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Garden Way Yoga Center

Executive Summary

Hatha Yoga is an ancient discipline that explores, develops, and integrates the body, mind, and spirit. Yoga systematically stretches and strengthens muscles throughout the body, increases circulation to internal organs and glands, quiets the nervous system, and improves concentration. This ancient system of self-care brings vitality, health, deep relaxation, and peace of mind.

The style of Hatha Yoga taught is the Anusara method. Anusara Yoga is a new style of yoga that is heart-oriented, spiritually inspiring, yet grounded in a deep knowledge of optimal body alignment in the poses. Instructors encourage students to listen to their body, respect its wisdom, and to progress at their own pace.

Deep relaxation is taught in each class after completion of the postures. The intention of the instructors at Garden Way Yoga Center (GWYC) is to assist students in the development of physical, mental, and spiritual well-being: a truly priceless health advantage.

The Garden Way Yoga Center offers 8 eight-week sessions of classes per year. Courses offered include Anusara-style Hatha Yoga plus workshops in related topics. The Yoga Center features well-trained, professional instructors, progressive teaching methods, a non-competitive and encouraging atmosphere, and a beautiful light-filled facility.

The Garden Way Yoga Center also has a boutique that will sell workshop clothing and yoga training aides.

Jill Gordon, Ph.D., founder of The Garden Way Yoga Center, is one of Anusara Yoga’s leading teachers. She conducts workshops and teacher trainings nationally and internationally, and has previously established yoga training centers in Santa Barbara, CA; Denver, CO; and Charlottesville, VA. She co-founded and co-developed the Four Winds Yoga Center in Portland, OR, which offered instruction to nearly 1,000 students per week. She has been a yoga practitioner since 1985 and a meditator since 1989. Jill is a certified Anusara instructor and one of the few Designated Teacher Trainers in the Anusara style of Hatha Yoga. She is registered with the national Yoga Alliance at the highest 500-hour level.

Yoga center business plan, executive summary chart image

1.1 Objectives

The objectives of Garden Way Yoga Center are the following:

  • Acquire 300 customers by the end of the first year of operation.
  • Achieve sales in excess of $60,000 from the boutique.
  • Increase customer base by 25% by the end of the second year of operation.
  • Increase sales by 15% by the end of the second year of operation.

1.2 Mission

The mission of Garden Way Yoga Center is to give the student, whether a beginner or advanced a place to practice Anusara. It is our intention to keep the teaching of Anusara as close to the way we have been taught as possible. It is incumbent for the teacher to always act responsibly and with the student’s interest in mind. No matter what we learn or from whom we learn the real and only teacher is within.

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Company Summary

The Garden Way Yoga Center offers Anusara-style Hatha Yoga plus workshops in related yoga topics. The Yoga Center features well-trained, professional instructors, progressive teaching methods, a non-competitive and encouraging atmosphere, and a beautiful light-filled facility.

GWYC will be located in the commercial downtown section of Monroe, in the renovated Millman Center. GWYC’s goal is to build a large base of yoga students from the thousands of office workers that are employed downtown. 

Besides the training, the Garden Way Yoga Center also has a boutique that will sell workshop clothing and yoga training aides.

GWYC will operate as a sole proprietorship.

2.1 Company Ownership

The Garden Way Yoga Center is owned by Jill Gordon.

2.2 Start-up Summary

The start-up expenses for the The Garden Way Yoga Center are focused primarily on workshop setup and equipment, and inventory for the boutique and bookstore.  Jill will invest $60,000.  In addition, GWYC will secure a $80,000 long-term loan.

Yoga center business plan, company summary chart image

Start-up
Requirements
Start-up Expenses
Legal $1,000
Stationery etc. $100
Brochures $8,000
Insurance $1,000
Rent $3,000
Expensed Equipment $20,000
Total Start-up Expenses $33,100
Start-up Assets
Cash Required $66,900
Start-up Inventory $10,000
Other Current Assets $0
Long-term Assets $30,000
Total Assets $106,900
Total Requirements $140,000
Start-up Funding
Start-up Expenses to Fund $33,100
Start-up Assets to Fund $106,900
Total Funding Required $140,000
Assets
Non-cash Assets from Start-up $40,000
Cash Requirements from Start-up $66,900
Additional Cash Raised $0
Cash Balance on Starting Date $66,900
Total Assets $106,900
Liabilities and Capital
Liabilities
Current Borrowing $0
Long-term Liabilities $80,000
Accounts Payable (Outstanding Bills) $0
Other Current Liabilities (interest-free) $0
Total Liabilities $80,000
Capital
Planned Investment
Jill Gordon $60,000
Other $0
Additional Investment Requirement $0
Total Planned Investment $60,000
Loss at Start-up (Start-up Expenses) ($33,100)
Total Capital $26,900
Total Capital and Liabilities $106,900
Total Funding $140,000

2.3 Company Locations and Facilities

The Garden Way Yoga Center is located in downtown Monroe, in the renovated Millman Center.  The facility is quickly accessible to the over 50,000 urban professionals that GWYC considers potential members. 

With five large workshop rooms, men and women’s dressing rooms, and a boutique, GWYC offers plenty of floor space for multiple classes being conducted simultaneously.  In addition, parking is not a problem.  GWYC is within easy walking distance from any building in the downtown area.  If a customer does decide to drive, the Millman Center has parking space for up to 2,000 vehicles.

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Products and Services

The Garden Way Yoga Center’s services and products are as follows:

Services

  • Yoga 1/Beginner is an introductory class for students who are new to Yoga. This class focuses on poses to stretch and strengthen the legs, back, and shoulders. Emphasis is given to the basic alignment of the standing poses.
  • Fundamentals of Vinyasa Yoga will prepare students for a vigorous flow style of yoga (Vinyasa) that synchronizes breath with movement. It will offer a balance of strength, flexibility, and endurance to challenge the fitness enthusiast. The course will begin with instruction on the alignment of the poses and move toward linking all the poses together in a continuous flow by the end of the session.
  • Gentle Yoga is designed for those who prefer a class less vigorous than Yoga 1. It includes gentle stretches and breathing as well as simple movements designed to systematically increase the range of motion of every major joint and increase energy. This class is ideal for students with chronic symptoms such as muscle/joint pain, stiffness, weakness, or fatigue. 
  • Yoga 1-2/Continuing Beginner is a continuation class for Yoga 1. The emphasis of this course is on refining and building endurance in Yoga 1 and Yoga 2 standing poses. It does not include the shoulder stand. The basic Anusara Yoga principles of alignment are presented. This class is suitable for students who have practiced other styles of yoga, but it is not suitable for those who have never studied yoga before.
  • Yoga 2/Intermediate focuses on refining the standing poses and learning basic sitting postures, simple back bending poses, and the shoulder stand using the Anusara Yoga principles of alignment. It is recommended that students complete both Yoga 1 and Yoga 1-2 before taking Yoga 2. 
  • Yoga 3/Advanced continues with refinements to poses studied in Yoga 2 and introduces full arm balance (handstand), headstand, and forearm balance. Additional back bend poses are also included. Regular yoga practice outside of class is strongly encouraged. Permission of the instructor is required.

Products

  • Workshop Clothing: Shirts, shorts, athletic bras and pants. 
  • Workshop Equipment: Balancing balls, belts, weights, and mats.
  • Yoga training aides: Video tapes, instructional manuals, inspirational books.
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Market Analysis Summary

Downtown Monroe has emerged from the recent recession to regain it position as the heart of the city. The growth has been fueled by the increased employment in the city’s high tech companies. Currently, 50,000 professional work in downtown Monroe. We believe that a yoga center can be very attractive to our customers if we create a program that fits the time constraints of their jobs. Our location is within easy walking distance from most office buildings downtown. We plan to offer our members a program that will allow them to use their lunch hours to attend workshops.

Jill Gordon will be a positive draw for those who have some experience with yoga instruction. The key to the success of GWYC will be attracting new people to yoga instruction.

4.1 Market Segmentation

The Garden Way Yoga Center will focus on two customer groups:

Middle Income Urban Professionals: This group is the core segment of potential students of GWYC.  Their demographic characteristics are the following:

  • Ages: 26-40.
  • Sex: 30% male, 70% female.
  • Family Income: $30,000-$50,000.
  • Health/Lifestyle Issues: Active individuals that are focused on healthy food and dieting.  Over 70% of this group are members of gyms. Approximately, 40% of potential customers have taken yoga classes before.
  • Social Pattern:  Will more likely attend as part of group. 
  • Center’s selling point: Close to work.  The session lowers stress.  Can be attended with workmates as group activity. 

Upper Income: The upper income customer is a secondary target group.  Their demographic characteristics are the following:

  • Ages: 40-60.
  • Sex: 30% male, 70% female.
  • Family Income: $60,000+.
  • Health/Lifestyle Issues: Active individuals that are focused on healthy food and dieting.  Over 90% of this group are members of gyms.
  • Social Pattern:  Will more likely attend alone.
  • Center’s selling point: Close to work.  The session lowers stress.
Yoga center business plan, market analysis summary chart image

Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential Customers Growth CAGR
Middle-Income 15% 15,000 17,250 19,838 22,814 26,236 15.00%
High-Income 9% 1,500 1,635 1,782 1,942 2,117 9.00%
Total 14.49% 16,500 18,885 21,620 24,756 28,353 14.49%

4.2 Target Market Segment Strategy

Everything GWYC does must be tailored to work within the time constraints of the target customer.  Yoga classes can be no longer than 45 minutes and must be scheduled to fit the break and rolling lunch schedules that exist in the downtown businesses. The focus of the instruction will also have to be tailored to a clientele that will be seeking maximum relief from the pressure of work and then returning to the workplace.  If GWYC can create a noticeable difference in the customers’ sense of well-being, then the customer will come to depend on instruction as a escape during the day.  These kinds of experiences will create a tremendous word of mouth and bring in more first time students.

4.3 Service Business Analysis

Typically, yoga centers are located away from the city’s commercial/business center.  GWYCs are less focus on serving a large number of beginners and is more focused on obtaining long term students.  Students are attracted to a specific type of yoga and the reputation and skills of GWYC’s leader.

4.3.1 Competition and Buying Patterns

“Stars do it. Sports do it. Judges in the highest courts do it. Let’s do it: that yoga thing. A path to enlightenment that winds back 5,000 years in its native India, yoga has suddenly become so hot, so cool, so very this minute. It’s the exercise cum meditation for the new millennium, one that doesn’t so much pump you up as bliss you out. Yoga now straddles the continent – from Hollywood, where $20 million-a-picture actors queue for a session with their guru du jour, to Washington, where, in the gym of the Supreme Court, Justice Sandra Day O’Connor and 15 others faithfully take their class each Tuesday morning. “

The Power Of Yoga, Time.com April 15, 2001

Yoga is a growing trend.  It was popular in the seventies and has come back full force into vogue in the 21st century.  Movie stars such as Madonna, Meg Ryan, Julia Roberts and Sting are advocates of the discipline.

The key to competition within the yoga business is the quality of the instructor.  There are a number of instructors around Monroe who are well respected, and Garden Way Yoga will strive to attract these teachers to its facility.  The location, quality and ambiance of the facility is the real competitive advantage for Garden Way.  Because it has the best most attractive facility in town teachers will want to teach here and clients will want to “get away” here.  Garden Way Yoga Center will focus of presenting GWYC as the perfect place to learn yoga skills that will improve the student physically and reduce the daily stress of the work world.

Other “schools” in the area will be able to match the quality of instruction, but are often held in church halls, community centers, fitness centers, etc. and do not have the relaxing ambiance that is so important to the discipline.

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Strategy and Implementation Summary

The Garden Way Yoga Center will market through the numerous downtown fitness clubs, beauty salons, tanning salons and boutiques.  The Garden Way Yoga Center will offer the free open workshop for beginners.  In addition, GWYC will initiate a program that will give 25% session discount to members who successfully recruit new members to GWYC.

5.1 Competitive Edge

The competitive advantage of Garden Way Yoga Center is location and the quality and ambiance of the facility. Based in the heart of Monroe, we offer our members excellent instruction that fits into their busy day, providing them a sanctuary from daily pressure.  Our facility is a perfect compliment to our brand image.

5.2 Sales Forecast

The sales forecast outlines sales of instruction time as well as sales of products through the boutique located in the facility.  Instructions is sold in the following three ways:

  1. Private lessons;
  2. Eight week courses;
  3. Drop-in sessions.

The boutique will sell clothing, books, posters, books, DVDs and videos, mats, and other props for yoga. In addition it will sell healthy pre-bottled drinks and healthy energy food.  In the beginning all food will be pre-packaged, since Jill does not have the facility or expertise to run a cafe facility.  If the facility becomes more of a destination, she will research adding a cafe.

The Garden Way Yoga Center anticipates that sales will be slow for the first and second month of operation. After that point, sales will increase as membership grows.

The following is the sales forecast for three years.

Yoga center business plan, strategy and implementation summary chart image

Yoga center business plan, strategy and implementation summary chart image

Sales Forecast
Year 1 Year 2 Year 3
Sales
Yoga Instruction $152,000 $190,000 $240,000
Boutique Sales $64,000 $85,000 $106,000
Other $0 $0 $0
Total Sales $216,000 $275,000 $346,000
Direct Cost of Sales Year 1 Year 2 Year 3
Yoga Instruction $0 $0 $0
Boutique Sales $20,150 $26,000 $32,000
Other $0 $0 $0
Subtotal Direct Cost of Sales $20,150 $26,000 $32,000

5.3 Milestones

The accompanying table lists important program milestones, with dates and managers in charge, and budgets for each. The milestone schedule indicates our emphasis on planning for implementation.

What the table doesn’t show is the commitment behind it. Our business plan includes complete provisions for plan-vs.-actual analysis, and we will be holding follow-up meetings every month to discuss the variance and course corrections.

Yoga center business plan, strategy and implementation summary chart image

Milestones
Milestone Start Date End Date Budget Manager Department
Brochures 3/1/2002 4/23/2002 $8,000 Jill Gordon Marketing
Center Setup 4/16/2002 5/10/2002 $20,000 Jill Gordon Department
Marketing Campaign 6/1/2002 7/31/2002 $5,000 Jill Gordon Department
Totals $33,000

5.4 Marketing Strategy

The key to the marketing strategy is to get the downtown lunch traffic off the streets and into GWYC. GWYC will offer free instruction and will have refreshment available for visitors.  The instruction segments will be 45 minutes and focus on exercises that will produce the maximum release of tension.

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Personnel Plan

Jill Gordon, Ph.D., founder of The Garden Way Yoga Center, is one of Anusara Yoga’s leading teachers. She conducts workshops and teacher trainings nationally and internationally. 

In addition she has excellent business experience having previously established yoga training centers in Santa Barbara, CA; Denver, CO; and Charlottesville, VA.  She co-founded and co-developed the Four Winds Yoga Center in Portland, OR, which offers instruction to nearly 1,000 students per week. She has been a yoga practitioner since 1985 and a meditator since 1989. 

Jill is a certified Anusara instructor and one of the few Designated Teacher Trainers in the Anusara style of Hatha Yoga. She is registered with the national Yoga Alliance at the highest 500-hour level.

Jill was the business manager Four Winds Yoga Center.  GWYC started with four employee and 20 students.  Within three years, GWYC had a staff of 25 and over 1,000 students.  She was an effective manager of the growth of Four Winds Yoga Center.

The Garden Way Yoga Center’s personnel will be the following:

  • Jill Gordon, director;
  • Teachers (5 half-time);
  • Boutique Staff (1).
Personnel Plan
Year 1 Year 2 Year 3
Jill Gordon $36,000 $36,000 $39,000
Teachers (5) $54,000 $65,000 $75,000
Boutique Staff $19,200 $22,000 $25,000
Total People 7 7 7
Total Payroll $109,200 $123,000 $139,000

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Financial Plan

The following is the financial plan for Garden Way Yoga Center.

7.1 Break-even Analysis

The monthly break-even point is $14,492.

Yoga center business plan, financial plan chart image

Break-even Analysis
Monthly Revenue Break-even $14,492
Assumptions:
Average Percent Variable Cost 9%
Estimated Monthly Fixed Cost $13,140

7.2 Projected Profit and Loss

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

Yoga center business plan, financial plan chart image

Yoga center business plan, financial plan chart image

Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $216,000 $275,000 $346,000
Direct Cost of Sales $20,150 $26,000 $32,000
Other Production Expenses $0 $0 $0
Total Cost of Sales $20,150 $26,000 $32,000
Gross Margin $195,850 $249,000 $314,000
Gross Margin % 90.67% 90.55% 90.75%
Expenses
Payroll $109,200 $123,000 $139,000
Sales and Marketing and Other Expenses $24,000 $26,000 $28,000
Depreciation $2,400 $2,400 $2,400
Utilities $3,300 $3,300 $3,300
Insurance $2,400 $2,400 $2,400
Payroll Taxes $16,380 $18,450 $20,850
Other $0 $0 $0
Total Operating Expenses $157,680 $175,550 $195,950
Profit Before Interest and Taxes $38,170 $73,450 $118,050
EBITDA $40,570 $75,850 $120,450
Interest Expense $7,721 $7,226 $6,710
Taxes Incurred $9,135 $19,867 $33,402
Net Profit $21,315 $46,357 $77,938
Net Profit/Sales 9.87% 16.86% 22.53%

7.3 Projected Cash Flow

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

Yoga center business plan, financial plan chart image

Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $216,000 $275,000 $346,000
Subtotal Cash from Operations $216,000 $275,000 $346,000
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 $216,000 $275,000 $346,000
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $109,200 $123,000 $139,000
Bill Payments $65,490 $105,836 $125,554
Subtotal Spent on Operations $174,690 $228,836 $264,554
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 $5,160 $5,160 $5,160
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $179,850 $233,996 $269,714
Net Cash Flow $36,150 $41,004 $76,286
Cash Balance $103,050 $144,054 $220,340

7.4 Projected Balance Sheet

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

Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $103,050 $144,054 $220,340
Inventory $2,750 $3,548 $4,367
Other Current Assets $0 $0 $0
Total Current Assets $105,800 $147,603 $224,707
Long-term Assets
Long-term Assets $30,000 $30,000 $30,000
Accumulated Depreciation $2,400 $4,800 $7,200
Total Long-term Assets $27,600 $25,200 $22,800
Total Assets $133,400 $172,803 $247,507
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $10,345 $8,551 $10,478
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $10,345 $8,551 $10,478
Long-term Liabilities $74,840 $69,680 $64,520
Total Liabilities $85,185 $78,231 $74,998
Paid-in Capital $60,000 $60,000 $60,000
Retained Earnings ($33,100) ($11,785) $34,571
Earnings $21,315 $46,357 $77,938
Total Capital $48,215 $94,571 $172,509
Total Liabilities and Capital $133,400 $172,803 $247,507
Net Worth $48,215 $94,571 $172,509

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 7997, Membership Sport and Recreation Club, are shown for comparison.

Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 27.31% 25.82% 15.20%
Percent of Total Assets
Inventory 2.06% 2.05% 1.76% 4.00%
Other Current Assets 0.00% 0.00% 0.00% 31.80%
Total Current Assets 79.31% 85.42% 90.79% 40.90%
Long-term Assets 20.69% 14.58% 9.21% 59.10%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 7.76% 4.95% 4.23% 31.60%
Long-term Liabilities 56.10% 40.32% 26.07% 28.00%
Total Liabilities 63.86% 45.27% 30.30% 59.60%
Net Worth 36.14% 54.73% 69.70% 40.40%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 90.67% 90.55% 90.75% 0.00%
Selling, General & Administrative Expenses 80.80% 73.69% 68.23% 72.30%
Advertising Expenses 2.78% 2.91% 2.89% 2.70%
Profit Before Interest and Taxes 17.67% 26.71% 34.12% 2.60%
Main Ratios
Current 10.23 17.26 21.45 1.23
Quick 9.96 16.85 21.03 0.83
Total Debt to Total Assets 63.86% 45.27% 30.30% 59.60%
Pre-tax Return on Net Worth 63.15% 70.03% 64.54% 2.80%
Pre-tax Return on Assets 22.83% 38.32% 44.98% 6.90%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin 9.87% 16.86% 22.53% n.a
Return on Equity 44.21% 49.02% 45.18% n.a
Activity Ratios
Inventory Turnover 3.95 8.26 8.09 n.a
Accounts Payable Turnover 7.33 12.17 12.17 n.a
Payment Days 27 33 27 n.a
Total Asset Turnover 1.62 1.59 1.40 n.a
Debt Ratios
Debt to Net Worth 1.77 0.83 0.43 n.a
Current Liab. to Liab. 0.12 0.11 0.14 n.a
Liquidity Ratios
Net Working Capital $95,455 $139,051 $214,229 n.a
Interest Coverage 4.94 10.16 17.59 n.a
Additional Ratios
Assets to Sales 0.62 0.63 0.72 n.a
Current Debt/Total Assets 8% 5% 4% n.a
Acid Test 9.96 16.85 21.03 n.a
Sales/Net Worth 4.48 2.91 2.01 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
Yoga Instruction 0% $0 $0 $7,000 $9,000 $14,000 $16,000 $18,000 $20,000 $15,000 $15,000 $18,000 $20,000
Boutique Sales 0% $0 $0 $3,000 $4,000 $5,000 $6,000 $8,000 $8,000 $6,000 $7,000 $8,000 $9,000
Other 0% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Sales $0 $0 $10,000 $13,000 $19,000 $22,000 $26,000 $28,000 $21,000 $22,000 $26,000 $29,000
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
Yoga Instruction $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Boutique Sales $0 $0 $1,000 $1,500 $1,750 $2,000 $2,400 $2,400 $2,000 $2,200 $2,400 $2,500
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Direct Cost of Sales $0 $0 $1,000 $1,500 $1,750 $2,000 $2,400 $2,400 $2,000 $2,200 $2,400 $2,500
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
Jill Gordon 0% $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Teachers (5) 0% $4,500 $4,500 $4,500 $4,500 $4,500 $4,500 $4,500 $4,500 $4,500 $4,500 $4,500 $4,500
Boutique Staff 0% $1,600 $1,600 $1,600 $1,600 $1,600 $1,600 $1,600 $1,600 $1,600 $1,600 $1,600 $1,600
Total People 7 7 7 7 7 7 7 7 7 7 7 7
Total Payroll $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100

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 $10,000 $13,000 $19,000 $22,000 $26,000 $28,000 $21,000 $22,000 $26,000 $29,000
Direct Cost of Sales $0 $0 $1,000 $1,500 $1,750 $2,000 $2,400 $2,400 $2,000 $2,200 $2,400 $2,500
Other Production Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Cost of Sales $0 $0 $1,000 $1,500 $1,750 $2,000 $2,400 $2,400 $2,000 $2,200 $2,400 $2,500
Gross Margin $0 $0 $9,000 $11,500 $17,250 $20,000 $23,600 $25,600 $19,000 $19,800 $23,600 $26,500
Gross Margin % 0.00% 0.00% 90.00% 88.46% 90.79% 90.91% 90.77% 91.43% 90.48% 90.00% 90.77% 91.38%
Expenses
Payroll $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100
Sales and Marketing and Other Expenses $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000
Depreciation $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200
Utilities $300 $300 $300 $300 $300 $300 $300 $300 $300 $300 $300 $0
Insurance $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200
Payroll Taxes 15% $1,365 $1,365 $1,365 $1,365 $1,365 $1,365 $1,365 $1,365 $1,365 $1,365 $1,365 $1,365
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Operating Expenses $13,165 $13,165 $13,165 $13,165 $13,165 $13,165 $13,165 $13,165 $13,165 $13,165 $13,165 $12,865
Profit Before Interest and Taxes ($13,165) ($13,165) ($4,165) ($1,665) $4,085 $6,835 $10,435 $12,435 $5,835 $6,635 $10,435 $13,635
EBITDA ($12,965) ($12,965) ($3,965) ($1,465) $4,285 $7,035 $10,635 $12,635 $6,035 $6,835 $10,635 $13,835
Interest Expense $663 $660 $656 $652 $649 $645 $642 $638 $634 $631 $627 $624
Taxes Incurred ($4,148) ($4,147) ($1,446) ($695) $1,031 $1,857 $2,938 $3,539 $1,560 $1,801 $2,942 $3,903
Net Profit ($9,680) ($9,677) ($3,375) ($1,622) $2,405 $4,333 $6,855 $8,258 $3,640 $4,203 $6,865 $9,108
Net Profit/Sales 0.00% 0.00% -33.75% -12.48% 12.66% 19.69% 26.37% 29.49% 17.34% 19.10% 26.41% 31.41%

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 $10,000 $13,000 $19,000 $22,000 $26,000 $28,000 $21,000 $22,000 $26,000 $29,000
Subtotal Cash from Operations $0 $0 $10,000 $13,000 $19,000 $22,000 $26,000 $28,000 $21,000 $22,000 $26,000 $29,000
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 $10,000 $13,000 $19,000 $22,000 $26,000 $28,000 $21,000 $22,000 $26,000 $29,000
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 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100 $9,100
Bill Payments $13 $380 $467 $3,100 $3,880 $5,572 $6,446 $8,792 $10,348 $7,656 $8,762 $10,076
Subtotal Spent on Operations $9,113 $9,480 $9,567 $12,200 $12,980 $14,672 $15,546 $17,892 $19,448 $16,756 $17,862 $19,176
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 $430 $430 $430 $430 $430 $430 $430 $430 $430 $430 $430 $430
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 $9,543 $9,910 $9,997 $12,630 $13,410 $15,102 $15,976 $18,322 $19,878 $17,186 $18,292 $19,606
Net Cash Flow ($9,543) ($9,910) $3 $370 $5,590 $6,898 $10,024 $9,678 $1,122 $4,814 $7,708 $9,394
Cash Balance $57,357 $47,448 $47,451 $47,821 $53,412 $60,310 $70,334 $80,012 $81,134 $85,948 $93,656 $103,050
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 $66,900 $57,357 $47,448 $47,451 $47,821 $53,412 $60,310 $70,334 $80,012 $81,134 $85,948 $93,656 $103,050
Inventory $10,000 $10,000 $10,000 $9,000 $7,500 $5,750 $3,750 $2,640 $2,640 $2,200 $2,420 $2,640 $2,750
Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Current Assets $76,900 $67,357 $57,448 $56,451 $55,321 $59,162 $64,060 $72,974 $82,652 $83,334 $88,368 $96,296 $105,800
Long-term Assets
Long-term Assets $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $30,000
Accumulated Depreciation $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 $1,800 $2,000 $2,200 $2,400
Total Long-term Assets $30,000 $29,800 $29,600 $29,400 $29,200 $29,000 $28,800 $28,600 $28,400 $28,200 $28,000 $27,800 $27,600
Total Assets $106,900 $97,157 $87,048 $85,851 $84,521 $88,162 $92,860 $101,574 $111,052 $111,534 $116,368 $124,096 $133,400
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 $367 $365 $2,972 $3,695 $5,360 $6,155 $8,443 $10,094 $7,366 $8,427 $9,719 $10,345
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 $367 $365 $2,972 $3,695 $5,360 $6,155 $8,443 $10,094 $7,366 $8,427 $9,719 $10,345
Long-term Liabilities $80,000 $79,570 $79,140 $78,710 $78,280 $77,850 $77,420 $76,990 $76,560 $76,130 $75,700 $75,270 $74,840
Total Liabilities $80,000 $79,937 $79,505 $81,682 $81,975 $83,210 $83,575 $85,433 $86,654 $83,496 $84,127 $84,989 $85,185
Paid-in Capital $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $60,000
Retained Earnings ($33,100) ($33,100) ($33,100) ($33,100) ($33,100) ($33,100) ($33,100) ($33,100) ($33,100) ($33,100) ($33,100) ($33,100) ($33,100)
Earnings $0 ($9,680) ($19,357) ($22,731) ($24,354) ($21,948) ($17,615) ($10,760) ($2,502) $1,138 $5,341 $12,207 $21,315
Total Capital $26,900 $17,220 $7,543 $4,169 $2,546 $4,952 $9,285 $16,140 $24,398 $28,038 $32,241 $39,107 $48,215
Total Liabilities and Capital $106,900 $97,157 $87,048 $85,851 $84,521 $88,162 $92,860 $101,574 $111,052 $111,534 $116,368 $124,096 $133,400
Net Worth $26,900 $17,220 $7,543 $4,169 $2,546 $4,952 $9,285 $16,140 $24,398 $28,038 $32,241 $39,107 $48,215

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