Team members:

(2T22)
Viet Quang
School:
Junior
Workshop
attended:
2014

Mai Viet Bach

Tran
(2T20)
Catholic
College
Date
24th May

Table of Content
1. Executive summary
1.1 Mission.3
1.2 Key to Success...3
2. Company summary
2.1 Company ownership..3
2.2 Company location and facilities4
3. Product
3.1 Product description.5
3.2 Product benefits..5
3.3 Comparative comparison.
..5
3.4 Sourcing...8
3.5 Product distribution.8
3.6 SWOT analysis...9
1 | Page

4. Market
4.1 Market segment....10
4.2 Target market analysis.11
5. Strategy and Implementation
5.1
Marketing
strategy..
..13
5.2 Marketing program
13
5.3 Pricing strategy.15
5.4
Sale
strategy..16
6. Financial plan
6.1 Start-up funding.
17
6.2 Important assumption..18
6.3 Break-even analysis.19
6.4 Projected profit and loss..19
6.5 Projected cash flow..20
6.6 Projected balance sheet..21
7. Evaluation
7.1 How do we measure success?........................22
7.2 Future plan....22

1. Executive summary
Currently there is an increasing trend in Vietnam, specifically in Ho Chi Minh City, to engage in bodybuilding. Reasons for this trend are numerous: aesthetics, health, esteem-building, etc. As such,
supplementary drinks, such as protein shake, also experience increasing demand without any sign of
cooling down, as individuals who want to keep fit or build their ideal body can achieve their goals
more efficiently with such products. Despite the facts, there are presently no such complementary
products to cater to the increasing need in Vietnam. Hence, Protein Quake seeks to be the first
specialty beverage retailer in Vietnam to relieve the growing body-builders community with protein rich
drinks that are not only tasty, but also healthy and affordable.

1.1 Mission
We adopt a three-pronged approach with 3 main missions:
- Product mission: provide customers with the best quality protein shakes that help them to achieve
their athletic goals.
- Community mission: promote a healthy lifestyle and popularise the use of protein shake, making it
not only a supplement drink but also a healthy drink that is suitable for anybody.
- Economic mission: Operate and grow at a profitable rate through sound economic decisions.

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1.2 Key to success

There is still a lack of knowledge of the people on the benefits of protein shakes. Hence, this is a gap
in the market that we need to exploit. As a pioneer in the industry, it is important to have:
1. An outstanding marketing campaign to introduce the new products into the market and to
let the people understand the benefits of protein shakes.
2. The best products: freshest ingredients and best tasting protein shakes.
3. The greatest locations: visibility, high traffic pattern, near the biggest gyms.
4. Best customers service: a team of knowledgeable nutritionists who are able to give advice
on which type of drink to take.
5. Close collaboration with gyms to promote our products.

2. Company summary
The Protein Quake is a specialty beverage retailer. It provides a new products to the customers in an
economical and convenient way as well as giving advice on the protein shake and diet. The products
are not only tasty but also healthy and helps build up and maintain muscles as well as lose weight.

2.1 Company Ownership:

Protein Quake ownership is shared equally between Tran Viet Quang from Ha Noi and Mai Viet Bach
from Vung Tau, Vietnam

2.2 Start-up Summary

Protein Quake start-up expenses a funding are shown below. All of the prerequisite services and
goods will be acquired within Vietnam, with local service and insurance rate already taken into
account.
Majority of the expenses are in legal services, rent and start-up assets, which include blenders,
seating, lightings, decorations, etc. The opening day cash on hand balance will be $500.
It should be noted that the cost of marketing has not been accounted for, as it is not a basic
requirement.

Start-up
Requirements
Start-up Expenses
Legal
Stationery
Insurance
Rent
Sales Personnel
Other
Total Start-up Expenses

$1,000
$50
$84
$2,900
$588
$50
$4,672

Start-up Assets
Cash Required
Other Current Assets
Long-term Assets
Total Assets

$500
$580
$1,570
$2,650

Total Requirements

$7,322

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2.3 Company locations and facilities

The first Protein Quake outlet will be located on Hai Ba Trung st, District 3, Ho Chi Minh City. This is
the most optimal location available we can find in the CBD area. Within its 500 metres radius are 3
major gyms - Gym Cali Wow, Be You Centre, and Pure Gym, and 3 additional small gyms.
Furthermore, the rent, at $2900 per month, is not too expensive despite being in the CBD.

3. Products
3.1 Products description
The Protein Quake provides its customers with a varieties of protein smoothies. Here is an example of
different recipes:
Plain shake:

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Fig.3.1: Plain protein shake

Blend fruit shake:

Fig.3.2: Chocolate and blended strawberry protein shake

Chocolate peanut butter:

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Fig 3.3: Chocolate peanut butter protein shake

Besides having different tastes, we also have a varieties of products with different effects on the body,
for example, gain weight, build muscles and burn fat.
In short, we will have our customers first choose their desired type of protein (they can be
recommended by our nutritionists at the outlet) then they will choose the flavour. The flavours are
named after the most famous bodybuilders.

Fig 3.3: Example of a menu

All the protein shakes will be served in our own plastic cup with our logo on it which is portable,
convenient and stylish.
Besides serving the drink, we also have a team of well-trained nutritionists who can recommend which
type of protein and drinks the customers should take. We will also be the retailer of ON protein
powder to diversify our products.

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3.2 Product benefits

Protein shake will help people going to gym to utilise their exercises. For bodybuilder, it is the fast
absorbing protein that helps them to gain muscle in the golden window period (one hour after gym).
According to bodybuilding.com1, without adequate protein, our bodies can't put together the structures
that make up every cell, tissue, and organ, nor can it generate the biochemical substances needed for
cardiovascular function, muscle contraction, growth, and healing. Without an adequate amount of
protein our muscles would not heal up as quickly and could therefore lead to overtraining your muscle
which could lead to injury.
Drinking a protein shake as a meal replacement can help you cut calories, says Mayo Clinic
nutritionist Katherine Zeratsky, which leads to eventual weight loss. In a study conducted at Ulm
University in Germany, subjects who consumed high-protein meal replacements, such as shakes, lost
more weight and fat mass than subjects who simply followed a reduced-calorie diet. One possible
reason for the tie between protein shakes and weight loss is the increased satiety that shakes can
provide. According to a 2008 article published in the American Journal of Clinical Nutrition, protein is
more effective at producing lasting fullness than carbohydrates or fat.

3.3 Competitive comparison

No other business in Vietnam specifically caters to the protein smoothies market. Hence, the Protein
Quake has no direct competitor. Instead, we have 3 main indirect competitors listed in the table.

Competitor

Homemade protein
shake

Description

Protein powder can be

easily purchased from
dinhduongcaocap.vn
which is the main
retailer of protein
shake in Vietnam

Strength

Economical to make
protein shake this way.
30% of the people
going to gym bring
along a protein shake
Not convenient. Some
people we have
interview inside the
gym are just too busy
to be making protein
shake on their own.
Furthermore, plain
protein powder does
not taste good due to
lack of flavouring.

Weakness

Other drinks sold

inside or near the
gyms
Inside the gyms, there
is a bar to sell drinks.
The drinks sold are
bottled drinks, for
example, Coca-Cola,
Pepsi, green tea and
sport drinks
Outside the gyms,
there are also small
retailers of bottled
drinks

Different cafes nearby

Convenient to buy
these drinks.

Convenient to go into any of

these cafes

None of them contains

any amount of protein.
These drinks contain
mostly sugar which is
not preferred by the
people as they are
unhealthy and
fattening.

There is no drink option

available that specifically
caters to help people going to
gym to maximise their
exercises

1 http://www.bodybuilding.com/fun/proteinshakebenefits.htm
7 | Page

They are popular cafes such

as Trung Nguyen Coffee
Capuccino and Urban Station
Smoothie and Soda. Trung
Nguyen Coffee and Urban
Station are major beverage
retailers in downtown Ho Chi
Minh City, with each having
more than 32 outlets within the
city and 8000 units sold per
day

Fig 3.1: Competition matrix analysis

Based on figure 3.1, it is clear that the Protein Quake has a competitive edge against its competitors.
Two things that makes it stand out from its competitors:
1/ The Protein Quake will be providing products in the most convenient and efficient way available by
setting up a small outlet (like a bubble tea shop) near the gyms.
2/ The products are healthy and supplement the athletic activities, unlike the soft drinks or
cafe which has no complementary effects on the workout.

3.4 Sourcing
The Protein Quake purchases its protein powder from BOCCI Vietnam (240 V Vn Tn, Q.5, H Ch
Minh, Vietnam) which is one of the two authorised direct distributors of Optimum Nutrition protein.
The ingredients (eg. fruits, chocolate) are bought from Co-op Marts (189C Cng Qunh, Q.1, H Ch
Minh, Vietnam) every day to ensure the daily freshness.
The cups and straws are manufactured by Gia Thanh Co., Ltd (1085 T Quang Bu, Q.8, H Ch
Minh, Vietnam)
Other necessary kitchen accessories are bought from barista.vn.

3.5 Product Distribution

Taking into consideration that all of our ingredients can be found within the city (refers to Section 3.4
Sourcing), a preferred means of transport would be vans. Ingredients will be taken from wholesalers
to points of sales, where transactions on cash basis will be made with customers on the spot.
A supply run will be made once a week, with the exception of milk and fruits being once a day. At the
inception of the business, owners may transport the milk and fruits from supermarkets to point of
sales themselves to reduce fixed costs.

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3.6 SWOT Analysis

The following SWOT Analysis presents the strengths, weaknesses, opportunities and threats of
our products, which will become the groundwork we use to design and organise our marketing
plan.

3.6.1 Strengths
1. First to tap into an increasing demand. As mentioned above in Chapter 4, there is a strong
demand for protein shake as complementary sport drinks. Protein Quake currently has no direct
competitors, as established in Section 3.3. Alternatives such as energy drinks, soft drinks, tea,
etc., however, have no complementary effects to body-building or body-maintaining.
2. Convenience. We offer quick, convenient and efficient methods in delivering our products.
Instead of having to make protein shake beforehand, customers can now visit our outlets at
strategically convenient locations (Section 2.3).
3. Higher Quality. as our products are made and consumed on the spot, any possible
degradation of protein due to exposure to air over extended periods of time is minimised, which is
frequently a major issue with home-made protein shake. Furthermore, plain protein shake does
not have an appeal to taste, which can be significantly alleviated by our use of fruits and other
condiments.
4. Greater benefits to body-building. The golden window period for drinking a protein shake is
immediately following one's resistance or weight training workout. This is when one's muscles
have been torn from exercising and in desperate need of protein to rebuild 2. This benefit can be a
major selling point of our protein products.

3.6.2 Weaknesses
1. The lack of expertise in marketing know-hows can be a problem, as additional resources
may have to be expended to cover the lack of expertise through training or hiring.
2. There is possible time lag to educate our customers of the benefits of protein shake to
body-building.

3.6.3 Opportunities
1. Increasing interest in body-building among youths (as established in 4.2.1 Market Trend).
Such trend allows opportunities for growth and further expansion.
2. Most of the years profits can be expected to be made in January and from June to
August, as students are relieved from schools and universities for extended periods of time,
prompting additional marketing efforts during these periods prime to capitalise on the possible
increase in free time among the target customers.

3.6.4 Threats
1. As our business grows, our idea may be copied and replicated. The low cost barrier of
entry may exacerbate the problem. Thus, this issue further emphasises the need for effective
marketing to differentiate ourselves from possible future direct competitors. It is also possible that
we may turn our business into a franchise to differentiate ourselves from the rest.

2 http://www.answerfitness.com/211/time-drink-protein-shakes-fitness-nerd/
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4. Market analysis
4.1 Market segmentation
The Protein will focus on 3 market segments: people who frequently go to the biggest gyms, people
who go to other gyms and people who are interested in healthier drink choices.
People who frequently go to the biggest gyms are concentrated in the 6 gyms. (the number of traffic is
based on what we have asked the personnel in each gym)
Gym

Description

Gym Cali Wow

(28 L Lai &Tng 5
Parkson Hng Vng)
Get Fit Gym
(lu 3 Ta nh H3 384
Hong Diu Q.4)
Lan Anh Gym
(291 Cch Mng Thng 8,
Qun 10. TPHCM)
Pure Gym (168 V Th
Su)
Be You Center
(200 L Lai and 127/135
in Bin Ph)

The most famous gym in Ho Chi Minh city with dance

classes, body building classes, yoga, sauna massage

The Gym (Parkson

Flemington)

Estimated
traffic per day
1000-1200

the second biggest with dance classes, body building

classes, yoga, sauna massage similar to Gym Cali
Wow
Oldest gym in Ho Chi Minh city

800

Smaller gyms but facilities are better

500

Similar to Gym Cali Wow.

1500 for 2
outlets

Premium gym

500

900-1200

People who go to these 6 biggest gyms are people with higher income as the gym membership is
about $500 to $700 a month. They are often businessmen, foreigners who work in Ho Chi Minh City
and children of the wealthier people. They should have no financial problem spending on our products
as one bottle of water in these gyms costs almost as much as our protein shake and they are willing
to pay for it.
There are other small gyms such as Nikko Fitness Club, Landmark Health Club Caravelle Fitness,
InterContinental - Health & Fitness Centre, Trung tm TDTM Dng Ngc, Diamond Health Club,
Vincharm Health Club, NutriFort Fitness, Huy Long Gym, Kryoga Vit Nam, Gym Sc Khe Vit,
Mommy Health Club, Pure Gym, gym Ton Thng and gym nh Ph Thnh.
All these gyms are located in the District 1, 2, 3, all of which are close to the CBD. A good estimation
of the combined traffic of the local gyms is 5000 per day, which is expected to be much higher during
the summer break, from June to August. The frequent customers have an average income of $2000 a
month. They are often professionals, workers. A large proportion is also the students whose parents
will pay for their fees.
The third group is the people with interest in a healthier drink. We have done a survey on 79 people
and out of them, 13 are interested in healthier drinks than Coca-Cola and Pepsi. That equates to
approximately 16.5% of the young population. Given the young population of Ho Chi Minh City is
3,216,600, we may estimate a tentative number of 530,739 people interested in a healthy drink. Since
our sample size is comparatively much smaller, it is appropriate to assume that only about 5000
people may become potential customers due to the currently low publicity level of protein shakes.

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Fig 4.1: Market segments

4.2 Target market analysis

Protein Quake main target is people who frequently go to gyms and want to build muscles or lose
weight fast by using supplement.

4.2.1 Market trend

According to Womens Health Vietnam3, the number of gyms in Ho Chi Minh City almost double form
2012 to 2014. This shows the trend of increasing interest of people in keeping fit and a healthy
lifestyle. Increasing number of people going to gyms also means the expansion of market is huge.

The graph is shown by Google trend4. It reflects the increasing number of searches on protein shake
in recent years from 2011 to now.

3 http://www.womenshealthvn.com/nao-cung-tap/khoi-dong/phong-gym-moc-len-nhu-namchat-luong-ra-sao
4 http://www.google.com.sg/trends/explore#q=Protein%20shake
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Hence, by notifying the trend in the increase in gyms in Ho Chi Minh City, increase in interest of
people in protein shake, it is certain that it is an untapped market of people demanding protein shakes
in Ho Chi Minh City.

4.2.2 Market growth

According to industry statistics, consumption of sport nutrition is going to grow rapidly in the next 3
years with the expected increase of 6.8% from 2012 to 2017.

Another trend can be identified in the case study of Amino Bar (a protein cafe bar). It was founded in
Singapore in 2010 and now it has 3 outlets in Somerset, Velocity and One-north. Currently, Amino Bar
is expanding into the USA. Although the market in Singapore is different from that of Vietnam, Ho Chi
Minh City has a large population of 8,190,775 which is even greater then Singapores (5,399,200),
proving a larger group of potential customers.
Furthermore, based on the increasing sales of one of our indirect competitor (Hoa Huong Duong
Energy Drink Ptd) in recent years, beverage industry is expanding in Ho Chi Minh City as people are
spending more on drinks.

4.2.3 Market needs

Ho Chi Minh City is a thriving city, probably the most economically developed in Vietnam with 9.5%
GDP growth last year. Having more disposable income, people are more willing to pay to have their
aesthetic look and thus more are going to gym (as seen in the surge of number of gyms mentioned
earlier).
A problem with a developing society is that people are having less free time, thus there is a need to
maximise the time they spend in the gym, thus they need to use supplement drink like protein shake.
The problem is:
1/ People forget, feel lazy or have no time to make their protein shake (in our survey with the gyms,
only about 30% of people going to their gyms bring along their shakes)
2/ Protein shakes do not taste good (I have tried to make it myself)

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In addition, the recommended or usual intake of protein of an average person is too meagre as said
by authoritynutrition.com, we should take in 91 grams instead of 56 grams per day for an average
male. Hence, not only people who go to gym but everyone else needs to take extra protein.
(http://authoritynutrition.com/how-much-protein-per-day/)
Hence, Protein Quake exists to provide customers with the best quality protein shakes that help them
to achieve their athletic goals in a convenient and simple way.

5. Strategy and Implementation

5.1 Marketing strategy
Firstly, the Protein Quake is placed at a location near to the biggest gyms mentioned before which
leads to high visibility and great ease of access for all people going to these gyms. The outlet will be
very unique and eye-catching with our mascot Mr. Protein Jake in front of the outlet to introduce about
our company and give out pamphlets.
Second, the Protein Quake will have an outstanding marketing campaign aiming to:
1/ Inform the people of protein shakes, their benefits and our brand
2/ Persuade them to buy our protein shakes
3/ Encourage brand loyalty
Third, the Protein Quake will rely on building relationship with the gyms. By giving collaborating with
the gyms, we can access the need of each member of the gyms. We will also give away samples and
they will give their word of mouth to other people going to gyms.

5.2 Marketing programs

5.2.1 To Inform
Distinctive logo:
In the middle of the logo is Mr. Protein Quake who is our
cartoon-like character of a cup of protein shake which
products that we sell. He also has bulky tricep which
benefits of the protein shakes. Behind him is the dawn which
beginning of a new hero (a new franchise).

mascot. He is a
represents the
represents the
represents the

E marketing:
We will have our own website, facebook, twitter and instagram to publicise our brand as well as our
product. However, as there is a lack of general knowledge of protein, we will also have our youtube
page featuring Mr. Protein Quake.

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Mr. Protein Quake will be the main character in the YouTube channel. In the videos, he will talk about
the benefits of protein shakes and why people should lead a fit and healthy lifestyle. A video will be
out every week. Some of the ideas of the videos are the workouts and how to make protein shakes
yourself.
This approach is the main part of our marketing campaign as there is no YouTube page in Vietnam
that provides a guide on how to exercise and make protein shakes. There are other pages on
YouTube which do the same thing, however, only 30% the population of Vietnam are proficient in
English.
The YouTube page can be foreseen as a success as YouTube is becoming more popular in Vietnam
in recent years with the rise of loggers such as JVevemind (1,482,645 subscribers), Huyme (363,824
subscribers), Pho (1,001,546 subscribers)... We will also collaborate with them to earn more
subscriber for our YouTube channels.
A case study of this would be Mike Changs six packs short-cut, he began making YouTube videos
teaching people how to do exercises. Then he earned more subscribers and now he is owning his
own brand of protein shake powder. This proves that a YouTube channel can really boost up a
business, especially when few people know about protein shakes
A link to our YouTube channel will be printed on every cup we sell.
A gigantic launching event:
2 weeks before the launching event, we will put up posters inside the gyms and give away pamphlets
and vouchers to inform people going to these gyms.
We will have a big launching event in which we will give out free samples near to our outlet and
outside every gym. The event will be fun, energetic and memorable so that people can have an idea
of a brand that is aiming to encourage people to have a healthy and fit lifestyle.

14 | P a g e

5.2.2 To persuade them and increase brand loyalty

Promotion with gym membership:
We will collaborate with the gyms to give 10% discount to the gym members. By doing this, we are
directly persuading our main target group to buy our protein shakes. We will also have a group of loyal
customers who are the long-term members of these gyms to be our customers. We also encourage
people to go to the gyms and exercise which is in line with our missions.
To penetrate the market, we will also make visits to the gyms to give away free samples and
pamphlets once a month. And, for every cup sold, a portion is returned to the gyms. It becomes a
tremendous, painless way for the gyms to gain a financial reward while providing a pleasant and
fulfilling benefit to our customers.

Loyalty card:
We will give a loyalty card to every customer who buy our products. Everytime, they buy our products,
they will earn one point. Everytime they bring a friend to buy our products they will also earn a point.
When they have garnered 10 points, they can use these points to participate in a wheel spinning to
get a prize. A list of prizes will be a free drink, a protein bar, an energy bar,...
By doing this, we encourage our customers to come back to our outlet to buy the protein shakes. We
also incentivize them to spread the words and invite more friends to buy our products
Free advice from professional nutritionists (to be implemented in the second year due to lack
of funds)
One thing that differentiate our brand is the free consultation with our nutritionist. A team of nutritionist
will be stationed at our outlet to give out advice to our customers about which type of protein and diet
they should take to achieve their goals.
By doing this, we provide them with extra customer service and thus differentiate our brand and
prevent potential competitor.

5.2.3 To remind
Taking advantage of the SEA GAME in June 2015 (which is well received by the Vietnamese
audience). We will launch an event called Gym n Drink.
In the day before the start of SEA GAME (4 June), we will send 2 vans to go around the city and to
different gyms. One van will carry a portable gym inside which is separated by clear, transparent glass
so that the public can see the people exercising inside the portable gym. Another van will be giving
away free samples of our protein shake.
The portable gym will definitely attract the attention of the people and show how people can exercise
anywhere. Materials will also be given out to show the important of exercising and protein shakes.
In this event, we will work closely with the biggest gym to let them publicize their brand as well as
sharing the cost.
Gymn Drink can be a shocking event for the people as it is the first time they see a portable gym
separated by glass wall. This will increase the visibility of our brand and again create an image of a
fun and energetic brand.

5.3 Pricing strategy

Protein Quake products will be offered at the following prices:

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Products
Protein Shake (All Types) with Milo/Milk
Protein Shake (All Types) with a Variety of Fruits
Optimum Nutrition Whey Protein 900g

Unit Price
$2.06
$2.06
$50.09

Protein Shake is sold at price point of $2.06 (equivalent to VND35,000). This price is comparable to
our indirect competitors price.
Competitors Products
Trung Nguyen Coffee Capuccino
Urban Station Smoothie and Soda

Unit Price
$2.35
$2.06

(Trung Nguyen Coffee and Urban Station are major beverage retailers in downtown Ho Chi Minh City,
with each having more than 32 outlets within the city and 8000 units sold per day)
At price point $ 2.08, customer are much less likely to deem our products prices as unreasonable.
Price for Optimum Nutrition Whey Protein is placed at standard retailers price point.

5.4 Sales Strategy

There will be several sales strategies put into place, including posting specials on high-profit
items. The barista will also hand out free drink coupons to those who purchase more than 5 cups
at once. The Protein Quake will also develop window sales techniques such as the baristas
asking if the customer would like a fresh-baked item with their coffee.

5.4.1 Sales Forecast

Unit sales are projected based on sale report of two indirect competitors, Hoa Huong Duong
Energy Drink Ltd and beverage sales of three different gyms. It is reasonable to estimate that the
growth of sales in Year 2 is 20% and that in Year 3 is 10%, assuming that there is no additional
outlets opened in this period.
For purposes of projection, sales of product is expected to rise in June, July and August, as this is
the summer break period for both high school and university students; the two main driving force
behind sales in this period. The sales forecast also assumed that a marketing campaign is
launched in this period to capitalise on the strong influx of students.

57 percent of sales will go to our company (the retailer), with 25 percent to wholesalers, 10
percent to sales employees and 8 percent to the designers.

Sales Forecast
Unit Sales
Protein Shake (All Types) with Milo/Milk
Protein Shake (All Types) with a Variety of
Fruits
Optimum Nutrition Whey Protein 900g
Total Unit Sales

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Year 1

Year 2

Year 3

24,783
27,200

30,979
34,620

34,077
38,082

933
52,916

1,166
66,765

1,283
73,442

Unit Prices
Protein Shake (All Types) with Milo/Milk
Protein Shake (All Types) with a Variety of
Fruits
Optimum Nutrition Whey Protein 900g
Sales
Protein Shake (All Types) with Milo/Milk
Protein Shake (All Types) with a Variety of
Fruits
Optimum Nutrition Whey Protein 900g
Total Sales
Direct Unit Costs
Protein Shake (All Types) with Milo/Milk
Protein Shake (All Types) with a Variety of
Fruits
Optimum Nutrition Whey Protein 900g
Direct Cost of Sales
Protein Shake (All Types) with Milo/Milk
Protein Shake (All Types) with a Variety of
Fruits
Optimum Nutrition Whey Protein 900g
Subtotal Direct Cost of Sales

Year 1
$2.06
$2.06

Year 2
$2.06
$2.06

Year 3
$2.06
$2.06

$50.09

$50.09

$50.09

$51,053
$56,032

$63,817
$71,317

$70,199
$78,449

$46,734
$153,819

$58,405
$193,539

$64,265
$212,913

Year 1
$0.88
$0.77

Year 2
$0.88
$0.77

Year 3
$0.88
$0.77

$36.06

$36.06

$36.06

$21,881
$20,810

$27,352
$26,487

$30,087
$29,136

$33,648
$76,340

$42,052
$95,891

$46,271
$105,494

6. Financial Plan
The financial prospects for Protein Quake is quite promising. Since Protein Quake is a pioneer in
the market, the business is expected to grow fast due to high existing, untapped demand.
Investment will play a major role in financing our growth and cushioning the initial losses.
We hope to expand to other outlets by Year 3 when we most likely have repaid most of the initial
debts. However, for the purpose of this financial plan, we assume that there will be no additional
outlets within 3 years.

6.1 Start-up Funding

The majority of our funding for start-up requirements will come from short-term loans from
VPBank and/or Agribank, as both banks are well known for charging a lower interest rate and
higher amount of loanable funds for entrepreneurs. Furthermore, as the maximum loanable
funds at both banks is at $9412, after the required start-up cost of $7322, there is a $2090
cushion for unexpected overhead costs.
Other current liabilities include but not limited to:

Taxes
Insurance
Start-up Stocks

The owners of Protein Quake has gathered an additional funding of $500 to support the
company for the first few months. We hope to able to secure an investment of $30,000, which will
be paid out in dividends of 2% per month after the first year.

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Start-up Funding
Start-up Expenses to Fund
Start-up Assets to Fund
Total Funding Required

$4,672
$2,650
$7,322

Assets
Non-cash Assets from Start-up
Cash Requirements from Start-up
Additional Cash Raised
Cash Balance on Starting Date
Total Assets

$2,150
$500
$31,363
$31,863
$34,013

Liabilities and Capital

Liabilities
Current Borrowing
Long-term Liabilities
Other Current Liabilities (interest-free)
Total Liabilities

$7,322
$0
$863
$8,185

Capital
Planned Investment
Owner
Investor
Total Planned Investment

$500
$30,000
$30,500

Loss at Start-up (Start-up Expenses)

($4,672)
$25,828

Total Capital and Liabilities

$34,013

Total Funding

$38,685

Total Capital

6.2 Important Assumptions

The financial plan depends on important assumptions, most of which are shown in the following
table. The key underlying assumptions are:
1.
2.
3.
4.

A quick-growth economy, without major recession or overheating.

There are no unforeseen changes in public health perceptions of its general products.
No additional outlets are opened within the assessed period.
Access to equity capital and financing sufficient to maintain its financial plan as shown in the
tables.

Additionally,

Tax rate for private businesses is expected to drop from 22% to 20% in 2016.
The interest rate is estimated based on public statements from VPBank and Agribank.

6.3 Break-even Analysis

Our break-even analysis is summarized by the following chart and table.

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The Average Per-Unit Revenue and Variable Cost are calculated based on the individual price,
cost and weightage of each selling items to the total revenue and cost.
We need at least $10,778 in sales to make cover all monthly expenses. That is approximately
$360 in sales per day, or 124 units sold per day to sustain business.
Break-even Analysis
Monthly Units Break-even
Monthly Revenue Break-even
Assumptions:
Average Per-Unit Revenue
Average Per-Unit Variable Cost
Estimated Monthly Fixed Cost

3,708
$10,778
$2.91
$1.44
$5,429

6.4 Projected Profit and Loss

There are a multitude of factors and consideration to include when determining projected profit
and loss. Net Profit in the first year may be punctured by the high cost of penetrative marketing.
However, if we can still make positive net profit by the end of Year 1, there is a good chance that
we can repay initial short-term loans in Year 2 and further expand in Year 3.
Pro Forma Profit and Loss
Year 1
$153,819
$76,340
$0
$76,340

Year 2
$193,539
$95,891
$0
$95,891

Year 3
$212,913
$105,494
$0
$105,494

Gross Margin
Gross Margin %

$77,479
50.37%

$97,648
50.45%

$107,419
50.45%

Expenses
Payroll
Marketing/Promotion

$6,720
$20,900

$7,251
$4,300

$7,828
$4,300

Sales
Direct Cost of Sales
Other Costs of Sales
Total Cost of Sales

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Depreciation
Rent
Utilities
Payroll Taxes
Other

$120
$34,800
$600
$469
$1,540

$350
$34,800
$750
$508
$1,694

$1,020
$34,800
$1,000
$782
$1,863

Total Operating Expenses

$65,149

$49,653

$51,593

Profit Before Interest and Taxes

EBITDA
Interest Expense
Taxes Incurred

$12,330
$12,450
$877
$2,520

$47,995
$48,345
$847
$9,430

$55,826
$56,846
$406
$11,084

$8,934
5.81%

$37,719
19.49%

$44,336
20.82%

Net Profit
Net Profit/Sales

6.5 Projected Cash Flow

Our projected cash flow is outlined in the following chart and table. Dividends for investors are
paid out in Year 2 at 2% of $30,000 per month, i.e. $600 monthly. The initial investment of
$30,000 will help us greatly not only in cushioning initial losses in Year 1, but also in allowing
opportunities for expansion in Year 3.
Pro Forma Cash Flow
Year 1

Year 2

Year 3

Cash from Operations

Cash Sales
Subtotal Cash from Operations

$153,819
$153,819

$193,539
$193,539

$212,913
$212,913

Additional Cash Received

Sales Tax, VAT, HST/GST Received
Subtotal Cash Received

$0
$153,819

$0
$193,539

$0
$212,913

Year 1

Year 2

Year 3

$144,765

$155,470

$167,557

Cash Received

Expenditures
Expenditures from Operations
Cash Spending

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Subtotal Spent on Operations

$144,765

$155,470

$167,557

Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out
Principal Repayment of Current Borrowing
Dividends
Subtotal Cash Spent

$0
$176
$0
$144,941

$0
$176
$7,200
$162,846

$0
$7,176
$7,200
$181,933

$8,878
$40,741

$30,693
$71,433

$30,980
$102,413

Net Cash Flow

Cash Balance

6.6 Projected Balance Sheet

The table below outlines the projected balance sheet.
Pro Forma Balance Sheet
Year 1

Year 2

Year 3

Current Assets
Cash
Other Current Assets
Total Current Assets

$40,741
$580
$41,321

$71,433
$580
$72,013

$102,413
$580
$102,993

Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets

$1,570
$120
$1,450
$42,771

$1,570
$470
$1,100
$73,113

$1,570
$1,490
$80
$103,073

Year 1

Year 2

Year 3

$7,146
$863

$6,970
$863

($206)
$863

Assets

Liabilities and Capital

Current Liabilities
Current Borrowing
Other Current Liabilities

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Subtotal Current Liabilities

$8,009

$7,833

$657

Long-term Liabilities
Total Liabilities

$0
$8,009

$0
$7,833

$0
$657

Paid-in Capital
Retained Earnings
Earnings
Total Capital
Total Liabilities and Capital

$30,500
($4,672)
$8,934
$34,762
$42,771

$30,500
($2,938)
$37,719
$65,280
$73,113

$30,500
$27,580
$44,336
$102,416
$103,073

Net Worth

$34,762

$65,280

$102,416

7. Evaluation
7.1 How to measure success?
Success will be measured based on whether short-term and long term goals are met.
7.1.1. Short-term Goals:
1. Make a normal or supernormal net profit by the end of Year 1.
2. Ensure that actual sales from June to August reach the projected sales of 6,125 units per
month through effective marketing, product quality and differentiation. Achieving the second
goal is imperative in keeping business in the black.
7.1.2. Long-term Goals:
1. Expand with at least 1 new outlet by Year 3
2. Create a body-building culture within the city to promote greater health and self-esteem,
especially among the youth.

7.2 Future plan

As the season changes, the Protein Quake will be offering products that will enhance sales and
satisfy its customers' desires. In the hotter seasons, the Protein Quake will extend its products into
protein ice-cream. The Proten Quake will also have special menus for holidays for example protein
egg nog during Christmas.
In the long run, to further diversify our products, we wil also sell protein and energy bars along with
protein-rich food like sandwiches or protein cake.
The Protein Quake's primary aim will be to listen to its customers to ascertain what they are looking
for most and provide it.

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