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Table of Contents
1.0 Executive Summary.............................................................................................................................1
1.1 Objectives ...................................................................................................................................1
1.2 Mission........................................................................................................................................2
1.3 Keys to Success ........................................................................................................................2
2.0 Company Summary.............................................................................................................................2
2.1 Company Ownership .................................................................................................................3
2.2 Start-up Summary ......................................................................................................................3
3.0 Services................................................................................................................................................6
4.0 Market Analysis Summary..................................................................................................................7
4.1 Market Segmentation ................................................................................................................8
4.2 Target Market Segment Strategy.............................................................................................9
4.3 Service Business Analysis .....................................................................................................10
4.3.1 Competition and Buying Patterns .......................................................................................10
5.0 Strategy and Implementation Summary..........................................................................................11
5.1 Competitive Edge....................................................................................................................11
5.2 Marketing Strategy ..................................................................................................................11
5.3 Sales Strategy..........................................................................................................................12
5.3.1 Sales Forecast .....................................................................................................................12
5.4 Milestones ................................................................................................................................15
6.0 Management Summary ....................................................................................................................17
6.1 Personnel Plan.........................................................................................................................17
7.0 Financial Plan ....................................................................................................................................18
7.1 Important Assumptions............................................................................................................18
7.2 Break-even Analysis................................................................................................................18
7.3 Projected Profit and Loss .......................................................................................................19
7.4 Projected Cash Flow ...............................................................................................................22
7.5 Business Ratios .......................................................................................................................24
7.6 Projected Balance Sheet ........................................................................................................26
Page 1
PC Repair
1.0 Executive Summary
PC Repair will provide computer and technical consulting (repairs, training, networking and
upgrade service) to loc al small businesses as well as home PC users. The company will foc us on
marketing, responsiveness, quality, and creating and retaining customer relations.
PC Repair was initially formed as a sole proprietorship, but was rec onfigured as an S Corporation
in Dec ember of 2004. PC Repair will at first be a home office start-up, utilizing one studio room in
the owner's home and serving customers in the loc al Ramsford-on-Bitstream area. In the third
month of our plan, we will move into a leased office space and hire a second tec hnician. As sales
increase, we will hire additional personnel.
The Market
The very nature of the computing industry, with its extraordinary rate of tec hnological
development, creates a constant need for businesses skilled in updating and advising customers
on computer-related issues. In town, the majority of potential customers are dissatisfied with
existing options, creating an attrac tive niche for an innovative start-up. Small business PC users
will provide the majority of our business revenue. Business Week expec ts the computing industry
to grow at a rate of 12% and the proc essor speeds to continue to expand for years to come,
providing a rich resource for sales.
PC Repair has dec ided to foc us mainly on the small business market, as these customers typically
don't have a full-time IT person, but have full-time IT needs. PC Repair will offer an affordable,
on-demand service for these customers. We can also offer maintenance agreements that
generate additional monthly income. For our residential customers, we will offer a very affordable
and helpful service with a very flexible sc hedule to meet their needs. Our target market will foc us
on Ramsford-on-Bitstream and the surrounding areas. Market research indicates there is an
abundance of business for a small company such as PC Repair.
Start-up Funding and Financials
To get PC Repair started the owner is providing cash and assets. We are also seeking a shortterm loan, to be secured with the owner's home equity, and repaid within three years. Our
conservative sales forec asts, based on industry research within the loc al area, projec t hefty
sales in year one, steadily increasing through year three. To reach these goals, we will use an
aggressive advertising campaign to exploit our competitors' weaknesses. With good cost control,
we will see a modest, yet comfortable, net profit the first year, even after moving into a leased
space and hiring additional tec hnicians.
1.1 Objectives
1.
2.
3.
4.
Page 1
PC Repair
1.2 Mission
Our goal is to set the standard for on-site computer solutions through fast, on-site service and
response. Our customers will always rec eive one-on-one personal attention at a very affordable
price. Our customers will rec eive the highest quality of customer service available. Our
employees will rec eive extensive training, a great plac e to work, fair pay and benefits, and
incentives to use their own good judgement to solve customers' problems.
Establishing a brand identity and generating brand rec ognition through marketing.
Responsiveness: being an on-call computer paramedic with fast response time.
Quality: getting the job done right the first time, offering 100% guarantee.
Relationships: developing loyal repeat customers--retainers.
Page 2
PC Repair
2.1 Company Ownership
PC Repair was initially envisioned as a sole proprietorship in the owner's home. However, rec ent
feedback from our marketing outreach has suggested a much higher sales potential than
originally imagined, and PC Repair has been reformed as an S Corporation. This change will
provide additional legal protec tion for the owner, and will also streamline the financial operations
of the company as we expand the personnel to 5 within the next three years, lease a separate
space for offices, and purchase company vehicles and cell phones.
The owner, Jack Hac ker, has 10 years of experience in the fields of tec hnical support,
networking, and computer training and repair. Jack has also spent the last three years as the
manager of a custom computer building and repair store, and understands the computer needs of
small businesses.
Page 3
PC Repair
Table: Start-up
Start-up
Requirements
Start-up Expenses
Legal
Website
Business Cards
Insurance
Uniforms
CPA
Advertisement
Total Start-up Expenses
$650
$350
$100
$150
$300
$275
$1,200
$3,025
Start-up Assets
Cash Required
Start-up Inventory
Other Current Assets
Long-term Assets
Total Assets
$28,000
$1,200
$10,000
$0
$39,200
Total Requirements
$42,225
Page 4
PC Repair
Table: Start-up Funding
Start-up Funding
Start-up Expenses to Fund
Start-up Assets to Fund
Total Funding Required
$3,025
$39,200
$42,225
Assets
Non-cash Assets from Start-up
Cash Requirements from Start-up
Additional Cash Raised
Cash Balance on Starting Date
Total Assets
$11,200
$28,000
$0
$28,000
$39,200
$19,225
$0
$0
$0
$19,225
Capital
Planned Investment
Owner
Investor
Additional Investment Requirement
Total Planned Investment
$23,000
$0
$0
$23,000
($3,025)
$19,975
$39,200
Total Funding
$42,225
Page 5
PC Repair
3.0 Services
PC Repair will offer computer repairs, training, networking and upgrade service to clients in two
major categories: home PC users and small business users. As PC Repair and the client demands
grow, we will offer software development to our business clients.
From the very first day, we will offer on-site repair and consulting services, so that our clients
don't need to take time out of their busy days to haul a computer in to our workshop. This is the
single biggest frustration Jack has seen among small business owners needing computer help.
Much of our diagnostic equipment is portable, and we will remove a PC to our workshop only
when the problem requires more detailed diagnosis or repair. We will also offer free pick-up and
delivery of PCs needing repair. To meet the growing demand for this service, we will purchase a
company vehicle in the third month.
We will also offer extended maintenance contrac ts, so that business clients can deal with
technical support and repair needs as a single line-item expense, rather than having to plan for
unexpec ted crashes and problems with a rainy-day fund they may never use. Maintenance
contrac ts yield a high gross margin for us, and provide peace of mind for the customer.
We will offer limited software support (installation and compatibility issues), and foc us on
hardware and networking support - this is a vital distinction, since software is evolving much
more rapidly than hardware, and our clients will have such diverse software needs that we
couldn't possibly keep up with all of them. We will encourage clients to register their software
and use the software's own support options to their full potential. We will, however, keep up to
date with multiple operating systems and networking developments, working with c lients to make
sure they have the most appropriate combinations of hardware, OS, networking, bac kup
systems, and software. Bac kup and security are bec oming higher priorities for all our potential
customers, as internet usage (and its pitfalls) bec omes more common, and as more and more
daily rec ords are stored elec tronically.
Page 6
PC Repair
4.0 Market Analysis Summary
PC Repair will provide computer support in both a consulting and tec hnical capacity to small
business owners as well as home PC users. Since PC Repair is currently a one man operation, its
growth in the first three months will be limited by the owner's capacity to complete work.
However, these first three months are critical for establishing our credibility and a reputation for
getting the job done quickly and well. We will foc us on delivering excellent service, and using the
good word of mouth from this initial period to network with other potential clients.
Personal market research by the owner indicates an attrac tive market niche for our services, of
which PC Repair will take full advantage. The very nature of the computing industry, with its
extraordinary rate of technological development, creates a constant need for businesses skilled
in updating and advising customers on computer-related issues.
National chains, such as "Geeks on Call," and Best Buy's "Geek Squad" have seen rapid growth in
demand for these services in the last few years. Customers are seeking skilled help with
everything from installation of software and hardware components, to networking, to transferring
files from an old computer to a new one. Those who can often enlist their tec h-savvy children's
help, but others are not so fortunate, and small-business owners need reliable and quick help
with all their computer needs, since every hour down may mean an hour or more of lost revenue,
espec ially for any business with a website or those doing e-commerce.
Page 7
PC Repair
4.1 Market Segmentation
The existing computer service market is so extensive that categorizing it is rather difficult. We
have broken our potential market down into two groups, based on their needs: home PC users
and small business clients.
Home PC User
Our home PC user market includes non-tech-savvy residents of the loc al area (15 mile radius),
generally between the ages of 30 and 70, with at least one home computer. We are not
expec ting income from users below 30, who tend to be more comfortable with technology and
willing to attempt repairs and upgrades on their own, without seeking professional assistance.
Such home users generally own a computer to do email, play games, write letters, sc an and print
photos, and oc casionally to do bookkeeping or taxes. Home PC users with more sophisticated
applications generally have enough tech savvy, from tec h experience at work, to do their own
repairs and upgrades. Their hardware needs will include the computer itself, monitors, keyboards,
mouse, printer, and sc anner.
This group is growing slightly faster than the overall population growth in our area, in part due to
the increasing demand for computers among retired people and young families, about 7% a year.
Small Business Users
Small business users will provide the majority of our business revenue. The small business market
will be defined as customers within a 15 mile radius, with 2 or more computers or a network
which they use for business purposes at least 25% of the time. Their business use may include
minor usage, such as updating a business website for a brick-and-mortar store, keeping the
books, designing graphics or ad campaigns, and writing copy for press releases. It may also be
more extensive, incorporating inventory trac king, POS systems, customer databases, online
product/service delivery, or product development. The more intensive their computer usage for
business, the more critical it is to them that their tec hnology work well and reliably, and that
quality repairs and support are available in a crisis. Their hardware needs will include the same
items as home users, plus servers, bac kup systems, data storage, and wireless networking.
The portion of the small business market we are targeting is growing at around 2% a year.
Growth
7%
2%
0%
5.39%
2006
25,000
10,000
0
35,000
2007
26,750
10,100
0
36,850
2008
28,623
10,201
0
38,824
2009
30,626
10,303
0
40,929
32,770
10,406
0
43,176
CAGR
7.00%
1.00%
0.00%
5.39%
Page 8
PC Repair
Page 9
PC Repair
4.3 Service Business Analysis
Secondary market research shows computer service customers tend to be very loyal to providers
that do good work and satisfy their needs. An analysis of PC Repair's main c ompetitors shows no
overwhelming strengths that would be significant barriers to entry into the market, as our loc al
competitors have serious weaknesses.
The computer maintenance and repair industry is fragmented, with a few large, national players
and hundreds of small, loc al stores. While most computers are ac tually repaired in-store, near
the customer, parts for the repair come from major manufac turers and distributors; delays in
rec eiving necessary parts can significantly slow down the repair proc ess. Large chains have
solved this problem by keeping vast amounts of inventory in stoc k at all times, while loc al stores
offer customers the trade-off of personal interac tion and trust that may make up for some delay.
PC Repair has established a relationship with a loc al distributor to do rapid special-ordering;
although this capability is more expensive than normal channels, it will enable us to quickly
establish a reputation as efficient and responsive to customer needs, particularly for our small
business users. We will leverage this customer loyalty into great word of mouth marketing and
steady growth.
Page 10
PC Repair
5.0 Strategy and Implementation Summary
Our Strategy and Implementation turn on three points:
1. A value proposition of timely and prac tical solutions, at a reasonable rate, coupled with a
100% guarantee.
2. Exploiting our competitors weaknesses: a competitive edge based on quick, effective, and
sympathetic customer service, which meets the customer where his needs are, rather than
trying to fit him into an existing box.
3. Quickly establishing a brand identity and developing a great reputation among loc al
customers to generate word of mouth advertising.
Page 11
PC Repair
5.3 Sales Strategy
Our marketing strategy will generate customer inquiries. We will close the deals by offering an
outstanding service and a very reasonable price. Happy customers generate repeat business and
word of mouth. Our toll free number is operational 24 hours a day, seven days a week, and from
8am to 9pm, I will be available to answer calls. At other times, or when I am on the phone, an
answering service we have hired will catch c allers and give them an estimated wait time for a
call-bac k; this is another step towards delivering a complete solution to our customers.
Sales forec ast figures are based on industry figures for the typical growth of a start-up and
reflec t repeat business generated through meeting customer needs.
Page 12
PC Repair
Page 13
PC Repair
Table: Sales Forecast
Sales Forecast
FY 2006
FY 2007
FY 2008
Unit Sales
Home PC Unit
Small Business Unit
Promo
Maintenance Contracts
Total Unit Sales
166
264
235
32
697
200
300
0
60
560
225
350
0
85
660
Unit Prices
Home PC Unit
Small Business Unit
Promo
Maintenance Contracts
FY 2006
$280.00
$500.00
$50.00
$400.00
FY 2007
$300.00
$600.00
$0.00
$600.00
FY 2008
$300.00
$600.00
$0.00
$600.00
Sales
Home PC Unit
Small Business Unit
Promo
Maintenance Contracts
Total Sales
$46,480
$132,000
$11,750
$12,800
$203,030
$60,000
$180,000
$0
$36,000
$276,000
$67,500
$210,000
$0
$51,000
$328,500
FY 2006
$84.00
$105.00
$4.00
$0.00
FY 2007
$90.00
$126.00
$0.00
$0.00
FY 2008
$90.00
$126.00
$0.00
$0.00
$13,944
$27,720
$940
$0
$42,604
$18,000
$37,800
$0
$0
$55,800
$20,250
$44,100
$0
$0
$64,350
Page 14
PC Repair
5.4 Milestones
Our milestones, listed in the table below, outline the major events that will promote, as well as
insure the success of PC Repair and keep it a going concern well into the future. We will measure
our success in meeting these milestones every month, and adjust the plan to keep up with our
objec tives. Name rec ognition, in particular, is very important to breaking into this market - we
will conduct a survey by calling 200 randomly selec ted small businesses from the Chamber of
Commerce listings on the specified dates and asking them whether they have heard of PC Repair,
and if so, what their impression is of our service. If any of the respondents have ac tually used
our services, we will elicit feedbac k on their experience with us, and suggestions for
improvement. We will also ask if they would rec ommend us to a colleague.
Page 15
PC Repair
Table: Milestones
Milestones
Milestone
Procurement of materials for
opening
Start-up Ad Campaign
Get Loan Approved
Open Business
Name Recognition by 5% of
potential market
Meet with Leasing Agent
Interview potential Techs
Move into Leased Space
Sign on Leased Vehicle
Targeted Ads Begin
1st Tech Starts
2nd Round Tech Interviews
Direct marketing to Small
Businesses
Increase Name Recognition to
20%
2nd Tech Starts
Totals
Start Date
12/1/2004
End Date
2/1/2005
Budget
$1,200
Manager
JMH
Department
Department
12/15/2004
1/1/2005
2/7/2005
2/28/2005
2/6/2005
1/17/2005
2/8/2005
2/28/2005
$1,200
$0
$0
$0
JMH
JMH
JMH
JMH
Department
Department
Department
Department
3/1/2005
3/1/2005
4/1/2005
4/15/2005
4/15/2005
5/1/2005
7/1/2005
7/1/2005
3/10/2005
4/25/2005
4/10/2005
4/20/2005
5/15/2005
5/1/2005
7/31/2005
9/30/2005
$0
$0
$2,000
$6,000
$4,000
$0
$0
$8,000
JMH
JMH
JMH
JMH
JMH
JMH
JMH
JMH
Department
Department
Department
Department
Department
Department
Department
Department
8/1/2005
8/2/2005
$0
JMH
Department
8/1/2005
8/7/2005
$0
$22,400
JMH
Department
Page 16
PC Repair
6.0 Management Summary
PC Repair will be owned and managed by Jack Hac ker. Jack has 10 years of experience in the
fields of technical support, networking, and computer training and repair. Jack has also spent the
last three years as the manager of a custom computer building and repair store, and understands
the computer needs of small businesses. Jack is adept at managing his time, and at quickly
responding to multiple customer calls and needs.
For the first three months, Jack will be in c harge of all aspec ts of the business. In the third
month, when another tech is hired, Jack will shift some of his energy from direc tly responding to
customer needs, to training and managing others to do this work effec tively. Jack will maintain
direc t control over inventory ordering and bookkeeping, and will try to do as many of the on-site
calls as possible himself. Part of our brand rec ognition strategy is to identify PC Repair with
Jack's efficiency, friendliness, and technical expertise. The easiest way to associate the two is
for Jack to be a major part of many customers' experiences with us. He will delegate technical
repairs later in the year to the tec hs working in the leased office space, and will also train them
in his method of direc t phone support.
Jack has worked extensively with c omputer technicians and support staff in the past, and knows
that they work best when given free rein within a set of mutually-agreed-upon guidelines. The
first week of each tech's employment will be dedicated to helping them understand PC Repair's
guidelines:
the customer needs help, and we're here to help them;
the customer is frustrated, upset, or confused - but that doesn't make the customer a
problem;
the customer needs reassurance as well as solutions.
Within this framework, the tec hs can solve the customer's problem the best way they see fit Jack is not a micro manager.
Page 17
PC Repair
Table: Personnel
Personnel Plan
Owner
Tech1
Tech2
Part Time
Total People
FY 2006
$33,000
$21,600
$14,400
$0
3
FY 2007
$38,000
$30,000
$30,000
$12,000
5
FY 2008
$40,000
$30,000
$30,000
$15,000
5
Total Payroll
$69,000
$110,000
$115,000
FY 2007
2
7.00%
10.00%
30.00%
0
FY 2008
3
70.00%
10.00%
30.00%
0
70.00%
10.00%
30.00%
0
Page 18
PC Repair
52
$15,110
Assumptions:
Average Per-Unit Revenue
Average Per-Unit Variable Cost
Estimated Monthly Fixed Cost
$291.29
$70.00
$11,479
Page 19
PC Repair
Page 20
PC Repair
Table: Profit and Loss
Pro Forma Profit and Loss
Sales
Direct Cost of Sales
Costs of Fulfilling Maintenance Contracts
Total Cost of Sales
FY 2006
$203,030
$42,604
$1,488
$44,092
FY 2007
$276,000
$55,800
$4,320
$60,120
FY 2008
$328,500
$64,350
$6,120
$70,470
Gross Margin
Gross Margin %
$158,938
78.28%
$215,880
78.22%
$258,030
78.55%
Expenses
Payroll
Marketing/Promotion
Depreciation
Lease
$69,000
$28,000
$0
$10,000
$110,000
$6,000
$0
$12,000
$115,000
$12,000
$0
$12,000
Expensed Equipment
Insurance
Website
Answering Service
Mileage
Vehicles
Cell Phones
Utilities
Internet
Moving Expenses
$0
$3,150
$2,080
$200
$2,660
$13,200
$1,260
$5,000
$1,200
$2,000
$10,000
$1,200
$480
$2,400
$5,400
$15,000
$1,260
$6,000
$1,200
$0
$12,000
$1,200
$480
$2,400
$5,400
$17,000
$1,260
$7,000
$1,200
$0
$137,750
$170,940
$186,940
$21,188
$21,188
$44,940
$44,940
$71,090
$71,090
$1,097
$6,027
$6,570
$11,511
$2,139
$20,685
$14,064
6.93%
$26,859
9.73%
$48,266
14.69%
Page 21
PC Repair
Page 22
PC Repair
Page 23
PC Repair
Table: Cash Flow
Pro Forma Cash Flow
FY 2006
FY 2007
FY 2008
$203,030
$203,030
$276,000
$276,000
$328,500
$328,500
$0
$0
$0
$0
$0
$0
$0
$203,030
$0
$0
$0
$0
$0
$0
$0
$276,000
$0
$0
$0
$0
$0
$0
$0
$328,500
FY 2006
FY 2007
FY 2008
$69,000
$110,873
$179,873
$110,000
$141,877
$251,877
$115,000
$164,115
$279,115
$0
$6,564
$0
$0
$0
$0
$0
$186,437
$0
$6,550
$0
$0
$0
$0
$0
$258,427
$0
$6,111
$0
$0
$0
$0
$0
$285,226
$16,593
$44,593
$17,573
$62,165
$43,274
$105,440
Cash Received
Expenditures
Page 24
PC Repair
Table: Ratios
Ratio Analysis
Sales Growth
FY 2006
0.00%
FY 2007
35.94%
FY 2008
19.02%
Industry Profile
5.23%
8.22%
16.81%
100.00%
0.00%
100.00%
8.15%
12.73%
100.00%
0.00%
100.00%
6.01%
8.14%
100.00%
0.00%
100.00%
2.79%
51.19%
75.09%
24.91%
100.00%
42.77%
0.00%
42.77%
57.23%
22.49%
0.00%
22.49%
77.51%
11.12%
0.00%
11.12%
88.88%
31.75%
18.48%
50.23%
49.77%
100.00%
78.28%
38.70%
0.00%
10.44%
100.00%
78.22%
65.72%
0.00%
16.28%
100.00%
78.55%
64.96%
0.00%
21.64%
100.00%
100.00%
80.06%
1.23%
1.95%
2.34
2.15
42.77%
59.02%
33.78%
4.45
4.08
22.49%
63.01%
48.84%
8.99
8.45
11.12%
63.16%
56.14%
1.53
1.24
57.27%
2.73%
6.39%
Additional Ratios
FY 2006
FY 2007
FY 2008
6.93%
41.32%
9.73%
44.10%
14.69%
44.21%
n.a
n.a
10.25
9.67
27
3.41
9.88
12.17
32
3.51
9.33
12.17
28
2.67
n.a
n.a
n.a
n.a
0.75
1.00
0.29
1.00
0.13
1.00
n.a
n.a
$34,039
19.32
$60,898
6.84
$109,163
33.24
n.a
n.a
0.29
43%
2.15
5.96
0.00
0.28
22%
4.08
4.53
0.00
0.37
11%
8.45
3.01
0.00
n.a
n.a
n.a
n.a
n.a
Current Liabilities
Long-term Liabilities
Total Liabilities
Net Worth
Percent of Sales
Sales
Gross Margin
Selling, General & Administrative Expenses
Advertising Expenses
Profit Before Interest and Taxes
Main Ratios
Current
Quick
Total Debt to Total Assets
Pre-tax Return on Net Worth
Pre-tax Return on Assets
Activity Ratios
Inventory Turnover
Accounts Payable Turnover
Payment Days
Total Asset Turnover
Debt Ratios
Debt to Net Worth
Current Liab. to Liab.
Liquidity Ratios
Net Working Capital
Interest Coverage
Additional Ratios
Assets to Sales
Current Debt/Total Assets
Acid Test
Sales/Net Worth
Dividend Payout
Page 25
PC Repair
7.6 Projected Balance Sheet
The Balance Sheet shows a steadily increasing net worth over the next three years. Since we
are planning to rent, and bec ause computer tec hnology changes so rapidly, we will have only
short-term assets, such as computer equipment and furniture. This will make our net worth much
more liquid than many similar businesses.
FY 2007
FY 2008
Current Assets
Cash
Inventory
Other Current Assets
Total Current Assets
$44,593
$4,890
$10,000
$59,482
$62,165
$6,404
$10,000
$78,569
$105,440
$7,385
$10,000
$122,825
Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets
$0
$0
$0
$59,482
$0
$0
$0
$78,569
$0
$0
$0
$122,825
FY 2006
FY 2007
FY 2008
Current Liabilities
Accounts Payable
Current Borrowing
Other Current Liabilities
Subtotal Current Liabilities
$12,783
$12,661
$0
$25,444
$11,561
$6,111
$0
$17,672
$13,662
$0
$0
$13,662
Long-term Liabilities
Total Liabilities
$0
$25,444
$0
$17,672
$0
$13,662
Paid-in Capital
Retained Earnings
Earnings
Total Capital
Total Liabilities and Capital
$23,000
($3,025)
$14,064
$34,039
$59,482
$23,000
$11,039
$26,859
$60,898
$78,569
$23,000
$37,898
$48,266
$109,163
$122,825
Net Worth
$34,039
$60,898
$109,163
Assets
Page 26
Appendix
Table: Sales Forecast
Sales Forecast
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Unit Sales
Home PC Unit
15
18
20
20
20
17
15
10
20
3
0
0
3
0
1
3
10
1
10
30
2
25
40
3
35
0
3
40
40
3
45
40
4
50
40
4
15
0
3
10
0
4
25
35
4
17
57
86
58
103
109
111
33
24
84
Unit Prices
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Home PC Unit
$280.00
$280.00
$280.00
$280.00
$280.00
$280.00
$280.00
$280.00
$280.00
$280.00
$280.00
$280.00
$500.00
$50.00
$500.00
$50.00
$500.00
$50.00
$500.00
$50.00
$500.00
$50.00
$500.00
$50.00
$500.00
$50.00
$500.00
$50.00
$500.00
$50.00
$500.00
$50.00
$500.00
$50.00
$500.00
$50.00
Maintenance Contracts
$400.00
$400.00
$400.00
$400.00
$400.00
$400.00
$400.00
$400.00
$400.00
$400.00
$400.00
$400.00
Home PC Unit
Small Business Unit
Promo
$840
$1,500
$0
$1,400
$1,500
$0
$840
$1,500
$500
$4,200
$5,000
$1,500
$5,040
$12,500
$2,000
$5,600
$17,500
$0
$5,600
$20,000
$2,000
$5,600
$22,500
$2,000
$4,760
$25,000
$2,000
$4,200
$7,500
$0
$2,800
$5,000
$0
$5,600
$12,500
$1,750
Maintenance Contracts
Total Sales
$0
$2,340
$400
$3,300
$400
$3,240
$800
$11,500
$1,200
$20,740
$1,200
$24,300
$1,200
$28,800
$1,600
$31,700
$1,600
$33,360
$1,200
$12,900
$1,600
$9,400
$1,600
$21,450
Sales
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
30.00%
21.00%
$84.00
$105.00
$84.00
$105.00
$84.00
$105.00
$84.00
$105.00
$84.00
$105.00
$84.00
$105.00
$84.00
$105.00
$84.00
$105.00
$84.00
$105.00
$84.00
$105.00
$84.00
$105.00
$84.00
$105.00
8.00%
$4.00
$4.00
$4.00
$4.00
$4.00
$4.00
$4.00
$4.00
$4.00
$4.00
$4.00
$4.00
12.00%
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$0.00
$252
$315
$420
$315
$252
$315
$1,260
$1,050
$1,512
$2,625
$1,680
$3,675
$1,680
$4,200
$1,680
$4,725
$1,428
$5,250
$1,260
$1,575
$840
$1,050
$1,680
$2,625
Promo
Maintenance Contracts
Subtotal Direct Cost of Sales
$0
$0
$567
$0
$0
$735
$40
$0
$607
$120
$0
$2,430
$160
$0
$4,297
$0
$0
$5,355
$160
$0
$6,040
$160
$0
$6,565
$160
$0
$6,838
$0
$0
$2,835
$0
$0
$1,890
$140
$0
$4,445
Home PC Unit
Small Business Unit
Promo
Maintenance Contracts
Page 1
Appendix
Table: Personnel
Personnel Plan
Owner
Tech1
Tech2
0%
0%
0%
Part Time
Total People
0%
Total Payroll
Feb
$2,000
$0
$0
Mar
$2,000
$0
$0
Apr
$2,500
$0
$0
May
$2,500
$2,400
$0
Jun
$3,000
$2,400
$0
Jul
$3,000
$2,400
$0
Aug
$3,000
$2,400
$2,400
Sep
$3,000
$2,400
$2,400
Oct
$3,000
$2,400
$2,400
Nov
$3,000
$2,400
$2,400
Dec
$3,000
$2,400
$2,400
Jan
$3,000
$2,400
$2,400
$0
1
$0
1
$0
1
$0
2
$0
2
$0
2
$0
3
$0
3
$0
3
$0
3
$0
3
$0
3
$2,000
$2,000
$2,500
$4,900
$5,400
$5,400
$7,800
$7,800
$7,800
$7,800
$7,800
$7,800
Page 2
Appendix
Table: General Assumptions
General Assumptions
Feb
Plan Month
Current Interest Rate
Long-term Interest Rate
Tax Rate
Other
Mar
2
Apr
3
May
4
Jun
5
Jul
6
Aug
7
Sep
8
Oct
9
Nov
10
Dec
11
Jan
12
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
10.00%
30.00%
0
10.00%
30.00%
0
10.00%
30.00%
0
10.00%
30.00%
0
10.00%
30.00%
0
10.00%
30.00%
0
10.00%
30.00%
0
10.00%
30.00%
0
10.00%
30.00%
0
10.00%
30.00%
0
10.00%
30.00%
0
10.00%
30.00%
0
Page 3
Appendix
Table: Profit and Loss
Pro Forma Profit and Loss
Feb
$2,340
$567
Mar
$3,300
$735
Apr
$3,240
$607
May
$11,500
$2,430
Jun
$20,740
$4,297
Jul
$24,300
$5,355
Aug
$28,800
$6,040
Sep
$31,700
$6,565
Oct
$33,360
$6,838
Nov
$12,900
$2,835
Dec
$9,400
$1,890
Jan
$21,450
$4,445
$0
$0
$48
$96
$144
$144
$144
$192
$192
$144
$192
$192
$567
$735
$655
$2,526
$4,441
$5,499
$6,184
$6,757
$7,030
$2,979
$2,082
$4,637
Gross Margin
Gross Margin %
$1,773
75.77%
$2,565
77.73%
$2,585
79.78%
$8,974
78.03%
$16,299
78.59%
$18,801
77.37%
$22,616
78.53%
$24,943
78.68%
$26,330
78.93%
$9,921
76.91%
$7,318
77.85%
$16,813
78.38%
Expenses
Payroll
$2,000
$2,000
$2,500
$4,900
$5,400
$5,400
$7,800
$7,800
$7,800
$7,800
$7,800
$7,800
Marketing/Promotion
Depreciation
Lease
$4,000
$0
$0
$1,000
$0
$0
$3,000
$0
$1,000
$2,000
$0
$1,000
$2,000
$0
$1,000
$3,000
$0
$1,000
$3,000
$0
$1,000
$2,000
$0
$1,000
$2,000
$0
$1,000
$2,000
$0
$1,000
$2,000
$0
$1,000
$2,000
$0
$1,000
Expensed Equipment
Insurance
Website
$0
$150
$40
$0
$0
$40
$0
$300
$200
$0
$300
$200
$0
$300
$200
$0
$300
$200
$0
$300
$200
$0
$300
$200
$0
$300
$200
$0
$300
$200
$0
$300
$200
$0
$300
$200
Answering Service
Mileage
Vehicles
$200
$80
$0
$0
$85
$0
$0
$95
$6,000
$0
$100
$800
$0
$200
$800
$0
$300
$800
$0
$300
$800
$0
$300
$800
$0
$300
$800
$0
$300
$800
$0
$300
$800
$0
$300
$800
$0
$0
$0
$60
$0
$0
$120
$500
$120
$120
$500
$120
$120
$500
$120
$120
$500
$120
$120
$500
$120
$120
$500
$120
$120
$500
$120
$120
$500
$120
$120
$500
$120
$120
$500
$120
$0
$0
$2,000
$0
$0
$0
$0
$0
$0
$0
$0
$0
$6,470
$3,185
$15,835
$10,040
$10,640
$11,740
$14,140
$13,140
$13,140
$13,140
$13,140
$13,140
($4,697)
($4,697)
($620)
($620)
($13,250)
($13,250)
($1,066)
($1,066)
$5,659
$5,659
$7,061
$7,061
$8,476
$8,476
$11,803
$11,803
$13,190
$13,190
($3,219)
($3,219)
($5,822)
($5,822)
$3,673
$3,673
$109
($1,442)
$106
($218)
$103
($4,006)
$99
($350)
$96
$1,669
$93
$2,090
$90
$2,516
$87
$3,515
$83
$3,932
$80
($990)
$77
($1,770)
$74
$1,080
($3,364)
-143.77%
($508)
-15.39%
($9,347)
-288.48%
($816)
-7.09%
$3,894
18.78%
$4,878
20.07%
$5,870
20.38%
$8,201
25.87%
$9,175
27.50%
($2,309)
-17.90%
($4,129)
-43.93%
$2,519
11.75%
Sales
Direct Cost of Sales
Costs of Fulfilling Maintenance
Contracts
Total Cost of Sales
Cell Phones
Utilities
Internet
Moving Expenses
Total Operating Expenses
Profit Before Interest and Taxes
EBITDA
Interest Expense
Taxes Incurred
Net Profit
Net Profit/Sales
15%
Page 4
Appendix
Table: Cash Flow
Pro Forma Cash Flow
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
$2,340
$2,340
$3,300
$3,300
$3,240
$3,240
$11,500
$11,500
$20,740
$20,740
$24,300
$24,300
$28,800
$28,800
$31,700
$31,700
$33,360
$33,360
$12,900
$12,900
$9,400
$9,400
$21,450
$21,450
Cash Received
Cash from Operations
Cash Sales
Subtotal Cash from Operations
Additional Cash Received
Sales Tax, VAT, HST/GST Received
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$2,340
$3,300
$3,240
$11,500
$20,740
$24,300
$28,800
$31,700
$33,360
$12,900
$9,400
$21,450
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
$2,000
$2,000
$2,500
$4,900
$5,400
$5,400
$7,800
$7,800
$7,800
$7,800
$7,800
$7,800
$105
$3,102
$2,353
$10,424
$8,954
$13,556
$15,209
$15,896
$16,290
$16,282
$4,550
$4,152
$2,105
$5,102
$4,853
$15,324
$14,354
$18,956
$23,009
$23,696
$24,090
$24,082
$12,350
$11,952
$0
$547
$0
$547
$0
$547
$0
$547
$0
$547
$0
$547
$0
$547
$0
$547
$0
$547
$0
$547
$0
$547
$0
$547
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$2,652
$0
$0
$5,649
$0
$0
$5,400
$0
$0
$15,871
$0
$0
$14,901
$0
$0
$19,503
$0
$0
$23,556
$0
$0
$24,243
$0
$0
$24,637
$0
$0
$24,629
$0
$0
$12,897
$0
$0
$12,499
($312)
$27,688
($2,349)
$25,340
($2,160)
$23,179
($4,371)
$18,809
$5,839
$24,647
$4,797
$29,444
$5,244
$34,688
$7,457
$42,145
$8,723
$50,868
($11,729)
$39,139
($3,497)
$35,642
$8,951
$44,593
0.00%
Page 5
Appendix
Table: Balance Sheet
Pro Forma Balance Sheet
Assets
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Starting Balances
Current Assets
Cash
Inventory
$28,000
$1,200
$27,688
$633
$25,340
$898
$23,179
$1,291
$18,809
$2,673
$24,647
$4,727
$29,444
$5,891
$34,688
$6,644
$42,145
$7,222
$50,868
$7,522
$39,139
$4,687
$35,642
$2,797
$44,593
$4,890
$10,000
$39,200
$10,000
$38,321
$10,000
$36,238
$10,000
$34,470
$10,000
$31,482
$10,000
$39,374
$10,000
$45,335
$10,000
$51,332
$10,000
$59,366
$10,000
$68,390
$10,000
$53,826
$10,000
$48,439
$10,000
$59,482
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$39,200
$0
$38,321
$0
$36,238
$0
$34,470
$0
$31,482
$0
$39,374
$0
$45,335
$0
$51,332
$0
$59,366
$0
$68,390
$0
$53,826
$0
$48,439
$0
$59,482
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets
Liabilities and Capital
Current Liabilities
Accounts Payable
Current Borrowing
Other Current Liabilities
$0
$19,225
$0
$3,033
$18,678
$0
$2,004
$18,131
$0
$10,130
$17,584
$0
$8,505
$17,037
$0
$13,050
$16,490
$0
$14,680
$15,943
$0
$15,354
$15,396
$0
$15,733
$14,849
$0
$16,130
$14,302
$0
$4,422
$13,755
$0
$3,711
$13,208
$0
$12,783
$12,661
$0
$19,225
$21,711
$20,135
$27,714
$25,542
$29,540
$30,623
$30,750
$30,582
$30,432
$18,177
$16,919
$25,444
Long-term Liabilities
Total Liabilities
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$19,225
$21,711
$20,135
$27,714
$25,542
$29,540
$30,623
$30,750
$30,582
$30,432
$18,177
$16,919
$25,444
Paid-in Capital
$23,000
$23,000
$23,000
$23,000
$23,000
$23,000
$23,000
$23,000
$23,000
$23,000
$23,000
$23,000
$23,000
Retained Earnings
Earnings
Total Capital
($3,025)
$0
$19,975
($3,025)
($3,364)
$16,611
($3,025)
($3,872)
$16,103
($3,025)
($13,219)
$6,756
($3,025)
($14,035)
$5,940
($3,025)
($10,141)
$9,834
($3,025)
($5,263)
$14,712
($3,025)
$607
$20,582
($3,025)
$8,809
$28,784
($3,025)
$17,983
$37,958
($3,025)
$15,674
$35,649
($3,025)
$11,544
$31,519
($3,025)
$14,064
$34,039
$39,200
$38,321
$36,238
$34,470
$31,482
$39,374
$45,335
$51,332
$59,366
$68,390
$53,826
$48,439
$59,482
Net Worth
$19,975
$16,611
$16,103
$6,756
$5,940
$9,834
$14,712
$20,582
$28,784
$37,958
$35,649
$31,519
$34,039
Page 6