Contents

I. EXECUTIVE SUMMARY ................................................................................................................................. 1

a. Market Opportunity ................................................................................................................................ 2
b. Projected Income and Expenses.............................................................................................................. 3
II. ANALYSIS OF THE INTERNATIONAL BUSINESS SITUATION .......................................................................... 3
A. Economic, political, and legal analysis of the trading country ................................................................ 3
B. Trade area and cultural analysis .............................................................................................................. 7
1. Trade Area Analysis ............................................................................................................................. 7
2. Manufacturing ................................................................................................................................... 10
3. Distribution ........................................................................................................................................ 10
III. PROBLEM ...................................................................................................................................................... 11
IV. CUSTOMER SEGMENTS ................................................................................................................................ 11
V. UNIQUE VALUE PROPOSITION ..................................................................................................................... 12
VI. SOLUTION ..................................................................................................................................................... 13
VII. CHANNELS ................................................................................................................................................... 14
1) Social media ............................................................................................................................................. 14
2) Trade Shows ............................................................................................................................................. 14
3) Word of mouth .......................................................................................................................................... 15
4) Storefronts ................................................................................................................................................ 15
5) Print Ads .................................................................................................................................................... 16
VIII. REVENUE STREAMS .................................................................................................................................... 16
A. Revenue Model ..................................................................................................................................... 16
B. Customer Life Time Value......................................................................................................................... 17
C. Revenue ................................................................................................................................................. 17
D. Gross Margin ......................................................................................................................................... 18
IX. COST STRUCTURE ......................................................................................................................................... 18
A. Customer Acquisition Cost .................................................................................................................... 18
B. Distribution Cost .................................................................................................................................... 19
C. Human Resources Cost .......................................................................................................................... 19
X. DETAILED FINANCIALS .................................................................................................................................. 20
A. Projected Income Statement by month .................................................................................................... 20
B. Projected Cash Flow, first year .............................................................................................................. 21
 C. Projected Cash Flow, by month ............................................................................................................. 21
D. Projected Balance Sheet ........................................................................................................................ 21
E. Projected Three Year Plan ......................................................................................................................... 22
F. Description of the planned growth........................................................................................................... 23
G. Proposed Plan to meet capital needs ...................................................................................................... 23
1. Personal and internal sources .............................................................................................................. 23
2. Earnings, short-term and long-term borrowing, long-term equity ...................................................... 24
3. External Sources ................................................................................................................................... 24
4. Short term and long-term borrowing ................................................................................................... 25
5. Repayment plan .................................................................................................................................... 25
6. Plan to repay borrowed funds or provide return on investment ......................................................... 25
XI. KEY METRICS ................................................................................................................................................. 25
XII. COMPETITIVE ADVANTAGE ......................................................................................................................... 28
XIII. CONCLUSION .............................................................................................................................................. 28
XIV. BIBLIOGRAPHY............................................................................................................................................ 29
XV. APPENDIX .................................................................................................................................................... 29
Cost of Materials Analysis & Breakdown........................................................................................................... 29
 I. EXECUTIVE SUMMARY
Helios International, Ltd. (Company) is a subsidiary of Helios, an existing US based company
(http://www.ridehelios.com/) dedicated to enhancing the way bikers interact with their bikes by infusing
bicycles with smart technology. The primary strategy is to market the existing Smartbike Handlebars to
the European market. The patented Smartbike handlebar technology is unique in the industry because it
combines GPS and Bluetooth technology with illumination features into a bicycle handlebar that provides
an exceptional biker experience and a level of safety, security, and navigational aids that is unparalleled
in the market place. By packaging these devices into a sleek and stylish handlebar, it provides a unique
enhancement for the bicycle and the biker. The strategy is to introduce the product into bicycle
storefronts and thru the internet. In addition, the Company will approach the top three bicycle OEMs to
offer the Smartbike handlebar as an option directly from the factory.

Due to capital constraints and a lack of international expertise, Helios has created Helios International
Ltd. as the exclusive representative in the European market. Carlos Weeber and Danny Scott have
extensive experience working in the industry and specifically related to the bicycle industry in
Europe. Danny S has competed in the Tour de France and has many connections to the market. Carlos
W. has been with Helios since the inception and is ready to take his experience to the European
market. To capitalize the Company, the Principals intend to contribute a total of $125,000 dollars of
equity, Helios (the Parent) will also contribute $125,000. To fund Helios International Ltd., an additional
loan of $500,000 will be required to reach the $750,000 goal. It is expected that the loan will be repaid
in four years with an interest rate of 8.0%. For this loan, the lender will have a 50% ownership in the
Company until the loan is repaid. In addition, Helios (Parent) will place company as collateral. The
proceeds of this capital will be utilized for Helios International, Ltd. organization and start-up costs as
well as for ongoing working capital requirements.

The Company will be established in Amsterdam Netherlands with a warehouse, offices, and distribution
facility from where sales will be realized through Internet sales and wholesale distribution to bike shops
in the Netherlands region. Manufacturing of the product is sourced from Shenzhen Fumax Technology
Co. Ltd. Shenzhen Fumax is the current supplier of the Smartbike handlebars to Helios today. Quality
is strictly controlled and has provided reliable delivery to date of the product. Investment will be made
in additional tooling capacity to sufficiently provide the projected volume.

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The strategy is to establish distribution first in the Netherlands marketplace through an existing
infrastructure of 2,655 bike shops, while using Internet website to generate sales in the greater European
Economic Community. The plan is to expand into brick and mortar bike shops in Germany, Belgium,
and Denmark within the five-year business plan. These 4 countries in total represent the highest
concentration of bicycles in the EU and the affluence to afford the premium Smartbike handlebars.

a. Market Opportunity
In the Netherlands market there are approximately 16.6 million bike riders in the country. There are
more bikes than people in the country and is one of the most common forms of transportation. On any
given day there are over 4 million of these bikes on the road. Bicycles are used for commuting to work,
school, shopping and entertainment. Less than 10% of bikes are used for recreational purposes. In fact,
the Netherlands offers the cyclist a 19 a kilometer tax deduction. With that many cyclists there are over
300 cycling fatalities a year. In addition, 450,000 bikes were reported stolen in 2012. The Helios
Smartbike handlebars are a perfect fit for the market. The handlebars provide the biker with a sleek
solution to enhance safety, security for the bike, and a navigational tool integrated into one package.

Currently the market offers individual products that must be attached to the bicycle and will perform
similar functions. This option is a risk for the biker because they must then detach the devices or risk
having them stolen as well. The patented Smartbike handlebar is the only product to combine all three
features in one integrated handlebar. The Helios Smartbike handlebar is priced at a premium in the
market at 300 or $325.81, this price includes the mandatory 20% Value Added Tax (VAT). Considering
the average cost for bicycle is $1,200, the handlebar is appropriately priced.

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 b. Projected Income and Expenses
To evaluate the merits of Helios International, Ltd. business plan, detailed financial projections were
evaluated to assess the
profitability of the
enterprise. This analysis
included the preparation of
a detailed balance sheet,
income statement, and
cash flow statement. This
analysis also demonstrated
loan repayment over a
four-year period. While the Company is a Start-Up, the business risk of the undertaking is manageable
as: 1) The Helios Smartbike handlebar is a proven product in the North American market, 2) The
manufacturing will be performed by a well-respected company with a proven track record, and 3) The
initial target market has been thoroughly analyzed in terms of market size, regulatory environment,
economic potential, and political stability.

Gross profit is conservatively calculated to result in a 77% return. The five-year plan results in
$5,700,000 projected income by the fifth year. Sales are projected to grow from 8,900 units the first year
to 36,700 units by the fifth year.

II. ANALYSIS OF THE INTERNATIONAL BUSINESS SITUATION

A. Economic, political, and legal analysis of the trading country

Helios is planning to introduce the integrated Smartbike handlebars into the European Union.

Specifically, Helios has decided to locate sales, marketing, warehousing, and distribution team in

Amsterdam, Netherlands. The strong economic stability in the European Union is hosted together by

the 28 member states that have adopted the framework of a single market with free movement of goods,

services and capital. Internationally, the EU aims to bolster Europe's trade position and its political and

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economic weight. The currency of EU is the euro () which has a current exchange rate of $1.09 dollars

per euro ( ) and circulates among 19 of the member states, under the auspices of the European

Economic and Monetary Union (EMU). The US is the largest trading partner with the EU at 15.3%

with 517,162 million euro () the second largest trading partner with the EU is China at 13.8% and

466,826 million euro (). The EU was also the biggest exporter, accounting for 15.4% of all exports

compared with 13.4% for China and the 10.5% for the United States. The EU aims is to promote

efficient, safe, secure and environmentally friendly transport networks. With just 7% of the worlds

population, the EU's trade with the rest of the world accounts for around 20% of global exports and

imports. EU economic policy seeks to sustain growth by investing in transport, energy and research

while minimizing the impact of further economic development on the environment. Around two-thirds

of EU countries total trade is done with other EU countries. With the EU at a GDP of $18.27 trillion,

23.6% of the global GDP and at a 1.4% growth per yearly quarter this is a prime time to enter into this

growing market. The EU has a $48,670 GDP per capita. EU major industries include electronics,

automotive, fashion and shoe, telecommunications, metal processing and energy. The Netherlands has

no required minimum investment to start a business for foreigners. Currently around 6,300 foreign

companies have established their operations, including; Cisco Systems, Microsoft and Nike. The

Netherlands is one of the largest recipients of FDI (Foreign Direct Investment) in the world. Foreign

companies made inward direct investments worth 589 billion US dollars. Foreign investors provide

15% of Dutch employment.

Netherlands, which is the trading country, has a very stable Constitutional Monarchy. The Netherlands

is also a parliamentary democracy. The Dutch monarch has no real political power and serves only as

representative head of state, and a symbolic person uniting the divided parliamentary politics. The

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parliament is comprised of two chambers, the Lower House, and the Senate. Together these two

chambers constitute the Estates-General. This means that the Dutch political system gives a lot of

freedom to the government, as long as the parliament is in

support of the partys actions. The government is governed by a

coalition of different political parties, and the party with the most

seats won typically produces the Prime Minister. The King gives

the leader of the party, holding the most seats in the government,

the task of forming the new government. The Netherlands is

Map of the Netherlands recognized worldwide as for its transparency, fairness and

effectiveness. The World Bank stated that the Dutch government is one of the most effective in the

world. The legal system is fair and transparent and well equipped to deal with business, trade, taxation,

and patent issues. The Netherlands is a part of the European Union which provides economic stability,

meaning if a decline in economic stature is detected, other members will take action to ensure the

stability of the economy and government which adds to the statement that the Netherlands is well

equipped and able to handle business.

Helios Intl, Ltd. is a limited liability company which allows the company to only be liable for what

Helios and equity shareholders have invested and is a distinction from a privately held company and the

publicly traded company. In order to incorporate the business by legal standards Helios Intl, Ltd. must

file the legal form: Besloten Vennootschap (BV). Helios Intl, Ltd. must follow this website

www.belastingdienst.nl to start the legal process in becoming a registered tax paying company, which

includes every step from tax arrangements to benefits. The legal system is fair and transparent and well

equipped to deal with business, trade, taxation and patent issues. The Dutch tax system has a number of

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features that may be very beneficial in international tax planning. The relevant factors include a

corporate income tax rate of 20% on the first 200,000 euros, and 25% for taxable profits exceeding

200,000 euros, which is well below the EU national average. Companies can benefit from an effective

tax rate of only 5% for R&D income from self-developed patented intangible assets and also from self-

developed unpatented intangible assets which qualify for the so-called WBSO. The Dutch ruling

practice, which provides clarity and certainty on tax assessments in advance, can be obtained on future

transactions, investments or corporate structures. There is also a broad tax treaty network. The

Netherlands has signed treaties with more than 80 countries that ensure the avoidance of double

taxation on income and capital. This reduces withholding taxes on dividends, interests and royalties (for

interest and royalties, in some cases, taxes are reduced to 0 %). Dutch tax law also provides the

participation exemption, which states that all benefits related to a qualifying shareholding, including

cash dividends, dividends-in-kind, bonus shares, hidden profit distributions and capital gains, are

exempt from Dutch corporate income tax. In addition, a law was passed in 2006 that every member on

the EU must tax 6% for all e-bikes and bicycles imported into an EU member country, this number is

added to the Cost of Goods Sold. VAT is an additional tax paid to the government based 20% of the

final sold product, since Helios Intl, Ltd. is only selling directly to the customer through online sales,

Helios Intl, Ltd. only has to pay the VAT tax on the final product sold going through online sales.

Labor Laws within the EU and Netherlands have been with high demand, in 2007 an EU law was

passed that the employee must be granted 20 days of paid vacation and 33% of benefits added to their

yearly salary.

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 B. Trade area and cultural analysis
1. Trade Area Analysis
Europe is often described as being a peninsula meaning it is a piece of land surrounded by water on

three sides. The oceans that surround the

continent are the Arctic Ocean to the north,

Atlantic Ocean to the west, and Mediterranean,

Black, and Caspian Seas to the south. Many

smaller peninsulas make up Europe such as the

Iberian, Italian, Balkan, Scandinavian, and

Jutland. The link between these pieces of land

Map of Europe has made Europe a dominant economic, social and

cultural force throughout history. This continent can be divided into four major regions running north to

south. These consist of Western Uplands, North European Plain, Central Uplands, and the Alpine

Mountains. These diverse regions cause a very wide variety of physical landscape as well. In the

Western Uplands, glaciers and large sheets of ice have created a very rough landscape consisting of

marshlands, lakes, and fjords making travel by car a challenge. The majority of the North European

plain lays below 152 meters (500 feet) in elevation making it home to many navigable rivers. This

geographic region is also home to the most densely populated regions in Europe. The Central Uplands

are lower in altitude and less rugged than the Alpine region and are heavily wooded. In this area, the

population density is among the lowest except in few river valleys such as the Rhine, Elbe, and

Danube. The fourth and final region is the Alpine Mountains which consists of very high elevations,

rugged plateaus and steeply sloping land. Europe is considered the most culturally diverse continent in

the western world. Due to the large scale diversity it is home to many religions, and languages. Among

the different variety of religions Christianity is by far the largest majority of religious persons in the

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continent. This has a direct influence on the language spoken which is English. 51% of all European

adults can speak and understand English. The next widely spoken language is German which consists

of approximately 18%. Due to Europe being surrounded by water on three sides it is exposed to a vast

amount of trade influencing customs and traditions. Among these customs is transportation. Riding

bikes is a major part of the culture of living in Europe. Bikes have been the main form of transportation

since they were created. In the mid 1900s as cars started to become a more plausible method of

transportation, bikes began to become in danger of being hit by automotive vehicles. Several children

deaths occurred, which frustrated and caused many parents to become concerned with their loved ones

safety. Bike lanes called fietspaden, were created in several countries but in the Netherlands they

were taken more seriously and laws were passed prohibiting anything besides two wheels to be within

the combines of the two lanes. The laws in this country are very different from America. In the

Netherlands if a cyclist is hit for any apparent reason then the driver of the vehicle is at fault. These

laws and regulations make cycling in the Netherlands one of the safest places to ride and also deter

many people from driving cars in the fear that they will hit one of the hundred thousands of cyclist in

the city. This is the reason why the bike per capita is so high within this country. With so many bikes

prevalent around in the city it is easy for one of them to be picked up and stolen, which acts as an

advantage to the proposed product. Now the customer can easily monitor where their bike is at all

times, and if it is stolen they can easily track its location through cell service. Some other advantages

that arise from this situation is that with the Helios handlebars turn signals can help the operators of

motor vehicles to better predict the next move of the cyclist. Disadvantages of the product are very

minimal, however they do exist. Among these are the frustration of recharging the product. In the

Netherlands the majority of people leave their bikes outdoors overnight. With this being said, the

handlebars must be opened up and the battery will be taken out and up to its charging station when low.

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A problem that can arise from this is that while the battery is disconnected from the handlebars, the

tracking system will not function, however technology will be developed to solve this problem with

early revenue.

All throughout Europe people ride bikes,

however the Smartbike handlebar is geared

more towards the everyday cyclist because of

its practical uses. At the age of 15 to 50 the

majority of people will use bikes as their main

form of transportation. This age range will be

Helios main focus when advertising the

Smartbike handlebars, however efforts to get a more Bike station in the city of Amsterdam

diverse crowd will be implemented. Seeing as this age group responds better to products that are

interconnected to their cellular devices and turning something ordinary to extraordinary, the main

features of the product that will be heavily marketed is the technological innovations rather than the

safety features. The average income per capita per year within the Netherlands is approximately

27,888 or $30,434.17. This average income is higher than the United States. In Amsterdam an

estimated 63% use their bikes on a daily basis that is not including those who use bikes on a weekly

basis. Due to this high percentage of individuals who rely on their bikes as a main form of

transportation they are more willing to spend money to updated and repair their bikes. In America the

main form of transportation is via car, where the average income is $50,500 and the average price per

car is $33,560. With that being said, Americans spend over half of their income on transportation,

similarly in Amsterdam, citizens are more willing to spend a larger portion of their income on other

forms of transportation, which in this case are bikes. The Helios handlebars priced at 300 or $325.81

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will be a relatively small portion of the citizen's income. Helios Ltd is aware that a large portion of

sales will be coming from adults such as parents. Due to this aspect, on the website, Helios is going to

place a greater emphasis on the safety features of the product.

2. Manufacturing
The manufacturing for the Helios Smartbike handlebars will take place in Shenzhen Fumax

Technology Co. Ltd., Shenzhen, China. Shenzhen Fumax is the current contract supplier and

assembler of the Helios handlebars to the North American market. Investment will be made to add

capacity and tooling requirements that will meet the volume demands of Helios International, Ltd. This

city is considered the wealthiest city within China. It is known as the shopping mall of the country

because of its vast range of items are manufactured and sold to the public. Tourism is a large portion of

income for this city. Estimated at over 67 million total visitors and 6.89 million overnight visitors,

tourism brings many companies and technological innovations to gain exposure. Due to the vast market

ranging from manufacturing to distribution and even tourism the economy is more stable than the

majority of neighboring cities.

3. Distribution

After the manufacturing of the Helios bar is completed in Shenzhen, the product will be transported via

ocean freight to the large city of Amsterdam. This is largest city in Holland with a population of

779,808 recorded in the 2011 census. Along with being the largest city, it also is the capital of the

Dutch nation. Due to the stability of the European Union, both storage and distribution will be done

through countries that are a part of the EU. Helios is planning to rent a warehouse, instead of

purchasing one, in order to allow for expansion if needed. Helios will hire the company of Komerk,

which provides a 700m2 warehouse facility for 130,000 per year with a five-year contract. This

company is going to provide warehouse services including loading and unloading shipments onto

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freighters, taking care of any and all paperwork to be able to ship the goods as well as send updates on

the whereabouts of the goods. Helios will pay the company an additional 70,000 a year for their

services. Komerk is a well-established company receiving phenomenal ratings over its 20 years of

doing business.

III. PROBLEM
1. Safety The greatest challenge of riding a bike is sharing the road with other vehicles. Being

seen by drivers and other bike riders is a top safety concern. Among these concerns is the need

to signal a turn. It can be difficult or even dangerous to remove a hand from the handlebars in

order to execute the turn signal.

2. Security In Amsterdam, parking for bikes cost a fee, so a large percent of citizens do not park

their bikes in the safety of a bike rack with locks. As a result bikes are easily accessible on the

side of the road. Bike theft is a big problem and with such a large bike population, it makes

recovery of a stolen bike very difficult. In 2013 approximately 450,000 bikes were stolen and

almost 50% of those stolen were taken from right outside of the residents home.

3. Navigation - Riding a bike requires full attention to the road and all potential hazards. With

hundreds of intersecting streets and canals, Amsterdam can be very difficult to navigate.

Looking at a map or your GPS while riding is not a safe option. The Helios Smartbike

handlebars offer a solution.

IV. CUSTOMER SEGMENTS

The Netherlands is one of the most populated countries in the world with 477 people per square

kilometer of land. A large majority of the population is either Catholic (31%) or Protestant (21%) and

unaffiliated (40%). The literacy rate for ages 15 and older is 99%. The Netherlands was chosen as a

launch point for Helios in the EU due to the high concentration of people using bicycles for

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transportation and the affluence of the average citizen to afford the device. This form of transportation

is very valuable and even offers benefits for users. Bike riders can receive 19 cents per kilometer as a

tax-free perk, meaning that the amount of money spent on taxes will decrease the larger distance

traveled by bicycle. The specific target market will be bikers between the ages of 15 to 50, which

makes up approximately 80% of the entire biking population. At any given time 25% of the population

of bikes are being ridden, meaning one and every four people is on their bicycle at any given time.

Cyclist account for 40% of all of traffic related incidents, just last year there were over 300 reported

deaths by bike related accidents. Biking is such a large part of life within the Netherlands that the

government has spent $436,000,000 in improving bicycle infrastructure. In this country theft is a large

problem, last year alone 450,000 bikes were stolen. Studies show that one and every three bikes is

reported stolen in its lifetime.

Wearing helmets is very rare, and is typically only seen on either on a child or a teen who has not yet

succumbed to peer pressure. This helps to explain the high number of fatalities seen every year as well

as a need for a new safety aspect built into the bicycles. The average speed of a cyclist is between 15

and 18 kilometers per hour, making that average trip just 15 short minutes, making traveling by bicycle

5% to 10% quicker than driving a car. The reason for the Helioss target market being so vast, is due to

the wide range of cycling by such diverse age groups. Citizens use bikes for everyday activities such as

going to work, school, seeing family and friends, going to bars, cinemas and theaters. These activities

are not restricted to a certain age group and appeal from teens to fifty-year-old men and women.

V. UNIQUE VALUE PROPOSITION

Helios Smartbike Handelbars are the only handlebars on the market that tastefully combine visibility,

strength, and sleekness in a way that compliments your style and keeps you safe at the same time.

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VI. SOLUTION
1. Safety Helios provides many features that are very important in creating a safe environment to

ride. The cautionary blinkers on either side of the handlebar help to alert cars, and other bikers

around the cyclist which could pose as a

potential danger. When the cyclist needs to

turn, the touch of an easily accessible button

will allow the indicator to click on and blink

for several seconds while the cyclist is

moving. When the rider is within the bike

lane, Helios has ambient lighting to let other

riders know the speed of peers, allowing

cyclist to see when others are speeding up and or slowing down to prevent bike crashes. In

addition, there is a powerful 500 lumens headlight to illuminate the path at night.

2. Security In order to prevent theft, Helios offers a very special feature which sends a message

to your smartphone via notification alerting if the bike is in motion once the lock setting is

turned on. If the bike does happen to be taken and the owner of the bike cannot get to the bike

before the thief flees, a GPS system can be used to track the bike through SMS. This same

feature will help you to locate your bike if youve forgotten where it is parked.

3. Navigation Aide - With Helios handlebars getting lost will never be a problem again. The

Smartbike handlebar product offers a solution, with turn by turn navigation, the blinkers

automatically illuminate when approaching an upcoming turn to alert you it is time to slow and

switch lanes. It uses state of the art code through Bluetooth to route your smartphones maps to

the handlebars to accomplish this task making getting lost a thing of the past while riding

bikes.

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VII. CHANNELS

1) Social media
To attract attention from a younger crowd; Instagram, Twitter, Facebook, Youtube, and Snapchat pages

will be created. On these sites, the product will be featured demonstrating all of its amazing capabilities

in different situations that will impress the youth of Europe. Helios will show the wide range and

durability that the Helios bars can withstand and conquer with ease. To attract more traffic to the social

media and website pages, celebrities will be paid to use and advertise the Smartbike handlebar. A total

of $25,000 will be spent on website and social media development in the first year. $10,000 will be

spent on the development of a fully functional and easily navigable website. This is important because

this will be the final destination of traffic flow from the internet. The rest of the money, which is

$15,000, will be used to pay celebrities to advertise the Smartbike handlebar. The celebrities will be

chosen based off of popularity in the biking community. The marketing budget for the website and

social media increases every year.

2) Trade Shows
Since this product is for those who use bikes not only for recreation but for sport as well, a large

portion of advertisement will be attained at trade shows and bike races. At these races a booth will be

set up with the product mounted on a bike, and an expert will be demonstrating how beneficial the

Helios handlebars are for every rider. Helios Intl, Ltd will also sponsor riders and give them a free

handlebar to discuss after and before the televised races. This will capture the crowd that is very serious

about street riding as a sport, as well as the kids who aspire to become great like the professional bikers

as well. In the first year Helios has budgeted $42,000 to be spent on trade shows. The amount of

invested money in trade shows increase substantially each year ending the five year plan with

$89,288.98 budgeted for tradeshows.

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3) Word of mouth
Word of mouth is going to be very beneficial when advertising the Smartbike Handlebars product. This

product contains many amazing features that make the experience of biking more enjoyable and far

safer. These handlebars will undoubtedly be discussed between friends and family members. Another

feature that is contained within the smartphone application is a community page which allows Helios

members to connect to one another. This will be an incentive for friends to get their peers involved in

this community as well. Due to the resolving of multiple local biking issues such as safety and security,

this product will be a solution to those issues. Although word of mouth is free, Helios wants to ensure

the satisfaction of their customers and plans to create a survey for those who have bought or heard of

the Smartbike handlebars to communicate different aspects of the company if needed to keep customers

happy, and keep Helios a topic frequently discussed in and around the community.

4) Storefronts
In Amsterdam alone there are approximately 157 bike shops and in all of the Netherlands 2,655 bike

shops exist. Helios is going to wholesale Smartbike handlebars to these stores for a much lower cost

than sold retail, so that they can make a profit, generate

additional bike sales, and incentivize them to sell. Bike

shops will be provided with a promotional package to

place in their windows and product displays. $25,000 is

set aside in the first year alone for promotion in retail

Amsterdam Bike Shop stores and this number continues to grow over the

course of the five-year plan as more bike shops begin selling the Smartbike handlebar. This cost will

help to bring recognition to the product inside of the store as well as attract attention from pedestrians

passing by the bike shops.

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5) Print Ads
The largest form of marketing investment that Helios will be budgeted for is print ads. This method of

marketing covers everything from flyers, newspaper ads, banners, magazine articles and more. In

Europe reading the newspapers and magazines is still of large importance. Helios plans to take

advantage of this aspect of life for Europeans by placing advertisements within these commonly read

tabloids by spending $50,000 in the first year and increasing at a steady rate until $106,296.40 is

budgeted in the fifth year. This price also includes the creation of flyers that storefronts can pass out to

customers to drive their sales. It also includes banners that can be hung in store windows and along

streets, to attract attention to the Smartbike handlebar.

VIII. REVENUE STREAMS

A. Revenue Model
The source of revenue is coming from two different streams, from

online sales as well as storefront or Netherlands retail sales. In the

Netherlands there are 2,655 bike shops. The percent of overall sales in

store fronts decreases each year for the first five years. The reason for this

smaller percentage of store front sales is because Helios plans to have the second revenue stream

becoming more profitable as it touches a larger number of people, and expands beyond just Netherlands.

The percent of sales in storefronts as well as online are shown to the right. For future growth, Helios will

partner up with major bike manufacturers such as Accell Group headquartered in Heerenveen,

Netherlands to offer the Helios handlebar as an option direct from the manufacturer. In addition,

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partnering up with city bike rentals to give their customer a more enjoyable and safer experience, could

allow Helios for another revenue stream that will become sustainable with loyal customers.

B. Customer Life Time Value

Customer lifetime value is important to Helios due to the improvement and development of new

technology within the Smartbike handlebar. Based on market research, Helios determines that a

customer will replace his bike 4 times within our target market of 15-50 year olds. At an average

Helios handlebar price of $285.00, the customer lifetime value is $1,140.00 Lifetime value is important

to understand when determining the amount of money to spend on marketing.

Everyone who purchases the Smartbike handlebars will register with Helios. Updates on software will

be provided. Helios will create a blog that drives customer loyalty, promotes the features of the

product where one can describe occurrences that have saved the consumer in forms of safety, security,

and navigation. Promotion items can be awarded to the one who writes the most articles or random

drawings to select a winner.

C. Revenue
Revenue 2017 2018 2019 2020 2021
Units Sold
Netherland Wholesale 5,950 8,033 10,442 13,053 15,664
Cross Border Internet Sales (less VAT) 2,943 4,414 7,063 12,007 21,012
Total Units 8,893 12,447 17,505 25,060 36,676
Unit Growth (%)
Netherland Whole Sale 35% 30% 25% 20%
Cross Border Internet Sales 50% 60% 70% 75%
Unit Sales Price ($/Unit)
Netherland Retail 154.76 162.50 170.62 179.15 188.11
Cross Border Internet Sales 271.51 285.09 299.34 314.31 330.02
Unit Sales Price Growth (%) 5% 5% 5% 5%
Total Gross Sales ($) 1,719,856.02 2,563,740.80 3,895,917.61 6,112,348.63 9,880,949.95
Service Parts Revenue ($) 149,345.91 307,648.90 467,510.11 733,481.84 1,185,713.99
Returns (Parent Co. resp) (85,992.80) (128,187.04) (194,795.88) (305,617.43) (494,047.50)
Total Revenue 1,783,209.13 2,871,389.70 4,363,427.73 6,845,830.47 11,066,663.95

Helioss revenue contains a very conservative growth throughout the first five years. The two sources

of revenue are Brick and Mortar and Online sales. While the Brick and Mortar sales grow at a slower

rate because of reaching maximum expansion, the Online Sales grow at a faster rate due to the

expanding exposure of the Smartbike Handlebars. The revenue is increasing by a comfortable

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percentage each year allowing for expansion and further development of Helios. Starting with a total

revenue of $1,780,000 in the first year of sales and increasing to $11,070,000 in the sales.

D. Gross Margin
The increasing gross margin demonstrates the viability of the product and that customers are willing to

pay a premium price for the Smartbike Handlebar. Looking at the Gross Margin, the value of the product

is demonstrated in the market and is our gauge in controlling costs. Providing a gain in gross margins

also shows how sustainable the company will be. With an outstanding 77% gross margin the first year to

by year 5 the company will start to generate at 85% gross margin meaning that the company will bet

more efficient with the selling price to the landed cost per unit.
Projected Gross Margin 2017 2018 2019 2020 2021
Total Revenue ($) 1,783,209.13 2,871,389.70 4,363,427.73 6,845,830.47 11,066,663.95
Cost of Goods Sold ($) 413,519.97 570,335.49 790,417.60 1,115,029.67 1,608,072.39
Gross Margin ($) 1,369,689.17 2,301,054.21 3,573,010.13 5,730,800.80 9,458,591.56
Gross Margin (%) 77% 80% 82% 84% 85%

IX. COST STRUCTURE

A. Customer Acquisition Cost

Customer acquisition cost is the monetary value associated with the conceiving of a customer. This value

is important because it determines if Helios is turning profit from advertising per customer. The number

can be found by dividing the total cost of advertisement for the specific year by the number of units sold
Customer Acquisition Cost
within that same year. This customer acquisition
Cost of Total Units Customer
Year Marketing Sold Acquistion Cost
is very low when compared to the lifetime value,
2017 $ 142,000.00 8,893 $ 15.97
2018 $ 171,465.00 12,447 $ 13.78
meaning that the customer is considered
2019 $ 207,043.99 17,505 $ 11.83
2020 $ 250,005.61 25,060 $ 9.98
profitable. The reasoning behind this is because it
2021 $ 301,881.71 36,676 $ 8.23
cost less money to secure a customer through advertising than the customer is worth to Helios.

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 B. Distribution Cost
Distribution cost is any cost required by a wholesaler, retailer, or distributor. This covers anything from
Distribution Cost per unit sold
shipping, both inbound and Year 2017 2018 2019 2020 2021
Distribution Cost $ 45.28 $ 36.58 $ 29.78 $ 24.11 $ 19.39
outbound, to taxes and tariffs, marketing and advertising, and storage costs. This amount is important to

Helios because it determines how much money will need to be spent to get the product to the customer.

The amount spent on distribution decreases from year to year as a result of improved scale with more

units sold as well as Helios Ltd controlling the selling general and administrative expenses (SG&A).

C. Human Resources Cost

*Note: Salary does not include benefits. Benefits are

estimated at 30% and included in the operating costs.

Job Description:

1) President & Internal Sales Directs the overall strategy of the company and develops relationship

with Danish bicycle shops. Salary: $100,000/yr

2) CFO & Internet Sales Manages the accounting, payroll, and directs the Internet sales strategies and

the development of new markets within the E.U. Salary: 100,000/yr

3) Marketing and Sales Manager Manages and promotes internal and external sales on a daily

basis. Develops marketing strategies for all markets. $60,000/yr

4) Customer Service/Warranty Analyst Manages customer service and warranty calls and

returns. Inspects quality on shipments received. Assists in the order fulfillment activities when

required. Salary: $50,000 /year.

5) Order Fulfillment Analyst (1) - Wholesale distributer managing customer service and order

fulfillment and inventory. Salary: $45,000/year.

6) Admin and Order Processing Analyst (1) - Handle office calls, incoming and outgoing

correspondence, processing orders, payment to suppliers. Salary: $40,000/yr

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 X. DETAILED FINANCIALS
A. Projected Income Statement by month

Projected Income Statement for the first 12 months

Income Statement Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17
Revenue ($)
Units Sold
Netherland Wholesale 398 410 422 435 452 470 489 514 539 572 606 642
Cross Border Internet Sales (less VAT) 183 190 198 206 216 227 238 255 273 295 318 344
Total Units 581 600 620 641 668 697 728 769 812 866 924 986
Unit Growth (%)
Netherland Wholesale 0% 3% 3% 3% 4% 4% 4% 5% 5% 6% 6% 6%
Cross Border Internet Sales 0% 4% 4% 4% 5% 5% 5% 7% 7% 8% 8% 8%
Unit Sales Price ($/Unit)
Netherland Retail $ 154.76 154.76 154.76 154.76 154.76 154.76 154.76 154.76 154.76 154.76 154.76 154.76
Cross Border Internet Sales $ 271.51 271.51 271.51 271.51 271.51 271.51 271.51 271.51 271.51 271.51 271.51 271.51
Total Gross Sales ($) 111,280.81 115,116.10 119,086.32 123,196.32 128,683.07 134,417.24 140,410.12 148,724.63 157,545.45 168,479.67 180,188.48 192,727.81
Service Parts Revenue ($) - - 11,908.63 12,319.63 12,868.31 13,441.72 14,041.01 14,872.46 15,754.54 16,847.97 18,018.85 19,272.78
Returns (Parent Co. resp) - - - - - - - - - - - -
Total Revenue 111,280.81 115,116.10 130,994.95 135,515.95 141,551.38 147,858.97 154,451.14 163,597.10 173,299.99 185,327.64 198,207.33 212,000.59

Cost Of Goods Sold ($/Unit)

Manufacturing Costs ($/Unit) 42.66 42.66 42.66 42.66 42.66 42.66 42.66 42.66 42.66 42.66 42.66 42.66
Inbound Shipping Costs ($/Unit) 1.28 1.28 1.28 1.28 1.28 1.28 1.28 1.28 1.28 1.28 1.28 1.28
European Tariff ($/Unit) 6% 2.56 2.56 2.56 2.56 2.56 2.56 2.56 2.56 2.56 2.56 2.56 2.56
Total Units Cost 46.50 46.50 46.50 46.50 46.50 46.50 46.50 46.50 46.50 46.50 46.50 46.50
Cost of Goods Sold ($) 27,016.27 27,911.85 28,837.70 29,794.87 31,082.39 32,426.19 33,828.77 35,741.82 37,766.04 40,285.73 42,976.89 45,851.45

Gross Margin ($) 84,264.54 87,204.25 102,157.25 105,721.07 110,468.99 115,432.78 120,622.37 127,855.28 135,533.95 145,041.92 155,230.43 166,149.14
Gross Margin (%) 76% 76% 78% 78% 78% 78% 78% 78% 78% 78% 78% 78%

SG&A Costs
Professional Salaries 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67
Employee Salaries 16,250.00 16,250.00 16,250.00 16,250.00 16,250.00 16,250.00 16,250.00 16,250.00 16,250.00 16,250.00 16,250.00 16,250.00
Benefits 15,800.00 15,800.00 15,800.00 15,800.00 15,800.00 15,800.00 15,800.00 15,800.00 15,800.00 15,800.00 15,800.00 15,800.00
Supplies 750.00 750.00 500.00 250.00 250.00 250.00 250.00 250.00 250.00 250.00 250.00 250.00
Accounting/Tax (Contract) 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00
Legal (Contract) 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00 1,250.00
Warehouse 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67 16,666.67
Utilities 4,500.00 4,500.00 4,500.00 4,500.00 4,500.00 4,500.00 4,500.00 4,500.00 4,500.00 4,500.00 4,500.00 4,500.00
Product Delivery 1,492.50 1,537.28 1,583.39 1,630.90 1,696.13 1,763.98 1,834.54 1,926.26 2,022.57 2,143.93 2,272.57 2,408.92
Marketing/Advertisement 11,833.33 11,833.33 11,833.33 11,833.33 11,833.33 11,833.33 11,833.33 11,833.33 11,833.33 11,833.33 11,833.33 11,833.33
R&D 4,213.23 4,360.21 5,107.86 5,286.05 5,523.45 5,771.64 6,031.12 6,392.76 6,776.70 7,252.10 7,761.52 8,307.46
General Liability Insurance 1,112.81 1,151.16 1,309.95 1,355.16 1,415.51 1,478.59 1,544.51 1,635.97 1,733.00 1,853.28 1,982.07 2,120.01
Misc. Startup Cost 41,710.00 - - - - - - - - - - -
Total SG&A Cost 133,495.20 92,015.32 92,717.87 92,738.77 93,101.76 93,480.87 93,876.83 94,421.66 94,998.94 95,715.97 96,482.83 97,303.05
SG&A/UNIT 229.77 153.29 149.50 144.73 139.28 134.05 129.04 122.84 116.97 110.48 104.39 98.68
Total Expenses (160,511.47) (119,927.16) (121,555.58) (122,533.65) (124,184.15) (125,907.06) (127,705.60) (130,163.48) (132,764.98) (136,001.69) (139,459.72) (143,154.50)
Total Expenses/Unit (276.27) (199.79) (196.00) (191.23) (185.78) (180.55) (175.54) (169.34) (163.47) (156.98) (150.89) (145.18)

Net Income ($) (49,230.66) (4,811.07) 9,439.38 12,982.30 17,367.23 21,951.91 26,745.54 33,433.61 40,535.01 49,325.95 58,747.60 68,846.09
Net Margin/Unit ($) (84.73) (8.01) 15.22 20.26 25.98 31.48 36.76 43.50 49.91 56.93 63.56 69.82

Distribution Cost/unit sold 56.75 55.13 53.15 51.25 49.39 47.60 45.88 43.75 41.73 39.50 37.41 35.44

Net Operating Profit (49,230.66) (4,811.07) 9,439.38 12,982.30 17,367.23 21,951.91 26,745.54 33,433.61 40,535.01 49,325.95 58,747.60 68,846.09
Depreciation - - - - - - - - - - - -
Interest Expense - - - - - - - - - - - -
Loan Repayment - - - - 12,500.00 12,500.00 12,500.00 12,500.00 12,500.00 12,500.00 12,500.00 12,500.00
Income Tax (25%) - - 1,526.51 2,412.24 3,508.47 4,675.48 5,894.72 7,587.57 9,383.75 11,602.32 13,978.57 16,524.02
Net Profit (50,343.47) (9,295.56) 3,269.58 5,881.57 (3,390.09) 47.84 3,639.64 8,626.74 13,918.26 20,453.68 27,453.63 34,952.06

20 | P a g e
 B. Projected Cash Flow, first year
Projected Cash Flow Statement
2017 2018 2019 2020 2021
Cash Flow Statement
Net Income 51,880.55 666,918.66 1,536,026.99 3,044,739.85 5,691,845.98
Inventory (126,196.12) (4,559.40) (50,379.90) (74,281.41) (112,783.47)
Accounts Receivables (212,000.59) (27,281.88) (124,336.50) (206,866.90) (351,736.12)
Accounts Payables 48,651.52 1,982.26 4,218.79 5,044.78 6,251.59
Operating Cash Flow (237,664.64) 637,059.63 1,365,529.38 2,768,636.32 5,233,577.98
Start-Up Cost (Equipment) (41,710.00) - - - -
Debt 400,000.00 (187,500.00) (100,000.00) (100,000.00) (12,500.00)
Equity 750,000.00 - - - -
Net Cash Flow 870,625.36 449,559.63 1,265,529.38 2,668,636.32 5,221,077.98
Initial Cash Balance 883,125.36 1,332,685.00 2,598,214.37 5,266,850.69
Ending Cash Balance 883,125.36 1,332,685.00 2,598,214.37 5,266,850.69 10,487,928.67

C. Projected Cash Flow, by month

Projected Cash Flow Statement for the first 12 months
Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17
Cash Flow Statement
Net Income (53,676.80) (9,295.56) 3,269.58 5,881.57 (3,390.09) 47.84 3,639.64 8,626.74 13,918.26 20,453.68 27,453.63 34,952.06
Inventory (74,356.38) (2,464.89) (2,548.21) (2,634.40) (3,543.60) (3,698.52) (3,860.29) (5,265.26) (5,571.22) (6,934.89) (7,406.85) (7,911.60)
Accounts Receivables (111,280.81) (3,835.29) (15,878.85) (4,521.00) (6,035.43) (6,307.59) (6,592.17) (9,145.96) (9,702.89) (12,027.65) (12,879.68) (13,793.27)
Accounts Payables 66,747.60 (20,739.94) 351.28 10.45 181.49 189.56 197.98 272.42 288.64 358.51 383.43 410.11
Operating Cash Flow (172,566.39) (36,335.69) (14,806.20) (1,263.38) (12,787.63) (9,768.71) (6,614.84) (5,512.06) (1,067.22) 1,849.65 7,550.52 13,657.31
Start-Up Cost (Equipment) (41,710.00) - - - - - - - - - - -
Debt 500,000.00 - - - - (12,500.00) (12,500.00) (12,500.00) (12,500.00) (12,500.00) (12,500.00) (12,500.00)
Equity 750,000.00 - - - - - - - - - - -
Net Cash Flow 1,035,723.61 (36,335.69) (14,806.20) (1,263.38) (12,787.63) (22,268.71) (19,114.84) (18,012.06) (13,567.22) (10,650.35) (4,949.48) 1,157.31
Initial Cash Balance - 1,035,723.61 999,387.92 984,581.72 983,318.34 970,530.71 948,262.00 929,147.16 911,135.10 897,567.88 886,917.54 881,968.06
Ending Cash Balance 1,035,723.61 999,387.92 984,581.72 983,318.34 970,530.71 948,262.00 929,147.16 911,135.10 897,567.88 886,917.54 881,968.06 883,125.36

D. Projected Balance Sheet

Yearly Balance Sheet
2017 2018 2019 2020 2021
Balance Sheet
Assets
Cash 883,125.36 1,332,685.00 2,598,214.37 5,266,850.69 10,487,928.67
Accounts Receivables 212,000.59 239,282.47 363,618.98 570,485.87 922,222.00
Inventory 126,196.12 130,755.52 181,135.43 255,416.84 368,200.31
Total Current Assets 1,221,322.08 1,702,722.99 3,142,968.78 6,092,753.41 11,778,350.98

Start-Up Cost (Equipment) 41,710.00 41,710.00 41,710.00 41,710.00 41,710.00

Less Accum. Depreciation 5,958.57 12,810.93 20,691.14 29,753.38 35,751.43
Net Equipment 35,751.43 28,899.07 21,018.86 11,956.62 5,958.57
Total Assets 1,257,073.51 1,731,622.06 3,163,987.64 6,104,710.03 11,784,309.55
Liabilities
Accounts Payables 48,651.52 50,633.78 54,852.57 59,897.36 66,148.95
CPLTD 12,500.00 100,000.00 100,000.00 12,500.00 -
Total Current Liabilities 61,151.52 150,633.78 154,852.57 72,397.36 66,148.95
LongTerm Debt 387,500.00 112,500.00 12,500.00 - -
Total Liabilities 448,651.52 263,133.78 167,352.57 72,397.36 66,148.95
Initial Startup Equity 750,000.00 750,000.00 750,000.00 750,000.00 750,000.00
Retained Earnings 51,880.55 718,799.21 2,254,826.20 5,299,566.05 10,991,412.03
Net Worth 801,880.55 1,468,799.21 3,004,826.20 6,049,566.05 11,741,412.03

21 | P a g e
E. Projected Three Year Plan
Income Statement
Projected Income Statement 2017 2018 2019 2020 2021
Revenue ($)
Units Sold
Netherland Wholesale 5,950 8,033 10,442 13,053 15,664
Cross Border Internet Sales (less VAT) 2,943 4,414 7,063 12,007 21,012
Total Units 8,893 12,447 17,505 25,060 36,676
Unit Growth (%)
Netherland Whole Sale 35% 30% 25% 20%
Cross Border Internet Sales 50% 60% 70% 75%
Unit Sales Price ($/Unit)
Netherland Retail 154.76 162.50 170.62 179.15 188.11
Cross Border Internet Sales 271.51 285.09 299.34 314.31 330.02
Unit Sales Price Growth (%) 5% 5% 5% 5%
Total Gross Sales ($) 1,719,856.02 2,563,740.80 3,895,917.61 6,112,348.63 9,880,949.95
Service Parts Revenue ($) 149,345.91 307,648.90 467,510.11 733,481.84 1,185,713.99
Returns (Parent Co. resp) (85,992.80) (128,187.04) (194,795.88) (305,617.43) (494,047.50)
Total Revenue 1,783,209.13 2,871,389.70 4,363,427.73 6,845,830.47 11,066,663.95

Cost Of Goods Sold ($/Unit)

Manufacturing Costs ($/Unit) 42.66 42.02 41.39 40.77 40.16
Inbound Shipping Costs ($/Unit) 1.28 1.27 1.25 1.24 1.23
European Tariff ($/Unit) 6% 2.56 2.53 2.51 2.48 2.46
Total Units Cost 46.50 45.82 45.15 44.49 43.85
Cost of Goods Sold ($) 413,519.97 570,335.49 790,417.60 1,115,029.67 1,608,072.39

Gross Margin ($) 1,369,689.17 2,301,054.21 3,573,010.13 5,730,800.80 9,458,591.56

Gross Margin (%) 77% 80% 82% 84% 85%

SG&A Costs 5% 5% 5% 5%
Professional Salaries 200,000.00 210,000.00 220,500.00 231,525.00 243,101.25
Employee Salaries 195,000.00 204,750.00 214,987.50 225,736.88 237,023.72
Benefits 189,600.00 199,080.00 209,034.00 219,485.70 230,459.99
Supplies 4,250.00 3,150.00 3,307.50 3,472.88 3,646.52
Accounting/Tax (Contract) 15,000.00 15,750.00 16,537.50 17,364.38 18,232.59
Legal (Contract) 15,000.00 15,750.00 16,537.50 17,364.38 18,232.59
Warehouse 200,000.00 210,000.00 220,500.00 231,525.00 243,101.25
Utilities 54,000.00 56,700.00 59,535.00 62,511.75 65,637.34
Product Delivery 22,312.96 23,428.60 24,600.03 25,830.04 27,121.54
Marketing/Advertisement 142,000.00 171,465.00 207,043.99 250,005.61 301,881.78
R&D 72,784.10 76,423.30 80,244.47 84,256.69 88,469.53
General Liability Insurance 18,692.02 28,713.90 43,634.28 68,458.30 110,666.64
Misc. Startup Cost 41,710.00
Total SG&A Cost 1,170,349.07 1,215,210.80 1,316,461.77 1,437,536.60 1,587,574.73
SG&A/UNIT 131.60 97.63 75.20 57.36 43.29
Total Expenses (1,583,869.04) (1,785,546.29) (2,106,879.36) (2,552,566.27) (3,195,647.12)
Total Expenses/Unit (178.10) (143.45) (120.36) (101.86) (87.13)
Net Income ($) 199,340.09 1,085,843.41 2,256,548.36 4,293,264.20 7,871,016.83
Net Margin/Unit ($) 22.42 87.24 128.91 171.32 214.61
Distribution Cost/unit sold 45.28 36.58 29.78 24.11 19.39
Net Operating Profit 285,332.89 1,085,843.41 2,256,548.36 4,293,264.20 7,871,016.83
Depreciation 5,958.57 6,852.36 7,880.21 9,062.24 5,998.05
Interest Expense 37,666.67 25,000.00 17,000.00 9,000.00 1,000.00
Loan Repayment 100,000.00 100,000.00 100,000.00 100,000.00 100,000.00
Income Tax (25%) 61,916.56 265,210.85 559,887.09 1,071,066.05 1,967,504.21
Net Profit 67,057.65 666,918.66 1,536,026.99 3,044,739.85 5,691,845.98

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F. Description of the planned growth
At first month of operation, conservatively, Helios Intl. Ltd. expects to have 26 retail shops carrying the
Revenue 2017 2018 2019 2020 2021
product which is 1% of all bike Units Sold
Netherland Wholesale 5,950 8,033 10,442 13,053 15,664
Cross Border Internet Sales (less VAT) 2,943 4,414 7,063 12,007 21,012
shops in the Netherlands. The Total Units 8,893 12,447 17,505 25,060 36,676
Unit Growth (%)
Netherland Whole Sale 35% 30% 25% 20%
Projected growth through retail is Cross Border Internet Sales 50% 60% 70% 75%

35% in the second year of operation, 30% in the third, 25% in the fourth, and 20% the fifth. The growth

will start to slow as the product reaches maximum expansion. The Online sales will reach exponential

growth because of the market potential which is all of Europe. The online growth starts with 50% the

second year, 60% the third, 70% the fourth, and 75% the fifth. By the fifth year the number of units

sold online will exceed the units sold through retail because of the vast exposure through the internet.

The plan is to expand into brick and mortar bike shops in Germany, Belgium, and Denmark by the end

of the fifth fiscal year business plan. These 4 countries in total represent the highest concentration of

bicycles in the EU and the affluence to afford the premium Smartbike handlebars.

G. Proposed Plan to meet capital needs

1. Personal and internal sources

This is a Financial Summary of the parent company based in San Francisco, California. This shows the

financials since the company started its operations, to show there are sufficient funds, not only for the

$125,000 investment but the equity to support the collateral for the investment.

Financial Summary Helios

2013 2014 2015 2016 2017
Charge out (Units Sold) 2,350 3,643 5,646 8,751 13,564
Revenue $ 587,500.00 $ 910,625.00 $ 1,411,468.75 $ 2,187,776.56 $3,391,053.67
COGS/Unit $ (51.73) $ (52.51) $ (53.29) $ (54.09) $ (54.90)
Cost of Goods Sold $ (121,565.50) $ (191,252.92) $ (300,888.66) $ (473,373.09) $ (744,734.21)
SG&A/Unit $ (89.83) $ (85.34) $ (81.07) $ (77.02) $ (73.17)
SG&A $ (211,100.50) $ (310,845.49) $ (457,719.98) $ (673,992.67) $ (992,454.20)
Profit $ 254,834.00 $ 408,526.59 $ 652,860.11 $ 1,040,410.81 $1,653,865.26
Profit/Pair $ 108.44 $ 112.16 $ 115.63 $ 118.89 $ 121.93
Gross Margin % 43% 45% 46% 48% 49%

23 | P a g e
The Personal Financial Statement shows the Principal Executives net worth, since they will together be
PERSONAL FINANCIAL STATEMENT
Date: 31-Dec-15
Person: Danny Scott
Assets Amount in Dollars
C ash - checking accounts $ 26,023.00
C ash - savings accounts $ 61,083.00
C ertificates of deposit $ 58,050.00
Securities - stocks / bonds / mutual
$ 65,064.00
funds
Notes & contracts receivable $ 51,038.40
Life insurance (cash surrender value) $ 95,000.00
31-Dec-15 investing up to an additional $125,000 for
Carlos Weeber
Amount in Dollars
$ 21,438.00
equity share. Each executive will be putting
$ 69,394.00
$ 64,538.00
$62,500 to the business to start and the
$ 72,850.00
$ 61,876.00
initial capital funding. The executives have
$ 94,000.00

Personal property (auto s, jewelry, etc.) $ 267,251.00 $ 254,387.00

Retirement Funds (eg. IRA s, 401k) $ 115,823.00 $ 128,656.00

agreed to move to Amsterdam and liquidate
Real estate (market value) $ 167,315.20 $ 149,872.00
Other assets (specify) $ 88,284.00 $ 73,217.00 all property assets in the United States.
Total Assets $ 994,931.60 $ 990,228.00

Liabilities Amount in Dollars Amount in Dollars

Most of the executives capital will derive
C urrent Debt (Credit cards, A cco unts) $ 8,293.00 $ 12,660.00

Notes payable (describe belo w) $ 7,384.00 $ 6,497.00

Taxes payable $ 19,203.00 $ 12,832.00 from the Cash (Savings & Checking), CD,
Real estate mortgages (describe) $ 117,943.00 $ 129,485.00

Other liabilities (specify) $ 8,265.00 $ 13,932.54

Total Liabilities $ 161,088.00 $ 175,406.54
Securities, and Real Estate.
Net Worth $ 833,844 $ 814,821

Date: 1/1/2016 Signature: Danny J. Scott Signature: Carlos G. Weeber

2. Earnings, short-term and long-term borrowing, long-term equity

The agreement on the net worth is the total amount of capital needed to start the operations, $750,000.

To capitalize the Company, the Principals intend to contribute a total of $125,000 dollars of equity,

Helios (the Parent) will also contribute $125,000. To fund Helios International Ltd., an additional loan

of $500,000 will be required to reach the $750,000 goal. It is expected that the loan will be repaid in

four years with an interest rate of 8.0%. For this loan, the lender will have a 50% ownership in the

Company until the loan is repaid. In addition, Helios (Parent) will place the subsidiary as collateral.

3. External Sources
Helios LTD. Is requesting a one-time

loan of $500,000 from an investor. The

sources and uses of the investment is

shown here on this chart.

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4. Short term and long-term borrowing

The $500,000 investment is a loan that is intended and projected to be payed of by the end of the fifth

fiscal year

5. Repayment plan
Repayment Plans
2017 2018 2019 2020 2021
Beginning Loan Balance ($) 412,500.00 312,500.00 212,500.00 112,500.00 12,500.00
Interest Expense (8%) 37,666.67 25,000.00 17,000.00 9,000.00 1,000.00
Loan Amortization 100,000.00 100,000.00 100,000.00 100,000.00 12,500.00
Ending Loan Balance 312,500.00 212,500.00 112,500.00 12,500.00 -

6. Plan to repay borrowed funds or provide return on investment

Interest and principle will be paid on a monthly basis per the schedule outline found in the repayment

plans section. Principle and interest will begin after the 4th month of investment. In addition to the

repayment plan the investors are entitled to 50% of the profit in such time until the loan is paid in full.

In total 50% of the projected profit will be $5,500,000 this money will be paid yearly.

XI. KEY METRICS

Key Performance Indicators (KPI) are very important in running this business. With the fact that this is

a startup, KPIs are critical to measure performance. Without a measurement, there is no baseline and

there is no target. Helios International will be measuring the following KPIs monthly:

1) Sales revenue - Monthly revenue will have an impact on cash flow required to run the business. Helios

Int. will measure this by keeping track of the number of units exported each month.

2) Gross Margin - Measuring gross margin is key to maintain profitability and insure the company will

be viable moving forward. This is calculated week by week and will be using the equation previously

mentioned. Although the gross margin is tracked week by week, action to correct any areas causing a

decline will be altered at the end of each month.

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3) Customer Experience - Important to gauge the success of a new product in a new market. This is key

for a startup and building customer acceptance in light of the fact that word of mouth is important for this

visible product. This will be measured by a quick survey that is administered from the app. Follow up

emails will be made after the handlebars are purchased encouraging the customer to input their comments

through the app.

4) Customer Acquisition Cost - CAC will need to be calculated and tracked to manage Helioss

advertising and insure that Helios is receiving the biggest value for its marketing budget. Helios is

calculating the CAC through the equation explained previously, and will be tracked month by month.

5) Monthly Profit and Loss - Tracking P&L results monthly will give the business a clear view that

Helios International is on track with sales and expectations. A comparison with the projected growth and

the number of actual sales will allow Helios to make this comparison at the end of each month.

6) Overhead Costs - Tracking SG&A expenses monthly is critical to insure that variable costs that the

business controls is kept in check. Unexpected expenses can rise and eliminate the gains in profit. This

is calculated each month by the amount of money deducted from the companys cash flow.

7) Inventory Size - This metric is important to measure the quantity of product on hand. First to make

certain that there is sufficient product to meet demand, but also to insure that there is not an overstock

situation and the company is not burdened with a high carrying cost. This measurement is important that

the bike shops also report what is on hand to measure their turnover and the success of their sales. This

is calculated by an IMS which determines the number of units of each particular model sold per week.

This system will also create a seasonal prediction for the number of units, and skews sold.

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XII. COMPETITIVE ADVANTAGE
The Helios Smartbike handlebar is an integrated safety, security, and navigational device that is

packaged in a stylish fashion that has no competition. The Helios handle bar has a utility and design

patent. The functions provided by the handlebar are not found in any other product:

1) Integrated turn signals and headlamp - Safety Feature

2) GPS navigation - Navigation Feature
3) Bike locator- Security Feature
4) Turn by turn navigation - Navigation Feature
5) Visual speedometer changes colors as you pedal faster - Enhanced rider experience.

The handlebars have been tested in all weather conditions and have excellent reliability

ratings. Exceptional service will be provided with Youtube videos to troubleshoot any problems as well

as technicians on call that will assist in the setup and maintenance issues.

XIII. CONCLUSION
Helios International, Ltd. a jointly owned subsidiary of Helios (San Francisco) is seeking to expand

into the European Economic Community market with a launch strategy from Amsterdam,

Netherlands. All estimates in this business plan are based on the two revenue streams described;

Storefront wholesale and Internet sales. We are confident that with this strategy Helios Ltd will meet

the revenue and profit goals described. Helios Ltd will establish a foothold in Netherlands and then

expand storefront sales to other European countries. We are most excited for the additional prospect of

growth in the partnering with Accell Group. Accell is the largest bike OEM in Netherlands

manufacturing brands such as: Hercules, Staiger, Winora, Tunturi, Lapierre, Mercier, Atala, Batavus,

Loekie, Koga-Miyata, and Sparta B.V. Offering the patented Helios Smartbike Handlebars as optional

equipment from the OEM has the potential to increase the original projections by 50%. Helios Ltd is

looking for the investment of $500,000, to be paid back in a 4-year period with an 8.0% interest and in

addition the investor will receive 50% of the profits during this period of growth.

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XIV. BIBLIOGRAPHY
http://www.ridehelios.com/
http://www.belastingdienst.nl/rekenhulpen/registratie_buitenlandse_ondernemers/en/
http://www.hollandtrade.com/business-information/holland-information/foreign-investment/
http://www.numbeo.com/cost-of-
living/compare_cities.jsp?country1=Netherlands&city1=Amsterdam&country2=United+States&city2=New+York
%2C+NY
http://netherlandsbynumbers.com/2013/08/31/10-questions-about-the-dutch-and-their-bikes/
http://www.weekendnotes.com/interesting-facts-about-netherlands/
https://en.wikipedia.org/wiki/Customer_lifetime_value
http://netherlandsbynumbers.com/2013/08/31/10-questions-about-the-dutch-and-their-bikes/
http://www.chinaimportal.com/blog/customs-taxes-importing-china-ultimate-guide/
http://europa.eu/about-eu/countries/member-countries/netherlands/index_en.htm
http://www.doingbusiness.org/data/exploreeconomies/netherlands/~/media/giawb/doing%20business/docume
nts/profiles/country/NLD.pdf
http://ec.europa.eu/budget/biblio/documents/regulations/regulations_en.cfm

XV. APPENDIX

Cost of Materials Analysis & Breakdown

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 MFG COST OF THE BAR PER UNIT
MATERIALS $ 21.96
LOADED LABOR $ 5.14
PACKAGING $ 3.37
Manufacturing FEE (40%) $ 12.19
TOTAL $ 42.66

Initial Equipment Cost

Equipment TOTAL COST
x1 Automative Welding Machine (China) $ 13,590.00
x1 Automative Cutting Machine (China) $ 13,870.00
Tooling to Assemble $ 8,500.00
Storage shelves $ 3,500.00
Office Supplies $ 2,250.00
TOTAL $ 41,710.00

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