Wholesale Juice Business Plan

Oasis Juice

Financial Plan

The following is the financial plan for Oasis Juice.

7.1 Break-even Analysis

The monthly break-even point is $66,534.

Wholesale juice business plan, financial plan chart image

Break-even Analysis


Monthly Revenue Break-even	$66,534

Assumptions:
Average Percent Variable Cost	27%
Estimated Monthly Fixed Cost	$48,400

7.2 Projected Profit and Loss

The following table and charts are the projected profit and loss for three years.

Pro Forma Profit and Loss
	2002	2003	2004
Sales	$1,020,000	$1,200,000	$1,300,000
Direct Cost of Sales	$278,000	$310,000	$360,000
Other Production Expenses	$0	$0	$0
Total Cost of Sales	$278,000	$310,000	$360,000

Gross Margin	$742,000	$890,000	$940,000
Gross Margin %	72.75%	74.17%	72.31%


Expenses
Payroll	$384,000	$416,000	$448,000
Sales and Marketing and Other Expenses	$72,000	$132,000	$132,000
Depreciation	$9,600	$9,600	$9,600
Leased Equipment	$0	$0	$0
Utilities	$12,000	$12,000	$12,000
Insurance	$9,600	$9,600	$9,600
Rent	$36,000	$36,000	$36,000
Payroll Taxes	$57,600	$62,400	$67,200
Other	$0	$0	$0

Total Operating Expenses	$580,800	$677,600	$714,400

Profit Before Interest and Taxes	$161,200	$212,400	$225,600
EBITDA	$170,800	$222,000	$235,200
Interest Expense	$9,310	$13,703	$14,203
Taxes Incurred	$45,567	$59,609	$63,419

Net Profit	$106,323	$139,088	$147,978
Net Profit/Sales	10.42%	11.59%	11.38%

7.3 Projected Cash Flow

The following table and chart are the projected cash flow for three years.

Pro Forma Cash Flow
	2002	2003	2004
Cash Received

Cash from Operations
Cash Sales	$255,000	$300,000	$325,000
Cash from Receivables	$697,500	$873,971	$960,539
Subtotal Cash from Operations	$952,500	$1,173,971	$1,285,539

Additional Cash Received
Sales Tax, VAT, HST/GST Received	$0	$0	$0
New Current Borrowing	$100,163	$0	$0
New Other Liabilities (interest-free)	$36,000	$36,000	$36,000
New Long-term Liabilities	$36,000	$36,000	$36,000
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	$1,124,663	$1,245,971	$1,357,539

Expenditures	2002	2003	2004

Expenditures from Operations
Cash Spending	$384,000	$416,000	$448,000
Bill Payments	$511,954	$637,704	$695,324
Subtotal Spent on Operations	$895,954	$1,053,704	$1,143,324

Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out	$0	$0	$0
Principal Repayment of Current Borrowing	$19,992	$19,992	$19,992
Other Liabilities Principal Repayment	$0	$0	$0
Long-term Liabilities Principal Repayment	$18,000	$18,300	$3,700
Purchase Other Current Assets	$24,000	$30,000	$40,000
Purchase Long-term Assets	$24,000	$30,000	$30,000
Dividends	$0	$0	$0
Subtotal Cash Spent	$981,946	$1,151,996	$1,237,016

Net Cash Flow	$142,717	$93,975	$120,524
Cash Balance	$182,717	$276,692	$397,216

7.4 Projected Balance Sheet

The following table is the projected balance sheet for three years.

Pro Forma Balance Sheet
	2002	2003	2004
Assets

Current Assets
Cash	$182,717	$276,692	$397,216
Accounts Receivable	$147,500	$173,529	$187,990
Inventory	$33,000	$36,799	$42,734
Other Current Assets	$29,000	$59,000	$99,000
Total Current Assets	$392,217	$546,020	$726,940

Long-term Assets
Long-term Assets	$74,000	$104,000	$134,000
Accumulated Depreciation	$21,600	$31,200	$40,800
Total Long-term Assets	$52,400	$72,800	$93,200
Total Assets	$444,617	$618,820	$820,140

Liabilities and Capital	2002	2003	2004

Current Liabilities
Accounts Payable	$51,123	$52,530	$57,564
Current Borrowing	$80,171	$60,179	$40,187
Other Current Liabilities	$36,000	$72,000	$108,000
Subtotal Current Liabilities	$167,294	$184,709	$205,751

Long-term Liabilities	$58,000	$75,700	$108,000
Total Liabilities	$225,294	$260,409	$313,751

Paid-in Capital	$80,000	$80,000	$80,000
Retained Earnings	$33,000	$139,323	$278,411
Earnings	$106,323	$139,088	$147,978
Total Capital	$219,323	$358,411	$506,389
Total Liabilities and Capital	$444,617	$618,820	$820,140

Net Worth	$219,323	$358,411	$506,389

7.5 Business Ratios

Business ratios for the years of this plan are shown below. Industry profile ratios based on the Standard Industrial Classification (SIC) code 5149, Groceries and related products, are shown for comparison.

Ratio Analysis
	2002	2003	2004	Industry Profile
Sales Growth	75.86%	17.65%	8.33%	4.60%

Percent of Total Assets
Accounts Receivable	33.17%	28.04%	22.92%	33.30%
Inventory	7.42%	5.95%	5.21%	26.00%
Other Current Assets	6.52%	9.53%	12.07%	20.90%
Total Current Assets	88.21%	88.24%	88.64%	80.20%
Long-term Assets	11.79%	11.76%	11.36%	19.80%
Total Assets	100.00%	100.00%	100.00%	100.00%

Current Liabilities	37.63%	29.85%	25.09%	45.20%
Long-term Liabilities	13.04%	12.23%	13.17%	10.00%
Total Liabilities	50.67%	42.08%	38.26%	55.20%
Net Worth	49.33%	57.92%	61.74%	44.80%

Percent of Sales
Sales	100.00%	100.00%	100.00%	100.00%
Gross Margin	72.75%	74.17%	72.31%	44.10%
Selling, General & Administrative Expenses	62.32%	62.58%	60.92%	26.70%
Advertising Expenses	5.88%	10.00%	9.23%	0.70%
Profit Before Interest and Taxes	15.80%	17.70%	17.35%	0.80%

Main Ratios
Current	2.34	2.96	3.53	1.69
Quick	2.15	2.76	3.33	1.01
Total Debt to Total Assets	50.67%	42.08%	38.26%	55.20%
Pre-tax Return on Net Worth	69.25%	55.44%	41.75%	3.60%
Pre-tax Return on Assets	34.16%	32.11%	25.78%	8.00%

Additional Ratios	2002	2003	2004
Net Profit Margin	10.42%	11.59%	11.38%	n.a
Return on Equity	48.48%	38.81%	29.22%	n.a

Activity Ratios
Accounts Receivable Turnover	5.19	5.19	5.19	n.a
Collection Days	59	65	68	n.a
Inventory Turnover	10.91	8.88	9.05	n.a
Accounts Payable Turnover	10.62	12.17	12.17	n.a
Payment Days	28	30	29	n.a
Total Asset Turnover	2.29	1.94	1.59	n.a

Debt Ratios
Debt to Net Worth	1.03	0.73	0.62	n.a
Current Liab. to Liab.	0.74	0.71	0.66	n.a

Liquidity Ratios
Net Working Capital	$224,923	$361,311	$521,189	n.a
Interest Coverage	17.31	15.50	15.88	n.a

Additional Ratios
Assets to Sales	0.44	0.52	0.63	n.a
Current Debt/Total Assets	38%	30%	25%	n.a
Acid Test	1.27	1.82	2.41	n.a
Sales/Net Worth	4.65	3.35	2.57	n.a
Dividend Payout	0.00	0.00	0.00	n.a