Our goal is to acquire a business loan for 10 years. Our present plan is to utilize the borrowed money for the first year's operating capital, with cash input on a monthly basis. Such cash input will aid our operating costs and salaries. We should reach our break-even point after our first year. Upon receiving our loan, we would like to incorporate, as this will protect our company, investors, lenders, products, and stockholders. We expect sales to be healthy the first year, and grow steadily through the third year.
If sales don't measure up to our expectations, this could add an additional six months and an influx of another $20,000, which could be carried by credit card, but we don't expect this to happen.
These are our strong points:
The financial plan depends on important assumptions, most of which are shown in the General Assumptions table. The key underlying assumptions are:
Aside from the standard financial break-even shown, the following is a simplified breakdown of our first year's overall numbers in broad terms:
|First Year's Projected Sales:||$473,843|
|Less 25%Tax:||- $11,846|
|Less Production Costs:||-$129,520|
|Less Operating Costs:||- $71,450|
|Plus Loan:||$ 50,000|
|Cash at end of the first year:||$311,027|
|Production Costs for Year 2001:||-$281,065|
|Projected Profit 1st Year:||$29,962|
Our goal is to acquire a business loan for a total of ten years. Our present plan is to utilize the borrowed money for the first year's operating expenses, with cash input on a monthly basis. Such cash input will aid in our advertising, operating costs, and salaries. This loan should help us maintain production and operating costs while developing our customer base and sales. Should sales lag, we plan to maintain solvency with credit card financing. We should reach our break-even point after our first year. Our sales projection is very conservative, considering the sales potential.
As shown on the balance sheet in the following table, we expect a healthy growth in the net worth by the end of the third year.
Standard business ratios are included in the table, based on NAICS code 339920 for the Sporting and Athletic Goods Manufacturing industry. The ratio shows a plan for balanced and healthy growth.