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HeavyMetal Praise Records

Executive Summary

Youth will be served!  For the past 10 years, Christian music has made strong inroads in every area of popular music except for the vital and chaotic world of Heavy Metal music. Heavy Metal Praise Records will focus only on recording Christian Heavy Metal performers, promoting their success in the popular mainstream of Punk and Ska music.

Music recording distribution business plan, executive summary chart image

1.1 Objectives

  1. Sign and record two new Heavy Metal bands in the first year.
  2. Release the first CD of each group in the first year.
  3. Establish a strong distribution network that will facilitate CD sales.
  4. Establish the necessary strategic alliances to assure the widest possible distribution of our music.

1.2 Mission

The idea of Heavy Metal Praise Records is the brainchild of a group of dedicated Christians who created the Skate Ministry over three years ago. The Skate Ministry is a group of 10 adult skateboarders who spread the word of God to young skateboarders during the weekend at various skate parks throughout the area. Most of these young skateboarders are boys between the ages of 12 to 18. The predominant music in the skateboard culture is Heavy Metal and is played at every skatepark in the area. From the beginning the group realized that the music itself was creating negative actions on the part of young skateboarders and was facilitating a culture of selfishness and violence.

Heavy Metal Praise’s mission is to introduce Christian Heavy Metal bands to the target audience that gives the same musical intensity of popular Heavy Metal bands but with a more positive, constructive message that will move young people to a closer relationship with God.

1.3 Keys to Success

  • Delivering Heavy Metal groups that the target audience will find irresistible.
  • Access the music and distribution network that feeds Heavy Metal artists to the skate culture.
  • Access the traditional Christian music and distribution network that will provide a ready-made group of customers for Heavy Metal Praise Records artists.
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Company Summary

Heavy Metal Praise Records is a recording business that will focus exclusively on Christian Heavy Metal music groups.

2.1 Company Ownership

The sole founder and owner of Heavy Metal Praise Records is Johnny Young. Johnny is also a founding member of the Skate Ministry and a skateboarder for the last 20 years. 

2.2 Start-up Summary

Heavy Metal Praise Records has the following start-up expenses and the purchase of equipment:

  • Computer system with three workstations, a printer, CD-RW, Microsoft Office, and Microsoft Access.
  • Legal fees regarding business formation and generating and reviewing contracts.
  • Copier, fax, and a phone line.
  • Various office supplies.

Music recording distribution business plan, company summary chart image

Start-up
Requirements
Start-up Expenses
Legal $1,000
Stationery etc. $100
Rent $0
Other $0
Total Start-up Expenses $1,100
Start-up Assets
Cash Required $83,900
Start-up Inventory $0
Other Current Assets $15,000
Long-term Assets $0
Total Assets $98,900
Total Requirements $100,000
Start-up Funding
Start-up Expenses to Fund $1,100
Start-up Assets to Fund $98,900
Total Funding Required $100,000
Assets
Non-cash Assets from Start-up $15,000
Cash Requirements from Start-up $83,900
Additional Cash Raised $0
Cash Balance on Starting Date $83,900
Total Assets $98,900
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
Johnny $100,000
Investor 2 $0
Other $0
Additional Investment Requirement $0
Total Planned Investment $100,000
Loss at Start-up (Start-up Expenses) ($1,100)
Total Capital $98,900
Total Capital and Liabilities $98,900
Total Funding $100,000

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Products

Heavy Metal Praise Records, as the name implies, produces CDs of Heavy Metal Christian music groups.

The typical Heavy Metal Praise Records buyer is in the 13-22 year old age bracket–and is a direct result of the attitudes expressed by the label’s bands. The spirit of youth is the driving force of the label, offering proof that the energy of Heavy Metal Praise music exists beyond constraints and categorizations.

While Heavy Metal Praise Records hates to pigeonhole any of its artists’ musical sounds, it can be generalized that all the bands convey an in-your-face sound Christian music. This sound, when coupled with each band’s own creativity and inspiration, allows for the artists to maintain their identity while sharing the same energy, focus and often fan base with their label mates. Heavy Metal Praise Records is an artist-friendly label, priding itself on giving its bands complete artistic and creative freedom.

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Market Analysis Summary

Heavy Metal music is the music of preference among boys and young men, ages 12-22, who are part of the skateboarding culture. Heavy Metal music generated $180 million dollars in sales last year.

Skateboarding has grown into an enormously popular recreational sport that generated 1/2 billion dollars in sales last year. Each year the base of skateboarder grows even larger. The sport is still enjoyed by young men in their thirties. In many cases, these older skateboarders still enjoy Heavy Metal music. This represents a huge market opportunity for Christian music.

Heavy Metal Praise Records will focus on two customer groups:

  • Early teen skateboarder.
  • Late teen skateboarder.

4.1 Market Segmentation

  • Early Teen Skateboarders: This group has limited mobility to attend most Heavy Metal group performances. Yet they represent the largest consumer group of Heavy Metal music. Generally, this target group hears the music from friends, at skateboard parks and at skateboard shops.
  • Late Teen Skateboarders: This group represents the strong fan base that comes out for live performances at local clubs. They are also exposed to the music at skateboard parks and skateboard shops. It is critical to build a secure fan base with this group in order to generate sales among the younger skate boarders.
Music recording distribution business plan, market analysis summary chart image

Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential Customers Growth CAGR
Early Teen Skateboarders 10% 3,000,000 3,300,000 3,630,000 3,993,000 4,392,300 10.00%
Late Teen Skateboarders 10% 4,000,000 4,400,000 4,840,000 5,324,000 5,856,400 10.00%
Other 0% 0 0 0 0 0 0.00%
Total 10.00% 7,000,000 7,700,000 8,470,000 9,317,000 10,248,700 10.00%

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Strategy and Implementation Summary

Heavy Metal Praise Records will use their competitive advantages in a new musical area of Christian music to steadily gain market share. The first advantage is based on Johnny’s extensive inside knowledge of the recording industry. The second advantage is an already established network of contacts within the industry.

5.1 Competitive Edge

Presently, there are few Christian Heavy Metal bands with CDs in the marketplace. The only real competition is the acceptance of the skateboard culture. Can a Heavy Metal group with a christian message gain a fan base? The success of a Heavy Metal band is dependent on its fan base and its live performances. If the energy is there, the fan base will grow and CD sales will follow.

Heavy Metal Praise Records understands that their bands must have the energy before the message will be heard.

5.2 Marketing Strategy

Heavy Metal Praise Records has established the following Promotion and Distribution strategies.

5.2.1 Promotion Strategy

  • Early Teens: Heavy Metal Praise recording artists will be marketed at the weekly sponsored skateboarding events by the Skate Ministry. A band will play at each event during the summer months. In addition, Heavy Metal Praise recording artists will perform as part of the concert series sponsored by Rally Skateboards. At these events, free CD samplers will be given out of Heavy Metal Praise recording artists.
  • Late Teens: Heavy Metal Praise recording artists will be booked to play extensively during the summer of 2002. A Heavy Metal Praise band will be part of the “Split Cross” tour in the region. Split Cross is a Christian music website and a strategic partner of Heavy Metal Praise recording. At these events, free CD samplers will be given out of Heavy Metal Praise recording artists.

5.2.2 Distribution Strategy

Heavy Metal Praise Records have made strategic alliances with both the Coalition of Independent Music Stores (CIMS) and Straight Arrow, the number one Christian Music Website in the country. Heavy Metal Praise Records CDs will be distributed through CIMS to stores regionally and with greater visibility of the bands, the distribution will expand nationally. Straight Arrow will sell the CDs online as part of their campaign to widen the range of artists they offer. Last year, Straight Arrow sales topped $50 million.

5.3 Strategic Alliances

The strategic alliance with the Coalition of Independent Music Stores (CIMS) and Straight Arrow holds great potential.

  • Straight Arrow is a distribution system for Christian artists who want to buck the system and do it without major label backing. The amazing thing is: it truly works. Some of the most sincere, yet cutting edge artists existing today are available to purchase at the Straight Arrow website. They will focus on building sales in the field of Heavy Metal music starting with Heavy Metal Praise artists.
  • Coalition of Independent Music Stores represents a distribution system of 10,000 stores nationally. CIMS creates its own sales programs that focus on independent artists. They have committed to packaging Heavy Metal Praise Recording artists to its regional members. With the bands’ success, they plan to distribute the CDs nationally.

5.4 Sales Strategy

Our combined sales strategy of distributing our product online and in stores will result in the following first year sales goals:

  • 5,000 CDs sold online.
  • 10,000 CDs sold in stores.

The sales totals represent only six months of sales activity. The first six months will be focused on signing the bands and producing the recording.

5.4.1 Sales Forecast

The following table and chart presents specific sales forecasts by month, over the first year of development. Years two and three are cumulative totals only.

Music recording distribution business plan, strategy and implementation summary chart image

Sales Forecast
Year 1 Year 2 Year 3
Sales
Online $84,000 $160,000 $200,000
In Store $154,000 $380,000 $500,000
Total Sales $238,000 $540,000 $700,000
Direct Cost of Sales Year 1 Year 2 Year 3
Online $4,200 $8,000 $10,000
In Store $7,700 $19,000 $25,000
Subtotal Direct Cost of Sales $11,900 $27,000 $35,000

5.5 Milestones

Heavy Metal Praise Records will have several milestones:

  • Sign two Heavy Metal Christian bands.
  • Produce two new recordings during the first six months of operation.
  • Release recordings in six months.
Milestones
Milestone Start Date End Date Budget Manager Department
Signing of Bands 1/1/2001 3/1/2001 $10,000 JY Owner
Recording 3/31/2001 6/30/2001 $65,000 JY Owner
CD Release 6/30/2001 9/30/2001 $40,000 JY Owner
Totals $115,000

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Management Summary

Heavy Metal Praise Records is solely operated by Johnny Young. Johnny is a Christian music industry veteran with over 13 years of music ministry experience with extensive connections with producers and distributors. Johnny toured the USA with the CCM group “Seeds of Change” between 1991 and 1998. It was during this time that Johnny felt God calling him into a ministry that would usher in Heavy Metal music that was so powerful, so fresh…that people would sense the spirit of God and come to a realization that God desired each and every one of His creations to know Him intimately.

This will be a one person business for a while. Johnny’s planned salary is shown in the Personnel table below.

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Financial Plan

The following sections will outline the general financial assumptions, break-even analysis, profit and loss, cash flow, balance sheet and business ratios.

7.1 Important Assumptions

The following table shows some of the basic financial assumptions used in this business plan.

General Assumptions
Year 1 Year 2 Year 3
Plan Month 1 2 3
Current Interest Rate 10.00% 10.00% 10.00%
Long-term Interest Rate 10.00% 10.00% 10.00%
Tax Rate 30.00% 30.00% 30.00%
Other 0 0 0

7.2 Break-even Analysis

The Break-even Analysis indicates approximately $1,700 is needed in monthly revenue to break even. The Estimated Monthly Fixed Cost varies over the course of the first year, as seen in the P & L appendix table, and this figure is an average based on the first-year totals.

Music recording distribution business plan, financial plan chart image

Break-even Analysis
Monthly Revenue Break-even $17,022
Assumptions:
Average Percent Variable Cost 5%
Estimated Monthly Fixed Cost $16,171

7.3 Projected Profit and Loss

The following table will indicate projected profit and loss.

Music recording distribution business plan, financial plan chart image

Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $238,000 $540,000 $700,000
Direct Cost of Sales $11,900 $27,000 $35,000
Other Production Expenses $0 $0 $0
Total Cost of Sales $11,900 $27,000 $35,000
Gross Margin $226,100 $513,000 $665,000
Gross Margin % 95.00% 95.00% 95.00%
Expenses
Payroll $27,000 $35,000 $42,000
Sales and Marketing and Other Expenses $142,000 $190,000 $350,000
Depreciation $3,000 $3,000 $3,000
Leased Equipment $0 $0 $0
Utilities $0 $0 $0
Insurance $6,000 $8,000 $10,000
Rent $12,000 $15,000 $18,000
Payroll Taxes $4,050 $5,250 $6,300
Other $0 $0 $0
Total Operating Expenses $194,050 $256,250 $429,300
Profit Before Interest and Taxes $32,050 $256,750 $235,700
EBITDA $35,050 $259,750 $238,700
Interest Expense $0 $0 $0
Taxes Incurred $9,615 $77,025 $70,710
Net Profit $22,435 $179,725 $164,990
Net Profit/Sales 9.43% 33.28% 23.57%

7.4 Projected Cash Flow

Heavy Metal Praise will begin with adequate investment to cover the beginning months of negative cash flow and, as shown below, have an overall increase in cash balance by the end of the first plan year.

Music recording distribution business plan, financial plan chart image

Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $166,600 $378,000 $490,000
Cash from Receivables $31,740 $111,675 $183,338
Subtotal Cash from Operations $198,340 $489,675 $673,338
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 $198,340 $489,675 $673,338
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $27,000 $35,000 $42,000
Bill Payments $140,307 $350,569 $479,397
Subtotal Spent on Operations $167,307 $385,569 $521,397
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 $0 $0
Subtotal Cash Spent $167,307 $385,569 $521,397
Net Cash Flow $31,033 $104,107 $151,940
Cash Balance $114,933 $219,039 $370,980

7.5 Projected Balance Sheet

The following chart and table indicates balance sheet.

Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $114,933 $219,039 $370,980
Accounts Receivable $39,660 $89,985 $116,647
Inventory $4,400 $9,983 $12,941
Other Current Assets $15,000 $15,000 $15,000
Total Current Assets $173,993 $334,007 $515,568
Long-term Assets
Long-term Assets $0 $0 $0
Accumulated Depreciation $3,000 $6,000 $9,000
Total Long-term Assets ($3,000) ($6,000) ($9,000)
Total Assets $170,993 $328,007 $506,568
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $49,658 $26,947 $40,518
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $49,658 $26,947 $40,518
Long-term Liabilities $0 $0 $0
Total Liabilities $49,658 $26,947 $40,518
Paid-in Capital $100,000 $100,000 $100,000
Retained Earnings ($1,100) $21,335 $201,060
Earnings $22,435 $179,725 $164,990
Total Capital $121,335 $301,060 $466,050
Total Liabilities and Capital $170,993 $328,007 $506,568
Net Worth $121,335 $301,060 $466,050

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 7929, Musical Groups and Artists, are shown for comparison.

Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 126.89% 29.63% 15.20%
Percent of Total Assets
Accounts Receivable 23.19% 27.43% 23.03% 6.80%
Inventory 2.57% 3.04% 2.55% 3.10%
Other Current Assets 8.77% 4.57% 2.96% 33.90%
Total Current Assets 101.75% 101.83% 101.78% 43.80%
Long-term Assets -1.75% -1.83% -1.78% 56.20%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 29.04% 8.22% 8.00% 38.30%
Long-term Liabilities 0.00% 0.00% 0.00% 23.30%
Total Liabilities 29.04% 8.22% 8.00% 61.60%
Net Worth 70.96% 91.78% 92.00% 38.40%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 95.00% 95.00% 95.00% 0.00%
Selling, General & Administrative Expenses 84.69% 61.33% 71.13% 75.30%
Advertising Expenses 13.45% 7.41% 7.14% 2.90%
Profit Before Interest and Taxes 13.47% 47.55% 33.67% 2.90%
Main Ratios
Current 3.50 12.39 12.72 1.22
Quick 3.42 12.02 12.41 0.82
Total Debt to Total Assets 29.04% 8.22% 8.00% 61.60%
Pre-tax Return on Net Worth 26.41% 85.28% 50.57% 2.90%
Pre-tax Return on Assets 18.74% 78.28% 46.53% 7.40%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin 9.43% 33.28% 23.57% n.a
Return on Equity 18.49% 59.70% 35.40% n.a
Activity Ratios
Accounts Receivable Turnover 1.80 1.80 1.80 n.a
Collection Days 50 146 180 n.a
Inventory Turnover 10.35 3.75 3.05 n.a
Accounts Payable Turnover 3.83 12.17 12.17 n.a
Payment Days 27 43 25 n.a
Total Asset Turnover 1.39 1.65 1.38 n.a
Debt Ratios
Debt to Net Worth 0.41 0.09 0.09 n.a
Current Liab. to Liab. 1.00 1.00 1.00 n.a
Liquidity Ratios
Net Working Capital $124,335 $307,060 $475,050 n.a
Interest Coverage 0.00 0.00 0.00 n.a
Additional Ratios
Assets to Sales 0.72 0.61 0.72 n.a
Current Debt/Total Assets 29% 8% 8% n.a
Acid Test 2.62 8.69 9.53 n.a
Sales/Net Worth 1.96 1.79 1.50 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
Online 0% $0 $0 $0 $0 $0 $3,000 $4,000 $6,000 $10,000 $13,000 $18,000 $30,000
In Store 0% $0 $0 $0 $0 $0 $3,000 $10,000 $12,000 $18,000 $25,000 $36,000 $50,000
Total Sales $0 $0 $0 $0 $0 $6,000 $14,000 $18,000 $28,000 $38,000 $54,000 $80,000
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
Online $0 $0 $0 $0 $0 $150 $200 $300 $500 $650 $900 $1,500
In Store $0 $0 $0 $0 $0 $150 $500 $600 $900 $1,250 $1,800 $2,500
Subtotal Direct Cost of Sales $0 $0 $0 $0 $0 $300 $700 $900 $1,400 $1,900 $2,700 $4,000
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
Owner 0% $0 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $3,000 $3,000 $3,000 $3,000 $3,000
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 $0 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $3,000 $3,000 $3,000 $3,000 $3,000

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 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 $0 $0 $0 $6,000 $14,000 $18,000 $28,000 $38,000 $54,000 $80,000
Direct Cost of Sales $0 $0 $0 $0 $0 $300 $700 $900 $1,400 $1,900 $2,700 $4,000
Other Production Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Cost of Sales $0 $0 $0 $0 $0 $300 $700 $900 $1,400 $1,900 $2,700 $4,000
Gross Margin $0 $0 $0 $0 $0 $5,700 $13,300 $17,100 $26,600 $36,100 $51,300 $76,000
Gross Margin % 0.00% 0.00% 0.00% 0.00% 0.00% 95.00% 95.00% 95.00% 95.00% 95.00% 95.00% 95.00%
Expenses
Payroll $0 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $3,000 $3,000 $3,000 $3,000 $3,000
Sales and Marketing and Other Expenses $5,000 $5,000 $5,000 $5,000 $45,000 $22,000 $7,000 $7,000 $4,000 $3,000 $2,000 $32,000
Depreciation $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250
Leased Equipment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Utilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Insurance $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500
Rent $0 $0 $0 $0 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
Payroll Taxes 15% $0 $300 $300 $300 $300 $300 $300 $450 $450 $450 $450 $450
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Operating Expenses $5,750 $8,050 $8,050 $8,050 $49,550 $26,550 $11,550 $12,700 $9,700 $8,700 $7,700 $37,700
Profit Before Interest and Taxes ($5,750) ($8,050) ($8,050) ($8,050) ($49,550) ($20,850) $1,750 $4,400 $16,900 $27,400 $43,600 $38,300
EBITDA ($5,500) ($7,800) ($7,800) ($7,800) ($49,300) ($20,600) $2,000 $4,650 $17,150 $27,650 $43,850 $38,550
Interest Expense $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Taxes Incurred ($1,725) ($2,415) ($2,415) ($2,415) ($14,865) ($6,255) $525 $1,320 $5,070 $8,220 $13,080 $11,490
Net Profit ($4,025) ($5,635) ($5,635) ($5,635) ($34,685) ($14,595) $1,225 $3,080 $11,830 $19,180 $30,520 $26,810
Net Profit/Sales 0.00% 0.00% 0.00% 0.00% 0.00% -243.25% 8.75% 17.11% 42.25% 50.47% 56.52% 33.51%

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 $0 $0 $0 $4,200 $9,800 $12,600 $19,600 $26,600 $37,800 $56,000
Cash from Receivables $0 $0 $0 $0 $0 $0 $60 $1,880 $4,240 $5,500 $8,500 $11,560
Subtotal Cash from Operations $0 $0 $0 $0 $0 $4,200 $9,860 $14,480 $23,840 $32,100 $46,300 $67,560
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 $0 $0 $0 $0 $0 $4,200 $9,860 $14,480 $23,840 $32,100 $46,300 $67,560
Expenditures Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Expenditures from Operations
Cash Spending $0 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $3,000 $3,000 $3,000 $3,000 $3,000
Bill Payments $126 $3,762 $3,385 $3,385 $4,353 $31,989 $18,771 $10,857 $11,823 $13,452 $16,286 $22,119
Subtotal Spent on Operations $126 $5,762 $5,385 $5,385 $6,353 $33,989 $20,771 $13,857 $14,823 $16,452 $19,286 $25,119
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 $126 $5,762 $5,385 $5,385 $6,353 $33,989 $20,771 $13,857 $14,823 $16,452 $19,286 $25,119
Net Cash Flow ($126) ($5,762) ($5,385) ($5,385) ($6,353) ($29,789) ($10,911) $624 $9,017 $15,648 $27,014 $42,441
Cash Balance $83,774 $78,012 $72,627 $67,242 $60,889 $31,100 $20,189 $20,813 $29,830 $45,478 $72,491 $114,933
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 $83,900 $83,774 $78,012 $72,627 $67,242 $60,889 $31,100 $20,189 $20,813 $29,830 $45,478 $72,491 $114,933
Accounts Receivable $0 $0 $0 $0 $0 $0 $1,800 $5,940 $9,460 $13,620 $19,520 $27,220 $39,660
Inventory $0 $0 $0 $0 $0 $0 $700 $1,000 $1,100 $1,540 $2,090 $2,970 $4,400
Other Current Assets $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000 $15,000
Total Current Assets $98,900 $98,774 $93,012 $87,627 $82,242 $75,889 $48,600 $42,129 $46,373 $59,990 $82,088 $117,681 $173,993
Long-term Assets
Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Accumulated Depreciation $0 $250 $500 $750 $1,000 $1,250 $1,500 $1,750 $2,000 $2,250 $2,500 $2,750 $3,000
Total Long-term Assets $0 ($250) ($500) ($750) ($1,000) ($1,250) ($1,500) ($1,750) ($2,000) ($2,250) ($2,500) ($2,750) ($3,000)
Total Assets $98,900 $98,524 $92,512 $86,877 $81,242 $74,639 $47,100 $40,379 $44,373 $57,740 $79,588 $114,931 $170,993
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 $3,649 $3,272 $3,272 $3,272 $31,354 $18,410 $10,464 $11,378 $12,915 $15,583 $20,406 $49,658
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 $3,649 $3,272 $3,272 $3,272 $31,354 $18,410 $10,464 $11,378 $12,915 $15,583 $20,406 $49,658
Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Liabilities $0 $3,649 $3,272 $3,272 $3,272 $31,354 $18,410 $10,464 $11,378 $12,915 $15,583 $20,406 $49,658
Paid-in Capital $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000
Retained Earnings ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100) ($1,100)
Earnings $0 ($4,025) ($9,660) ($15,295) ($20,930) ($55,615) ($70,210) ($68,985) ($65,905) ($54,075) ($34,895) ($4,375) $22,435
Total Capital $98,900 $94,875 $89,240 $83,605 $77,970 $43,285 $28,690 $29,915 $32,995 $44,825 $64,005 $94,525 $121,335
Total Liabilities and Capital $98,900 $98,524 $92,512 $86,877 $81,242 $74,639 $47,100 $40,379 $44,373 $57,740 $79,588 $114,931 $170,993
Net Worth $98,900 $94,875 $89,240 $83,605 $77,970 $43,285 $28,690 $29,915 $32,995 $44,825 $64,005 $94,525 $121,335

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