 $5,364 ($348)
Net Profit ($14,169) ($12,414) ($4,284) $3,107 $14,107 $20,797 $29,657 $30,609 $28,692 $26,067 $13,794 ($894)
Net Profit/Sales -61.61% -47.75% -11.04% 6.31% 21.79% 28.02% 34.20% 34.68% 33.43% 31.63% 21.55% -2.13%

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 $23,000 $26,000 $38,820 $49,261 $64,724 $74,210 $86,721 $88,257 $85,820 $82,411 $64,000 $42,000
Cash from Receivables $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash from Operations $23,000 $26,000 $38,820 $49,261 $64,724 $74,210 $86,721 $88,257 $85,820 $82,411 $64,000 $42,000
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 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash Received $23,000 $26,000 $38,820 $49,261 $64,724 $74,210 $86,721 $88,257 $85,820 $82,411 $64,000 $42,000
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 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000 $29,000
Bill Payments $268 $8,069 $9,429 $14,064 $17,161 $21,569 $24,393 $27,941 $28,489 $27,960 $26,997 $20,821
Subtotal Spent on Operations $29,268 $37,069 $38,429 $43,064 $46,161 $50,569 $53,393 $56,941 $57,489 $56,960 $55,997 $49,821
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 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
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 $29,268 $37,069 $38,429 $43,064 $46,161 $50,569 $53,393 $56,941 $57,489 $56,960 $55,997 $49,821
Net Cash Flow ($6,268) ($11,069) $391 $6,197 $18,563 $23,642 $33,327 $31,316 $28,331 $25,451 $8,003 ($7,821)
Cash Balance $33,732 $22,664 $23,055 $29,252 $47,815 $71,457 $104,784 $136,100 $164,431 $189,882 $197,885 $190,064
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 $40,000 $33,732 $22,664 $23,055 $29,252 $47,815 $71,457 $104,784 $136,100 $164,431 $189,882 $197,885 $190,064
Accounts Receivable $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Current Assets $40,000 $33,732 $22,664 $23,055 $29,252 $47,815 $71,457 $104,784 $136,100 $164,431 $189,882 $197,885 $190,064
Long-term Assets
Long-term Assets $27,000 $27,000 $27,000 $27,000 $27,000 $27,000 $27,000 $27,000 $27,000 $27,000 $27,000 $27,000 $27,000
Accumulated Depreciation $0 $142 $284 $426 $568 $710 $852 $994 $1,136 $1,278 $1,420 $1,562 $1,704
Total Long-term Assets $27,000 $26,858 $26,716 $26,574 $26,432 $26,290 $26,148 $26,006 $25,864 $25,722 $25,580 $25,438 $25,296
Total Assets $67,000 $60,590 $49,380 $49,629 $55,684 $74,105 $97,605 $130,790 $161,964 $190,153 $215,462 $223,323 $215,360
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 $7,760 $8,963 $13,497 $16,445 $20,760 $23,463 $26,991 $27,556 $27,053 $26,295 $20,362 $13,294
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 $7,760 $8,963 $13,497 $16,445 $20,760 $23,463 $26,991 $27,556 $27,053 $26,295 $20,362 $13,294
Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Liabilities $0 $7,760 $8,963 $13,497 $16,445 $20,760 $23,463 $26,991 $27,556 $27,053 $26,295 $20,362 $13,294
Paid-in Capital $130,000 $130,000 $130,000 $130,000 $130,000 $130,000 $130,000 $130,000 $130,000 $130,000 $130,000 $130,000 $130,000
Retained Earnings ($63,000) ($63,000) ($63,000) ($63,000) ($63,000) ($63,000) ($63,000) ($63,000) ($63,000) ($63,000) ($63,000) ($63,000) ($63,000)
Earnings $0 ($14,169) ($26,584) ($30,868) ($27,761) ($13,655) $7,142 $36,799 $67,408 $96,100 $122,167 $135,961 $135,066
Total Capital $67,000 $52,831 $40,416 $36,132 $39,239 $53,345 $74,142 $103,799 $134,408 $163,100 $189,167 $202,961 $202,066
Total Liabilities and Capital $67,000 $60,590 $49,380 $49,629 $55,684 $74,105 $97,605 $130,790 $161,964 $190,153 $215,462 $223,323 $215,360
Net Worth $67,000 $52,831 $40,416 $36,132 $39,239 $53,345 $74,142 $103,799 $134,408 $163,100 $189,167 $202,961 $202,066

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