Occasions

Personal events planning specialists

The Event Planning Specialists

A business owned by Tomi Andrada and Zapartan Andra
Students at Faculty of Business Administration, MASTER of Research, year 1, group 2

Table of Contents

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

Chart: Highlights..................................................................................................................................1
1.1 Objectives..........................................................................................................................................1
1.2 Mission...............................................................................................................................................2
1.3 Keys to Success..................................................................................................................................2
2.0 Company Summary...............................................................................................................................2
2.1 Company Ownership.........................................................................................................................2
2.2 Start-up Summary..............................................................................................................................3
Table: Start-up.....................................................................................................................................3
..............................................................................................................................................................3
Chart: Start-up......................................................................................................................................5
2.3 Company Locations and Facilities.....................................................................................................5
3.0 Products and Services............................................................................................................................5
3.1 Competitive Comparison...................................................................................................................6
4.0 Market Analysis Summary....................................................................................................................7
4.1 Market Segmentation.........................................................................................................................7
Chart: Market Analysis (Pie)...............................................................................................................8
Table: Market Analysis........................................................................................................................8
4.2 Target Market Segment Strategy.......................................................................................................8
4.3 Service Business Analysis.................................................................................................................9
5.0 Strategy and Implementation Summary.................................................................................................9
5.1 Sales Strategy...................................................................................................................................10
5.1.1 Sales Forecast............................................................................................................................10
Chart: Sales Monthly.....................................................................................................................10
Table: Sales Forecast.....................................................................................................................11
5.2 Milestones........................................................................................................................................11
Chart: Milestones...............................................................................................................................11
Table: Milestones...............................................................................................................................12
6.0 Management Summary........................................................................................................................12
6.1 Organizational Structure..................................................................................................................12
6.2 Personnel Plan..................................................................................................................................13
Table: Personnel.................................................................................................................................13
7.0 Financial Plan.......................................................................................................................................13
7.1 Important Assumptions....................................................................................................................13
Table: General Assumptions..............................................................................................................13
................................................................................................................................................................13
Chart: Benchmarks.............................................................................................................................14
7.3 Break-even Analysis........................................................................................................................15
Table: Break-even Analysis...............................................................................................................15
Chart: Break-even Analysis...............................................................................................................15
7.4 Projected Profit and Loss.................................................................................................................16
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Table of Contents

Table: Profit and Loss........................................................................................................................16

Chart: Profit Monthly.........................................................................................................................17
Chart: Profit Yearly............................................................................................................................17
7.5 Projected Cash Flow........................................................................................................................18
Table: Cash Flow...............................................................................................................................18
Chart: Cash.........................................................................................................................................19
7.6 Projected Balance Sheet...................................................................................................................20
Table: Balance Sheet..........................................................................................................................20
................................................................................................................................................................20
Table: Ratios......................................................................................................................................21
Table: Sales Forecast...................................................................................................................................1
......................................................................................................................................................................1
Table: Personnel...........................................................................................................................................2
......................................................................................................................................................................2
Table: Profit and Loss..................................................................................................................................3
......................................................................................................................................................................3
Table: Cash Flow.........................................................................................................................................4
Table: Balance Sheet....................................................................................................................................5

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Occasions, The Event Planning Specialist

1.0 Executive Summary

Welcome to the future of event planning! Occasions, The Event Planning Specialists, brings to
the community of Bucharest a new breath of air in the event planning market. By combining old
fashioned values, going the extra mile, and using cutting edge event-planning software,
Occasions will lead the market, providing the same quality results, every time.
Occasions is an equal opportunity business making its expertise and its products available to
help its customers plan their own events. Party Packs (complete kits for their event), make
hosting a party a snap, right down to the refreshments. The event planning software brings
interactive event planning as close as their personal computer. Through these and other
affordable products and services, Occasions aims to be the number one resource for any event.

Chart: Highlights

Highlights
$600,000

$500,000

$400,000

Sales
Gross Margin

$300,000

Net Profit
$200,000

$100,000

$0
Year 1

Year 2

Year 3

1.1 Objectives
Occasions is a small business aimed at the big time. In order to reach its lofty goals, Occasions
must focus on the mission behind the vision. It will take all the employees, owners, founders,
and vendors daily living the vision that Occasions represents. The vision manifests itself in
three ways:

1. Be one of the top three event planning specialists in Romania.

2. Justly compensate the employees, owners, and founders of Occasions.
3. Produce the same quality results, every time.

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Occasions, The Event Planning Specialist

1.2 Mission
In an ever changing, fast-paced world, success is determined by good choices for lasting
effects. Communication is essential. Occasions strives to be the best choice of clients by helping
to ease their event planning burden. Through consistent, predictable professionalism, Occasions
will ensure a worry and hassle-free event at a reasonable price.
But, not all our clients will be external. Occasions has internal clients to serve. Occasions will
strive to provide the same predictable and professional working environment to its employees
and contracted vendors, justly compensating them for their services. It is also a priority to
make a comfortable living wage for its owners, founders, full-time staff, and their families.
Keeping in tune with the needs of the market, utilizing the latest technology and trends, all
while ensuring the client receives the individual attention they deserve, is the vision and daily
mission of Occasions; The Event Planning Specialists.
1.3 Keys to Success
Our keys to success include the commitment to quality by every person who is part of the
team. Each of us will be responsible to push ourselves to a higher level of professionalism in
three areas:
1. Consistent, accurate fulfillment of the client's wishes.
2. Competitive pricing for the quality of services offered.
3. Significant profit made on each event planned.
2.0 Company Summary
Founded originallyl on a part-time basis, Occasions is a small business designed to meet the
needs of the ever changing social world. Bucharest is the current home with plans to expand to
branch offices within four years. Occasions' staff of two, with numerous contract vendors, plans
events, writes event-planning products, and trains area students in the art of event planning.
Occasions is invested in the community it resides in.
Occasions is, in part, the answer to demands of the social world, on the working family,
heavily-burdened office, out-of-town business, or special occasion in need of special
recognition. As a business, we understand the needs of public and private organizations. As
parents and family members, we understand the needs of setting special time apart from other
events in our lives. Occasions strives to accomplish these goals, in Bucharest and eventually
other areas of the Romania.
2.1 Company Ownership
Occasions is established as a sole proprietorship with the intention of selling the business when
it is established to one of the employees invested in the vision of event planning. All aspects of
the business will be documented to ensure clients can count on the same results every time. It
is these documents that will become the basis of ownership. The sole proprietor will use his or
her name as the guarantor of each service. Therefore, the sole proprietor must embody the
vision and mission of Occasions.

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Occasions, The Event Planning Specialist

2.2 Start-up Summary

Through careful planning on the part of the founders, the start-up costs for Occasions are
minimal. It began as a home-based business with little overhead, and it continues to demand
fewer outlay of funds as a service-based business. The start-up cost investment funds were
assets saved from prior earnings by the owners who did event planning on a part-time basis
before establishing themselves as a business.
It is the wish of the founders to remain a debt-free establishment. However, recognizing that in
reality not all variables are controllable, outside financing is a viable option. Both founders own
homes and have a perfect credit rating.
Table: Start-up

Start-up
Requirements
Start-up Expenses
Legal
Stationery etc.
Brochures
Consultants
Insurance
Rent
Expensed Equipment
Other
Total Start-up Expenses

$200
$300
$185
$200
$145
$150
$1,985
$200
$3,365

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

$2,300
$0
$0
$0
$2,300

Total Requirements

$5,665

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Occasions, The Event Planning Specialist

Table: Start-up Funding

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

$3,365
$2,300
$5,665

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

$0
$2,300
$0
$2,300
$2,300

Liabilities and Capital

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

$2,000
$0
$0
$0
$2,000

Capital
Planned Investment
Alicia Nollan
Other
Additional Investment Requirement
Total Planned Investment
Loss at Start-up (Start-up Expenses)
Total Capital

$3,400
$265
$0
$3,665
($3,365)
$300

Total Capital and Liabilities

$2,300

Total Funding

$5,665

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Occasions, The Event Planning Specialist

Chart: Start-up

Start-up
$4,000
$3,600
$3,200
$2,800
$2,400
$2,000
$1,600
$1,200
$800
$400
$0
Expenses

Assets

Investment

Loans

2.3 Company Locations and Facilities

Occasions is located inside the city limits of Bucharest. It is a home-based business. Most
meetings with clients are conducted in social settings, such as restaurants, coffee houses, the
client's home, facilities wishing to be used for the event, or over the phone. Although the
demand has not yet reached its peak, Occasions will eventually move from its home base into a
small office complex, also within the city limits of Bucharest. When the company has reached
its finished point, Occasions will have branch offices in Bucharest, Brasov, Sibiu, Cluj, Sinaia,
Ploiesti, Constanta and many more.
The company will maintain a high degree of professionalism. All offices are equipped with the
latest in business technology, such as telephone systems, computers, fax machines, email,
duplicators, printers, and software. Each location will have a secure storage area for supplies
and equipment used in events, such as walkie-talkies, cellular phones, portable fax machines,
and laptops.
3.0 Products and Services
Although Occasions is primarily a service business, we also offer products to aid our customers
in planning the event themselves. The following products are tools used inside our operation for
the best possible results:

1. Party Pack
The Party Pack is a complete kit for any party. It includes decorations, lighting effects guide,
disposable theme cameras, cutlery, plates, napkins, cups, punch mix (or recipe), snack
supplies (or recipe), tablecloths, theme music (where applicable), invitations, thank-you
cards, and a step-by-step guide to planning, putting together, and hosting the event.
2. Step-by-Step Guides
These booklets include a calendar to map out the event, a step-by-step guide on what is
needed for and how to put together a successful, worry-free event, resource information,

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Occasions, The Event Planning Specialist

popular refreshments with recipes, games, and tips to put their event in the record books.
The events available include birthdays for all ages, meetings, retreats, parties, vacations,
and special occasion celebrations such as graduations, holidays, showers, weddings, and
receptions.
3. Event Planning Software
Due to be released June 2012, this cutting-edge tool will allow the client all the resources
and visual aids for their event planning. They will be able to play with decoration themes,
listen to theme music, design invitations, thank-you cards, and RSVP cards, use the
interactive planning calendar, and much more. This software will bring their event into the
millennium with cutting edge technology that is designed to save time and money.
4. Resources Manual
This valuable guide acts as a review for all the resources located in the surrounding area. A
ranking is given to the various services, such as caterers, decorators, disc jockeys, bands,
and facilities. This manual gives the client the freedom of making a choice based on
experience.
Free Event Planners Training for High School and College Students
As a member of the Bucharest community, it is our mission to support our community. Ten
hours each month will be devoted to training area students in event planning. This will aid them
in planning proms, graduation parties, homecoming, and other important events. This is a
priority of Occasions. It will not be cut back as the business grows.
Occasions provides event planning in a wide range of applications. We guarantee satisfaction in
the areas of appearance, performance, and taste. The following is a sampling of the types of
events we plan every year:
1.
2.
3.
4.
5.

Meetings, Trainings, and Retreats.

Conferences and Workshops.
Birthdays, Anniversaries, Graduations and Holidays.
Weddings, Receptions, and Showers.
Company picnics, banquets, and award ceremonies.

.....and any other event that needs to be planned.

3.1 Competitive Comparison
Occasions, although young, draws from the age-old tradition of going above and beyond what
is expected, every time. Our systems for event planning have been drawn up, evaluated,
practiced, worked, and reworked to ensure the maximum efficiency while minimizing the
possibility of error. We employ local vendors who have the same desire to be the best at what
they do, while providing un-matchable services. Thus, we give back to the community by
providing jobs outside of our organization. We encourage new and upcoming small businesses
who provide a service within our need base to step up to the challenge of being the best
through their contract with Occasions.
Our products will serve the function of aiding those that cannot afford the cost of an event
planner. We wish to make our event planning tips available to those who need a helping hand.
Occasions is a member of the community. Through event planning, Occasions gets the
opportunity to laugh when the community laughs and cry when the community cries, to rejoice
when the community rejoices and to help put the pieces back together when things change or
begin to fall apart. We care about the things that have meaning in the lives of our neighbors.

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Occasions, The Event Planning Specialist

4.0 Market Analysis Summary

The following sections describe the market segmentation, strategies, and industry analysis.
4.1 Market Segmentation
The breakdown of the market for event planning, falls in a wide, very diverse grouping.
Individuals as well as organizations demand the services we provide. In order to provide the
greatest depth of information, the market segments have been broken down into private and
public organizations, and age groups.
1. Private Organizations and Businesses
Private organizations make up the single largest portion of Occasions' client base. Private
organizations such as businesses, corporations, and political parties host the most events on
the largest scales, therefore, these events generate larger revenues per event. The majority
of larger scale holiday functions will fall under this segment.
2. Public Organizations
Government agencies host many events every year. Occasions hopes to alleviate the
pressure of event planning for public employees. The second single largest segment, the
public sector, can save money and give back to its community at the same time. These
events are moderate in scale with middle to low revenues generated. Emphasis is placed on
the visibility of the event for public viewing. The majority of organizational family functions
will fall under this segment.
3. Age Breakdowns
o

Under 24: Persons under the age of twenty-four (24) using an event planner are rare
at best. We hope to tap the early college graduates who have begun their
professional careers but have not yet started their families. These events will focus
mainly on themes with moderate to high energy appeal. The revenues generated will
range from moderate to high, depending on the event. The majority of weddings will
fall into this segment.
Ages 25-55: The persons that fall into this age group are employed, middle to uppermiddle class families. The reason they choose event planners is they are too busy to
do it themselves. Therefore, Occasions will be on hand for questions, contact will be
moderate in length but occur regularly so as not to disturb the daily life of the
families. These events will generate moderate revenues, with a few generating low
revenues. The majority of special occasion planning will occur in this market
segment.
Ages 56 and above: Persons over the age of 55 have reached the turning point of
life. Many are retiring, others are celebrating anniversaries of significant years, and
still others are seeing that their children's special events are taken care of. These
events will generate moderate to high revenues depending upon the income level of
the family (direct correlation to social status). Most holiday parties, and other special
occasions, such as wedding receptions and reunions, will occur in this market
segment.

4. Other
This segment has no direct information to compile for a description. It consists of any event
planned that does not fit into one of the above categories.

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Occasions, The Event Planning Specialist

Chart: Market Analysis (Pie)

Market Analysis (Pie)

Under 24
Age 25 to 55
Age 56 and over
Private Organizations
Public Organizations
Other

Table: Market Analysis

Market Analysis
Potential Customers
Under 24
Age 25 to 55
Age 56 and over
Private Organizations
Public Organizations
Other
Total

Year 1

Year 2

Year 3

Year 4

Year 5

18
33
31
40
62
5
189

18
33
31
40
62
5
189

20
44
37
102
105
7
315

21
51
40
163
137
8
420

22
59
44
261
178
9
573

Growth
0%
0%
0%
0%
0%
0%
31.95%

CAGR
5.14%
15.63%
9.15%
59.83%
30.17%
15.83%
31.95%

4.2 Target Market Segment Strategy

Our target markets are middle to upper-middle class families, couples, individuals, or private
and public organizations. We chose these groups because they are most able to afford event
planners, and have the least amount of time to spare for event planning in general. Families
demand attention, employees are overburdened, and overwhelming detail needed to plan large
events are too large a constraint to place on people not trained in the area of event planning.
The fast pace of the world we live in leaves little time for extra things we would like to do, like
plan events, parties, and social get-togethers. Occasions fills the need by being available to
take on the burden of planning so that people can spend time on more important things, like
family and friends. The demand for this service can only increase considering the rise in
incomes, population, and need for interpersonal relations in the workplace.

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Occasions, The Event Planning Specialist

4.3 Service Business Analysis

Occasions is in a unique position of competition. We compete against hotels with conference
facilities, conference centers, other event planners both on the large and small scale, persons
within an organization who are assigned the task of organizing an event, and people who wish
to organize their own events without the benefit of assistance. The benefits and drawbacks of
each of our competitors as compared with the services we offer are hardly a match in quality
and price.
1. Hotels and Conference Centers
Strengths: On-site facilities, equipment, and support staff. Ability to transport and house
persons for overnight stays. Able to internalize costs of transportation and equipment.
Weakness: Often very expensive, impersonal, rely on unskilled labor for support staff. The error
rate is high due to high volume and traffic from other events happening at the same time.
2. Other Event Planners
Strengths: Have been in the market longer, have established a reputation and client base.
Weakness: Reputation precedes them, no systems-based businesses designed to produce
consistent results; focus on smaller events, specialized events are main focused rather than all
events; do not have the supporting products to market with, or instead of, event planning
services.
3. Employees or Persons wishing to do it themselves
Strengths: Internalized cost of planning the event; able to add tiny personalized touches that
have meaning within the group or family.
Weakness: Consumes time that could be spent on other things; don't have access to the best
prices, services, and other needed resources available.
5.0 Strategy and Implementation Summary
Marketing and Competition
We have discussed our client base as being predominately middle to upper-middle class
individuals, couples or families, public and private organizations. We must then look at the
needs of these markets and cater to them. We promise the same great results, every time.
When marketing to individuals, the idea of releasing them from the task, freeing their time for
family and friends, and the promise of a worry-free event are the buzz words and concepts. Our
marketing is predominantly by word of mouth or visual connection to large events these
individuals have participated in or worked at.
When marketing to public or private organizations, the idea of greater efficiency for the money
and a professional event without error would be the key concept. Groups, especially large ones,
do not wish to deal with problems that arise due to oversight on their part. If the guarantee of
worry-free, error-free events is available at a cost benefit to them, there really appears to be
no better choice.

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Occasions, The Event Planning Specialist

5.1 Sales Strategy

Occasions deals with a diverse market of clients. Within each market segment, closing of sales
will differ. Each approach is described as follows:
1. Private and Public Organizations
Sales will be concluded one to two days after the end of the event. A follow-up phone call
will be placed informing the client of the total cost, number of attendees, and information
about the billing packet that will arrive at their offices. Feedback forms will be included in
these packets to ensure the client is being served as they deem appropriate. Form letter
thank-yous will be sent following each event.
2. Individuals
Sales will be concluded with a follow-up phone call one to two days after the event. The
phone call will explain the total cost of the event, number of attendees, and information
concerning the billing. Individual parties of any age group are placed on a billing cycle.
Invoices will be sent out the 25th of the month and will be due the 10th of the following
month. Feedback forms will be included in these packets to ensure the client is being served
as they deem appropriate. Thank-you cards will follow each individual event.
5.1.1 Sales Forecast
By beginning on a smaller scale, Occasions has the foresight to grow at a rapid pace to keep up
with demand. We wish to maintain a steady rate of sales growth; however, we understand that
sales of products and services will vary in different months. As noted in the graph and chart,
rapid increases during the holiday season will boost sales, then allow that growth to level off at
a steady rate.

Chart: Sales Monthly

Sales Monthly
$40,000
$36,000
$32,000
$28,000

Private

$24,000

Public

$20,000

Other

$16,000
$12,000
$8,000
$4,000
$0
Month 1
Month 3
Month 5
Month 7
Month 9
Month 11
Month 2
Month 4
Month 6
Month 8
Month 10
Month 12

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Occasions, The Event Planning Specialist

Table: Sales Forecast

Sales Forecast
Year 1

Year 2

Year 3

$206,170
$113,185
$33,794
$353,149

$276,099
$178,490
$40,081
$494,670

$299,002
$193,000
$62,777
$554,779

Year 1
$28,864
$11,319
$1,690
$41,872

Year 2
$38,654
$17,849
$2,004
$58,507

Year 3
$41,860
$19,300
$3,139
$64,299

Sales
Private
Public
Other
Total Sales
Direct Cost of Sales
Private
Public
Other
Subtotal Direct Cost of Sales

5.2 Milestones
The milestones table and chart show the specific detail about actual program activities that
should be taking place during the year. Each one has its manager, starting date, ending date,
and budget. During the year we will be keeping track of implementation against plan, with
reports on the timely completion of these activities as planned.

Chart: Milestones

Milestones
Sample Milestones
Finish Business Plan
Acquire Financing
Ah HA! Event
Oooooh Noooooo! Event
Grand Opening
Marketing Program Starts
Plan vs. Actual Review
First Break-even Month
Hire Employees
Upgrade the business to glory
1/31/2008 7/31/2008 1/31/2009 7/31/2009 1/31/2010 7/31/2010 1/31/2011 7/31/2011

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Occasions, The Event Planning Specialist

Table: Milestones

Milestones
Milestone
Sample Milestones
Finish Business Plan
Acquire Financing
Ah HA! Event
Oooooh Noooooo! Event
Grande Opening
Marketing Program Starts
Plan vs. Actual Review
First Break-even Month
Hire Employees
Upgrade Business to glory
Totals

Start Date
1/4/2008
9/8/2010

End Date
1/4/2008
10/8/2010

Budget
$0
$100

Manager
ABC
Dude

9/18/2010
9/28/2010
10/28/2010
11/7/2010
10/8/2010
3/5/2011
7/7/2011
6/5/2011
8/24/2011

11/7/2010
10/3/2010
11/2/2010
11/12/2010
11/2/2010
3/12/2011
8/6/2011
7/5/2011
8/26/2011

$200
$60
$250
$500
$1,000
$0
$0
$150
$100
$2,360

Dudette
Marianne
Marionette
Gloworm
Glower
Galore
Bouys
Gulls
Brass

Department
Department
LeGrande
Fromage
Legumers
Bosses
Chvre deBlme
Nobs
Marketeers
Alles
Salers
HRM
Bossies

6.0 Management Summary

Information and expense details are presented in subtopics Organizational Structure and
Personnel Plan.
6.1 Organizational Structure
The management team within Occasions will be small in the beginning. The primary employee
is the founder, who plans events, then contracts with caterers, decorators, disc jockeys, and
bands to fill out the event. A contract labor site manager will be on hand to work the events as
a liaison and vendor coordinator. Thus, there are two main employees with various levels of
vendors.
When Occasions reaches its expansion goals, each office will have one to two event planners,
an office assistant, two to three site managers for the events, and a product and marketing
specialist. This team will function as one with constant communication through weekly staff
meetings, email, and message boards. All jobs are interrelated. The performance of one effects
the performance of the others; therefore, each team member expects nothing but the best
from each other.
As it functions currently, we see no gaps in the management of this organization. Should
Occasions grow beyond its estimated size, more positions in specialized areas will need to be
added as well as additional site support and office assistance. To fill these positions, Occasions
is looking for energetic, teachable, detail-oriented persons who want the potential to grow and
improve their skills within the organization. Occasions wants to be the best; therefore, they will
hire those who want to succeed.

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Occasions, The Event Planning Specialist

6.2 Personnel Plan

The following table shows the estimated personnel needs for Occasions.
Table: Personnel

Personnel Plan
Year 1

Year 2

Year 3

Event Specialist
Site Manager
Other
Total People

$36,000
$11,097
$8,947
0

$40,000
$13,750
$9,560
0

$42,000
$14,560
$10,000
0

Total Payroll

$56,044

$63,310

$66,560

7.0 Financial Plan

Service-based businesses require little funds to start-up, and as they grow and expand, less
funds to maintain. The charts and graphs that follow will show that investment up front allows
Occasions to function debt-free with little overhead. This gives Occasions a quicker break-even
point and increased profit margins from the start. As Occasions grows, the debt-free philosophy
will be maintained until it is impossible to function during growth periods without financial
assistance.
7.1 Important Assumptions
Tax rates are noted for information. We carry no loan burden that would be effected by these
rates. What hits Occasions the hardest (but not nearly are bad as other service businesses), is
the tax rate of 24%, which is nearly one quarter of the total sales. As Occasions continues to
grow, these numbers will be reference rather than influence.
Table: General Assumptions

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

Year 1

Year 2

Year 3

1
10.00%
10.00%
24.00%
0

2
10.00%
10.00%
24.00%
0

3
10.00%
10.00%
24.00%
0

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Occasions, The Event Planning Specialist

7.2 Key Financial Indicators

The break-even point for Occasions is based on the assumption that we will produce 22 events
per month and average approximately $521 per event. In the current situation, we average
more than this assumption for our public and private organization events. These currently make
up 18 of the 22 average events hosted per month.

Chart: Benchmarks

Benchmarks

Year 1

1.0

Year 2
Year 3

0.0
Sales

Operating Expenses
Inventory Turnover
Gross Margin%
Collection Days

Page 14

Occasions, The Event Planning Specialist

7.3 Break-even Analysis

The break-even point is based on the assumption that we will produce 22 events per month and
average approximately $521 per event. In the current situation, we average more than this
assumption for our public and private organization events. These currently make up 18 of the
22 average events hosted per month.
The break-even point will appear more rapidly for Occasions than for other types of homebased businesses. Start-up costs are limited to minimal equipment, there is little or no staff to
pay in the beginning, and contracted companies will handle any additional equipment required
for the planned events.
Table: Break-even Analysis

Break-even Analysis
Monthly Revenue Break-even

$19,313

Assumptions:
Average Percent Variable Cost
Estimated Monthly Fixed Cost

12%
$17,023

Chart: Break-even Analysis

Break-even Analysis
$12,000
$9,000
$6,000
$3,000
$0
($3,000)
($6,000)
($9,000)
($12,000)
($15,000)
$0

$6,000
$3,000

$9,000

$12,000
$18,000
$24,000
$30,000
$15,000
$21,000
$27,000
$33,000

Page 15

Occasions, The Event Planning Specialist

7.4 Projected Profit and Loss

Leading the industry in event planning requires the use of the resources available at the lowest
cost. As noted in the table, we spend less money on overhead than another event planners with
an outside office or office space in their own facility. This savings allows us to market in
creative ways and spend funds on expansion into other areas when the time is right.
Table: Profit and Loss

Pro Forma Profit and Loss

Year 1

Year 2

Year 3

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

$353,149
$41,872
$196
$42,068

$494,670
$58,507
$203
$58,710

$554,779
$64,299
$221
$64,520

Gross Margin
Gross Margin %

$311,081
88.09%

$435,960
88.13%

$490,259
88.37%

Payroll
Sales & Marketing & Other Expenses
Depreciation
Leased Equipment
Utilities
Insurance
Rent
Payroll Taxes
Other

$56,044
$146,013
$0
$0
$516
$264
$1,440
$0
$0

$63,310
$68,400
$0
$0
$750
$750
$1,800
$0
$0

$66,560
$73,400
$0
$0
$800
$1,000
$1,800
$0
$0

Total Operating Expenses

$204,277

$135,010

$143,560

Profit Before Interest and Taxes

EBITDA
Interest Expense
Taxes Incurred

$106,804
$106,804
$406
$25,535

$300,950
$300,950
$279
$72,161

$346,699
$346,699
$362
$83,121

$80,862
22.90%

$228,510
46.19%

$263,216
47.45%

Expenses

Net Profit
Net Profit/Sales

Page 16

Occasions, The Event Planning Specialist

Chart: Profit Monthly

Profit Monthly
$12,000
$10,000
$8,000
$6,000
$4,000
$2,000
$0
Month 1

Month 3
Month 5
Month 7
Month 9
Month 11
Month 2
Month 4
Month 6
Month 8
Month 10
Month 12

Chart: Profit Yearly

Profit Yearly

$270,000
$240,000
$210,000
$180,000
$150,000
$120,000
$90,000
$60,000
$30,000
$0
Year 1

Year 2

Year 3

Page 17

Occasions, The Event Planning Specialist

7.5 Projected Cash Flow

Our cash situation is great. Although we begin with little extra cash, our increased growth
allows us to make up for lost time. Our cash balance is always above the mark with the cash
flow not too far behind. We have no negatives in our cash analysis.
Table: Cash Flow

Pro Forma Cash Flow

Year 1

Year 2

Year 3

$141,260
$178,271
$319,531

$197,868
$283,330
$481,198

$221,912
$327,145
$549,057

$0
$4,000
$0
$0
$0
$0
$0
$323,531

$0
$1,080
$0
$0
$0
$0
$0
$482,278

$0
$1,080
$0
$0
$0
$0
$0
$550,137

Year 1

Year 2

Year 3

$56,044
$199,964
$256,008

$63,310
$209,744
$273,054

$66,560
$222,455
$289,015

$0
$3,500
$0
$0
$0
$0
$0
$259,508

$0
$500
$0
$0
$0
$0
$0
$273,554

$0
$0
$0
$0
$0
$0
$0
$289,015

$64,023
$66,323

$208,723
$275,047

$261,122
$536,168

Cash Received
Cash from Operations
Cash Sales
Cash from Receivables
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
Cash Balance

Page 18

Occasions, The Event Planning Specialist

Chart: Cash

Cash
$70,000
$60,000
$50,000
$40,000

Net Cash Flow

$30,000

Cash Balance

$20,000
$10,000
$0
Month 1
Month 3
Month 5
Month 7
Month 9
Month 11
Month 2
Month 4
Month 6
Month 8
Month 10 Month 12

Page 19

Occasions, The Event Planning Specialist

7.6 Projected Balance Sheet

Occasions is set up for success. According to the numbers, we start out fair and end up
amazing. By FY2012, we will be worth over $125,000 with a profit margin of over 30%. We are
operating with little to zero debt, boosting the net worth even higher. Our only weakness is the
products to be released in FY2012 have not been accounted for as an investment of funds. This
will effect the cash flow in a moderate way, and is undetermined how it will effect the profit
ratio of the business.
Table: Balance Sheet

Pro Forma Balance Sheet

Year 1

Year 2

Year 3

$66,323
$33,618
$4,991
$0
$104,933

$275,047
$47,090
$7,494
$0
$329,631

$536,168
$52,812
$6,478
$0
$595,458

$0
$0
$0
$104,933

$0
$0
$0
$329,631

$0
$0
$0
$595,458

Year 1

Year 2

Year 3

Accounts Payable
Current Borrowing
Other Current Liabilities
Subtotal Current Liabilities

$21,270
$2,500
$0
$23,770

$16,878
$3,080
$0
$19,958

$18,410
$4,160
$0
$22,570

Long-term Liabilities
Total Liabilities

$0
$23,770

$0
$19,958

$0
$22,570

$3,665
($3,365)
$80,862
$81,162
$104,933

$3,665
$77,497
$228,510
$309,672
$329,631

$3,665
$306,007
$263,216
$572,888
$595,458

$81,162

$309,672

$572,888

Assets
Current Assets
Cash
Accounts Receivable
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

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

Page 20

Occasions, The Event Planning Specialist

7.7 Business Ratios

Data on our business ratios is shown in the table below. Industry Profile ratios are based on
Standard Industry Classification (SIC) Index code 7299.
Table: Ratios
Ratio Analysis
Year 1

Year 2

Year 3

Industry Profile

n.a.

40.07%

12.15%

11.37%

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

32.04%
4.76%
0.00%
100.00%
0.00%
100.00%

14.29%
2.27%
0.00%
100.00%
0.00%
100.00%

8.87%
1.09%
0.00%
100.00%
0.00%
100.00%

10.40%
3.83%
48.41%
62.64%
37.36%
100.00%

Current Liabilities
Long-term Liabilities
Total Liabilities
Net Worth

22.65%
0.00%
22.65%
77.35%

6.05%
0.00%
6.05%
93.95%

3.79%
0.00%
3.79%
96.21%

23.10%
24.97%
48.07%
51.93%

100.00%
88.09%
69.22%
0.51%
30.24%

100.00%
88.13%
35.37%
0.44%
60.84%

100.00%
88.37%
34.65%
0.47%
62.49%

100.00%
100.00%
65.24%
2.43%
4.31%

4.41
4.20
22.65%
131.09%
101.40%

16.52
16.14
6.05%
97.09%
91.21%

26.38
26.10
3.79%
60.45%
58.16%

1.83
1.31
58.52%
7.33%
17.66%

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
Additional Ratios

Year 1

Year 2

Year 3

Net Profit Margin

Return on Equity

22.90%
99.63%

46.19%
73.79%

47.45%
45.95%

n.a
n.a

6.30
43
10.91
10.40
27
3.37

6.30
50
9.37
12.17
34
1.50

6.30
55
9.20
12.17
29
0.93

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

0.29
1.00

0.06
1.00

0.04
1.00

n.a
n.a

$81,162
262.90

$309,672
1,078.67

$572,888
957.73

n.a
n.a

0.30
23%
2.79
4.35
0.00

0.67
6%
13.78
1.60
0.00

1.07
4%
23.76
0.97
0.00

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

Activity Ratios
Accounts Receivable Turnover
Collection Days
Inventory Turnover
Accounts Payable Turnover
Payment Days
Total Asset Turnover
Debt Ratios
Debt to Net Worth
Current Liab. to Liab.
Liquidity Ratios
Net Working Capital
Interest Coverage
Additional Ratios
Assets to Sales
Current Debt/Total Assets
Acid Test
Sales/Net Worth
Dividend Payout

Page 21

Appendix
Table: Sales 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

$20,009
$11,999
$4,622
$36,630

$19,650
$12,300
$4,800
$36,750

$22,103
$12,089
$4,688
$38,880

Month 10

Month 11

Month 12

Sales
Private
Public
Other
Total Sales

0%
0%
0%

$12,860
$3,852
$800
$17,512

$10,966
$7,884
$955
$19,805

$11,435
$7,200
$900
$19,535

$12,889
$8,965
$1,190
$23,044

$13,001
$8,566
$2,450
$24,017

$15,777
$7,600
$2,133
$25,510

$15,998
$9,705
$2,100
$27,803

$24,960
$11,245
$4,656
$40,861

$26,522
$11,780
$4,500
$42,802

Direct Cost of Sales

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Private

$1,800

$1,535

$1,601

$1,804

$1,820

$2,209

$2,240

$3,494

$3,713

$2,801

$2,751

$3,094

Public

$385

$788

$720

$897

$857

$760

$971

$1,125

$1,178

$1,200

$1,230

$1,209

Other

$40

$48

$45

$60

$123

$107

$105

$233

$225

$231

$240

$234

$2,226

$2,371

$2,366

$2,760

$2,799

$3,075

$3,315

$4,852

$5,116

$4,232

$4,221

$4,538

Subtotal Direct Cost of Sales

Page 1

Appendix
Table: Personnel

Personnel Plan

Event Specialist
Site Manager
Other
Total People
Total Payroll

0%
0%
0%

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9
$3,000
$1,245
$844
0

Month
10
$3,000
$875
$844
0

Month
11
$3,000
$875
$895
0

Month
12
$3,000
$875
$895
0

$3,000
$735
$586
0

$3,000
$907
$800
0

$3,000
$735
$586
0

$3,000
$735
$586
0

$3,000
$735
$586
0

$3,000
$735
$586
0

$3,000
$1,245
$844
0

$3,000
$1,400
$895
0

$4,321

$4,707

$4,321

$4,321

$4,321

$4,321

$5,089

$5,295

$5,089

$4,719

$4,770

$4,770

Page 2

Appendix
Table: Profit and Loss

Pro Forma Profit and

Loss
Month 10

Month 11

Month 12

$17,512

Month 1

$19,805

$19,535

$23,044

$24,017

$25,510

$27,803

$40,861

$42,802

$36,630

$36,750

$38,880

$2,226

$2,371

$2,366

$2,760

$2,799

$3,075

$3,315

$4,852

$5,116

$4,232

$4,221

$4,538

$15

$13

$15

$16

$16

$16

$19

$22

$22

$13

$15

$14

$2,241

$2,384

$2,381

$2,776

$2,815

$3,091

$3,334

$4,874

$5,138

$4,245

$4,236

$4,552

$15,271

$17,421

$17,154

$20,268

$21,202

$22,419

$24,469

$35,987

$37,664

$32,385

$32,514

$34,328

87.21%

87.96%

87.81%

87.95%

88.28%

87.88%

88.01%

88.07%

88.00%

88.41%

88.47%

88.29%

Payroll

$4,321

$4,707

$4,321

$4,321

$4,321

$4,321

$5,089

$5,295

$5,089

$4,719

$4,770

$4,770

Sales & Marketing &

Other Expenses
Depreciation

$9,015

$10,748

$9,982

$10,260

$10,315

$10,415

$12,418

$18,015

$16,615

$13,290

$11,975

$12,965

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$43

$43

$43

$43

$43

$43

$43

$43

$43

$43

$43

$43

Sales
Direct Cost of Sales
Other Costs of Sales
Total Cost of Sales
Gross Margin
Gross Margin %

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Expenses

Leased Equipment
Utilities
Insurance
Rent
Payroll Taxes
Other
Total Operating
Expenses
Profit Before Interest and
Taxes
EBITDA
Interest Expense
Taxes Incurred
Net Profit
Net Profit/Sales

12%

$22

$22

$22

$22

$22

$22

$22

$22

$22

$22

$22

$22

$120

$120

$120

$120

$120

$120

$120

$120

$120

$120

$120

$120

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$13,521

$15,640

$14,488

$14,766

$14,821

$14,921

$17,692

$23,495

$21,889

$18,194

$16,930

$17,920

$1,750

$1,781

$2,666

$5,502

$6,381

$7,498

$6,777

$12,492

$15,775

$14,191

$15,584

$16,408

$1,750

$1,781

$2,666

$5,502

$6,381

$7,498

$6,777

$12,492

$15,775

$14,191

$15,584

$16,408

$17

$50

$47

$44

$41

$38

$35

$33

$30

$27

$24

$21

$416

$415

$629

$1,310

$1,521

$1,790

$1,618

$2,990

$3,779

$3,399

$3,734

$3,933

$1,318

$1,315

$1,990

$4,148

$4,818

$5,669

$5,123

$9,469

$11,966

$10,765

$11,826

$12,454

7.52%

6.64%

10.19%

18.00%

20.06%

22.22%

18.43%

23.17%

27.96%

29.39%

32.18%

32.03%

Page 3

Appendix
Table: Cash Flow

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

$7,005

$7,922

$7,814

$9,218

$9,607

$10,204

$11,121

$16,344

$17,121

$14,652

$14,700

$15,552

$0

$5,604

$11,241

$11,797

$12,844

$14,138

$14,888

$16,040

$20,860

$25,138

$23,706

$22,016

$7,005

$13,526

$19,055

$21,014

$22,451

$24,342

$26,009

$32,384

$37,981

$39,790

$38,406

$37,568

$0
$0

$0
$4,000

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

New Other Liabilities (interestfree)

New Long-term Liabilities

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$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

$7,005

$17,526

$19,055

$21,014

$22,451

$24,342

$26,009

$32,384

$37,981

$39,790

$38,406

$37,568

Expenditures

Month 1

Cash Received
Cash from Operations
Cash Sales
Cash from Receivables
Subtotal Cash from Operations
Additional Cash Received
Sales Tax, VAT, HST/GST Received
New Current Borrowing

0.00%

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month
10

Month
11

Month
12

Expenditures from Operations

Cash Spending

$4,321

$4,707

$4,321

$4,321

$4,321

$4,321

$5,089

$5,295

$5,089

$4,719

$4,770

$4,770

$477

$14,309

$13,919

$13,277

$15,006

$14,951

$15,891

$18,185

$27,728

$25,842

$20,173

$20,204

$4,798

$19,016

$18,240

$17,598

$19,327

$19,272

$20,980

$23,480

$32,817

$30,561

$24,943

$24,974

Sales Tax, VAT, HST/GST Paid Out

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Principal Repayment of Current

Borrowing
Other Liabilities Principal
Repayment
Long-term Liabilities Principal
Repayment
Purchase Other Current Assets

$0

$0

$350

$350

$350

$350

$350

$350

$350

$350

$350

$350

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

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

$4,798

$19,016

$18,590

$17,948

$19,677

$19,622

$21,330

$23,830

$33,167

$30,911

$25,293

$25,324

Bill Payments
Subtotal Spent on Operations
Additional Cash Spent

Subtotal Cash Spent

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Appendix
Net Cash Flow

$2,206

($1,490)

$465

$3,066

$2,773

$4,720

$4,679

$8,554

$4,814

$8,879

$13,113

$12,245

Cash Balance

$4,506

$3,016

$3,481

$6,547

$9,321

$14,041

$18,719

$27,273

$32,087

$40,966

$54,079

$66,323

Month 2

Month 3

Month 4

Month 5

Table: Balance Sheet

Pro Forma Balance Sheet

Month 1
Assets

Month 6

Month 7

Month 8

Month 9

Month
10

Month
11

Month
12

Starting
Balances

Current Assets
Cash
Accounts Receivable
Inventory
Other Current Assets
Total Current Assets

$2,300
$0
$0
$0
$2,300

$4,506
$10,507
$2,448
$0
$17,462

$3,016
$16,786
$2,609
$0
$22,411

$3,481
$17,266
$2,602
$0
$23,350

$6,547
$19,296
$3,037
$0
$28,880

$9,321
$20,863
$3,079
$0
$33,262

$14,041
$22,031
$3,383
$0
$39,454

$18,719
$23,825
$3,647
$0
$46,191

$27,273
$32,301
$5,337
$0
$64,911

$32,087
$37,122
$5,628
$0
$74,837

$40,966
$33,963
$4,655
$0
$79,584

$54,079
$32,306
$4,643
$0
$91,028

$66,323
$33,618
$4,991
$0
$104,933

$0
$0
$0
$2,300

$0
$0
$0
$17,462

$0
$0
$0
$22,411

$0
$0
$0
$23,350

$0
$0
$0
$28,880

$0
$0
$0
$33,262

$0
$0
$0
$39,454

$0
$0
$0
$46,191

$0
$0
$0
$64,911

$0
$0
$0
$74,837

$0
$0
$0
$79,584

$0
$0
$0
$91,028

$0
$0
$0
$104,933

Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets
Liabilities and Capital

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month
10

Month
11

Month
12

Current Liabilities
Accounts Payable
Current Borrowing
Other Current Liabilities
Subtotal Current Liabilities

$0
$2,000
$0
$2,000

$13,844
$2,000
$0
$15,844

$13,478
$6,000
$0
$19,478

$12,777
$5,650
$0
$18,427

$14,509
$5,300
$0
$19,809

$14,423
$4,950
$0
$19,373

$15,296
$4,600
$0
$19,896

$17,259
$4,250
$0
$21,509

$26,860
$3,900
$0
$30,760

$25,169
$3,550
$0
$28,719

$19,502
$3,200
$0
$22,702

$19,470
$2,850
$0
$22,320

$21,270
$2,500
$0
$23,770

Long-term Liabilities
Total Liabilities

$0
$2,000

$0
$15,844

$0
$19,478

$0
$18,427

$0
$19,809

$0
$19,373

$0
$19,896

$0
$21,509

$0
$30,760

$0
$28,719

$0
$22,702

$0
$22,320

$0
$23,770

$3,665
($3,365)
$0
$300
$2,300

$3,665
($3,365)
$1,318
$1,618
$17,462

$3,665
($3,365)
$2,633
$2,933
$22,411

$3,665
($3,365)
$4,623
$4,923
$23,350

$3,665
($3,365)
$8,771
$9,071
$28,880

$3,665
($3,365)
$13,589
$13,889
$33,262

$3,665
($3,365)
$19,258
$19,558
$39,454

$3,665
($3,365)
$24,381
$24,681
$46,191

$3,665
($3,365)
$33,851
$34,151
$64,911

$3,665
($3,365)
$45,817
$46,117
$74,837

$3,665
($3,365)
$56,582
$56,882
$79,584

$3,665
($3,365)
$68,408
$68,708
$91,028

$3,665
($3,365)
$80,862
$81,162
$104,933

$1,618

$2,933

$4,923

$9,071

$13,889

$19,558

$24,681

$34,151

$46,117

$56,882

$68,708

$81,162

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

$300

Page 5