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Table of Contents

1.0 Executive Summary .................................................................................................................... 1


Chart: Highlights .......................................................................................................................... 2
1.1 Objectives.................................................................................................................................... 2
1.2 Keys to Success ........................................................................................................................ 2
1.3 Mission .......................................................................................................................................... 3
2.0 Company Summary..................................................................................................................... 3
2.1 Company Ownership ............................................................................................................... 3
2.2 Company Locations and Facilities ...................................................................................... 4
2.3 Start-up Summary................................................................................................................... 4
Table: Start-up.............................................................................................................................. 5
Chart: Start-up ............................................................................................................................. 7
2.3.1 Itemized Start-up............................................................................................................. 8
3.0 Products ......................................................................................................................................... 12
3.1 Product Description ............................................................................................................... 12
3.2 Competitive Comparison ..................................................................................................... 14
3.3 Sales Literature ....................................................................................................................... 14
3.4 Sourcing ..................................................................................................................................... 14
3.5 Technology................................................................................................................................ 14
3.6 Future Products ....................................................................................................................... 15
4.0 Market Analysis Summary ...................................................................................................... 15
4.1 Market Segmentation ........................................................................................................... 15
Table: Market Analysis ............................................................................................................. 17
Chart: Market Analysis (Pie).................................................................................................. 17
4.2 Target Market Segment Strategy .................................................................................... 17
4.2.1 Market Trends.................................................................................................................. 18
4.2.2 Market Growth................................................................................................................. 18
4.2.3 Market Needs ................................................................................................................... 18
4.3 Industry Analysis.................................................................................................................... 18
4.3.1 Competition and Buying Patterns ............................................................................ 19
4.3.2 Main Competitors ........................................................................................................... 19
4.3.3 Industry Participants..................................................................................................... 19
5.0 Strategy and Implementation Summary .......................................................................... 20
5.1 Value Proposition.................................................................................................................... 20
5.2 Competitive Edge ................................................................................................................... 20
5.3 Marketing Strategy ................................................................................................................ 21
5.3.1 Pricing Strategy............................................................................................................... 21
5.3.2 Promotion Strategy ....................................................................................................... 22
5.3.3 Marketing Programs ...................................................................................................... 22
5.3.4 Positioning Statement .................................................................................................. 23
5.4 Sales Strategy ......................................................................................................................... 23
5.4.1 Sales Programs ............................................................................................................... 23
5.4.2 Sales Forecast.................................................................................................................. 24
Table: Sales Forecast ........................................................................................................... 24
Page 12

Table of Contents
Chart: Sales Monthly ............................................................................................................ 25

Page 12

Table of Contents

Chart: Sales by Year ............................................................................................................. 25


5.5 Strategic Alliances.................................................................................................................. 26
5.6 Milestones.................................................................................................................................. 26
Table: Milestones ....................................................................................................................... 26
Chart: Milestones ....................................................................................................................... 27
6.0 Web Plan Summary ................................................................................................................... 27
7.0 Management Summary............................................................................................................ 27
7.1 Personnel Plan ......................................................................................................................... 28
Table: Personnel ......................................................................................................................... 28
7.2 Management Team ................................................................................................................ 28
8.0 Financial Plan ............................................................................................................................... 29
8.1 Important Assumptions ....................................................................................................... 29
Table: General Assumptions .................................................................................................. 29
8.2 Break-even Analysis.............................................................................................................. 30
8.2 Break-even Analysis.............................................................................................................. 30
Chart: Break-even Analysis ................................................................................................... 30
Table: Break-even Analysis.................................................................................................... 30
8.3 Projected Profit and Loss..................................................................................................... 31
8.3 Projected Profit and Loss..................................................................................................... 31
Chart: Profit Monthly ................................................................................................................ 31
Chart: Profit Yearly.................................................................................................................... 31
Chart: Gross Margin Monthly................................................................................................. 32
Chart: Gross Margin Yearly .................................................................................................... 32
Table: Profit and Loss............................................................................................................... 33
8.4 Projected Cash Flow .............................................................................................................. 34
8.4 Projected Cash Flow .............................................................................................................. 34
Chart: Cash .................................................................................................................................. 34
Table: Cash Flow ........................................................................................................................ 35
8.5 Projected Balance Sheet...................................................................................................... 36
8.5 Projected Balance Sheet...................................................................................................... 36
Table: Balance Sheet................................................................................................................ 36
8.6 Business Ratios ....................................................................................................................... 37
8.6 Business Ratios ....................................................................................................................... 37
Table: Ratios ................................................................................................................................ 38
Table: Sales Forecast ......................................................................................................................... 1
Table: Personnel ................................................................................................................................... 2
Table: Personnel ................................................................................................................................... 2
Table: Profit and Loss......................................................................................................................... 3
Table: Profit and Loss......................................................................................................................... 3
Table: Cash Flow .................................................................................................................................. 4
Table: Cash Flow .................................................................................................................................. 4
Table: Balance Sheet.......................................................................................................................... 5
Table: Balance Sheet.......................................................................................................................... 5
Page 12

Inspirational
66 BooksGrounds
Cafe

1.0 Executive Summary


66 Books Cafe will provide a relaxing, Christian-focused, neighborhood-centered place with
freshly roasted coffee, specialty drinks, good books, and music. 66 Books Cafe is the
answer to an increasing demand. Our target market wants:

Neighborhood businesses in TBD


Great coffee at a competitive price
A comfortable place to socialize with others with similar interests

66 Books Cafes' goal is to provide the community with a social, entertaining atmosphere where
Christian neighbors can meet each other in a neutral, non-denominational setting.
66 Books Cafe is incorporated as an S corporation. This will shield the owner from issues of
personal liability and double taxation.
This proposal is prepared to obtain financing in the amount of $80,000. The supplemental
financing is required to prepare the selected site, purchase equipment, and cover expenses
during the first year of operation. The owner will invest $15,000 of her own into the business.
This financing will allow 66 Books Cafe to successfully open and maintain operations.
The large initial capital investment will allow 66 Books Cafe to provide its customers with an
inviting atmosphere and quality products. A unique, upscale and innovative environment is
required to provide customers with an atmosphere that will create socialization. Successful
operation in year one will provide 66 Books Cafe with a customer base that will allow it
to be self sufficient in year two.
Even with our conservative sales forecast, we will maintain a positive cash flow in all months,
repay the loan in 12 years, and have a positive net worth over $27,000 by year three. We
project that our net profits will increase from $12,000 to over $14,000 over the next three
years.

Page 12

Inspirational
66 BooksGrounds
Cafe

Chart: Highlights

1.1 Objectives
66 Books Cafe' objectives for the first three years of operation include:

The creation of a unique, upscale, innovative spiritual environment that will differentiate
66 Books Cafe from local coffee shops.
To make 66 Books Cafe the destination for quality coffee in a welcoming atmosphere for
people who are serious about their coffee and growing in their spirituality.
The formation of an environment that will bring people with diverse backgrounds and
interests together in a common forum.
To be an active and vocal member of the community, and to provide continual reinvestment through participation in community activities and financial
contributions.
Consistently providing excellent specialty beverages, bakery items, inspirational books,
and music.

1.2 Keys to Success


The keys to the success for 66 Books Cafe are:
The creation of a unique, innovative, upscale atmosphere that will differentiate 66 Books
Cafe from other local coffee shops and future coffee shops.
Fresh Coffee roasted on-site daily will give customers a unique experience as well as
excellent product.
Selling beverages and products that are of the highest quality.

Page 12

Inspirational
66 BooksGrounds
Cafe

The creation of an environment that won't intimidate the spiritual seeker. 66 Books Cafe
will position itself as an educational resource for individuals wishing to learn about the
benefits of growing spiritually.
The establishment of 66 Books Cafe as a community hub for socialization and
entertainment.
Encourage the two most important values in Christianity: love and service.

Page 12

Inspirational Grounds

1.3 Mission
As people are becoming more interested in their spiritual side, a neighborhood shop with
excellent freshly roasted coffee and non-denominational Christian books and tapes, is a
welcomed alternative and/or addition to the local church. 66 Books Cafe is a specialty beverage
establishment focused on providing freshly roasted coffee beans, coffee/espresso drinks and
information to enhance our customers' spiritual experience. We also understand that coffee
drinkers interested in growing spiritually want a destination, not just a location;we provide
them with the best of both.
Our goal is to be the destination for Christian coffee drinkers seeking a non-secular
environment in the Twin Cities area. People of all ages and backgrounds will come to enjoy the
unique upscale, educational, motivational and innovative environment that 66 Books Cafe
provides.
We believe it is important to remain an active member of the community and to impact our
customers' lives in more ways than the selling of specialty drinks.
2.0 Company Summary
66 Books Cafe, Minneapolis' South Central area, will offer great specialty beverages and easy
access to exciting spiritual information. 66 Books Cafe sells quality products and provides
excellent customer service for coffee lovers and persons looking to enhance their spiritual
experience. We are looking to lease a retail store which we will use to market and merchandise
our products. The company took its name in July 2002, and organized as an S Corporation in
October, 2003.
Our book and music selection and helpful staff will appeal to the audience that is seeking to
grow and learn spiritually in this age of uncertainty. This invigorating aspect will attract younger
and elderly members alike who are gaining interest in their spiritual condition. The central
location will provide easy access from most points of origin throughout the Twin City area for
those who will recognize 66 Books Cafe as a destination point, as well as provide local
community residents with convenient access to freshly roasted coffee.
2.1 Company Ownership
66 Books Cafe is incorporated as an S corporation. This will shield the owner Regina Brown
from issues of personal liability and double taxation. The Corporation was formed in
October of 2003.

Page 3

Inspirational Grounds

2.2 Company Locations and Facilities


The site, Midtown Commons (Also known as the Sears Project), is located in South Central
Minneapolis. The initial space is approximately 2,000 square feet and has ample space for
the first three years of growth. The complex has ample parking and significant foot traffic
from Allina Healthcare Office Facility. This area was chosen for various reasons, including:

Proximity to other areas within the Twin Cities; Central location easily accessed.
Proximity to the Lyn/Lake and Uptown areas.
High Visibility.
Proximity to the many local churches in South Central Minneapolis.
Diverse population within the community.
Desire for South Central Businesses.
Scarcity of other coffee houses in the area.
Proximity to the light rail depot and 12th Precinct of the Minneapolis police.

All of these qualities are consistent with 66 Books Cafe' goal of providing a community hub
for socialization and entertainment.
2.3 Start-up Summary
66 Books Cafe' start-up costs will cover coffee, espresso, and specialty drink making
equipment, micro-roasting equipment, training, site renovation and modification, capital for
operating expenses in the first year, and the inventory necessary to provide customers with
the information needed to grow.
A large portion of our start-up requirements will go towards the purchase of specialty drink
equipment from Espresso Services, Inc. Our long-term assets will include:

One espresso machine


One micro-roasting system
an Espresso grinder/doser
water filtration system

Expensed equipment includes:

A Bulk grinder for drip coffee


Single airpot brewer
Smoothie blender
Minor additional equipment

Additionally, we need funding for initial inventory, both for the coffee shop side of things and
the other specialty merchandise, books, and music. Music items will be purchased from
Provident Music, Diamante Music Group, and New Day Christian Distributors among others.
Books and other inspirational material will be purchased from Bridge-Logos Publishers, KCM,
Bethany House Distributors, and others.

Page 4

Inspirational Grounds
The site 66 Books Cafe chooses will require funds for renovation and modification. A single
estimated figure will be allocated for this purpose. The renovation/modification cost
estimate will include the costs associated with preparing the site for opening business.

Page 5

Inspirational Grounds

Current Assets, in the table below, includes furniture and fixtures.


Long-term assets, in addition to our major brewing, grinding, and
roasting equipment, includes a POS System.
Table: Start-up

Start-up
Requirements
Start-up Expenses
Legal
Stationery etc.
Brochures/Mailings
Marketing Consultant
Insurance
Rent
Research and Development
Build Out Expenses
Initial Marketing
Training
Website development
Expensed Equipment
Other
Total Start-up Expenses

$1,500
$800
$1,000
$1,000
$500
$2,000
$1,500
$8,000
$2,000
$1,500
$50
$4,950
$5,000
$29,800

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

$30,600
$6,600
$12,000
$16,000
$65,200

Total Requirements

$95,000

Page 6

Inspirational Grounds

Table: Start-up Funding


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

$29,800
$65,200
$95,000

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

$34,600
$30,600
$0
$30,600
$65,200

Liabilities and Capital


Liabilities
Current Borrowing
Long-term Liabilities
Accounts Payable (Outstanding Bills)
Other Current Liabilities (interest-free)
Total Liabilities

$0
$80,000
$0
$0
$80,000

Capital
Planned Investment
Owner Investment
Investor 2
Other
Additional Investment Requirement
Total Planned Investment
Loss at Start-up (Start-up Expenses)
Total Capital

$15,000
$0
$0
$0
$15,000
($29,800)
($14,800)

Total Capital and Liabilities

$65,200

Total Funding

$95,000

Page 7

Inspirational Grounds

Chart: Start-up

Page 8

Inspirational Grounds

2.3.1 Itemized Start-up


The following table represents an itemized list of the equipment, supplies, furniture
and fixtures needed at start-up.
Equipment: Total $15,946.78
Item

Description

Supplier Number Per Item Cost Total Cost

Espresso Machine

La Cimabli MN29 Select

ESI

Grinder/Doser

Mazzer Super Jolly

ESI

$770.00

$629.78

Bulk Grinder

Mazzer Major

ESI

$1,025.00

$838.35

Brewer

Single Pot Brewer

ESI

$865.00

$707.48

Airpot

Service Idea 3 ltr

ESI

$54.90

$179.61

Water Filter Head

Everpure SO MC twin

ESI

$175.71

$143.71

Filter Cartridge

Everpure MC

ESI

$69.07

$56.49

Water softener

Everpure 7-SO Cartridge

ESI

$94.92

$77.63

Knockbox

Countertop

ESI

$40.00

$32.72

Creamer

Bell Creamer

ESI

$40.00

ESI

$7.35

Thermometer

$6,900.00 $5,643.50

Steam Pitcher

1 liter

ESI

$12.15

Steam Pitcher

1.5 liter

ESI

$19.15

Whipped Cream Maker ISI 1 Pint

ESI

$69.23

Espresso Hand Tamper

ESI

Blender

Vita Mix 48 OZ - Bar Boss Zesco

$379.00

$379.00

Coffee Roaster

Micro Roaster

ESI

Microwave Oven

Amana lgt duty 1000 wt

Zesco

$200.00

$200.00

Refrigerator

27 1/2" Undercounter

Zesco

$837.00

$837.00

Refrigerator

Upright beverage - True

Zesco

Freezer

Chest

Zesco

Ice Machine

Undercounter

Zesco

Dipperwell

w/faucet

Zesco

$3,500.00 $3,500.00

$1,092.00 $1,092.00
$379.00

$379.00

$1,096.00 $1,096.00
$154.50

$154.50

Page 9

Inspirational Grounds

Supplies: Total $2,667.94


Item

Description

Supplier

Number

Detergent

Espresso cleaning

Per Item Cost Total Cost

ESI

$7.57

$7.57

Barspoon

ESI

$2.15

$2.15

Nail Brush

Zesco

$8.70

$8.70

Cleaning Brush

Group head O-Ring

ESI

$4.38

$4.38

Cleaning Brush

Airpot

ESI

$3.75

$3.75

Cleaning brush

flat grounds

ESI

$3.09

$3.09

Cleaning blank

back flush

ESI

$3.58

$3.58

Foam Cups - hot

8oz - 1000 count

ESI

$39.33

$39.33

Foam Cups - hot

12 oz - 1000 count

ESI

$55.92

$55.92

Foam Cups - hot

16 oz - 1000 count

ESI

$63.92

$63.92

Insulated Cups - hot

20 oz - 500

ESI

$64.42

$64.42

Plastic Cups - cold

12 oz - 500

ESI

$36.83

$36.83

Plastic Cups - cold

12 oz - 500

ESI

$36.88

$36.88

Plastic Cups - cold

16 oz - 500

ESI

$51.72

$51.72

Lid - Hot

8 oz - 1000 count

ESI

$28.36

$28.36

Lid - Hot

12/16 oz - 1000 count

ESI

$36.58

$36.58

Domed Lid

12/16/20 oz 1000

ESI

$36.58

$73.16

Lid - Cold

flat 12 oz 1000 count

ESI

$36.51

$36.51

Lid - Cold

flat 16/20 oz 1000 count

ESI

$44.72

$44.72

Lid - Cold

dome 12 oz - 1000 count

ESI

$52.09

$52.09

Lid - Cold

dome 16 oz - 1000 count

ESI

$67.41

$67.41

Bus Boxes

Zesco

$4.70

$23.50

Mugs

3 oz Barista - 3 doz

Zesco

$180.00

$180.00

Mugs

8 oz barista - 3 doz

Zesco

$201.00

$201.00

Mugs

12 oz Barista - 2 doz

Zesco

$152.00

$152.00

Saucers

5 1/4 " Barista - 3 doz

Zesco

$118.00

$118.00

Saucers

6 1/2" Barista- 3 doz

Zesco

$128.00

$128.00

Demitasse Spoons

1 doz

ESI

$3.00

$6.00

Plasticware

Spoons/Forks/Knives

Costco

$6.00

$12.00

Flatware

Spoons - 3 doz

Zesco

$35.60

$71.20

Flatware

Forks 3 doz

Zesco

$49.70

$99.40

Utility Cart

300 lb capacity

Zesco

$230.00

$460.00

Stir Sticks

wooden 1000 count

ESI

$1.57

$3.14

Straws

Individually Wrap 500 cnt

ESI

$2.72

$8.16

Coffee Bags

1 lb bags - 50 cnt

ESI

$6.38

$19.14

Coffee Bags

1/2 lb bags - 50 cnt

ESI

$5.45

$16.35

Coffee Filters

13x5 1000/case

ESI

$12.02

$12.02

Carrier

4 cup carrier- 300 cnt

ESI

$52.57

$52.57

Java Jackets

1500 cnt

ESI

$87.21

$87.21

Page 10

Inspirational Grounds
Condiment Dispensers

Salt & Pepper shakers

Dollar Store 6

$1.00

$6.00

Page 11

Inspirational Grounds

Furniture & Fixtures: Total $10,570.50


Item

Description

Supplier

Menu Board

Laminated

Eckel Sign Co 1

Cash Register

Restaurant POS System

Hand Sink

w/ faucet

Zesco

3 Compartment Sink

94" w/ 2 drainboards

Faucet
Prep Sink

$150.00

$150.00

$73.10

$73.10

Zesco

$612.00

$612.00

3 comp sink

Direct Buy

$100.00

$100.00

TBD

Zesco

$100.00

$100.00

Zesco

$170.00

$170.00

10 lb Avert Berkel Digital Zesco

$342.00

$342.00

Mop Sink
Trade Scale

Number Per Item Cost Total Cost


1

Chairs

Zesco

90

$53.10 $4,779.00

Stools

Zesco

12

$88.60 $1,063.20

Table Tops

24x24

Zesco

30

$22.70

$681.00

Table Tops

24x42

Zesco

10

$35.40

$354.00

Table Bases

22x22

Zesco

30

$27.00

$810.00

Table Bases

33x33

Zesco

10

$34.00

$340.00

Zesco

20

$38.60

$772.00

Stackable high chairs

Zesco

$63.90 $4,191.70

Lighting

Direct Buy

Hand Towel
Dispenser

Zesco

$32.50

Bakery Case
Storage Shelving

Zesco
Amco II

$32.50

Page 12

Inspirational Grounds

Start-up Inventory: Total $1,812.96


Item

Description

Supplier

Number Per Item Cost Total Cost

Espresso Beans

Lavazza 6/2.2 lb case

ESI

$102.93

$205.86

Decaf Espresso Beans

Lavazza 1.1 lb

ESI

$9.70

$19.40

Green Beans

Columbian Supremo

ESI

$75.45

$150.90

Green Beans

Costa Rican Tarrazu

ESI

$89.48

$89.48

Green Beans

Tanazanian Peaberry

ESI

$66.35

$66.35

Green Beans

Indian

ESI

$64.08

$64.08

Green Beans

Nicaraguan

ESI

$74.32

$74.32

Green Beans

Guatemala Antigua

ESI

$79.25

$79.25

Green Beans

Peru Organic

ESI

$74.04

$74.04

Green Beans

Columbian Decaf

ESI

$72.50

$72.50

Green Beans

Costa Rican Decaf

ESI

$81.25

$81.25

1883 Flavored Syrup

6 per case

ESI

$37.38

$149.52

1883 Syrup Pumps

No Charge

ESI

12

$0.00

$0.00

1883 Syrup Rack

No Charge

ESI

$0.00

$0.00

Sugar-Free Syrups

DaVinci

ESI

$5.82

$23.28

Chai Syrup

DaVinci 750 ml bottle

ESI

$6.49

$12.98

DaVinci Pumps

No charge

ESI

$0.00

$0.00

Chocolate Sauce

DaVinci 6/64 case

ESI

$42.81

$42.81

White Chocolate Sauce DaVinci 6/64 case

ESI

$42.81

$42.81

Caramel Sauce

DaVinci 6/64 case

ESI

$48.44

$48.44

Sauce Pumps

DaVinci - No Charge

ESI

$0.00

$0.00

Fruit Smoothie Base

Case

ESI

$54.42

$163.26

Pwd Smoothie Base

Case

ESI

$24.96

$49.92

N20 Chargers

24/case

ESI

$13.85

$13.85

Stash Tea Display

No charge

ESI

$0.00

$0.00

Stash Tea

Start-up case

ESI

$24.57

$24.57

Milk

2% Gal 4/case

Clover Super Foods 2

$2.38

$4.76

Milk

Skim gal 4/case

Clover Super Foods 1

$2.53

$2.53

Milk

Soy 32 oz 12/case

Clover Super Foods 1

$16.48

$16.48

Milk

Half/Half

Clover Super Foods 1

$8.27

$8.27

Sugar

packets 2000 ct

Clover Super Foods 1

$10.84

$10.84

Equal

packets 2000 ct

Clover Super Foods 1

$35.74

$35.74

Bakery

Cheesecake - Amaretto Clover Super Foods 1

$14.39

$14.39

Bakery

Choc Chip Cheesecake

Clover Super Foods 1

$15.54

$15.54

Bakery

Dipped Cheescake

Clover Super Foods 1

$18.67

$18.67

Bakery

Raspberry Cheescake

Clover Super Foods 1

$16.43

$16.43

Soft Drinks

Jones Soda 12 oz 24/cs Clover Super Foods 4

$15.95

$63.80

Page 13

Inspirational Grounds

3.0 Products
Beverages and Baked Goods
66 Books Cafe sells quality freshly roasted coffee, specialty beverages, and beverage
related items to the discriminating coffee drinker. The beverages are made by trained staff
members who know the products and make recommendations to customers.
The coffee varietals, teas, and other beverages items are supplied by Espresso Services, Inc
and delivered within 24 hours. The roasting of the green beans will take place on-site for the
freshest product possible. Owner will rely on customers and employees to shorten the
communication and feedback loop in product and service offerings.
66 Books Cafe will offer custom roasting services to our customers. Customers will be able to
order selected coffee varietals roasted to order for enjoyment in their homes or offices. These
custom roasted coffees will create a unique experience for our customer, and allow them to
further their specialty coffee knowledge.
Books and Music
Containing Christian, uplifting, and life-affirming messages will be sold to complete
the ambiance and community centered feel of the store.
3.1 Product Description
66 Books Cafe sells the entire array of coffee and espresso-based drinks,specialty
drinks, and bakery items, as well as music and books geared toward the spiritual reader.
Specialty Coffees
The primary product of 66 Books Cafe is the specialty coffee. Several unique blends will be
micro roasted for daily serving or specially roasted to order at our customers' request which
will give our customers the variety they seek. These coffee blends include: Columbia Supremo,
Tanzanian Peaberry, Jamaican Blue Mountain, Guatemalan Antigua, Costa Rican Tarrazu,
Sumatra Mandheling, and Ethiopian Yaefacheffe. Other blends and decaffeinated coffee will be
offered as well.
Espresso & Coffee Drinks
The Straight Shot - The foundation of every espresso beverage; served in a demitasse, when
consumed alone.
Espresso Macchiato - Espresso served in a demitasse with a small amount of foamed milk on
top
Espresso Con Panna - Variation of the Macchiato substituting whipped cream in place of
the foamed milk.

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Caff Americano - A single or double shot of espresso is combined with hot water from the
espresso machine. This produces a smoother and fresher (as well as hotter) cup of coffee
than conventional brewing.

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Cappuccino - Espresso mixed with foamed milk upon the pour; can be garnished with
shaved chocolate.
Caff Latte - Espresso mixed with steamed milk, and topped with foamed milk; can be
garnished with shaved chocolate.
Mocha - Espresso, steamed milk, and chocolate syrup, usually topped with whipped cream
and chocolate shavings.
The Breve - An extra rich Caffe' Latte made with half & half instead of milk.
Caf Au Lait - Drip coffee with steamed milk added and topped with foamed milk.
Flavor-Based Drinks
Hot Chocolate and Steamers - These drinks are made like lattes and mochas without the
addition of coffee. Flavored syrups are added to steamed milk and may be topped with whipped
cream at the customer's request.
Italian Sodas and Creamosas - An Italian soda is a combination of flavored syrup and high
quality carbonated mineral or soda water, served over ice. A creamosa is an Italian soda with
heavy cream or half & half added and gently stirred to making a swirled appearance in the
drink.
Granita - An Italian style granular ice drink similar to a slushy but much more dense in
consistency.Granita flavors are usually coffee or fruit based
Other specialty drinks include: Gourmet hot tea, iced Tea, Chai, smoothies, blended coffee
and tea-based drinks, and bottled soft drinks.
Books and Music
Books - The most popular titles will be stocked in limited supply. Such books as Woman, Thou
are Loosed by T.D. Jakes; In Pursuit of Purpose, by Dr. Myles Munroe; Prayers That Heal The
Heart, by Mark & Patti Virkler; A Fresh Word For Today, by Bob Gass; Run Baby Run, by Nicky
Cruz; Morning By Morning, by Charles H. Spurgeon, and others.
Music - 66 Books Cafe will carry the finest in contemporary Christian music. Titles include
Kirk Franklin; Mary Mary; Set Free; Audio Adrenaline; Yolanda Adams, and more.
Bakery Items
66 Books Cafe will also offer its customers a variety of baked goods, including pastries,
cookies, and cakes. Bread for sandwiches and buns for soup will also be secured. Negotiations
with several local bakeries are now underway. Quality and consistency will be the determining
factors for this decision.

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3.2 Competitive Comparison


66 Books Cafe will be unique in the vicinity. Not only will 66 Books Cafe differentiate itself from
the strictly-coffee cafes by providing its customers with a theme based on sound spiritual
principles, we will also be the first independently-owned, urban store to roast its own beans
on-site, providing the customer with a unique experience in a welcoming environment.
3.3 Sales Literature
66 Books Cafe will use print advertising and sales programs to get the word out to
customers.
Fliers will be distributed throughout the Twin City area to chambers of commerce, tourism
council offices, hotels, neighborhood stores and shops, churches, schools, and other areas one
month before the grand opening.
Newspaper advertisements in Minneapolis and St. Paul, The Shepherd's Guide, and
neighborhood publications will be used to attract customers with grand opening offers, as well
as 1,000 door-to-door flyers offering a free 16 oz. drink.
See attached example flier.
3.4 Sourcing
66 Books Cafe has associated itself with the finest coffee supplier in the Twin Cities area,
Espresso Services, Inc. We will bring fine coffees from all over the world to South Central
Minneapolis, where residents, other Midtown tenants and passers-by can enjoy a freshly
roasted quality cup of coffee, an espresso or specialty drink in an inviting and
friendly atmosphere.
3.5 Technology
The technology 66 Books Cafe is dependant upon is the micro-roasting equipment it will use to
roast the beans on-site. This equipment is serviced through the supplier;Espresso Services,
Inc.
66 Books Cafe will also use our website to advertise specials and events, and to post the
monthly menu and talent offerings. We will use email to communicate with customers wishing
to sign-up for email specials. Eventually, we would like to institute online ordering for roasted
coffee and specialty merchandise, but that plan is at least two years off.
The Point of Sale (POS) technology 66 Books Cafe will use allows for order taking when the
lines are long, keeps customer discount information, inventory, and revenue/profit
information. The system has a battery back-up in case of power surges and temporary power
losses.
The 66 Books Cafe' logo will be Federally Trademarked. Although the beverages will not be
protected in content, beverage names for specialty drinks reflecting the theme of the shop will
be protected under the Federal Trademark laws.

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The security system 66 Books Cafe uses will protect the contents of the store and reduce
insurance premiums.
3.6 Future Products
As 66 Books Cafe grows, more features will be added to the existing store. A key part of this is
the addition of live entertainment. This entertainment will be in the form of Jazz singers,
poetry readings, Comedy for the King, motivational speakers, and Christian musical Artists.
Food items will be added to the menu of offerings. The soup will be made fresh daily, one kind
per week. The soups are: Chicken Noodle, Minestrone, Clam Chowder, Vegetable Beef,
Vegetable, Chicken and Rice, and Wild rice. Sandwiches are made to order and include deli
favorites such as herbed turkey, egg salad, tuna salad, roast beef, corned beef, and turkey. A
variety of condiments will also be available. 66 Books Cafe will obtain deli meats from Costco.
The salad sandwiches will be made fresh on-site.
66 Books Cafe will establish itself as the destination for non-secular and motivational
entertainment. We also envision adding meeting rooms, hosting receptions, and adding small
devotional rooms for private reflection. The meeting rooms will be perfect for small business
and non-profit organizations with limited office space. Coffee and pastries will be served to
ensure a successful atmosphere for business. 66 Books Cafe will also be available for private
receptions, such as birthday parties, anniversaries, or showers. Customer provided catering
will go a long way to ensure the guests' parties are successful. The devotional rooms will be
wired for individual music selection, equipped with one-way TV cameras, and furnished with a
comfortable chair and table.
These additions complete the vision for 66 Books Cafe, and provide its customers with a place
for socialization, relaxation, and reflection.
4.0 Market Analysis Summary
66 Books Cafe is faced with the exciting challenge of being the first-mover in the
Minneapolis/St. Paul Christian coffee house and roaster market. The consistent popularity of
coffee and specialty drinks, combined with the ever growing and ever profitable Christian
bookselling and music market, is a winning concept and will produce overwhelming results.
Our target market includes coffee drinkers, spiritual seekers, Christians seeking fellowship (and
snacks), and local neighborhood residents.
4.1 Market Segmentation
Census data, religous adherent research, and coffee consumption statistics were used to
determine market share for 66 Books Cafe. Recent census data shows that there are
38,860 persons in the 55407 zip code, and 1,126,944 persons in Hennepin county. Coffee
Research Institute data shows that 54% of the population drinks coffee daily, and 25% drink
coffee occasionally. The Glenmary Research Institute shows that 64.9% of the Minnesota
population are self-professed religous adherents. Minnesota ranks 5th in the nation for
percentage of population religiously affiliated. National statistics show that most persons do
not travel more than 20 minutes to eat or listen to entertainment; we are using a conservative
10%. The following is a breakdown of target customers:

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55407 Market
AGE

% of Population

15-19

7.1%

20-24

8.4%

25-44

35.8%

45-64

17.3%

TOTAL

68.6%

INCOME

% of Population

15,000-24,999

16.5%

25,000-49,999

29.0%

50,000-99,999

28.6%

TOTAL

74.1%

55407 market = (38,860 x 68.6% 15-64 year olds, x 74.1% in targeted income bracket, x 54%
coffee drinkers) + (38,860 x 68.6% x 74.1% x 25% occasional coffee drinkers)
The formula takes the total 55407 population and then multiplies that number by the
percentages in order of importance, that figure is multiplied by the percent of persons who
drink coffee daily. The next formula is calculated the same except it uses the percentage of
person who drink coffee occasionally.
Hennepin County Market
AGE

% of Population

15-19

6.5%

20-24

7.3%

25-44

33.1%

45-64

22.2%

TOTAL

69.1%

INCOME

% of Population

15,000-24,999

10.8%

25,000-49,999

23.9%

50,000-99,999

37.6%

TOTAL

72.3%

Hennepin County Market = ((1,126,944 - 38,860) x 69.1% x 72.3% x 64.9% x 54% x 10%) +
((1,126,944 - 38,860) x 69.1% x 72.3% x 64.9% x 25% x 10%))
The formula takes the total county population minus the 55407 population and then multiplies
that number by the percentages in order of importance, that figure is multiplied by the percent
of persons who drink coffee daily multiplied by the percentage of the population likely to travel
to 66 Books Cafe. The next formula is calculated the same except it uses the percentage of
person who drink coffee occasionally.

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Table: Market Analysis

Market Analysis
Potential Customers

Year 1

Year 2

Year 3

Year 4

Year 5

1%

13,165

13,297

13,430

13,564

13,700

1.00%

1%

19,731

19,928

20,127

20,328

20,531

1.00%

0%

10,000

10,000

10,000

10,000

10,000

0.00%

0.77%

42,896

43,225

43,557

43,892

44,231

0.77%

Growth

Neighborhood Resident
Religious Adherent - Henn
County
Other
Total

CAGR

Chart: Market Analysis (Pie)

4.2 Target Market Segment Strategy


The customers will be between 15-64 years old. The income level is between $15,000 and
$99,000 annually. They live in the 55407 zip code, the proposed area for 66 Books Cafe. The
Hennepin county customer is between 15-64 with income levels ranging from $15-99K
annually. They live in the Hennepin county area and are self-professed religious adherents. A
limited number, estimated at about 10,000 will come from other areas out of curiosity or to
see a particular entertainer or poetry reading. A majority of the customers will be persons who
enjoy a relaxing atmosphere, reading, reflection, and excellent coffee.

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4.2.1 Market Trends


The specialty beverage market will continue to grow as younger people are opting for nonalcoholic beverages and wholesome entertainment. Religious book retail sales grew 2.3%
in
2002. In 2000 they represented 5.25% of all book sales resulting in $1.25 billion in revenue. In
2001, these sales grew 4.7% to $1.3 billion and market share grew to 5.5%. With the
increasing interest in spirituality, sales and market share will increase steadily.
4.2.2 Market Growth
The Hennepin County area is expected to grow .8% annually. The 55407 zip code area is
expected to grow 1% annually. These estimates are based on most recent census data and
projected growth rate for the the Minneapolis area.
4.2.3 Market Needs
Current trends and historical sales data both indicate that the high demand for coffee will
remain constant over the next five years. The Christian book and music business is expected
to continue to grow as contemporary Christian artists rival secular music. In addition to the
increased sales in these areas, Generation X'ers are more religious than their parents,
according the GlenMary Research Institute.
The needs of this market are decidedly soft in nature. The soft needs of this market include,
but are not limited to, a general feeling of acceptance, a place of belonging, and nonjudgmental atmosphere.
4.3 Industry Analysis
The retail coffee industry in the Twin Cities experienced rapid growth at the beginning of the
90's and is now moving into the mature stage of its life cycle. Many factors contribute to the
demand for excellent coffee and specialty beverages in Minneapolis. The climate in
Minneapolis
is extremely conducive to coffee consumption; coffee consumption increases in colder months.
Current trends in the Midwest reflect the popularity of fresh, quality coffee and specialty
drinks,
Minneapolis/St. Paul boasts sophisticated coffee lovers.
The popularity of Christian entertainment is growing immensely as people are searching for
meaning during these uncertain times. Those who are familiar with Christian music and
book trends and sales are looking for authors and performers to keep up with the seemingly
insatiable demand.
Due to competition, cafe owners must look for ways to differentiate their place of business
from others in order to achieve and maintain a competitive advantage. The founder of 66 Books
Cafe realizes the need for differentiation and strongly believes that combining freshly roasted
coffee, a cafe, spiritual books and music, and entertainment are the keys to success. The fact
that no other such cafes are established in the Twin Cities presents 66 Books Cafe with a
chance to enter the window of opportunity and take hold of a very profitable niche market.

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4.3.1 Competition and Buying Patterns


66 Books Cafe will face competition on two fronts: coffee retailers and book & music stores.
The good news is that 66 Books Cafe does not currently face any direct competition from other
cafes in the market. There are no independently operated Christian cafes in the Twin Cities.
Christian based coffee houses are either located within, or owned by a church.
Heavy competition in the Twin Cities area creates an industry where cafes face the same
costs. There is a direct relationship between price and quality of coffee. Some fresh roasted
coffee retails from $12/lb while other more exotic beans may sell as high as $40/lb.
Wholesalers sell green (unroasted) beans to retailers at an average of 50-75% discount. For
example; a pound of Columbian Supremo beans wholesale for $3.06 and retails for $12.85. As
in most industries, price decreases as volume increases.
4.3.2 Main Competitors
The main competitor in the retail coffee segment is Dunn Bros, as they also sell freshly roasted
beans. In fact, the largest part of Dunn Bros' revenue is generated from the sale of the roasted
beans to the consumer. The difference is Dunn Bros. does not roast their beans on-site, nor do
they have the ability to custom roast for their customers.
Dunn Bros. - Uptown
Local chain cafe that boasts freshly roasted beans. The bulk of these sales are in the form of
roasted beans sold to the consumer. The cafe caters to customers who want fresh beans
and
brewed coffee. The atmosphere is homey, the prices are competitive, no entertainment is
provided. They are known for good quality coffee. The stores are clean and well managed.
Vera's - Lynn/Lake
A nice specialty coffee cafe with an atmosphere that caters to the "Green Peace" crowd. They
have competitive prices, good quality coffee, and an excellent location. The cafe has three
rooms; one with tables and chairs, one with couches and over-stuffed chairs, the third "room"
is an outside patio. Vera's doesn't offer entertainment, on-site roasted coffee, or books and
music.
Boathouse Coffee - 42nd & Cedar Ave South
Serves specialty coffee drinks, sandwiches, soft drinks, and ice cream. The street is busy,
there is not a lot of foot traffic, and there is no parking lot so the location doesn't allow for
easy access. The shop is clean and prices are competitive. The Boathouse Coffee Cafe has
several tables, and a couch. It can accommodate about 25 patrons.
4.3.3 Industry Participants
There are countless coffee wholesalers who could conceivably do business with 66 Books
Cafe. These wholesalers distribute coffee and espresso beans to restaurants and retailers.
Competition in this industry creates an even amount of bargaining power between buyers
and suppliers resulting in competitive pricing.

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5.0 Strategy and Implementation Summary


66 Books Cafe uses a strategy of total market service. Our promise is in our uniqueness in the
market and the products we sell, the people we attract, the atmosphere we create.
We will create an atmosphere that lures the "spiritual seeker." The "coffee lover" and others will
come because of the quality and the atmosphere. Ultimately, we aren't selling either products
or coffee. We are selling the experience. We want to be part of the community, part of their
lives, part of the search for meaning.
Strategic Assumptions:
1. Every person is a potential customer and all potential markets experience growth.
2. Marketing to the soft needs of the customer will produce sales of products.
5.1 Value Proposition
66 Books Cafe will position itself as an upscale coffee house, spiritual resource and
entertainment provider. It will serve on-site roasted, high quality coffee and espresso, as well
as specialty beverages at a competitive price. Due to the number of coffee shops in the
Minneapolis area, it is important that 66 Books Cafe set competitive prices for the freshly
roasted coffee. Customers will see coffee as it roasts throughout the day, and they will be
able to order coffee beans roasted to their specifications while they enjoy a beverage.
5.2 Competitive Edge
The competitive advantage of 66 Books Cafe is threefold:
Our uniqueness in the market - 66 Books Cafe will be the only spiritually centered coffee
shop in the Twin Cities metropolitan area which roasts its own beans daily, sells quality coffee
and espresso based beverages, and specialty drinks, along with inspirational music and
books. 66 Books Cafe is upscale, not stuffy. Our community-based focus will be hard to
duplicate, even if products and service are similar.
Excellent Customer Service - Because competition in the specialty beverage market is
high, 66 Books Cafe will work to ensure that each customer is treated in the same respectful
manner as the next. Technology will play a key role in ensuring that our customers get that
special one-on-one feeling they might experience at a high-end retail store. Our Point of Sale
system will not just ring orders, but keep key data on customers' previous purchases in the
area of freshly roasted coffee. In this manner, sales staff will know about the customer's buying
habits and tastes, and will be able to make suggestions for purchases that will likely result
in increased sales and make the customer feel special.
Excellent service in a community focused environment will be a unique undertaking. We will
ensure that 66 Books Cafe is a fun place for people to gather. 66 Books Cafe will employ the
principles that make Seattle's World Famous Pike Place Fish Market an invigorating experience
for customers. These principles are: Play, Make Their Day, Be there, and Choose Your Attitude.
We will ensure that each employee understands the fundamentals at the base of any
successful service organization.

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Quality - We are committed to serving only the best quality beans and beverages. Moreover,
the training the staff receives will ensure that the art of espresso making is understood.
There is more to a good espresso than the beans and the machine. At 66 Books Cafe, we
understand it, and will ensure our customers do as well.
It's the combination of these three elements that make up the competitive advantage of
66 Books Cafe.
5.3 Marketing Strategy
66 Books Cafe' marketing strategy focuses on the key elements of the target markets' soft
needs, and the focus of the venture.
Soft Needs:

Spiritual Growth
A place of belonging
Learning & communication

Venture Focus:

On-Site Roasted Coffee


Community Involvement

5.3.1 Pricing Strategy


Pricing in this industry is very competitive. The price of freshly brewed coffee and specialty
beverages doesn't vary by more than a few cents between the corner coffee shop and the
large chains.
The price of roasted coffee beans can vary. Larger chains, having the benefit of volume, can
charge slightly lower prices per pound. 66 Books Cafe will charge a slightly higher price as our
coffees are freshly roasted on-site daily. 66 Books Cafe will roast its coffee to maximize the
flavor of the specific bean. We will also roast coffee to the customer's specifications. This
strategy of bringing the customer in to the whole coffee experience, gives the customer an
additional service, for which a slightly higher price will not be deemed excessive.

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5.3.2 Promotion Strategy


66 Books Cafe will use several ways to reach new customers. We will leverage schools,
churches, community organizations, print ad, internet advertising and word of mouth.
1. Advertising--We'll be developing our core positioning message: "On-Site Roasted
Coffee, Made to Order." to differentiate our service from the competition.
2. Postcards-- 66 Books Cafe will employ targeted mailings to our 55407 customer base.
These postcards will announce Grand Opening Specials.
3. Internet Advertising--As customers come in, they will be asked if they wish to sign up on
our internet mailing list. Special promotions will be available only through Internet "coupons."
4. Media--66 Books Cafe will work with local media on several different "story of interest"
venues. The Homework Happy Hour is one example that would gain media attention at no cost
to 66 Books Cafe.
5.3.3 Marketing Programs
The programs 66 Books Cafe will initiate are depicted on the following graphs. These programs
support the soft needs and product offerings listed in the Marketing Strategy section, and have
been transliterated into "Vision Focus" and "Customer Focus" programs.
Vison Focus
1. Community Involvment
o Community Reinvestment
o MCDA Hiring Program
2. Spiritual Information
o Product Offerings
o Speakers and Entertainment
3. Welcoming Environment
o Vision Communication
Customer Focus
1. Roasting Expertise
o Micro Roasting Program
2. Custom Offerings
o POS System
3. Excellent Training
o EST Training Programs
o Encourage F.I.S.H. Philosophy

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5.3.4 Positioning Statement


For the Christian who needs a place to seek, have fun, relax, and enjoy quality beverages, 66
Books Cafe is a place to feel welcome, special, informed, and energized. 66 Books Cafe meets
the needs of this market. Unlike the other coffee shops in the metro area, 66 Books Cafe has
character and a purpose.
For the neighborhood, 66 Books Cafe brings a positive message with a community centered
focus. This is a place where all are welcomed and embraced with a warm greeting and hot
coffee. The look and feel of the shop will ensure that anyone who walks through the door feels
right at home. We want our customers to learn about coffee, and experience quality first hand.
5.4 Sales Strategy
The trained baristas at 66 Books Cafe will handle the sales transactions. To speed up the
customer service, at least two employees will be servicing clients--while one employee
prepares the customer's order, the other one will take care of the sales transaction. All sales
data logged on the computerized point-of-sale terminal will later be analyzed for marketing,
Cost of Sale, and volume purposes.
In order to build up its client base, 66 Books Cafe will use banners, fliers, postcards and other
advertising, utilize customer referrals and cross-promotions with other businesses in the
community. At the same time, we will use customer retention programs like drink punch-cards
to make sure the customers are coming back and spending more at the coffee bar.
5.4.1 Sales Programs
Internet Coupons - As customers come into the store, they will asked if they'd like to put their
name on the internet mailing list. Once added, these customers will receive special "internet
only" solicitations for discounts and specials, as well as a calendar of events.
Community Based Programs - 66 Books Cafe will partner with community organizations,
schools, and churches to provide unique offerings which strengthen the community and
provide sales for the store. The Homework Happy Hour is a prime example of leveraging
community needs with sound sales techniques and business practices.
Direct Mailing - 66 Books Cafe will periodically mail special product offerings to people in the
55407 zip code. This promotion will also be used to announce the Grand Opening of 66 Books
Cafe.

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5.4.2 Sales Forecast


66 Books Cafe is taking a modest approach to forecasting. 66 Books Cafe is forecasting an
8% average growth which is in line with industry estimates. With our unique product and
service offerings, along with our aggressive marketing strategies, the sales forecasts are
actually on the conservative side.

Table: Sales Forecast

Sales Forecast
Year 1

Year 2

Year 3

Fresh Brewed Coffee


Espresso Based Beverages
Specialty Drinks
Pastries/Desserts
Music/CDs
Books
Fresh Roasted Coffee
Misc Candies/Products
Total Sales

$41,079
$53,507
$34,725
$14,458
$11,604
$11,604
$19,341
$17,121
$203,440

$44,365
$57,788
$37,503
$15,615
$12,765
$12,765
$21,275
$17,977
$220,053

$47,914
$62,411
$40,503
$16,864
$14,041
$14,041
$23,402
$18,876
$238,054

Direct Cost of Sales


Fresh Brewed Coffee
Espresso Based Beverages
Specialty Drinks
Fresh Roasted Coffee
Pastries/Desserts
Candies, etc.
Books/Music

Year 1
$1,370
$3,855
$7,216
$5,809
$7,229
$8,561
$11,617

Year 2
$1,397
$3,933
$7,289
$5,867
$7,807
$8,989
$11,733

Year 3
$1,425
$4,011
$7,361
$5,925
$8,432
$9,438
$11,851

Subtotal Direct Cost of Sales

$45,657

$47,014

$48,444

Sales

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Chart: Sales Monthly

Chart: Sales by Year

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5.5 Strategic Alliances


66 Books Cafe has aligned itself with key players in the industry: Espresso Services, Inc.
located in Minneapolis, Minnesota, and the specialty Coffee Association of America. Both of
these organizations are nationally and internationally known for their knowledge of, and
expertise in, the specialty beverage industry.
66 Books Cafe has also formed key alliances with non-competing experts in Restaurant and
Retail markets.
Finally, 66 Books Cafe has established itself within the community through developing
relationships with five of the surrounding Neighborhood Associations, key developers and
planners of the Midtown Exchange project and various City Officials and city Counsel
Members.
These alliances will serve to be conducive to the company's success and marketability.
5.6 Milestones
The accompanying table lists important program milestones up to the date of opening. Further
milestones, with dates and budgets for each, are currently being developed to line up our liveperformance events and to meet our marketing and sales goals. These post-opening
milestones are dependent on receiving adequate funds for opening.
Table: Milestones

Milestones
Milestone
Accounting Plan
Personnel Plan
Technology Systems
Communication Systems
Site Selection
Business Plan
Shop Design
Secure Start-Up Funding
Grand Opening Materials
Opening Inventory
Totals

Start Date
9/30/2003
10/1/2003
10/1/2003
10/1/2003
6/1/2003
7/1/2002
9/15/2003
5/1/2003
1/1/2005
1/5/2005

End Date
10/15/2003
11/1/2003
11/1/2003
11/1/2003
2/1/2004
2/4/2004
10/1/2004
12/31/2004
1/15/2005
3/1/2005

Budget
$1,500
$500
$1,500
$1,500
$1,500
$500
$2,500
$150
$500
$2,500

Manager
ABC
ABC
ABC
ABC
Regina Brown
Regina Brown
Regina Brown
Albert Brown
ABC
ABC

Department
Department
Department
Department
Department
Owner
Owner
Owner
Manager
Department
Department

$12,650

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Chart: Milestones

6.0 Web Plan Summary


66 Books Cafe will use our website to advertise specials and events, and to post the
monthly menu. We will maintain a confidential email list to communicate with customers
wishing to sign-up for email specials. Our website is being developed by the owners, and will
be hosted with a professional hosting service which allows us to post our own changes as often
as
we wish.
Although we would eventually like to institute an on-line ordering system, we realize this
development may have to wait until the business is firmly established and has sufficient cash
for designing and maintaining these dynamic features. Online ordering will not only increase
sales geographically, but allow 66 Books Cafe to utilize the full spectrum of its POS system's
capabilities.
7.0 Management Summary
66 Books Cafe is owned by Regina Brown, and operated by Albert Brown. The company, being
small, requires a simple organization structure. Implementation requires the owner, Regina
Brown, to make decisions on the mission and vision, while Albert Brown makes operational
decisions. Major decisions affecting the execution of the plan are made jointly by the owner
and operations manager.

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7.1 Personnel Plan


The personnel plan is included in the following table. It shows the owner's and operations
manager's salaries, followed by 5 part-time salaries for espresso servers. Part time employees
will collectively work 19.5 hours daily with an hourly salary of $8.00. 66 Books Cafe assumes a
5% annual increase in barista salaries. These employees will share any tips received while they
are on duty. The owner will receive no payments or dividends until at least the
fourth year of the business.
Table: Personnel

Personnel Plan
Albert Brown - Operations Manager
Owner
Baristas
Total People

Year 1
$18,000
$0
$56,160
6

Year 2
$18,000
$0
$58,968
6

Year 3
$25,000
$0
$61,916
7

Total Payroll

$74,160

$76,968

$86,916

7.2 Management Team


Regina Brown, owner and operator, has extensive start-up experience within the corporate
sector and has successfully managed key areas for Fortune 500 companies. She has an
entrepreneurial spirit which has made her corporate ventures successful. Her people savvy, and
ability to turn vision into strategy, and strategy into tactics, will be key elements of success for
66 Books Cafe. She has successfully managed million dollar budgets. Currently, Regina
is starting up a new venture within Wells Fargo Home Mortgage. This is her third start-up for
that organization.
Albert Brown has start-up experience as well as restaurant management experience. Most
recently Albert owned and operated RB Mortgage Company. Albert received a bachelor's
degree from Cheney University in Cheney, PA, a Juris Doctorate from Lasalle University, and is
currently pursuing a Masters in Divinity at Bethel Seminary in St. Paul, MN. Albert has held
several management positions within the restaurant industry.

Page 28

Inspirational Grounds

8.0 Financial Plan


66 Books Cafe is basing projected sales on the market research, industry analysis and
proximity of other coffee houses in the area. We are looking to obtain a modest .1% of the
market share.
The cost of goods sold is based on the price list of Espresso Services, Inc., and is consistent
with costs in the coffee and espresso industry. The cost of the bakery items and candies is 50%
of the selling price.
66 Books Cafe will use its POS System to keep cash flow and sales goals on track, and to
indicate which marketing efforts are worth the investment. We expect sales to easily exceed
the break-even point from the first month onward. The following sections outline our projected
Profit and loss, Cash Flow, and Balance Sheet.
8.1 Important Assumptions
We do not sell anything on credit. The personnel burden is very low because part-time workers
receive no benefits. The long-term interest rate is extraordinarily low because of the MCDA
business program which loans money to start-up ventures at a 2% annual interest rate.
66 Books Cafe will obtain employees through MCDA's community reinvestment programs,
which further establishes our commitment to the community, and raises community
awareness of our presence and purpose. We will also look to local seminaries to involve their
students in a internship capacity.
Table: General Assumptions

General Assumptions
Plan Month
Current Interest Rate
Long-term Interest Rate
Tax Rate
Other

Year 1
1
8.75%
2.00%
25.00%

Year 2
2
8.75%
2.00%
25.00%

Year 3
3
8.75%
2.00%
25.00%

Page 29

Inspirational Grounds

8.2 Break-even Analysis


For our break-even analysis, we assume fixed costs of approximately $11,650 per month,
which includes our full payroll, rent, and utilities, and an estimation of other running
costs.
The chart shows that we need to sell about $15,000 per month to break-even, according to
these assumptions. Our conservative projections will exceed the break-even point even in
the first month of business.

Chart: Break-even Analysis

Table: Break-even Analysis

Break-even Analysis
Monthly Revenue Break-even

$15,017

Assumptions:
Average Percent Variable Cost
Estimated Monthly Fixed Cost

22%
$11,646

Page 30

Inspirational Grounds

8.3 Projected Profit and Loss


Projected profit and loss are depicted in the table below. Payroll expenses reflect the annual
salaries of operations manager and 5 part-time baristas. Rental Expense is based on
leasing
2,000 square feet at $12.50 per square foot.
We project sales and marketing expenses at $12,000 for the first year. 66 Books Cafe will
depend on curiosity, established community involvement and media human interest stories to
spread the word, in addition to the tradition sales and marketing tactics.
Chart: Profit Monthly

Chart: Profit Yearly

Page 31

Inspirational Grounds

Chart: Gross Margin Monthly

Chart: Gross Margin Yearly

Page 32

Inspirational Grounds

Table: Profit and Loss

Pro Forma Profit and Loss


Sales
Direct Cost of Sales
Other
Total Cost of Sales

Year 1
$203,440
$45,657
$0
$45,657

Year 2
$220,053
$47,014
$0
$47,014

Year 3
$238,054
$48,444
$0
$48,444

Gross Margin
Gross Margin %

$157,783
77.56%

$173,038
78.63%

$189,610
79.65%

$74,160
$12,000
$2,004
$3,000
$4,000
$1,800
$28,380
$300
$11,113
$3,000

$76,968
$15,000
$2,000
$3,000
$4,700
$1,900
$31,691
$325
$11,545
$4,000

$86,916
$18,000
$2,000
$3,000
$5,800
$2,000
$33,100
$350
$13,037
$4,500

$139,757

$151,129

$168,703

Profit Before Interest and Taxes


EBITDA
Interest Expense
Taxes Incurred

$18,026
$20,030
$1,528
$4,124

$21,909
$23,909
$1,400
$5,127

$20,906
$22,906
$1,267
$4,910

Net Profit

$12,373

$15,382

$14,730

6.08%

6.99%

6.19%

Expenses
Payroll
Marketing/Promotion
Depreciation
Leased Equipment
Utilities
Insurance
Rent
Website Hosting and Maintenance
Payroll Taxes
Other
Total Operating Expenses

Net Profit/Sales

Page 33

Inspirational Grounds

8.4 Projected Cash Flow


We will be a medium risk concern with steady cash flows. Sales are in cash, giving 66 Books
Cafe an excellent cash structure. Solid product offerings and intelligent marketing will secure a
cash balance of close to $48,000 by December 2005.

Chart: Cash

Page 34

Inspirational Grounds

Table: Cash Flow

Pro Forma Cash Flow


Year 1

Year 2

Year 3

$203,440
$203,440

$220,053
$220,053

$238,054
$238,054

$0
$0
$0
$0
$0
$0
$0
$203,440

$0
$0
$0
$0
$0
$0
$0
$220,053

$0
$0
$0
$0
$0
$0
$0
$238,054

Year 1

Year 2

Year 3

$74,160
$102,996
$177,156

$76,968
$125,117
$202,085

$86,916
$133,821
$220,737

$0
$0
$0
$6,660
$0
$0
$0
$183,816

$0
$0
$0
$6,660
$4,000
$0
$0
$212,745

$0
$0
$0
$6,660
$4,000
$0
$0
$231,397

Cash Received
Cash from Operations
Cash Sales
Subtotal Cash from Operations
Additional Cash Received
Sales Tax, VAT, HST/GST Received
New Current Borrowing
New Other Liabilities (interest-free)
New Long-term Liabilities
Sales of Other Current Assets
Sales of Long-term Assets
New Investment Received
Subtotal Cash Received
Expenditures
Expenditures from Operations
Cash Spending
Bill Payments
Subtotal Spent on Operations
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out
Principal Repayment of Current Borrowing
Other Liabilities Principal Repayment
Long-term Liabilities Principal Repayment
Purchase Other Current Assets
Purchase Long-term Assets
Dividends
Subtotal Cash Spent
Net Cash Flow

$19,624

$7,307

$6,656

Cash Balance

$50,224

$57,532

$64,188

Page 35

Inspirational Grounds

8.5 Projected Balance Sheet


The following table shows our projected assets and liabilities over the next three years. We
anticipate a steadily increasing net worth, as we pay off our loan and sales show modest
increases. The Balance Sheet also reflects new current asset purchases in years 2 and 3.
Table: Balance Sheet

Pro Forma Balance Sheet


Year 1

Year 2

Year 3

$50,224
$4,418
$12,000
$66,642

$57,532
$4,441
$16,000
$77,973

$64,188
$4,579
$20,000
$88,767

$16,000
$2,004
$13,996
$80,638

$16,000
$4,004
$11,996
$89,969

$16,000
$6,004
$9,996
$98,763

Year 1

Year 2

Year 3

$9,725
$0
$0
$9,725

$10,334
$0
$0
$10,334

$11,059
$0
$0
$11,059

$73,340
$83,065

$66,680
$77,014

$60,020
$71,079

$15,000
($29,800)
$12,373
($2,427)
$80,638

$15,000
($17,427)
$15,382
$12,955
$89,969

$15,000
($2,045)
$14,730
$27,685
$98,763

($2,427)

$12,955

$27,685

Assets
Current Assets
Cash
Inventory
Other Current Assets
Total Current Assets
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
Subtotal Current Liabilities
Long-term Liabilities
Total Liabilities
Paid-in Capital
Retained Earnings
Earnings
Total Capital
Total Liabilities and Capital
Net Worth

Page 36

Inspirational Grounds

8.6 Business Ratios


The following table outlines some of the more important ratios from the Coffee Shop industry.
The final column, Industry Profile, details specific ratios based on the industry as it is
classified by the Standard Industry Classification (SIC) code, 5812.
Our business will be a little different from the standard coffee shop, in that we will also sell
books and music. One of the major differences between us and the rest of the industry is our
asset structure - most of our assets are short-term, rather than long-term, in part because of
our extra inventory, but also because we will lease, rather than own, our space.

Page 37

Inspirational Grounds

Table: Ratios

Ratio Analysis
Year 1
n.a.

Year 2
8.17%

Year 3
8.18%

Industry Profile
5.24%

Inventory
Other Current Assets
Total Current Assets
Long-term Assets
Total Assets

5.48%
14.88%
82.64%
17.36%
100.00%

4.94%
17.78%
86.67%
13.33%
100.00%

4.64%
20.25%
89.88%
10.12%
100.00%

2.72%
32.59%
41.88%
58.12%
100.00%

Current Liabilities
Long-term Liabilities
Total Liabilities
Net Worth

12.06%
90.95%
103.01%
-3.01%

11.49%
74.11%
85.60%
14.40%

11.20%
60.77%
71.97%
28.03%

21.75%
29.17%
50.92%
49.08%

100.00%
77.56%
71.48%
0.99%
8.86%

100.00%
78.63%
71.64%
0.91%
9.96%

100.00%
79.65%
73.46%
0.84%
8.78%

100.00%
55.74%
37.46%
2.06%
1.50%

6.85
6.40
103.01%
-679.90%
20.46%

7.55
7.12
85.60%
158.31%
22.80%

8.03
7.61
71.97%
70.94%
19.89%

0.81
0.51
53.68%
2.39%
5.16%

Additional Ratios

Year 1

Year 2

Year 3

Net Profit Margin


Return on Equity

6.08%
0.00%

6.99%
118.73%

6.19%
53.20%

n.a
n.a

10.90
11.59
27
2.52

10.61
12.17
29
2.45

10.74
12.17
29
2.41

n.a
n.a
n.a
n.a

0.00
0.12

5.94
0.13

2.57
0.16

n.a
n.a

$56,917
11.80

$67,639
15.65

$77,709
16.50

n.a
n.a

0.40

0.41

0.41

n.a

Sales Growth
Percent of Total Assets

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

Page 38

Inspirational Grounds
Current Debt/Total Assets
Acid Test
Sales/Net Worth

12%
6.40
0.00

11%
7.12
16.99

11%
7.61
8.60

n.a
n.a
n.a

Dividend Payout

0.00

0.00

0.00

n.a

Page 39

Appendix
Table: Sales
Personnel
Forecast

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

$3,239
$4,219
$2,738
$1,140
$915
$915
$1,525
$1,350

$3,271
$4,261
$2,765
$1,151
$924
$924
$1,540
$1,364

$3,304
$4,304
$2,793
$1,163
$933
$933
$1,556
$1,377

$3,337
$4,347
$2,821
$1,175
$943
$943
$1,571
$1,391

$3,371
$4,390
$2,849
$1,186
$952
$952
$1,587
$1,405

$3,404
$4,434
$2,878
$1,198
$962
$962
$1,603
$1,419

$3,438
$4,479
$2,906
$1,210
$971
$971
$1,619
$1,433

$3,473
$4,523
$2,936
$1,222
$981
$981
$1,635
$1,447

$3,507
$4,569
$2,965
$1,234
$991
$991
$1,651
$1,462

$3,542
$4,614
$2,995
$1,247
$1,001
$1,001
$1,668
$1,476

$3,578
$4,660
$3,024
$1,259
$1,011
$1,011
$1,685
$1,491

$3,614
$4,707
$3,055
$1,272
$1,021
$1,021
$1,701
$1,506

Total Sales

$16,041

$16,201

$16,363

$16,527

$16,692

$16,859

$17,028

$17,198

$17,370

$17,544

$17,719

$17,896

Direct Cost of Sales

Sales
Fresh Brewed Coffee
Espresso Based Beverages
Specialty Drinks
Pastries/Desserts
Music/CDs
Books
Fresh Roasted Coffee
Misc Candies/Products

0%
0%
0%
0%
0%
0%
0%
0%

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

Fresh Brewed Coffee

$108

$109

$110

$111

$112

$114

$115

$116

$117

$118

$119

$120

Espresso Based Beverages

$304

$307

$310

$313

$316

$320

$323

$326

$329

$332

$336

$339

Specialty Drinks

$569

$575

$580

$586

$592

$598

$604

$610

$616

$622

$629

$635

$458

$463

$467

$472

$477

$481

$486

$491

$496

$501

$506

$511

$570
$675

$576
$682

$581
$689

$587
$695

$593
$702

$599
$709

$605
$717

$611
$724

$617
$731

$623
$738

$630
$746

$636
$753

$916

$925

$934

$944

$953

$963

$972

$982

$992

$1,002

$1,012

$1,022

$3,600

$3,636

$3,672

$3,709

$3,746

$3,784

$3,821

$3,860

$3,898

$3,937

$3,977

$4,016

Fresh Roasted Coffee


Pastries/Desserts
Candies, etc.
Books/Music
Subtotal Direct Cost of Sales

50%
50%

Page 1

Appendix
Table: Sales
Personnel
Forecast

Personnel Plan
Month 1
$1,500
$0
$4,680

Month 2
$1,500
$0
$4,680

Month 3
$1,500
$0
$4,680

Month 4
$1,500
$0
$4,680

Month 5
$1,500
$0
$4,680

Month 6
$1,500
$0
$4,680

Month 7
$1,500
$0
$4,680

Month 8
$1,500
$0
$4,680

Month 9

Month 10

Month 11

Month 12

$1,500
$0
$4,680

$1,500
$0
$4,680

$1,500
$0
$4,680

$1,500
$0
$4,680

Total People

Total Payroll

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

Albert Brown - Operations Manager


Owner
Baristas

0%
0%
0%

Page 2

Appendix
Table: Profit
Cash Flow
and Loss

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

$16,041

$16,201

$16,363

$16,527

$16,692

$16,859

$17,028

$17,198

$17,370

$17,544

$17,719

$17,896

$3,600

$3,636

$3,672

$3,709

$3,746

$3,784

$3,821

$3,860

$3,898

$3,937

$3,977

$4,016

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$3,600

$3,636

$3,672

$3,709

$3,746

$3,784

$3,821

$3,860

$3,898

$3,937

$3,977

$4,016

Gross Margin

$12,441

$12,565

$12,691

$12,818

$12,946

$13,076

$13,206

$13,338

$13,472

$13,607

$13,743

$13,880

Gross Margin %

77.56%

77.56%

77.56%

77.56%

77.56%

77.56%

77.56%

77.56%

77.56%

77.56%

77.56%

77.56%

Payroll

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

Marketing/Promotion

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

Depreciation

$167

$167

$167

$167

$167

$167

$167

$167

$167

$167

$167

$167

Leased Equipment

$250

$250

$250

$250

$250

$250

$250

$250

$250

$250

$250

$250

Utilities

$300

$300

$300

$300

$300

$300

$300

$300

$400

$400

$400

$400

Sales
Direct Cost of Sales
Other
Total Cost of Sales

Expenses

Insurance

$150

$150

$150

$150

$150

$150

$150

$150

$150

$150

$150

$150

$2,365

$2,365

$2,365

$2,365

$2,365

$2,365

$2,365

$2,365

$2,365

$2,365

$2,365

$2,365

$25
$927

$25
$927

$25
$927

$25
$927

$25
$927

$25
$927

$25
$927

$25
$927

$25
$916

$25
$927

$25
$927

$25
$927

$250

$250

$250

$250

$250

$250

$250

$250

$250

$250

$250

$250

$11,614

$11,614

$11,614

$11,614

$11,614

$11,614

$11,614

$11,614

$11,703

$11,714

$11,714

$11,714

Profit Before Interest and Taxes

$827

$951

$1,077

$1,204

$1,332

$1,462

$1,592

$1,724

$1,769

$1,893

$2,029

$2,166

EBITDA

Rent
Website Hosting and Maintenance
Payroll Taxes
Other

Total Operating Expenses

0%
15%

$994

$1,118

$1,244

$1,371

$1,499

$1,629

$1,759

$1,891

$1,936

$2,060

$2,196

$2,333

Interest Expense

$132

$131

$131

$130

$129

$128

$127

$126

$125

$124

$123

$122

Taxes Incurred

$174

$205

$237

$269

$301

$333

$366

$400

$411

$442

$476

$511

$521

$615

$710

$806

$903

$1,000

$1,099

$1,199

$1,233

$1,326

$1,429

$1,533

3.25%

3.80%

4.34%

4.88%

5.41%

5.93%

6.45%

6.97%

7.10%

7.56%

8.07%

8.57%

Net Profit
Net Profit/Sales

Page 3

Appendix
Table: Profit
Cash Flow
and Loss

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 Sales

$16,041

$16,201

$16,363

$16,527

$16,692

$16,859

$17,028

$17,198

$17,370

$17,544

$17,719

$17,896

Subtotal Cash from Operations

$16,041

$16,201

$16,363

$16,527

$16,692

$16,859

$17,028

$17,198

$17,370

$17,544

$17,719

$17,896

Cash Received
Cash from Operations

Additional Cash Received


Sales Tax, VAT, HST/GST Received

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

New Current Borrowing

0.00%

$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

$16,041

$16,201

$16,363

$16,527

$16,692

$16,859

$17,028

$17,198

$17,370

$17,544

$17,719

$17,896

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

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$6,180

$219

$6,662

$9,243

$9,349

$9,417

$9,486

$9,555

$9,626

$9,699

$9,836

$9,916

$9,989

$6,399

$12,842

$15,423

$15,529

$15,597

$15,666

$15,735

$15,806

$15,879

$16,016

$16,096

$16,169

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

$555

$555

$555

$555

$555

$555

$555

$555

$555

$555

$555

$555

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

$6,954

$13,397

$15,978

$16,084

$16,152

$16,221

$16,290

$16,361

$16,434

$16,571

$16,651

$16,724

Expenditures from Operations


Cash Spending
Bill Payments
Subtotal Spent on Operations
Additional Cash Spent

Long-term Liabilities Principal Repayment

Subtotal Cash Spent


Net Cash Flow

$9,087

$2,804

$386

$443

$540

$638

$737

$837

$936

$973

$1,068

$1,173

Cash Balance

$39,687

$42,491

$42,877

$43,320

$43,861

$44,499

$45,237

$46,074

$47,010

$47,983

$49,052

$50,224

Page 4

Appendix
Table: Balance Sheet

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

$30,600
$6,600
$12,000
$49,200

$39,687
$4,000
$12,000
$55,687

$42,491
$4,000
$12,000
$58,491

$42,877
$4,040
$12,000
$58,917

$43,320
$4,080
$12,000
$59,400

$43,861
$4,121
$12,000
$59,982

$44,499
$4,162
$12,000
$60,661

$45,237
$4,204
$12,000
$61,440

$46,074
$4,246
$12,000
$62,320

$47,010
$4,288
$12,000
$63,298

$47,983
$4,331
$12,000
$64,314

$49,052
$4,374
$12,000
$65,426

$50,224
$4,418
$12,000
$66,642

$16,000
$0
$16,000
$65,200

$16,000
$167
$15,833
$71,520

$16,000
$334
$15,666
$74,157

$16,000
$501
$15,499
$74,416

$16,000
$668
$15,332
$74,732

$16,000
$835
$15,165
$75,147

$16,000
$1,002
$14,998
$75,659

$16,000
$1,169
$14,831
$76,271

$16,000
$1,336
$14,664
$76,984

$16,000
$1,503
$14,497
$77,795

$16,000
$1,670
$14,330
$78,644

$16,000
$1,837
$14,163
$79,589

$16,000
$2,004
$13,996
$80,638

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

$0
$0
$0
$0

$6,354
$0
$0
$6,354

$8,931
$0
$0
$8,931

$9,035
$0
$0
$9,035

$9,101
$0
$0
$9,101

$9,167
$0
$0
$9,167

$9,235
$0
$0
$9,235

$9,303
$0
$0
$9,303

$9,371
$0
$0
$9,371

$9,505
$0
$0
$9,505

$9,583
$0
$0
$9,583

$9,654
$0
$0
$9,654

$9,725
$0
$0
$9,725

$80,000
$80,000

$79,445
$85,799

$78,890
$87,821

$78,335
$87,370

$77,780
$86,881

$77,225
$86,392

$76,670
$85,905

$76,115
$85,418

$75,560
$84,931

$75,005
$84,510

$74,450
$84,033

$73,895
$83,549

$73,340
$83,065

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

$15,000
($29,800)
$0
($14,800)
$65,200

$15,000
($29,800)
$521
($14,279)
$71,520

$15,000
($29,800)
$1,136
($13,664)
$74,157

$15,000
($29,800)
$1,846
($12,954)
$74,416

$15,000
($29,800)
$2,652
($12,148)
$74,732

$15,000
($29,800)
$3,554
($11,246)
$75,147

$15,000
($29,800)
$4,554
($10,246)
$75,659

$15,000
($29,800)
$5,654
($9,146)
$76,271

$15,000
($29,800)
$6,852
($7,948)
$76,984

$15,000
($29,800)
$8,085
($6,715)
$77,795

$15,000
($29,800)
$9,412
($5,388)
$78,644

$15,000
($29,800)
$10,841
($3,959)
$79,589

$15,000
($29,800)
$12,373
($2,427)
$80,638

Net Worth

($14,800)

($14,279)

($13,664)

($12,954)

($12,148)

($11,246)

($10,246)

($9,146)

($7,948)

($6,715)

($5,388)

($3,959)

($2,427)

Assets

Starting Balances

Current Assets
Cash
Inventory
Other Current Assets
Total Current Assets
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
Subtotal Current Liabilities
Long-term Liabilities
Total Liabilities

Page 5

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