Keith's Sporting Goods
KSG intends to provide customers with the quality products they need to maximize athletic performance and accomplish their physical and mental goals. We will provide our customers with a knowledgeable staff that enjoys working in an athletic atmosphere and helping others. We will be located in Eugene where there is a high concentration of health conscious individuals and a devoted following to both high school and college athletics.
2.1 Company Ownership
With the intent to operate the store I will be considered the owner of Keith’s Sporting Goods. However, I will not be the only one with a capital investment in the company. A local investor will have equal shares in the business. The investor will receive dividends starting in year 2, until he has recouped his initial investment, at which time the owner has reserved the option of buying out his shares.
Under these circumstances, and the fact that the investment is a relatively small undertaking, KSG will be filed as an S Corporation. The ownership will be split up evenly between myself and the other investor, and the rest will be debt financed.
2.2 Start-up Summary
Keith’s Sporting Goods will be financed through a combination of 60% debt and 40% equity. A local bank will provide the debt while the equity will be provided by an equal combination of owner investment and an angel investor. A large portion of the initial investment will be spent on beginning inventory (83%), which we forecast to be sold within the first two months. Total assets will amount to 93.4% of the initial investment.
|Marketing/ Advertising – Grand Opening||$1,000|
|Total Start-up Expenses||$6,610|
|Other Current Assets||$0|
|Start-up Expenses to Fund||$6,610|
|Start-up Assets to Fund||$93,390|
|Total Funding Required||$100,000|
|Non-cash Assets from Start-up||$84,901|
|Cash Requirements from Start-up||$8,489|
|Additional Cash Raised||$0|
|Cash Balance on Starting Date||$8,489|
|Liabilities and Capital|
|Accounts Payable (Outstanding Bills)||$0|
|Other Current Liabilities (interest-free)||$0|
|Additional Investment Requirement||$0|
|Total Planned Investment||$40,000|
|Loss at Start-up (Start-up Expenses)||($6,610)|
|Total Capital and Liabilities||$93,390|