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Load Hog

Executive Summary

Load Hog Inc. (Load Hog) was organized in December, 1997 by John and Carol Kowalski. The company is an automotive after-market manufacturer of a revolutionary patented device that turns ordinary pickup trucks into full-on dump trucks. This ingenious pneumatic device is invisible when not in use, weighs only 120 pounds when installed, and is virtually maintenance free. The concept of the pneumatic hoist was pioneered in New Zealand in the late 70’s and early 80’s. This device utilized the exhaust gasses of the applied vehicle to fill the lifting envelope and hoist the bed. The obvious perils of the original concept have been ironed out by Load Hog with the inclusion of an on-board air compressor.

Load Hog is interested in securing $4 million in staged capital over an 18-month period to execute an aggressive public relations and advertising campaign to educate the truck owning and buying public about the capabilities, cost, application, and availability of the Load Hog Program. These funds will be used in the initialization of the advertising and public relations plan which will use $40,000 in its first phase. The balance of the first phase of funding will be to support additions to the management staff (Sales Manager), additional inventory, manufacturing equipment, and continuing operations.

Phase I:  $175,000  This phase has been accomplished with debt capital and has been committed and closed.

Phase II:  $200,000  This phase is scheduled to be accomplished with additional debt, and is committed.

Phase III & IV: $1 million/$17 million. These phases will be accomplished with a combination of debt and equity. The use of these funds will continue the marketing and sales push, build the number of company sales personnel, continue operations expansion with the purchase of new capital equipment, expand manufacturing operations, and provide working capital to respond to the rapidly increasing demand. Recent commitments by Ford to include Load Hog in the Super Duty Dealer Ordering Guide for Model Year 2002 will bolster our revenues, as reflected in the appendix**.

The purpose of the phased approach to funding is that it allows the organization to assimilate new business and grow at a measured and structured pace. Each sequential phase is built into the growth strategy, and each element can be pursued as an individual transaction, or should a single investor be interested, structure a longer-term transaction. Bringing in a sales manager will allow the current staff and president the time to react to potential investors, as well as honing assembly and procurement operations, engineering upgrades, and new product development.

**appendix were not available for this sample plan.

Lift bed manufacturer business plan, executive summary chart image

1.1 Keys to Success

The company’s further success will depend on the following factors:

  • Securing required financing for the marketing and product development efforts.
  • Improving name recognition.
  • Strengthening original equipment manufacturer (OEM) relationships and building the distribution network.
  • Supply chain management to ensure uninterrupted component sourcing.

1.2 Mission

The Load Hog corporate mission is to educate the truck owning public about how to realize the full utility of their vehicle using our product. Strategically, we have positioned ourselves at the top of the quality pyramid featuring a combination of superb technology, extraordinary customer service, and an almost fanatic attention to quality assurance. Underpinning our strategy is continued research and development related to our existing product and extending our offering in response to customer demand and breadth of market. We will be supported in this growth by our field force, advertising, public relations, and our growing e-commerce effort. Additionally, we will continue our trade show presence at local, regional, and national levels.

1.3 Objectives

Load Hog is located in a single facility in Aliquippa, PA, which includes approximately 1,200 square feet of office space and 8,600 square feet of manufacturing and assembly space. The present plant is adequate, but as we ramp up there is ample office and manufacturing space available within walking distance, and at a comparable price to the current facility.

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Company Summary

Load Hog was founded in 1997 by John and Carol Kowalski, who are majority shareholders. Over the last three years the company has developed, manufactured, and patented a unique kit that converts an ordinary pickup truck into a full-on dump truck.

2.1 Company Ownership

Load Hog is a Subchapter S, Pennsylvania Corporation majority owned (91%) by John and Carol Kowalski. Two members of the Board of Directors own the minority position (nine percent).

2.2 Company History

It took Load Hog over a year to design and start manufacturing its products. In 1998, all of the operating expenses were incurred by the product design and development efforts. The first experimental kits were sold in 1999, with most of the year spent on product improvements. In 2000, the company started marketing the full spectrum of its products in the U.S.

Lift bed manufacturer business plan, company summary chart image

Past Performance
1998 1999 2000
Sales $0 $3,591 $205,697
Gross Margin $0 ($12,302) $124,814
Gross Margin % 0.00% -342.58% 60.68%
Operating Expenses $18,000 $392,327 $270,385
Collection Period (days) 0 0 0
Inventory Turnover 0.00 0.00 0.00
Balance Sheet
1998 1999 2000
Current Assets
Cash $1,832 $1,426 $2,806
Accounts Receivable $0 $0 $26,591
Inventory $1,200 $112,755 $187,673
Other Current Assets $0 $2,842 $5,418
Total Current Assets $3,032 $117,023 $222,488
Long-term Assets
Long-term Assets $15,201 $470,722 $362,502
Accumulated Depreciation $0 $48,346 $68,330
Total Long-term Assets $15,201 $422,376 $294,172
Total Assets $18,233 $539,399 $516,660
Current Liabilities
Accounts Payable $0 $39,916 $74,002
Current Borrowing $0 $5,536 $385,239
Other Current Liabilities (interest free) $0 $0 $0
Total Current Liabilities $0 $45,452 $459,241
Long-term Liabilities $0 $524,427 $421,710
Total Liabilities $0 $569,879 $880,951
Paid-in Capital $382,581 $371,931 $375,886
Retained Earnings ($364,348) ($357,918) ($686,386)
Earnings $0 ($44,493) ($53,791)
Total Capital $18,233 ($30,480) ($364,291)
Total Capital and Liabilities $18,233 $539,399 $516,660
Other Inputs
Payment Days 0 0 0
Sales on Credit $0 $0 $0
Receivables Turnover 0.00 0.00 0.00

2.3 Company Locations and Facilities

The 50 million registered, 5 million unregistered, and the 3 million new pickup trucks produced annually represent a rich target environment in which to operate.

Keeping the market size in mind, Load Hog offers a kit which extends and enhances the working attributes and capabilities of virtually any pickup truck. Load Hog’s conversion kit will rewrite the book on getting full utility from any pickup truck.

Load Hog has designed, patented, manufactured, and is marketing a revolutionary kit that converts an ordinary pickup truck into a full-on DUMP TRUCK.

Load Hog has juxtaposed off-the-shelf components and applied the soundest development principles to create a product of the highest quality and engineering integrity. Load Hog is not only establishing the market for this product, but also the standard by which all subsequent entrants will be measured.

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Products

Load Hog designs, manufacturers, and distributes devices for lifting loads on light and medium trucks and trailers.

3.1 Product Description

  1. The principal product is the Load Hog Pickup Truck Kit. Packaged in a single carton, this kit includes all the material necessary to turn any pickup truck into a full-on dump truck. Lightweight, maintenance free, and easy to use, the kit is virtually invisible when installed. The product retails for approximately $2,800. Wholesale averages $1,620 per unit.

  2. Load Hog builds a Trailer/Flatbed Kit for use on other than normal pickup truck applications. This kit is sold both in single unit packages and to OEM trailer builders. This kit retails for approximately $1,500 and wholesale for approximately $930.

  3. Load Hog has developed a proprietary receiver hitch trade named “Razorback,” retailing for approximately $300. Wholesale on this product is $205.

  4. Load Hog has developed a tailgate gap cover trade named “Liner Tongue,” which retails for $24.95 and wholesales for $12.47.

  5. Load Hog has also been engaged in providing body and lift kits to TORVEC International, a manufacturer of fast tracked vehicles primarily for export. The TORVEC sells for $3,650. (See appendix**) 

**appendix were not available for this sample plan.

3.2 Sourcing

Load Hog is primarily an assembler of outsourced components.

There are three principal areas of the product.

SHEET METAL

We have established relationships with several sheet metal suppliers, including Chase Industrial Products of Tarentum, PA., Trost Metal Products of Erie, PA, and Blackstone Manufacturing of Jamestown, NY. All three vendors have programmed our complex parts and are pursuing our business with vigor. Additionally, we now manage our own powder coating and have two vendors in H&S Coatings of Etna, PA and A-Plus Coatings of Columbiana,OH who can coat Load Hog Yellow to our standards.

LIFT CYLINDER & THRUST PLATES

This is the most critical element in our system. We have been working with Breton Industries, of Amsterdam, NY who sews the jackets (the ballistic nylon outer shell of the cylinder) and welds the urethane liner of the cylinder, and has for more than three years. Although Breton has the capacity to build 200 units per week, we have successfully sourced and tested jackets made by Five Filer Brothers of Grove City, PA, and bladders made by Evans Products of Akron, OH. Both Five Filer Brothers and Evans Products are capable of more than 200 units per week.

Our fiberglass thrust plates are made by another Pennsylvania company, Creative Pultrusions of Alum Bank, PA, another three-year veteran of our development program. Creative Pultrusions can produce more pultrusion than we can ever absorb. Pultrusion is a commodity product, and there are many suppliers ready, willing and able to secure a new customer.

COMPRESSOR

The area we could be most vulnerable to a supply chain interruption could be our compressor. Although comprised of several components, including a motor which we are double-sourced with both Prestolite Motors of Wagoner, OK, and Fasco Motors of Eaton Rapids, MI, and our dump valve from Parker-Hannifin of Pascagoula, MS and Horton of Upper St.Clair, PA, our dependence on Westmoor, LTD of Sherrill, NY, who is a smaller business, could be a critical interruption to our process if a catastrophic occurrence were to happen at their single facility. In light of that, we are exploring alternatives with Gast Manufacturing of Detroit, MI, Blackmur of Grand Rapids, MI, and Thomas Pumps of Rochester, MI. All three vendors make a comparable offering to the Westmoor #2 and have a nominal adaption to standard product to make them usable for our program.

3.3 Technology

Although Load Hog is not a hi-tech product, we continue to develop and patent proprietary technologies that relate to the bag and hinging system, as well as the pump system. (See appendix for patents.**)

For the moment, Load Hog has a full plate keeping up with the manufacturers newest designs in pickup trucks and trailers. The Load Hog II is the small truck (Ranger, S-10, Dakota, etc.) alternative and should keep us busy through calendar 2000. Most of the fiscal capital necessary for the development of these projects has already been expended. The balance of the resources are primarily intellectual.

Skunk works projects include a Leviathan lifter for loads of 50 tons or more and some flotation devices for marine applications. These are principally discussion projects and unless a killer marketing reason appears they will stay primarily intellectual exercises.

**appendix not available for this sample plan.

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Market Analysis Summary

Load Hog’s target market is the 50 million registered pickup truck owners in the U.S. Additionally, we will become the premier OEM supplier of light trailer lift kits. The market has no geographical boundaries, but we will target the upper-priced end of the marketplace.

Potential applications:

  • Landscaping
  • Agriculture
  • Federal, State, and Municipal Governments
  • Universities and Colleges
  • Golf and Recreation Facilities
  • Military Construction/All Trades
  • Firewood and Lumber Suppliers
  • Refuse Removal 
  • Excavators/Demolition
  • Rental Market

4.1 Market Segmentation

Load Hog focuses its market offerings on the registered truck owners. Major customer segments of this 50 million person users market are individual truck owners, as well as construction, governmental, and agricultural truck owners. These customers segments, which show strong growth trends, spend substantial amounts on after market vehicle improvement and personalization.

The chart and table below outline the total market potential for Load Hog’s products in the U.S.

Lift bed manufacturer business plan, market analysis summary chart image

Market Analysis
2001 2002 2003 2004 2005
Potential Customers Growth CAGR
Construction 2% 5,000,000 5,100,000 5,202,000 5,306,040 5,412,161 2.00%
Government 2% 2,000,000 2,040,000 2,080,800 2,122,416 2,164,864 2.00%
Individuals 10% 30,000,000 33,000,000 36,300,000 39,930,000 43,923,000 10.00%
Agriculture 4% 10,000,000 10,400,000 10,816,000 11,248,640 11,698,586 4.00%
Other services 10% 3,000,000 3,300,000 3,630,000 3,993,000 4,392,300 10.00%
Total 7.83% 50,000,000 53,840,000 58,028,800 62,600,096 67,590,911 7.83%

4.2 Target Market Segment Strategy

Load Hog will focus on both individual and certain business truck owners who represent the lion’s share of the market. These segments are more likely to have demanding requirements for easy-to-install dump capabilities, which are best suited for Load Hog’s positioning as the market leader. At the same time, these customer segments are less price sensitive and are more likely to be installing high priced devices to increase vehicle utilization.

4.2.1 Market Needs

All customer segments, although diverse in nature, seek ways to increase vehicle utilization. For business users, full-on dump attributes will provide convenience and cost reduction. Individual users value vehicle personalization options inherent in the full-on dump capabilities as well as convenience.

4.3 Industry Analysis

The automotive after market has developed as a result of the American love affair with their cars and trucks, and the compelling need by a significant number of vehicle owners to personalize these vehicles. The total after market industry is a $260 billion market comprised of more than 90,000 manufacturers growing at a 12% rate year after year. The fact that the pickup truck is the fastest growing segment of the light vehicle market has made this segment a significant component as on average, approximately $1,700 is spent in the first year of ownership on a new pickup for after market product.

4.3.1 Competition and Buying Patterns

While there is no direct competition for either the Load Hog product or pneumatic technology, we have isolated three products that accomplish similar outcomes as “competitors.”

Venco VP6

The company claims this a la carte package to be boltable, save the reattachment of the bumper. At 270 pounds, this electric-over-oil, multiple-hinged, scissors assembly requires extensive plumbing and wiring. The unit retails at approximately $2,200. It is sold and installed by truck equipment specialty houses and requires approximately 20 hours to install; it has very nearly the dump angle and capacity of a Load Hog kit.

E-Z Dumper

Weighing in at over 600 pounds, this electric-over-oil insert robs significant payload and still requires extensive electrical interface. An additional battery is also suggested, adding even more weight. Both the electrics and oil plumbing require frequent maintenance. The unit is notoriously noisy and unsightly. The unit has an advertised capacity of 4,000 pounds and a maximum tilt angle of 40 degrees. It is retailed through truck equipment houses for approximately $3,000, and is clearly not for the casual user.

Uni-Hoist

Similar to the Venco unit, this device weighs in at 300 pounds. The electric-over-oil scissors device also requires extensive plumbing and electrical hookups. Capacity and dump angle approach Load Hog specifications but operation in cooler weather (under 30 degrees) is, at best, suspect. This unit retails between $1800 and$2000, is sold through truck equipment dealers and requires an experienced and skilled fabricator to install, in a minimum of eighteen hours.

Our market research efforts have shown that customers’ major buying criteria include ease of installation, capacity and features, service, and price.

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Strategy and Implementation Summary

The overall sales strategy at Load Hog is to position ourselves at the top of the quality pyramid focusing additionally on our excellent technology and dedication to quality assurance and customer satisfaction. A main objective at Load Hog is to continue our research and development program focusing primarily on product improvement and secondarily on cost management. Because we enjoy a significant competitive edge, as a result of our lengthy technological lead, we will emphasize and feature the fact that Load Hog has created the market.

Load Hog has been featured editorially in more than forty publications including:

  • Popular Mechanics
  • Hot Rod
  • Newsweek
  • Sport Truck Accessory Digest
  • Trailer and Body Builders
  • Light and Medium Truck
  • Farming
  • Specialty Automotive
  • Truck Accessory News
  • Progressive Farmer.

Load Hog has been presented at more than 50 trade shows. These efforts to showcase the Load Hog Product have paid dividends in name recognition, which has blended well with the ongoing marketing and promotions implemented in house. Additional contracts are being negotiated for high-energy public relations and advertising to get the message out nationwide. Load Hog will also be featured on Sport Truck Connection, a syndicated television program and anchor program for TNN‘s weekend “Crank and Chrome” programming which will air in 258 markets nationwide.

Load Hog is is also building an Internet presence, www.loadhog.com, which adds an unknown, but very exciting, dimension to the sales effort. The analysis of our “hit ” count shows an average of more than 30,000 per month with no cross promotion. Load Hog is continuously reworking the site to improve eye appeal and ease navigability. Links to and from all distributors with websites have been initiated, and one distributor has even animated the Load Hog so that a customer can see it in action.

The Load Hog growth strategy is to enlarge the distributor base. There are essentially two profiles of distributor that have emerged from our sales efforts. The “small” distributor does not have the sales force to accomplish large territorial sweeps and will generally operate within a 25-mile trade radius. The advertising and promotional efforts done by this profile are generally home grown and linked to a corporate marketing effort. We anticipate three to four inventory turns in these stores if they are properly serviced by field representation. Our second profile of distributor is a much larger operator, with six to twenty sales personnel in the field and operating in a 100 to 200-mile trade radius. This distributor generally enjoys an excellent rapport with most of the new vehicle outlets and focuses on the wholesale and expediting customers in the area. With sophisticated advertising, extensive trade show presence, bailment operations, and consignment plans, these multi-location operators can deliver eight to ten inventory turns per year.

At this juncture, Load Hog is still operating with independent contract representatives. This particular breed does not always give a focused effort to a pioneer product. It is therefore of utmost importance that, as soon as economically possible, a switch to direct factory representation be made.

The recent committment by Ford Motor to include Load Hog in its Dealer Ordering Guide for the 2002 model year under its Vehicle Personalization option adds significant heft (3,000 units) to our plans going forward. Additionally, General Motors has been aggressively evaluating Liner Tongue for immediate inclusion in production. This could result in as many as 100,000 units per year. Although the OEM portion of our business was thought to be further down the road, we are going to be as aggressive as possible in expanding this opportunity going forward.

Load Hog is also entering into an agreement with American Media Group to promote Liner Tongue with an infomercial. This infomercial will air on a per inquiry (P.I.) basis with a sharing of profits after the absorption of wholesale costs.

5.1 Competitive Edge

Our technological lead gives us a substantial competitive edge over any possible competitor. Load Hog has established and defined the pneumatic truck lift market. However, if the market were to catch up, Load Hog also places the utmost importance on customer service and strict quality control. This provides another strong competitive advantage.

5.2 Sales Strategy

Our sales strategy revolves around enlarging our distributor base, gaining inclusion in catalog offerings (Stylin’ Concepts, J.C. Whitney, Reliable, Blacksmith, etc.) and our continuing efforts at OEM inclusion (Ford, GM, TORVEC, etc.), and our growing e-commerce effort.

Lift bed manufacturer business plan, strategy and implementation summary chart image

Sales Forecast
2001 2002 2003
Unit Sales
TORVEC 270 1,000 2,000
FORD 1,600 3,000 5,000
GM-LINER TONGUE 45,000 60,000 60,000
PICKUP TRUCK KITS 212 500 1,000
RAZORBACK 107 250 500
TRAILER KITS 20 50 200
LINER TONGUE 1,640 3,000 10,000
Total Unit Sales 48,849 67,800 78,700
Unit Prices 2001 2002 2003
TORVEC $3,652.00 $3,652.00 $3,652.00
FORD $1,570.00 $1,570.00 $1,570.00
GM-LINER TONGUE $12.52 $12.52 $12.52
PICKUP TRUCK KITS $1,620.00 $1,620.00 $1,620.00
RAZORBACK $205.00 $205.00 $205.00
TRAILER KITS $1,295.00 $1,295.00 $1,295.00
LINER TONGUE $16.20 $16.20 $16.20
Sales
TORVEC $986,040 $3,652,000 $7,304,000
FORD $2,512,000 $4,710,000 $7,850,000
GM-LINER TONGUE $563,400 $751,200 $751,200
PICKUP TRUCK KITS $343,440 $810,000 $1,620,000
RAZORBACK $21,935 $51,250 $102,500
TRAILER KITS $25,900 $64,750 $259,000
LINER TONGUE $26,568 $48,600 $162,000
Total Sales $4,479,283 $10,087,800 $18,048,700
Direct Unit Costs 2001 2002 2003
TORVEC $2,421.00 $2,421.00 $2,421.00
FORD $631.00 $631.00 $631.00
GM-LINER TONGUE $2.52 $2.52 $2.52
PICKUP TRUCK KITS $650.00 $650.00 $650.00
RAZORBACK $77.00 $77.00 $77.00
TRAILER KITS $543.00 $543.00 $543.00
LINER TONGUE $3.00 $3.00 $3.00
Direct Cost of Sales
TORVEC $653,670 $2,421,000 $4,842,000
FORD $1,009,600 $1,893,000 $3,155,000
GM-LINER TONGUE $113,400 $151,200 $151,200
PICKUP TRUCK KITS $137,800 $325,000 $650,000
RAZORBACK $8,239 $19,250 $38,500
TRAILER KITS $10,860 $27,150 $108,600
LINER TONGUE $4,920 $9,000 $30,000
Subtotal Direct Cost of Sales $1,938,489 $4,845,600 $8,975,300

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Management Summary

John Kowalski, Jr. Mr. Kowalski is the company president. Mr. Kowalski has more than 23 years of senior sales and senior executive experience. He has demonstrated success in sales, market share, and profitability growth, in addition to organizational design, fiscal control and general management. In co-founding Load Hog (with Carol Kowalski), he has utilized and developed a multitude of new skills and talents to research and develop the product, identify the market and put into operation the assembly, outsourcing system, fiscal, and production control systems the company currently uses.

Carol Kowalski. Mrs. Kowalski is the vice president and administration/controller for the company. With more than 25 years of administrative experience, Mrs. Kowalski has maintained the fiscal integrity of the company, as well as overseen the complex of insurance, human resource compliance, and extensive record keeping requirements needed for the progress of today’s organization. In addition, Mrs. Kowalski has negotiated and organized a superb freight handling and tracking system. She is highly regarded by field representatives and distributors for her knowledge of both the product and the sales and general administration she executes.

In addition, there is a manager of operations, a manager of production and installation, a regional manager, and an accounting manager in place within the company.

6.1 Management Growth/Action Plan

Load Hog has formulated and is implementing a plan to enhance and expand the managerial infrastructure of the company. The plan coordinates with the growth of the company and has as its objective minimizing the growing pains as Load Hog expands its reach.

There will be four management dimensions (departments) developed:

Manufacturing & Installation. This subdivision will be responsible for all assembly, packaging and in-house manufacturing. Additionally, this group will be responsible for warehousing, shipping, logistics, and inner company work-in-process transport (i.e. powdercoat) operations will fall under this jurisdiction. Local installation and installation training, as well as manufacturing process and Research and Development implementation, will be executed by this group.

Production Control-QA-Purchasing -Engineering. This multi-faceted group will be responsible for inventory, from concept to warranty. Besides concepting product improvement and cost reduction, the existing and new product development will eminate from here. This group will also be responsible for quality assurance and field service.

Sales & Marketing Management. Although these two disciplines require different skills and attitudes, they must both sing off the same song sheet. The long-range focus of the marketing function must communicate to the somewhat less long range objectives and focus of the sales force including both the factory representative component and the independent sales contractor. In the same spirit, the marketing organization must sensitize itself to the market feedback which is more immediate in nature eminating from the sales force on the ground. Both facets must have input and response to the e-commerce component as this vehicle will take both marketing and sales organizations into markets and customers they would never had thought of communicating with.

Audit & Control. The Audit & Control group will be the fiscal monitor of the entire effort and will maintain not only monitoring but notification responsibility among all our organizational subsets.

As Load Hog has recently retained department heads for both Manufacturing & Installation and Production Control, our objective is to find and retain a Sales & Marketing Manager and a bookeeper/accountant within the next sixty days .

6.2 Personnel Plan

The table below outlines the previously discussed staff needs.

Personnel Plan
2001 2002 2003
Production Personnel
Production Manager $21,600 $24,000 $56,000
Operations Manager $24,000 $28,000 $60,000
Other $54,000 $77,000 $150,000
Subtotal $99,600 $129,000 $266,000
Sales and Marketing Personnel
Marketing Manager $0 $60,000 $100,000
Administrator $0 $24,000 $35,000
Sales Manager $44,000 $50,000 $100,000
Regional Sales Manager $27,000 $35,000 $50,000
Regional Sales Manager $24,000 $32,000 $50,000
Regional Sales Manager $21,000 $60,000 $120,000
Subtotal $116,000 $261,000 $455,000
General and Administrative Personnel
Administrative Manager $36,000 $45,000 $55,000
Controller $18,000 $25,000 $35,000
Bookeeper $12,000 $18,000 $24,000
AR/AP $0 $36,000 $40,000
Subtotal $66,000 $124,000 $154,000
Other Personnel
ENGINEERING $0 $40,000 $50,000
PURCHASING $0 $30,000 $40,000
PRODUCTION CONTROL $0 $25,000 $50,000
R & D $0 $25,000 $50,000
Subtotal $0 $120,000 $190,000
Total People 12 20 50
Total Payroll $281,600 $634,000 $1,065,000

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Financial Plan

Our financial picture is encouraging. If we can secure the levels of financial support we are now seeking, we will be able to improve on forecasted results.

7.1 Important Assumptions

The financial plan depends on important assumptions, most of which are shown in the following table. The key underlying assumptions are as follows:

General Assumptions
2001 2002 2003
Plan Month 1 2 3
Current Interest Rate 12.00% 12.00% 12.00%
Long-term Interest Rate 10.00% 10.00% 10.00%
Tax Rate 25.42% 25.00% 25.42%
Other 0 0 0

7.2 Break-even Analysis

Our Break-even Analysis is based on true observed expenses over the last three years. Including payroll, rent, utilities, insurance, and basic marketing costs, our observation is that $80,000 is a realistic estimate.

Lift bed manufacturer business plan, financial plan chart image

Break-even Analysis
Monthly Units Break-even 1,554
Monthly Revenue Break-even $142,484
Assumptions:
Average Per-Unit Revenue $91.70
Average Per-Unit Variable Cost $39.68
Estimated Monthly Fixed Cost $80,822

7.3 Projected Profit and Loss

The company’s projected Income Statements are presented below.

Pro Forma Profit and Loss
2001 2002 2003
Sales $4,479,283 $10,087,800 $18,048,700
Direct Cost of Sales $1,938,489 $4,845,600 $8,975,300
Production Payroll $99,600 $129,000 $266,000
Comissions $67,577 $166,000 $325,000
Total Cost of Sales $2,105,666 $5,140,600 $9,566,300
Gross Margin $2,373,617 $4,947,200 $8,482,400
Gross Margin % 52.99% 49.04% 47.00%
Operating Expenses
Sales and Marketing Expenses
Sales and Marketing Payroll $116,000 $261,000 $455,000
Advertising/Promotion $323,171 $400,000 $500,000
Travel $84,000 $100,000 $200,000
Miscellaneous $69,000 $100,000 $125,000
Total Sales and Marketing Expenses $592,171 $861,000 $1,280,000
Sales and Marketing % 13.22% 8.54% 7.09%
General and Administrative Expenses
General and Administrative Payroll $66,000 $124,000 $154,000
Sales and Marketing and Other Expenses $0 $0 $0
Depreciation $72,000 $72,000 $72,000
Leased Equipment $18,784 $25,000 $60,000
Utilities/Phone/Postage $28,484 $90,000 $200,000
Insurance $37,440 $75,000 $100,000
Rent $22,500 $30,000 $50,000
Payroll Taxes $84,480 $190,200 $319,500
Other General and Administrative Expenses $0 $0 $0
Total General and Administrative Expenses $329,688 $606,200 $955,500
General and Administrative % 7.36% 6.01% 5.29%
Other Expenses:
Other Payroll $0 $120,000 $190,000
Consultants $0 $0 $0
Contract/Consultants $48,000 $30,000 $50,000
Total Other Expenses $48,000 $150,000 $240,000
Other % 1.07% 1.49% 1.33%
Total Operating Expenses $969,859 $1,617,200 $2,475,500
Profit Before Interest and Taxes $1,403,758 $3,330,000 $6,006,900
EBITDA $1,475,758 $3,402,000 $6,078,900
Interest Expense $137,050 $138,700 $124,900
Taxes Incurred $314,915 $797,825 $1,495,008
Net Profit $951,794 $2,393,475 $4,386,992
Net Profit/Sales 21.25% 23.73% 24.31%

7.4 Projected Cash Flow

The chart and table below outlines the projected annual Cash Flow for the first three years of this plan.

Lift bed manufacturer business plan, financial plan chart image

Pro Forma Cash Flow
2001 2002 2003
Cash Received
Cash from Operations
Cash Sales $0 $0 $0
Cash from Receivables $3,142,915 $8,381,237 $15,626,353
Subtotal Cash from Operations $3,142,915 $8,381,237 $15,626,353
Additional Cash Received
Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $175,000 $0 $0
New Other Liabilities (interest-free) $0 $0 $0
New Long-term Liabilities $500,000 $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 $3,817,915 $8,381,237 $15,626,353
Expenditures 2001 2002 2003
Expenditures from Operations
Cash Spending $281,600 $634,000 $1,065,000
Bill Payments $2,833,305 $7,681,212 $12,979,610
Subtotal Spent on Operations $3,114,905 $8,315,212 $14,044,610
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $75,000 $75,000 $75,000
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $48,000 $48,000 $48,000
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $3,237,905 $8,438,212 $14,167,610
Net Cash Flow $580,010 ($56,975) $1,458,743
Cash Balance $582,816 $525,842 $1,984,585

7.5 Projected Balance Sheet

Load Hog’s projected Balance Sheet is presented below.

Pro Forma Balance Sheet
2001 2002 2003
Assets
Current Assets
Cash $582,816 $525,842 $1,984,585
Accounts Receivable $1,362,959 $3,069,521 $5,491,868
Inventory $437,784 $1,094,318 $2,026,959
Other Current Assets $5,418 $5,418 $5,418
Total Current Assets $2,388,977 $4,695,099 $9,508,830
Long-term Assets
Long-term Assets $362,502 $362,502 $362,502
Accumulated Depreciation $140,330 $212,330 $284,330
Total Long-term Assets $222,172 $150,172 $78,172
Total Assets $2,611,149 $4,845,271 $9,587,002
Liabilities and Capital 2001 2002 2003
Current Liabilities
Accounts Payable $664,697 $628,345 $1,106,083
Current Borrowing $485,239 $410,239 $335,239
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $1,149,936 $1,038,584 $1,441,322
Long-term Liabilities $873,710 $825,710 $777,710
Total Liabilities $2,023,646 $1,864,294 $2,219,032
Paid-in Capital $375,886 $375,886 $375,886
Retained Earnings ($740,177) $211,617 $2,605,092
Earnings $951,794 $2,393,475 $4,386,992
Total Capital $587,503 $2,980,978 $7,367,970
Total Liabilities and Capital $2,611,149 $4,845,271 $9,587,002
Net Worth $587,503 $2,980,978 $7,367,970

7.6 Business Ratios

The company’s business ratios are presented below, the final column, Industry Profile, contains ratios for the motor vehicle parts and accessories industry, as determined by the standard industry classification (SIC) index code 3714, Motor Vehicle Parts and Accessories.

Ratio Analysis
2001 2002 2003 Industry Profile
Sales Growth 2077.61% 125.21% 78.92% 4.40%
Percent of Total Assets
Accounts Receivable 52.20% 63.35% 57.28% 24.50%
Inventory 16.77% 22.59% 21.14% 23.00%
Other Current Assets 0.21% 0.11% 0.06% 21.50%
Total Current Assets 91.49% 96.90% 99.18% 69.00%
Long-term Assets 8.51% 3.10% 0.82% 31.00%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 44.04% 21.43% 15.03% 38.20%
Long-term Liabilities 33.46% 17.04% 8.11% 14.20%
Total Liabilities 77.50% 38.48% 23.15% 52.40%
Net Worth 22.50% 61.52% 76.85% 47.60%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 52.99% 49.04% 47.00% 26.20%
Selling, General & Administrative Expenses 32.64% 25.96% 23.39% 15.10%
Advertising Expenses 7.21% 3.97% 2.77% 0.50%
Profit Before Interest and Taxes 31.34% 33.01% 33.28% 2.40%
Main Ratios
Current 2.08 4.52 6.60 1.86
Quick 1.70 3.47 5.19 1.01
Total Debt to Total Assets 77.50% 38.48% 23.15% 52.40%
Pre-tax Return on Net Worth 215.61% 107.06% 79.83% 5.40%
Pre-tax Return on Assets 48.51% 65.86% 61.35% 11.30%
Additional Ratios 2001 2002 2003
Net Profit Margin 21.25% 23.73% 24.31% n.a
Return on Equity 162.01% 80.29% 59.54% n.a
Activity Ratios
Accounts Receivable Turnover 3.29 3.29 3.29 n.a
Collection Days 55 80 87 n.a
Inventory Turnover 9.10 6.33 5.75 n.a
Accounts Payable Turnover 5.15 12.17 12.17 n.a
Payment Days 28 31 24 n.a
Total Asset Turnover 1.72 2.08 1.88 n.a
Debt Ratios
Debt to Net Worth 3.44 0.63 0.30 n.a
Current Liab. to Liab. 0.57 0.56 0.65 n.a
Liquidity Ratios
Net Working Capital $1,239,041 $3,656,516 $8,067,508 n.a
Interest Coverage 10.24 24.01 48.09 n.a
Additional Ratios
Assets to Sales 0.58 0.48 0.53 n.a
Current Debt/Total Assets 44% 21% 15% n.a
Acid Test 0.51 0.51 1.38 n.a
Sales/Net Worth 7.62 3.38 2.45 n.a
Dividend Payout 0.00 0.00 0.00 n.a

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Appendix

Sales Forecast
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Unit Sales
TORVEC 0% 0 0 10 20 20 0 0 0 20 50 50 100
FORD 0% 0 0 0 100 100 200 200 200 200 200 200 200
GM-LINER TONGUE 0% 0 0 0 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000
PICKUP TRUCK KITS 0% 13 13 13 15 18 20 20 20 20 20 20 20
RAZORBACK 0% 7 6 7 8 9 10 10 10 10 10 10 10
TRAILER KITS 0% 0 0 5 0 0 5 0 0 5 0 0 5
LINER TONGUE 0% 10 10 10 200 10 200 200 200 200 200 200 200
Total Unit Sales 30 29 45 5,343 5,157 5,435 5,430 5,430 5,455 5,480 5,480 5,535
Unit Prices Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
TORVEC $3,652.00 $3,652.00 $3,652.00 $3,652.00 $3,652.00 $3,652.00 $3,652.00 $3,652.00 $3,652.00 $3,652.00 $3,652.00 $3,652.00
FORD $1,570.00 $1,570.00 $1,570.00 $1,570.00 $1,570.00 $1,570.00 $1,570.00 $1,570.00 $1,570.00 $1,570.00 $1,570.00 $1,570.00
GM-LINER TONGUE $12.52 $12.52 $12.52 $12.52 $12.52 $12.52 $12.52 $12.52 $12.52 $12.52 $12.52 $12.52
PICKUP TRUCK KITS $1,620.00 $1,620.00 $1,620.00 $1,620.00 $1,620.00 $1,620.00 $1,620.00 $1,620.00 $1,620.00 $1,620.00 $1,620.00 $1,620.00
RAZORBACK $205.00 $205.00 $205.00 $205.00 $205.00 $205.00 $205.00 $205.00 $205.00 $205.00 $205.00 $205.00
TRAILER KITS $1,295.00 $1,295.00 $1,295.00 $1,295.00 $1,295.00 $1,295.00 $1,295.00 $1,295.00 $1,295.00 $1,295.00 $1,295.00 $1,295.00
LINER TONGUE $16.20 $16.20 $16.20 $16.20 $16.20 $16.20 $16.20 $16.20 $16.20 $16.20 $16.20 $16.20
Sales
TORVEC $0 $0 $36,520 $73,040 $73,040 $0 $0 $0 $73,040 $182,600 $182,600 $365,200
FORD $0 $0 $0 $157,000 $157,000 $314,000 $314,000 $314,000 $314,000 $314,000 $314,000 $314,000
GM-LINER TONGUE $0 $0 $0 $62,600 $62,600 $62,600 $62,600 $62,600 $62,600 $62,600 $62,600 $62,600
PICKUP TRUCK KITS $21,060 $21,060 $21,060 $24,300 $29,160 $32,400 $32,400 $32,400 $32,400 $32,400 $32,400 $32,400
RAZORBACK $1,435 $1,230 $1,435 $1,640 $1,845 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050 $2,050
TRAILER KITS $0 $0 $6,475 $0 $0 $6,475 $0 $0 $6,475 $0 $0 $6,475
LINER TONGUE $162 $162 $162 $3,240 $162 $3,240 $3,240 $3,240 $3,240 $3,240 $3,240 $3,240
Total Sales $22,657 $22,452 $65,652 $321,820 $323,807 $420,765 $414,290 $414,290 $493,805 $596,890 $596,890 $785,965
Direct Unit Costs Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
TORVEC 0.00% $2,421.00 $2,421.00 $2,421.00 $2,421.00 $2,421.00 $2,421.00 $2,421.00 $2,421.00 $2,421.00 $2,421.00 $2,421.00 $2,421.00
FORD 0.00% $631.00 $631.00 $631.00 $631.00 $631.00 $631.00 $631.00 $631.00 $631.00 $631.00 $631.00 $631.00
GM-LINER TONGUE 0.00% $2.52 $2.52 $2.52 $2.52 $2.52 $2.52 $2.52 $2.52 $2.52 $2.52 $2.52 $2.52
PICKUP TRUCK KITS 0.00% $650.00 $650.00 $650.00 $650.00 $650.00 $650.00 $650.00 $650.00 $650.00 $650.00 $650.00 $650.00
RAZORBACK 0.00% $77.00 $77.00 $77.00 $77.00 $77.00 $77.00 $77.00 $77.00 $77.00 $77.00 $77.00 $77.00
TRAILER KITS 0.00% $543.00 $543.00 $543.00 $543.00 $543.00 $543.00 $543.00 $543.00 $543.00 $543.00 $543.00 $543.00
LINER TONGUE 0.00% $3.00 $3.00 $3.00 $3.00 $3.00 $3.00 $3.00 $3.00 $3.00 $3.00 $3.00 $3.00
Direct Cost of Sales
TORVEC $0 $0 $24,210 $48,420 $48,420 $0 $0 $0 $48,420 $121,050 $121,050 $242,100
FORD $0 $0 $0 $63,100 $63,100 $126,200 $126,200 $126,200 $126,200 $126,200 $126,200 $126,200
GM-LINER TONGUE $0 $0 $0 $12,600 $12,600 $12,600 $12,600 $12,600 $12,600 $12,600 $12,600 $12,600
PICKUP TRUCK KITS $8,450 $8,450 $8,450 $9,750 $11,700 $13,000 $13,000 $13,000 $13,000 $13,000 $13,000 $13,000
RAZORBACK $539 $462 $539 $616 $693 $770 $770 $770 $770 $770 $770 $770
TRAILER KITS $0 $0 $2,715 $0 $0 $2,715 $0 $0 $2,715 $0 $0 $2,715
LINER TONGUE $30 $30 $30 $600 $30 $600 $600 $600 $600 $600 $600 $600
Subtotal Direct Cost of Sales $9,019 $8,942 $35,944 $135,086 $136,543 $155,885 $153,170 $153,170 $204,305 $274,220 $274,220 $397,985
Personnel Plan
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Production Personnel
Production Manager $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800
Operations Manager $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000
Other $0 $0 $5,400 $5,400 $5,400 $5,400 $5,400 $5,400 $5,400 $5,400 $5,400 $5,400
Subtotal $3,800 $3,800 $9,200 $9,200 $9,200 $9,200 $9,200 $9,200 $9,200 $9,200 $9,200 $9,200
Sales and Marketing Personnel
Marketing Manager $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Administrator $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales Manager $0 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000
Regional Sales Manager $0 $0 $0 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Regional Sales Manager $0 $0 $0 $0 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Regional Sales Manager $0 $0 $0 $0 $0 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Subtotal $0 $4,000 $4,000 $7,000 $10,000 $13,000 $13,000 $13,000 $13,000 $13,000 $13,000 $13,000
General and Administrative Personnel
Administrative Manager $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Controller $0 $0 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800
Bookeeper $0 $0 $0 $0 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
AR/AP $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal $3,000 $3,000 $4,800 $4,800 $6,300 $6,300 $6,300 $6,300 $6,300 $6,300 $6,300 $6,300
Other Personnel
ENGINEERING $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
PURCHASING $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
PRODUCTION CONTROL $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
R & D $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total People 4 4 8 9 11 12 12 12 12 12 12 12
Total Payroll $6,800 $10,800 $18,000 $21,000 $25,500 $28,500 $28,500 $28,500 $28,500 $28,500 $28,500 $28,500

General Assumptions
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Plan Month 1 2 3 4 5 6 7 8 9 10 11 12
Current Interest Rate 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00%
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% 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
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Sales $22,657 $22,452 $65,652 $321,820 $323,807 $420,765 $414,290 $414,290 $493,805 $596,890 $596,890 $785,965
Direct Cost of Sales $9,019 $8,942 $35,944 $135,086 $136,543 $155,885 $153,170 $153,170 $204,305 $274,220 $274,220 $397,985
Production Payroll $3,800 $3,800 $9,200 $9,200 $9,200 $9,200 $9,200 $9,200 $9,200 $9,200 $9,200 $9,200
Comissions $2,295 $6,000 $3,127 $3,729 $3,685 $5,340 $5,130 $5,840 $7,225 $7,225 $8,058 $9,923
Total Cost of Sales $15,114 $18,742 $48,271 $148,015 $149,428 $170,425 $167,500 $168,210 $220,730 $290,645 $291,478 $417,108
Gross Margin $7,543 $3,710 $17,381 $173,805 $174,379 $250,340 $246,790 $246,080 $273,075 $306,245 $305,412 $368,857
Gross Margin % 33.29% 16.52% 26.47% 54.01% 53.85% 59.50% 59.57% 59.40% 55.30% 51.31% 51.17% 46.93%
Operating Expenses
Sales and Marketing Expenses
Sales and Marketing Payroll $0 $4,000 $4,000 $7,000 $10,000 $13,000 $13,000 $13,000 $13,000 $13,000 $13,000 $13,000
Advertising/Promotion $171 $25,000 $28,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000
Travel $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000
Miscellaneous $4,000 $5,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000
Total Sales and Marketing Expenses $11,171 $41,000 $45,000 $50,000 $53,000 $56,000 $56,000 $56,000 $56,000 $56,000 $56,000 $56,000
Sales and Marketing % 49.30% 182.61% 68.54% 15.54% 16.37% 13.31% 13.52% 13.52% 11.34% 9.38% 9.38% 7.12%
General and Administrative Expenses
General and Administrative Payroll $3,000 $3,000 $4,800 $4,800 $6,300 $6,300 $6,300 $6,300 $6,300 $6,300 $6,300 $6,300
Sales and Marketing and Other Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Depreciation $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $6,000
Leased Equipment $757 $757 $1,727 $1,727 $1,727 $1,727 $1,727 $1,727 $1,727 $1,727 $1,727 $1,727
Utilities/Phone/Postage $1,742 $1,742 $2,500 $2,500 $2,500 $2,500 $2,500 $2,500 $2,500 $2,500 $2,500 $2,500
Insurance $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120
Rent $1,875 $1,875 $1,875 $1,875 $1,875 $1,875 $1,875 $1,875 $1,875 $1,875 $1,875 $1,875
Payroll Taxes 30% $2,040 $3,240 $5,400 $6,300 $7,650 $8,550 $8,550 $8,550 $8,550 $8,550 $8,550 $8,550
Other General and Administrative Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total General and Administrative Expenses $18,534 $19,734 $25,422 $26,322 $29,172 $30,072 $30,072 $30,072 $30,072 $30,072 $30,072 $30,072
General and Administrative % 81.80% 87.89% 38.72% 8.18% 9.01% 7.15% 7.26% 7.26% 6.09% 5.04% 5.04% 3.83%
Other Expenses:
Other Payroll $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Consultants $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Contract/Consultants $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000
Total Other Expenses $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000
Other % 17.65% 17.82% 6.09% 1.24% 1.24% 0.95% 0.97% 0.97% 0.81% 0.67% 0.67% 0.51%
Total Operating Expenses $33,705 $64,734 $74,422 $80,322 $86,172 $90,072 $90,072 $90,072 $90,072 $90,072 $90,072 $90,072
Profit Before Interest and Taxes ($26,162) ($61,024) ($57,041) $93,483 $88,207 $160,268 $156,718 $156,008 $183,003 $216,173 $215,340 $278,785
EBITDA ($20,162) ($55,024) ($51,041) $99,483 $94,207 $166,268 $162,718 $162,008 $189,003 $222,173 $221,340 $284,785
Interest Expense $9,083 $8,800 $8,767 $12,400 $12,367 $12,333 $12,300 $12,267 $12,233 $12,200 $12,167 $12,133
Taxes Incurred ($10,574) ($17,456) ($16,452) $20,271 $18,960 $36,984 $36,105 $35,935 $42,692 $50,993 $50,793 $66,663
Net Profit ($24,672) ($52,368) ($49,356) $60,812 $56,880 $110,951 $108,314 $107,806 $128,077 $152,980 $152,380 $199,989
Net Profit/Sales -108.89% -233.24% -75.18% 18.90% 17.57% 26.37% 26.14% 26.02% 25.94% 25.63% 25.53% 25.44%

Pro Forma Cash Flow
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Cash Received
Cash from Operations
Cash Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Cash from Receivables $13,296 $14,051 $22,650 $23,892 $74,191 $321,886 $327,039 $420,549 $414,290 $416,941 $497,241 $596,890
Subtotal Cash from Operations $13,296 $14,051 $22,650 $23,892 $74,191 $321,886 $327,039 $420,549 $414,290 $416,941 $497,241 $596,890
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 $175,000 $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 $500,000 $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 $188,296 $14,051 $22,650 $523,892 $74,191 $321,886 $327,039 $420,549 $414,290 $416,941 $497,241 $596,890
Expenditures Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Expenditures from Operations
Cash Spending $6,800 $10,800 $18,000 $21,000 $25,500 $28,500 $28,500 $28,500 $28,500 $28,500 $28,500 $28,500
Bill Payments $74,852 $26,295 $49,278 $61,523 $248,441 $239,015 $295,654 $268,606 $275,834 $390,771 $483,773 $419,264
Subtotal Spent on Operations $81,652 $37,095 $67,278 $82,523 $273,941 $267,515 $324,154 $297,106 $304,334 $419,271 $512,273 $447,764
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 $25,000 $0 $50,000 $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 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000
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 $85,652 $66,095 $71,278 $136,523 $277,941 $271,515 $328,154 $301,106 $308,334 $423,271 $516,273 $451,764
Net Cash Flow $102,643 ($52,045) ($48,627) $387,369 ($203,750) $50,371 ($1,115) $119,443 $105,956 ($6,330) ($19,032) $145,126
Cash Balance $105,449 $53,405 $4,777 $392,146 $188,397 $238,768 $237,653 $357,096 $463,052 $456,722 $437,690 $582,816
Pro Forma Balance Sheet
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Assets Starting Balances
Current Assets
Cash $2,806 $105,449 $53,405 $4,777 $392,146 $188,397 $238,768 $237,653 $357,096 $463,052 $456,722 $437,690 $582,816
Accounts Receivable $26,591 $35,953 $44,354 $87,356 $385,284 $634,900 $733,778 $821,029 $814,770 $894,285 $1,074,235 $1,173,884 $1,362,959
Inventory $187,673 $178,654 $169,712 $133,768 $148,595 $150,197 $171,474 $168,487 $168,487 $224,736 $301,642 $301,642 $437,784
Other Current Assets $5,418 $5,418 $5,418 $5,418 $5,418 $5,418 $5,418 $5,418 $5,418 $5,418 $5,418 $5,418 $5,418
Total Current Assets $222,488 $325,474 $272,888 $231,319 $931,443 $978,912 $1,149,438 $1,232,588 $1,345,772 $1,587,491 $1,838,017 $1,918,634 $2,388,977
Long-term Assets
Long-term Assets $362,502 $362,502 $362,502 $362,502 $362,502 $362,502 $362,502 $362,502 $362,502 $362,502 $362,502 $362,502 $362,502
Accumulated Depreciation $68,330 $74,330 $80,330 $86,330 $92,330 $98,330 $104,330 $110,330 $116,330 $122,330 $128,330 $134,330 $140,330
Total Long-term Assets $294,172 $288,172 $282,172 $276,172 $270,172 $264,172 $258,172 $252,172 $246,172 $240,172 $234,172 $228,172 $222,172
Total Assets $516,660 $613,646 $555,060 $507,491 $1,201,615 $1,243,084 $1,407,610 $1,484,760 $1,591,944 $1,827,663 $2,072,189 $2,146,806 $2,611,149
Liabilities and Capital Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Current Liabilities
Accounts Payable $74,002 $24,659 $47,442 $53,228 $240,540 $229,128 $286,704 $259,540 $262,918 $374,560 $470,106 $396,343 $664,697
Current Borrowing $385,239 $560,239 $535,239 $535,239 $485,239 $485,239 $485,239 $485,239 $485,239 $485,239 $485,239 $485,239 $485,239
Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Current Liabilities $459,241 $584,898 $582,681 $588,467 $725,779 $714,367 $771,943 $744,779 $748,157 $859,799 $955,345 $881,582 $1,149,936
Long-term Liabilities $421,710 $417,710 $413,710 $409,710 $905,710 $901,710 $897,710 $893,710 $889,710 $885,710 $881,710 $877,710 $873,710
Total Liabilities $880,951 $1,002,608 $996,391 $998,177 $1,631,489 $1,616,077 $1,669,653 $1,638,489 $1,637,867 $1,745,509 $1,837,055 $1,759,292 $2,023,646
Paid-in Capital $375,886 $375,886 $375,886 $375,886 $375,886 $375,886 $375,886 $375,886 $375,886 $375,886 $375,886 $375,886 $375,886
Retained Earnings ($686,386) ($740,177) ($740,177) ($740,177) ($740,177) ($740,177) ($740,177) ($740,177) ($740,177) ($740,177) ($740,177) ($740,177) ($740,177)
Earnings ($53,791) ($24,672) ($77,040) ($126,395) ($65,583) ($8,703) $102,248 $210,562 $318,368 $446,445 $599,425 $751,805 $951,794
Total Capital ($364,291) ($388,963) ($441,331) ($490,686) ($429,874) ($372,994) ($262,043) ($153,729) ($45,923) $82,154 $235,134 $387,514 $587,503
Total Liabilities and Capital $516,660 $613,646 $555,060 $507,491 $1,201,615 $1,243,084 $1,407,610 $1,484,760 $1,591,944 $1,827,663 $2,072,189 $2,146,806 $2,611,149
Net Worth ($364,291) ($388,963) ($441,331) ($490,686) ($429,874) ($372,994) ($262,043) ($153,729) ($45,923) $82,154 $235,134 $387,514 $587,503

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