September 21, 2011 Re-Bath 14080 Liberty Road Montgomery, TX

September 21, 2011
Re-Bath
14080 Liberty Road
Montgomery, TX 77316
Ms. Lisa Cox
People Fund
2921 E. 17th Street
Austin, TX, USA 78702
Re: Loan Request for $200,000
Dear Ms. Cox,
With over four years of Lead Installer experience with Re-Bath, we are requesting a loan to buy our own ReBath franchise, in Texas’ Montgomery County.
Re-Bath is a franchise operation that specializes in bathroom remodels in homes that are 15 years or older. It
has been in operation for over twenty years with over 200 franchises worldwide, and is the largest bathroom
remodeling franchise in the industry.
The climate for a successful Re-Bath in Montgomery County is perfect. Montgomery County, TX is the 24th
fastest growing county in the United States. Between 1990 and 2009 90,393 houses were built in
Montgomery County. Sixty-three percent of the residential areas built between 1990 and 2009 were middle
to high income households that are due for a 15 year remodel. We will be buying an already existing
franchise store in Montgomery, TX that has an excellent reputation and has seen between 25 and 30 percent
growth from 2009 to 2011.
Our target market is owners of homes that are 15 years or older that are due for a bathroom remodel, in
addition to commercial business owners. We plan to reach this target market with focused marketing, which
you will read about in our business plan. In addition, we have a good working relationship with suppliers and
the community since the Re-Bath we are purchasing has been in operation for three years.
Re-Bath has become the largest bathroom remodeling franchise in its industry due to its convenience,
affordability, and quality products. These attributes, along with a lifetime guarantee have allowed Re-Bath to
beat out local competition and spread the word of our superior service through satisfied customers.
We are investing $15k in savings and are requesting a $200K loan from your bank. We would like seven years
to repay the loan, using the cash flow of the business. Our secondary source of repayment will be from
collateralized equipment. Our house and two vehicles, valued at $153,300.00, are offered as collateral for the
loan.
Our business plan is attached; in it you will find the information you need. If you have any questions or need
more information, please contact Mr. Matt Vonruden at (512) 367-3281.
Respectfully Submitted,
Matt Vonruden
Daniel Vonruden
1
Executive Summary
The Woodlands Re-Bath’s strategic focus will be to improve its sales, marketing and customer service functions. The goal is to
increase sales to more than $1 million in three years, while also improving the gross profit and working capital. We want to
become known as the best quality bathroom remodeling company around.
This business plan leads the way. It renews our vision and strategic focus: adding value to our target market segments in our
local market. It also provides the step-by-step plan for improving our sales, gross margin, and profitability.
This plan includes this summary, and chapters on the company, products and services, market focus, action plans and forecasts,
management team, financial plan and management and working capital.
1.1 Objectives
1.
2.
3.
Sales increasing to $1 million by June Year 3.
Improve net profitability to 28% by end of fiscal year 3.
Provide 10% of gross sales for Owner and 10% of gross sales for company.
1.2 Mission
Re-Bath is a full service remodeling company that is devoted to building the dream bathrooms of local high-end and medium
income clients.
We believe that attention to detail and customer service sets us apart from our competition. We work with the property owner
to select products that will last for the lifetime of their home and fit the needs of their family or business. To ensure
longstanding customer satisfaction, we will also continue to contact the customer even after the job has been completed.
Highlights
1,600,000
1,400,000
1,200,000
1,000,000
Sales
800,000
Gross Margin
600,000
Net Profit
400,000
200,000
0
2011
2012
2013
2014
2015
2016
2
1.3 Keys to Success
Marketing: Creating a desire for our services above all competitors is a key to our continued success, as well as
creating the perception that we are the top of the line.
Craftsmanship: No matter how good the marketing program is, poor-quality of work will destroy our base referral business. It
will also take us out of our high end market.
Communication: Our communication systems, both internally and with our customers, are the key to excellent performance projects completed on schedule, on budget and to our customers' satisfaction. We also must ensure that the customer feels
like we have been responsive to his/her every request so that we can get a good referral.
Building Material prices: In order to turn a profit, we need to have a good feel for the prices of materials in our area, and where
to get the best deals.
Company Summary
Over the past 30 years Re-Bath has become the largest bathroom remodeling franchise in the bathroom remodeling industry.
With over 200 franchise locations, this company owes its success to its innovative Dura bath SSP™ material and a quick,
affordable one stop solution to customer’s remodeling needs. Re-Bath typically services bathrooms that are 15 years old and
guarantees its products with a lifetime warranty.
2.1 Company Ownership
Re-Bath is a Limited Liability Company. Matt Vonruden and his father Daniel Vonruden will be purchasing franchise rights to
Montgomery county Texas under a Co-ownership.
The Woodlands Re-Bath was started by Jeff Housley as a Sole Proprietorship in 2009. In his one and a half years of ownership,
he has increased gross sales from $500,000 to $800,000 from 2009 to 2011. Matt Vonruden and his father, Daniel Vonruden,
will be purchasing The Woodlands Re-Bath under Co-Ownership with the intent of continuing to exploit the area for an
increased sales growth of 12% per year for the next five years.
Increased sales growth will be realized through experience and financial stability. Matt Vonruden’s four plus years of
experience working as a lead installer for Re-Bath brings experienced leadership to this business proposal. In his over four
years working for Re-Bath, he has earned the highest title of “Grade A Installer”, trained six other Re-Bath installers, and helped
build the San Antonio, TX &Texas’ Bell County Re-Baths from the ground up. Matt’s experienced will be enhanced by the
assistance of Ryan Garrod, an experienced Re-Bath installer, and, Daniel Vonruden, the Financier.
3
2.2 Company History
 In 1982, Re-Bath was founded to offer bathtub liners top homeowners interested in replacement bathtubs
through a dealer network.

In 1991, Re-Bath converted its residential dealership business to a franchise organization.

In 2000, Re-Bath is awarded its 100 franchise, making it the largest franchise in the industry.
th
th
 In 2006, Re-Bath was awarded its 200 franchise and introduced Dura bath SSP, its new proprietary sanitary-ware
surface; available in bathtub replacements, walk-in bathtubs, shower bases, wall surrounds and more.
 In 2009, Re-Bath expanded its product offerings to encompass full bathroom remodeling, including bathroom
vanities, toilets and pedestal sinks, bathroom flooring and more.
Past Performance
800,000
700,000
600,000
500,000
Sales
400,000
Gross Margin
300,000
Net Profit
200,000
100,000
0
2009
Past Performance
Sales
Gross Margin
Gross Margin %
Operating Expenses
Collection Period (days)
2010
FY 2009
$500,000
$306,827
61%
$480,303
74
2011
FY 2010
$650,000
$399,302
61%
$585,210
74
FY 2011
$800,000
$490,962
61%
$687,116
74
4
Products and Services
Am Bath, LLC, with whom the Company has an Exclusive Licensing Agreement, is the exclusive manufacturer of most of the ReBath Products. Re-Bath products include, Dura bath SSP, replacement bathtubs, walk-in bathtubs, shower bases, wall
surrounds, bathroom vanities, toilets and pedestal sinks and bathroom flooring.
The Woodlands Re-Bath is a full-service bathroom remodeling company. At present we do mostly high-end and medium income
bathroom remodels. It is our philosophy that we can offer a quality product in a timely fashion giving the customer one-on-one
service.
This includes:







Residential Bathroom Remodeling
Lake house (second home) Bathroom Remodeling
Apartment Bathroom Remodeling
Dormitory Bathroom Remodeling
HUD Project Bathroom Remodeling
Hotel and Motel Bathroom Remodeling
Green Remodeling
Market Analysis Summary
The Woodlands Re-Bath is focusing on both the commercial and residential markets of Montgomery County, with the
residential being about 83% of the overall volume of the company.
As housing prices fall, potential clients will be more apt to remodel their high-end bathrooms, rather than try to sell them.
Medium income clients will be more apt to remodel their older homes in order to increase their appeal and market value.
Market Segments Available for Bathroom
Remodeling in Montgomery TX
17%
20%
Low Income
Residential
Middle Income
Residential
25%
38%
High Income
Residential
Business Remodels
5
4.1 Market Segmentation
In an era of decreasing residential property values and relatively stable rates of personal income growth, The Woodlands ReBath is focusing on two segments of the residential remodeling market:
1) Neighborhoods where homeowners have achieved success in their careers and have room in their budget for investment in
their homes, but are not eager to incur a much higher mortgage payment by selling their house and 'buying up.' [Such targeted
neighborhoods have housing stock with room to expand and are deemed to be worth the upgrade expenditures.]
2) New build communities. Texas' Montgomery county is the 24th fastest growing county in the United States and for this
reason, The Woodlands Re-Bath will target these communities for future sales. Re-Bath intends on becoming a household
name for these communities.
About 17% of The Woodlands Re-Bath overall volume consists of remodeling projects for businesses.
Houses Built in Montgomery
County TX
26%
35%
1900-1989
1990-1999
39%
2000-2009
Houses Due for a 15 Year Remodel
in Montgomery County TX
26%
39%
35%
Due for Remodel
in 2004
Due for Remodel
in 2005
Due for Remodel
2015-2024
* Note that The Woodlands Re-Bath did not open until 2009.



1900 – 1989: 66, 135 houses were built in Montgomery County, TX.
1990 – 1999: 40,795 houses were built in Montgomery County, TX.
2000 – 2009: 49,598 houses were built in Montgomery County, TX.
6
4.2 Target Market Segment Strategy
Re-Bath’s targeted market groups were chosen because of the long-term potential for continued sales. Assuming high quality
work and effective word-of-mouth marketing, the targeted, potentially upgradeable, neighborhoods afford a continuing supply
of work to do. The business remodels, while providing a smaller portion of the firm's income, offer an important opportunity to
build relationships and generate trust with business owners and managers who have homes in the targeted ‘upgradeable'
homes.
Montgomery County Home Improvement Loans
60,000
40,000
20,000
0
1999 2000
2001 2002
2003 2004
2005 2006
2007 2008
2009
# of Loans Approved
$ Value of Loans
4.3 Service Business Analysis
As a whole, the building industry is a very fragmented industry. Despite large homebuilders, no single company has as much as
a 2% market share.
The remodeling industry is even more diluted with only a handful of companies in the nation showing annual sales in excess of
$10 million. Under the standard definition, all remodelers fall into the category of a small business.
4.3.1 Competition and Buying Patterns
The remodeling market is made up of potential customers who weigh three competing values: Price, Quality and Service. There
is a saying that a remodeling company can deliver any two of those values. A large portion of the potential customers are asking
for quality and service, and then go shopping for price. These customers are extremely difficult to work for and make a profit.
There is another segment of the market that is concerned with getting a "fair" price. Re-Bath offers its customers a lifetime
guarantee on their products and services. This guarantee will entice customers that are looking for an investment “bargain” to
choose Re-Bath as their bathroom remodelers.
7
Strategy and Implementation Summary
Re-Bath will change its focus to differentiate their services from fly-by-night contractors, improve its sales and customer service
functions and increase the amount of work received from past clients and referrals. The marketing challenge is to improve the
company's image, allowing estimators to price work more profitably, reduce or eliminate the amount of work competitively bid
for, and to raise the perceived value the client gains by hiring Re-Bath.
5.1 Sales Strategy
1. The Woodland’s Re-Bath needs to sell the company and its lifetime guarantee, not the price.
2. Re-Bath has to sell its quality, convenience and service. It is Re-Bath’s goal to install our quality products as quickly and
conveniently as possible so that our customers’ home life will not be disturbed for more than one to two days. Re-Bath’s
specially designed tub liners and bathroom enclosures ensure the installation of a quality product with convenience and well
trained service technicians.
The Yearly Total Sales chart summarizes an ambitious sales forecast. The Woodlands Re-Bath expects sales to increase
significantly from $800,000 last year.
8
5.1.1 Sales Forecast
The important elements of the sales forecast are shown in the Total Sales by Month in Year 1 chart. Total sales will increase
substantially over the next several years.
Monthly Sales
120,000.00
100,000.00
80,000.00
Residential
60,000.00
Commercial
40,000.00
Other
20,000.00
Nov.
Oct.
Sep.
Aug.
Jul.
Jun.
May
Apr.
Mar.
Feb.
Jan.
Dec.
0.00
Yearly Sales
1,600,000
1,400,000
1,200,000
Residential
1,000,000
800,000
Commercial
600,000
Other
400,000
200,000
0
2012
2013
2014
2015
2016
9
Sales Forecast
FY 2011
FY 2012
FY 2013
FY 2014
FY 2015
FY 2016
Commercial
$136,000
$152,320
$170,598
$191,070
$213,999
$239,678
Residential
$592,000
$725,760
$812,851
$910,393
$1,019,640
$1,141,997
Other
$72,000
$80,640
$90,317
$101,154
$113,293
$126,889
Total Sales
$800,000
$896,000
$1,003,520
$1,123,942
$1,258,815
$1,409,873
Absorption Cost of Sales
FY 2011
FY 2012
FY2013
FY 2014
FY 2015
FY 2016
Materials
$217,006
$243,284
$271,258
$305,165
$341,615
$382,304
Permits & Licensing
$4,608
$4,608
$4,608
$4,608
$4,608
$4,608
Sales Commission
$79,872
$89,544
$99,840
$112,320
$125,736
$140,712
Vehicle Rental & Ins.
$7,200
$7,200
$10,800
$10,800
$10,800
$10,800
Employee Benefits
$40,000
$40,000
$70,000
$70,000
$70,000
$70,000
Utilities
$23,988
$23,988
$23,988
$23,988
$23,988
$23,988
Labor Wage
$45,000
$48,000
$50,000
$55,000
$58,000
$60,000
Sales Tax
$68,000
$76,160
$85,299
$95,535
$106,999
$119,893
Franchise Tax
$8,000
$8,960
$10,035
$11,239
$12,588
$14,099
Medicare
$2,580
$2,580
$4,118
$4,118
$4,118
$4,118
Labor Commission
$79,872
$89,544
$99,840
$112,320
$125,736
$140,712
Administrative Pay
$22,800
$22,800
$22,800
$22,800
$22,800
$22,800
Loan Payment with 7.5 interest
$36,812
$36,812
$36,812
$36,812
$36,812
$36,812
Trash
$720
$720
$720
$720
$720
$720
Other
$49,992
$49,992
$49,992
$49,992
$49,992
$49,992
Subtotal Absorption Cost of
Sales
$686,450
$744,192
$840,110
$915,417
$994,512
$1,081,504
Sales
5.2 Marketing Strategy
The marketing strategy is the core of the main strategy:
1.
2.
3.
Emphasize quality, convenience and service.
Build a relationship business--treat the customers like members of the family.
Take care of the customers for the rest of their life.
5.3 Competitive Edge
The Woodlands Re-Bath’s competitive edge is its reputation in the community. Over the past five years, Re-Bath has become
the largest bathroom remodeling company in the nation. In fact, the first Re-Bath franchises will be opening this year in Ireland,
and the UK. Its satisfied customer base continues to expand and spread the word.
10
5.4 Milestones
The following table lists important program milestones, with dates and persons in charge, and budgets for each. The milestone
schedule indicates our emphasis on planning for implementation. The most important programs are the sales and marketing
programs listed in detail in the previous topics.
Milestones
Milestones
Start Date
End Date
Business Plan
Aug. 29 2011
Sept. 22
2011
$100.00
New Computer System
Nov. 1 2011
Nov. 7 2011
$800
Thank You Cards
SCORE Business Start-up
Seminar
Dec. 1 2011
Dec. 3 2011
$20
Oct. 15 2011
$0
Oct. 3 2011
Oct. 15 2011
Dec. 30
2011
Oct. 10 2011
Nov. 11
2011
Assess Current Store Location
Start Woodlands Re-Bath
Website
Budget
Manager
Rebecca
Eastman
Daniel
Vonruden
Matt
Vonruden
$0
Matt
Vonruden
Matt
Vonruden
$500
Daniel
Vonruden
Department
Contract
Co-owner
Co-owner
Co-owner
Co-owner
Co-owner
Web Plan Summary
The Woodland’s Re-Bath website will be the virtual business card and portfolio for the company, as well as its online "home."
It will showcase the construction experience within the company, as well as the portfolio of all the past and current projects
done by Re-Bath. The website will include a resources area, offering articles, research and weekly newsletters to interested
parties.
The key to the website strategy will be combining a very well designed front end, with a back end capable of recording leads
and proposal requests.
Management Summary
The Woodlands Re-Bath is a company that desires to be of service to others. Its whole existence is keyed to helping people who
have need to improve the quality of their life. Re-Bath encourages team work and cooperation in helping the customer. The
company is very loyal to its employees and provides them with the security and satisfaction to know that they are the business
and that without them the company would not exist.
11
7.1 Personnel Plan
The Personnel Plan reflects the need to bolster our capabilities to match our positioning. Our total head-count should increase
to 5 this first year, and to 8 by the third year. This reflects a ~5% growth per year.
Personnel Plan
Labor
Installation Manager
Sales (commission)
Office
Owners
Total People
Total Payroll
FY 2012
FY 2013
FY 2014
FY 2015
FY 2016
$89,544
$99,840
$112,320
$125,736
$140,712
$48,000
$50,000
$55,000
$58,000
$60,000
$89,544
$99,840
$112,320
$125,736
$140,712
$22,800
$22,800
$22,800
$22,800
$22,800
$90,808
$102,410
$140,525
$174,303
$211,186
5
7
7
7
7
$340,696
$374,890
$442,965
$506,575
$572,593
Financier:
Daniel Vonruden (Co-owner)
Profession: Senior Electrical Technician with 15 plus years’ experience.
Sales and Marketing:
Jose Leva
7 years of Sales and Marketing experience. Leva will be responsible for office staff, sale estimated, customer service
and potential service plans.
One office staff member: One full time Administrative Assistant. The Administrative assistant would be paid a salary
of $22,800.00 annually. The Salesman will work on commission that is estimated to be $89,544 the first year, $99840
the second year and $112,320 the third year. They will receive medical insurance.
Operations
Matt Vonruden
4 Plus years of operational experience as a Re-Bath installer. Vonruden will be categorized as a lead installer and
holds a plumber card.
Ryan Garrod
1 year of operational experience as a Re-bath installer, 5 years of general constriction experience, and three years of
mechanical experience.
Vonruden will be working for a minimum wage of plus 2.5 % weekly in addition to owner’s profit. Garrod will be
working as Installation Manager for $48,000 the first year, $50,000 the second year and $55,000 the third year. They
will both work Monday – Saturday, 6:00 am – 4:00pm. A 14 day training period is required before joining the
company. Employees will receive full health coverage costing, $9,998.00 per employee annually.
12
Financial Plan
The most important element in the financial plan is the critical need for improving several of the key factors that impact cash
flow:
1.
2.
The Woodlands Re-Bath must do a better job of collecting deposits and asking for (demanding) prompt payment from
the customers.
We must bring the gross margin up to 61%. This is related to improving the marketing program which will generate
higher quality leads and jobs.
8.1 Important Assumptions
The financial plan depends on important assumptions, most of which are shown in the General Assumptions table below. The
key underlying assumptions are:



A slow-growth economy, without major recession.
There are no unforeseen changes in technology to make our services immediately obsolete (very unlikely).
We assume access to equity capital and financing sufficient to maintain our financial plan as shown in the tables.
General Assumptions
Plan Month
Current Interest Rate
Long-term Interest Rate
Tax Rate
Other
FY 2012
FY 2013
FY 2014
FY 2015
FY 2016
1
2
3
4
5
7.50%
7.50%
7.50%
7.50%
7.50%
10.00%
10.00%
10.00%
10.00%
10.00%
25.00%
25.00%
25.00%
25.00%
25.00%
0
0
0
0
0
8.2 Projected Profit and Loss
The most important assumption in the Projected Profit and Loss statement is the gross margin, which is supposed to increase,
up quite a bit from the last year. The increase in gross margin is based on changing our sales mix due to increased target
marketing based on 5% assumptions between years.
Profit
$500,000
$0
FY 2012 FY 2013
FY 2014 FY 2015
FY 2016
13
Pro Forma Profit and Loss
Sales
Absorption Cost of Sales
Other Cost of Goods
Total Cost of Sales
Gross Margin
Gross Margin %
Expenses
Payroll
Advertising
Marketing
Sales Tax
Bad Credit
Donations
Marketing
Entertainment
Employee Benefits
Equipment Rental
Bank Interest
Tool Repair / Replacement
Computer Hardware
Other
Dues/Sub./Licenses
Depreciation
Franchise Tax
Legal Expenses
Accounting Expenses
Rent Office / Warehouse
Repairs / Maintenance
Utilities
Office Expenses
Employee Liability Insurance
Vehicle Expenses / Insurance
Insurance (general)
Payroll Taxes
Total Operating Expenses
Profit Before Interest & Taxes
Net Profit
Net Profit / Sales
FY 2012
FY 2013
FY 2014
FY 2015
FY 2016
$896,000
$1,003,520
$1,123,942
$1,258,815
$1,409,873
$744,192
$840,110
$915,417
$994,512
$1,081,504
$0
$0
$0
$0
$0
$744,192
$840,110
$915,417
$994,512
$1,081,504
$550,085
$616,625
$690,041
$773,087
$867,497
61.39%
61.45%
61.39%
61.41%
61.53%
$340,696
$374,890
$442,965
$506,575
$572,593
$6,000
$4,000
$4,000
$4,000
$5,000
$0
$0
$0
$0
$0
$76,160
$85,299
$95,535
$106,999
$119,839
FY 2012
FY 2013
FY 2014
FY 2015
FY 2016
$12,210
$12,210
$12,210
$12,210
$12,210
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$40,000
$70,000
$70,000
$70,000
$70,000
$3,000
$3,000
$3,000
$3,000
$3,000
$13,951.27
$12,176.55
$10,264.05
$8,203.06
$5,982.10
$500
$500
$500
$500
$500
$800
$100
$100
$500
$100
$61,000
$61,000
$68,000
$90,000
$120,000
$4,608
$4,608
$4,608
$4,608
$4,608
$8,498
$9,884
$13,937
$17,208
$19,988
$8,960
$10,035
$11,239
$12,588
$14,099
$0
$0
$0
$0
$0
$2,331
$2,453
$2,582
$2,718
$2,861
$10,800
$10,800
$10,800
$10,800
$10,800
$1,137
$1,197
$1,260
$1,326
$1,396
$7,200
$7,200
$7,200
$7,200
$7,200
$4,208
$4,430
$4,450
$4,820
$5,139
$2,689
$3,756
$3,756
$3,756
$3,756
$7,200
$7,200
$7,200
$7,200
$7,200
$1,000
$1,000
$1,000
$1,000
$1,000
$64,271
$69,742
$81,704
$95,452
$110,814
$670,209
$745,771
$849,350
$964,253
$1,091,675
$99,163
$109,959
$142,035
$175,954
$211,186
$99,163
$109,959
$142,035
$175,954
$211,186
11.06%
10.96%
12.64%
13.98%
14.98%
14
8.4 Projected Cash Flow
The cash flow depends on assumptions for payment days and accounts receivable management. The projected 75-day
collection days are critical, and it is also reasonable.
Pro Forma Cash Flow
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
New Long - Term Liabilities
Sale of Other Current Assets
Sale of Long - Term Assets
New Investments Received
Subtotal Cash Received
Expenditures
Expenditures from Operations
Cash Spending
Bill Payments
Subtotal Spent on Operations
Additional Cash Spent
Sales Tax, VAT, HST/GST Received
Principle Repayment on Current
Borrowing
Other Liabilities Principle Payment
Purchase Other Current Assets
Dividends
Subtotal Cash Spent
Net Cash Flow
Cash Balance
FY 2012
FY 2013
FY 2014
FY 2015
FY 2016
$447,720
$501,760
$561,971
$629,408
$704,937
$447,720
$501,760
$561,971
$629,408
$704,937
$896,000
$1,003,520
$1,123,942
$1,258,815
$1,409,873
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$896,000
$1,003,520
$1,123,942
$1,258,815
$1,409,873
FY 2012
FY 2013
FY 2014
FY 2015
FY 2016
$178,207
$136,318
$223,534
$250,234
$280,038
$670,209
$745,771
$849,350
$964,253
$1,091,675
$848,416
$882,089
$1,072,884
$1,214,469
$1,371,713
$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
$848,416
$882,089
$1,072,884
$1,214,469
$1,371,713
$47,584
$121,431
$51,058
$44,346
$38,160
$161,747
$246,390
$208,093
$235,300
$264,346
15
8.5 Projected Balance Sheet
The Projected Balance Sheet is quite solid. We do not project any real trouble meeting our debt obligations--as long as we can
achieve our specific objectives.
8.6 Business Ratios
The table follows with our main business ratios. We do intend to improve gross profit and collection days.
8.7 Long-term Plan
The long-term plan is shown in the Appendix.
Appendix
Sales Forecast
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
$3,237 $3,699 $5,780 $11,098 $16,416 $20,116 $19,884 $16,647 $12,486
$9,249
$6,705
$6,474
Sales
Commercial
Residential
Other
Total Sales
$73,410 $76,879 $77,746 $89,884 $96,243 $101,156 $99,711 $109,827 $111,850 $119,075 $116,301 $116,532
$151
$151
$151
$151
$151
$151
$151
$151
$2,900
$3,587
$151
$151
$76,798 $80,729 $83,677 $101,133 $112,810 $121,423 $119,746 $126,625 $127,236 $131,911 $123,157 $123,157
16
Direct Cost of Sales
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Materials
$13,056 $13,724 $14,225 $17,193 $19,178 $20,642 $20,357 $21,526 $21,630 $22,425 $20,937 $20,937
Sub-Contractor Costs
$26,879 $28,255 $29,287 $35,397 $39,484 $42,498 $41,911 $44,319 $44,533 $46,169 $43,105 $43,105
Permits & Licensing
$282
$282
$282
$282
$282
$282
$282
$282
$282
$282
$282
$282
Sales Costs
w/commission
$484
$509
$527
$637
$711
$765
$754
$798
$802
$831
$776
$776
Warranties
$377
$385
$393
$401
$409
$417
$425
$434
$443
$452
$461
$470
Trash
$530
$530
$530
$530
$530
$530
$530
$530
$530
$530
$530
$530
Other
$161
$161
$161
$161
$161
$161
$161
$161
$161
$161
$161
$161
Subtotal Direct Cost of
Sales
$41,769 $43,846 $45,406 $54,601 $60,754 $65,295 $64,421 $68,050 $68,381 $70,850 $66,252 $66,261
Personnel Plan
Dec
Labor
Prod. Manager
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
$14,986 $14,986 $14,986 $14,986 $14,986 $14,986 $14,986 $14,986 $14,986 $14,985 $14,985 $14,985
$3,153
$3,153
$3,153
$3,153
$3,153
$3,153
$3,153
$3,153
$3,153
$3,154
$3,154
$3,154
17
Design
$887
$887
$887
$887
$887
$887
$887
$888
$888
$888
$888
$888
Prod Mgr. (office)
$773
$773
$773
$773
$773
$773
$773
$773
$773
$773
$773
$773
Sales (salaried/draw)
$712
$713
$713
$713
$713
$713
$713
$713
$713
$713
$713
$713
Office
$3,555
$3,555
$3,555
$3,555
$3,555
$3,555
$3,555
$3,555
$3,555
$3,555
$3,555
$3,555
Owners
$6,500
$6,500
$6,500
$6,500
$6,500
$6,500
$6,500
$6,500
$6,500
$6,500
$6,500
$6,500
12
12
12
12
1
12
12
12
12
12
12
12
Total People
Total Payroll
$30,566 $30,567 $30,567 $30,567 $30,567 $30,567 $30,567 $30,568 $30,568 $30,568 $30,568 $30,568
General Assumptions
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
1
2
3
4
5
6
7
8
9
10
11
12
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
7.00%
Long-term Interest
Rate
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
Tax Rate
25.00%
25.00%
25.00%
25.00%
25.00%
25.00%
25.00%
25.00%
25.00%
25.00%
25.00%
25.00%
Plan Month
Current Interest
Rate
18
Other
0
0
0
0
0
0
0
0
0
0
0
Sep
Oct
0
Pro Forma Profit and Loss
Dec
Sales
Direct Cost of Sales
Other Costs of Goods
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Nov
76,798 80,729 83,677 101,133 112,810 121,423 119,746 $126,625 $127,236 $131,911 $123,157 $123,157
$41,769 $43,846 $45,406 $54,601 $60,754 $65,295 $64,421 $68,050 $68,381 $70,850 $66,252 $66,261
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Total Cost of Sales
41,769 43,846 45,406 $54,601 $60,754 $65,295 $64,421 $68,050 $68,381 $70,850 $66,252 $66,261
Gross Margin
35,029 36,883 38,271 $46,532 $52,056 $56,128 $55,325 $58,575 $58,855 $61,061 $56,905 $56,896
Gross Margin %
45.61% 45.69% 45.74% 46.01% 46.14% 46.22% 46.20%
46.26%
46.26%
46.29%
46.21%
46.20%
Expenses
Payroll
30,566 30,567 30,567 $30,567 $30,567 $30,567 $30,567 $30,568 $30,568 $30,568 $30,568 $30,568
Advertising
$556
$612
$673
$740
$814
$895
$985
$1,084
$1,192
$1,311
$1,442
$1,586
Depreciation
$738
$738
$738
$738
$738
$738
$738
$738
$738
$738
$738
$738
Marketing
$643
$707
$778
$856
$942 $1,036 $1,140
$1,254
$1,379
$1,517
$1,669
$1,836
19
Bad Debts
$187
$187
$187
$187
$187
$187
$187
$187
$187
$187
$187
$187
Donations
$197
$197
$197
$197
$197
$197
$197
$197
$197
$197
$197
$197
Entertainment 50%
$175
$175
$175
$175
$175
$175
$175
$175
$175
$175
$175
$175
$4,129 $4,335 $4,552 $4,780 $5,019 $5,270 $5,534
$5,811
$6,102
$6,407
$6,727
$7,063
Employee Benefits
Equipment Buy/Rental
$244
$256
$269
$282
$296
$311
$327
$343
$360
$378
$397
$417
Interest/Bank Charges
($17)
($17)
($17)
($17)
($17)
($17)
($17)
($17)
($17)
($17)
($17)
($17)
Tool Repair/Replacement
$230
$230
$230
$230
$230
$230
$230
$230
$230
$230
$230
$230
Computer/Hardware/Software
Consultants
$541
$568
$596
$626
$657
$690
$724
$760
$798
$838
$880
$924
Dues/Sub/Licenses/Royalties/Trade
Assoc.
$237
$237
$237
$237
$237
$237
$237
$237
$237
$237
$237
$237
Corp & Business Taxes
$175
$175
$175
$175
$175
$175
$175
$175
$175
$175
$175
$175
Legal Expenses
$109
$109
$109
$109
$109
$109
$109
$109
$109
$109
$109
$109
Accounting Expenses
$194
$194
$194
$194
$194
$194
$194
$194
$194
$194
$194
$194
$1,210 $1,210 $1,210 $1,210 $1,210 $1,210 $1,210
$1,210
$1,210
$1,210
$1,210
$1,210
$95
$95
$95
$95
$95
Rent of Office/Warehouse Space
Repairs/Maintenance
$95
$95
$95
$95
$95
$95
$95
20
Communications
$780
$780
$780
$780
$780
$780
$780
$780
$780
$780
$780
$780
$77
$77
$77
$77
$77
$77
$77
$77
$77
$77
$77
$77
Office Expenses
$701
$701
$701
$701
$701
$701
$701
$701
$701
$701
$701
$701
Miscellaneous/Other
$382
$382
$382
$382
$382
$382
$382
$382
$382
$382
$382
$382
Liability Insurance
$626
$626
$626
$626
$626
$626
$626
$626
$626
$626
$626
$626
Vehicle Expenses & Insurance
$866
$866
$866
$866
$866
$866
$866
$866
$866
$866
$866
$866
$42
$42
$42
$42
$42
$42
$42
$42
$42
$42
$42
$42
$337
$337
$337
$337
$337
$337
$337
$337
$337
$337
$337
$337
$85
$85
$85
$85
$85
$85
$85
$85
$85
$85
$85
$85
Payroll Taxes
$5,471 $5,472 $5,472 $5,472 $5,472 $5,472 $5,472
$5,472
$5,472
$5,472
$5,472
$5,472
Total Operating Expenses
49,578 49,944 50,334 $50,750 $51,194 $51,668 $52,176 $52,719 $53,298 $53,918 $54,582 $55,293
Utilities
Liability Insurance for employees
Vehicle Expenses & Insurance
Insurance - General (#43)
Profit Before Interest and Taxes
(14549) (13061) (12062) ($4,217)
$862 $4,460 $3,150
$5,856
$5,557
$7,143
$2,323
$1,603
EBITDA
(13811) (12323) (11324) ($3,479) $1,600 $5,198 $3,888
$6,594
$6,295
$7,881
$3,061
$2,341
$0
$0
$0
$0
$0
Interest Expense
$0
$0
$0
$0
$0
$0
$0
21
Taxes Incurred
$0
Net Profit
Net Profit/Sales
$0
$0
$0
$0
$0
$0
(14549) (13061) (12062)
(4,217)
862
4,460
3,150
-18.9% -16.2% -14.4%
-4.2%
0.76%
3.67%
2.63%
May
Jun
$0
$0
$0
$0
$0
5,557
7,143
2,323
1,603
4.62%
4.37%
5.42%
1.89%
1.30%
Jul
Aug
Sep
Oct
Nov
5,856
Pro Forma Cash Flow
Dec
Jan
Feb
Mar
Apr
Cash Sales
$19,200 $20,182 $20,919
$25,283
$28,203
$30,356 $29,937 $31,656 $31,809 $32,978 $30,789 $30,789
Cash from
Receivables
$294,000 $294,000 $177,719
$59,171
$61,726
$69,740 $80,521 $88,053 $90,396 $92,561 $95,213 $97,297
Subtotal Cash from
Operations
$313,200 $314,182 $198,638 $84,454
Cash Received
Cash from
Operations
$89,928 $100,096 $110,457 $119,709 $122,205 $125,539 $126,002 $128,086
Additional Cash
Received
Sales Tax, VAT,
HST/GST Received
New Current
0.00%
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
22
Borrowing
New Other Liabilities
(interest-free)
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
New Long-term
Liabilities
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Sales of Other
Current Assets
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Sales of Long-term
Assets
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
New Investment
Received
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Subtotal Cash
Received
Expenditures
$313,200 $314,182 $198,638 $84,454
Dec
Jan
$89,928 $100,096 $110,457 $119,709 $122,205 $125,539 $126,002 $128,086
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Cash Spending
$30,566 $30,567 $30,567
$30,567
$30,567
$30,567 $30,567 $30,568 $30,568 $30,568 $30,568 $30,568
Bill Payments
$71,721 $60,124 $62,550
$64,755
$74,265
$80,810 $85,646 $85,430 $89,493 $90,475 $93,331 $89,552
Expenditures from
Operations
Subtotal Spent on
Operations
$102,288 $90,691 $93,117
$95,322 $104,832 $111,377 $116,213 $115,998 $120,061 $121,044 $123,899 $120,120
Additional Cash
23
Spent
Sales Tax, VAT,
HST/GST Paid Out
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Principal Repayment
of Current Borrowing
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Other Liabilities
Principal Repayment
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Long-term Liabilities
Principal Repayment
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Purchase Other
Current Assets
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Purchase Long-term
Assets
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Dividends
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Subtotal Cash Spent
$102,288 $90,691 $93,117
$95,322 $104,832 $111,377 $116,213 $115,998 $120,061 $121,044 $123,899 $120,120
Net Cash Flow
$210,912 $223,491 $105,522 ($10,868) ($14,904) ($11,281) ($5,756)
Cash Balance
$394,340 $617,831 $723,353 $712,485 $697,581 $686,300 $680,544 $684,255 $686,399 $690,894 $692,997 $700,964
$3,710
$2,144
$4,495
$2,103
$7,967
We recommend using Business Plan Pro as the easiest way to create automatic financials for your own business plan.
Pro Forma Balance Sheet
24
Dec
Assets
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Starting
Balances
Current
Assets
Cash
$183,428 $394,340 $617,831 723,353 712,485 $697,581 $686,300 $680,544 $684,255 $686,399 $690,894 $692,997 $700,964
Accounts
Receivable
$735,000 $498,599 $265,145 150,184 166,863 $189,744 $211,071 $220,360 $227,276 $232,307 $238,679 $235,834 $230,904
Other
Current
Assets
$31,380
$31,380
$31,380 $31,380 $31,380
$31,380
$31,380
$31,380
$31,380
$31,380
$31,380
$31,380
$31,380
Total Current
$949,808 $924,318 $914,356 904,916 910,728 $918,705 $928,751 $932,284 $942,911 $950,086 $960,953 $960,211 $963,249
Assets
Long-term
Assets
Long-term
Assets
$145,879 $145,879 $145,879 145,879 145,879 $145,879 $145,879 $145,879 $145,879 $145,879 $145,879 $145,879 $145,879
Accumulated
Depreciation
$56,879
$57,617
$58,355 $59,093 $59,831
$60,569
$61,307
$62,045
$62,783
$63,521
$64,259
$64,997
$65,735
Total Longterm Assets
$89,000
$88,262
$87,524 $86,786 $86,048
$85,310
$84,572
$83,834
$83,096
$82,358
$81,620
$80,882
$80,144
Total Assets
1,038,808 1,012,580 1,001,880 991,702 996,776 1,004,015 1,013,323 1,016,118 1,026,007 1,032,444 1,042,573 1,041,093 1,043,393
25
Liabilities
and Capital
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
$60,402 $62,286 $71,577
$77,955
$82,803
$82,448
$86,481
$87,360
$90,347
$86,543
$87,239
Current
Liabilities
Accounts
Payable
$69,720
$58,041
Current
Borrowing
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Other
Current
Liabilities
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Subtotal
Current
Liabilities
$69,720
$58,041
$60,402 $62,286 $71,577
$77,955
$82,803
$82,448
$86,481
$87,360
$90,347
$86,543
$87,239
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Total
Liabilities
$69,720
$58,041
$60,402 $62,286 $71,577
$77,955
$82,803
$82,448
$86,481
$87,360
$90,347
$86,543
$87,239
Paid-in
Capital
$20,000
$20,000
$20,000 $20,000 $20,000
$20,000
$20,000
$20,000
$20,000
$20,000
$20,000
$20,000
$20,000
Long-term
Liabilities
$0
$0
Retained
Earnings
$949,088 $949,088 $949,088 949,088 949,088 $949,088 $949,088 $949,088 $949,088 $949,088 $949,088 $949,088 $949,088
Earnings
$0 ($14,549) ($27,610) (39,672) (43,889) ($43,027) ($38,567) ($35,418) ($29,562) ($24,004) ($16,861) ($14,538) ($12,935)
26
Total Capital $969,088 $954,539 $941,478 929,416 925,199 $926,061 $930,521 $933,670 $939,526 $945,084 $952,227 $954,550 $956,153
Total
Liabilities
and Capital
1,038,808 1,012,580 1,001,880 991,702 996,776 1,004,015 1,013,323 1,016,118 1,026,007 1,032,444 1,042,573 1,041,093 1,043,393
Net Worth
$969,088 $954,539 $941,478 929,416 925,199 $926,061 $930,521 $933,670 $939,526 $945,084 $952,227 $954,550 $956,153
Long-term
FY 2009
Sales
FY 2010
FY 2011
FY 2012
FY 2013
FY 2014
FY 2015
FY 2016
FY 2017
FY 2018
$1,328,403 $1,496,903 $1,666,998 $1,822,098 $1,982,202 $1,995,000 $2,024,925 $2,055,299 $2,086,128 $2,117,420
Cost of Sales
$715,885
$805,135
$895,541
$978,094 $1,063,327 $1,057,350 $1,073,210 $1,089,308 $1,105,648 $1,122,233
Gross Margin
$612,517
$691,768
$771,457
$844,004
$918,875
$937,650
$951,715
$965,990
$980,480
$995,188
46.11%
46.21%
46.28%
46.32%
46.36%
47.00%
47.00%
47.00%
47.00%
47.00%
Operating Expenses
$625,452
$668,161
$703,328
$740,345
$779,309
$778,050
$789,721
$801,567
$813,590
$825,794
Operating Income
($12,935)
$23,607
$68,129
$103,658
$139,566
$159,600
$161,994
$164,424
$166,890
$169,394
Net Income
($12,935)
$17,705
$51,097
$77,744
Current Assets
$963,249
Gross Margin %
$104,675 $1,321,466 $1,453,613 $1,598,974 $1,758,872 $1,934,759
$989,191 $1,059,473 $1,156,141 $1,280,569 $1,283,130 $1,285,696 $1,288,267 $1,290,844 $1,293,426
27
Long-term Assets
$80,144
$70,822
$61,009
$50,680
$39,807
$36,031
$39,634
$43,598
$47,958
$52,753
Current Liabilities
$87,239
$86,155
$95,527
$104,122
$113,002
$92,950
$102,245
$112,470
$123,716
$136,088
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Long-term Liabilities
Equity
$956,153
$973,858 $1,024,955 $1,102,699 $1,207,374 $1,226,211 $1,223,085 $1,219,396 $1,215,085 $1,210,091
28