Po·Go Eyewear

Business Plan

William Kinzel 501 Washington St. #27 Walla Walla, WA 99362 (509) 301-8907 bkinzel@lycos.com

Executive Summary
The time is excellent to introduce non-prescription eyewear as a fashion accessory. In a recent study 46% of Americans said that they would wear glasses as an accessory. No longer are glasses associated with being “geeky.” Consumers want to look more intelligent for an interview, more playful for an outing, or more glamorous for an evening on the town. All of these looks can easily and affordably be accomplished with Pogo’s non-prescription eyewear. There is no easier way to alter your appearance than to put on a pair of glasses. Americans are aware of this fact, but up until now there have been few nonprescription choices. The only option is to visit your local optometrist and sort through hundreds of frames. Then you have to battle the pushy salespeople and pay prices often exceeding $200. Finally, you must wait for your order to be processed which can take up to a month. At Pogo we want to change all of that. We want to allow consumers to make an easy stop at our website where they can view free video tutorials regarding fashion and how to select frame designs and colors based on their own physical features. Our glasses will be sold affordable at less than $30 and will include a stylish carrying case and will be shipped the same day. Our selection will be limited to 20 to 40 of the most current and fashionable styles which will ease the decision making process for consumers. Our glasses represent a great gift giving opportunity, and are priced to allow consumers to own 2, 3, or 4 pairs. All of this will be supported by 1-800 customer service and a 30 day money back guarantee. Pogo’s goal is to be the frontrunner in bringing fashionable and affordable non-prescription eyewear to America. Mission: To provide stylish eyewear at an affordable price to consumers who want to augment their appearance with glasses but do not need prescription lenses. We can and will make well considered sacrifices on quality, and service to make sure that our product is priced as reasonably as possible. Keys to Success: Current, functional, and attractive ecommerce website Pervasive and memorable branding program Targeting prices between $10 and $30 Building a strong association with fashion through public relations, participation in events, viral marketing, and press coverage. Promptly shipping orders and processing returned products

Financial Highlights We expect to reach over $380,000 in sales in the first year and around 1.7 million in the second year. Operations should be profitable within the first few months of start up. In year two we forecast operating income to exceed $430,000.
Year 1 Financial Forecast
$90,000 $80,000 $70,000 $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 ($10,000) January February March April May Operating Income Gross Revenue

June

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August

September

October

November

In order to fund the start up Pogo Eyewear needs a total capital investment of $164,000. We are seeking an equity investment from outside investors. In exchange they will receive a 65% ownership stake in the corporation. Investors should be able to liquidate their investments within a 2 to 3 year time horizon with a share repurchase program or outright sale of the business. Projected return on investment ranges from 52% under the share repurchase program to 150% in an outright sale situation.

December

I. General Business Description
Pogo Eyewear will be in the business of retailing non-prescription optical grade eyewear to consumers throughout the world. Our mission is to provide quality stylish eyewear to those consumers who desire to augment their appearance with glasses but do not need prescription lenses. Initially we will market our products exclusively online through our website. In the future we plan to expand distribution to independent accessory shops and select national chains. Our products are designed to be a fashion accessory rather than a medical device and will be priced to retail between $10 and $30. According to a recent study conducted by Essilor of America1 46% of Americans would consider wearing eyeglasses as an accessory even if they didn’t need them. Our goal is to provide this market with an easily accessible and affordable product. Because this market is relatively undeveloped there is little evidence to support initial annual sales volumes. So far there has been no concerted attempt that we know of to market glasses solely as an accessory. At Pogo our business philosophy will be to sell fun. We want to breakaway our product from the traditional classification as a medical device and brand it in our customer’s minds as a hip and fashionable accessory. Our products will be designed and priced so that customers can affordably own a variety of styles and colors of frames to compliment their wardrobe. Our target market will initially be limited to women, but may be extended to include men in the future as demand warrants. Customers will include individuals in any age bracket who desire to augment their appearance with glasses. Our primary target market will be limited though to women ages 16 to 40. In the long term we see this as a growth industry. Pogo Eyewear hopes to be the first major brand to market. Our goal is to define the market for fashion optical eyewear much like Kleenex and tissue, Fossil and fashion watches, as well as Crocs and clogs footwear.

1

(http://www.beauty.about.com/cs/maybeauty/a/revealglasses.htm)

II. Products
Our frame offerings will fall under three different categories: Intelligence, Fun, and Glamour. Each category will contain five to ten different frame designs and each frame will be offered in a variety of different colors and finishes. Frames will be of high quality that consumers would expect to receive from a traditional optometrist. We will offer a variety of both metal and acetate (plastic) frames which will all come preinstalled with clear polycarbonate lenses. In addition to the three frame categories listed above we will offer a “customizable” frame package that will include a basic plastic frame with a package of adornments such as jewels and crystals. Consumers will have the ability to create their own customized designs by affixing the jewels to the basic frame. This will make a great gift idea. The average optometrist’s office carries over 1,500 frames. Many of these countless frames are very similar in style and features. At Pogo we will focus on less than 50 of the most popular designs in order to make the frame selection process more fun and less stressful. Each frame will carry an unconditional money back guarantee and will be offered in small, medium, and large sizes. If customers are unsatisfied with their glasses they will have the option returning them for a full refund or exchange. Since our products are optical grade our customers will be able to have them adjusted at their local optometrist if needed. Consumers will have the opportunity to select various style and color combinations from our website and place orders in real time. Due to compact packaging, shipping charges will be kept to a minimum. Glasses will ship with a very stylish case that will be embossed with various logos and designs.

III. Marketing Plan
Product Men and women alike are constantly looking for ways to make themselves look and feel better. Whether it’s working out at the gym, buying a new dress, or having a makeover there is no doubt that our generation places a high value on appearance. Whether or not you wear glasses plays a large role in ones appearance. In the past glasses were often associated with being overly brainy. Now though glasses have evolved into a fashion statement for those who need them. What about those who don’t? Based on our research there is a growing interest in using non-prescription glasses to alter your appearance. After all, what faster and easier way is there to alter your appearance than to put on a pair of glasses? In a recent study conducted by Essilor of America it was revealed that 46% of Americans representing over 130 million people would wear non-prescription eyeglasses as an accessory. Despite the clear demand for this product there are few if any (see bleudame.com) companies who are focusing on this market. These consumers could easily visit their local optometrist and purchase a pair of frames with non-prescription lenses, but choose not to for a variety of reasons. This is because the optometrists are not selling the right product, in the right place, with proper promotion and sales techniques. At Pogo Eyewear our plan is to make non-prescription glasses available to everyone with catchy advertising, hip styles, and ease of purchasing. Pogo will breakaway from the established norms of the current eyewear market and establish something that is altogether new, fresh, and appealing to consumers. Below are some interesting statistics regarding eyewear. 40% of respondents view people who wear glasses as smart 25% of respondents stated that wearing out of date clothing would ruin your appearance. 22% of respondents stated that wearing out of date glasses would ruin your appearance Consumers are not afraid of purchasing glasses online. Within one year of startup eyeglass.com was receiving over 6,000 hits per day. Research conducted by eyeglass.com has revealed that the typical eyeglass wearer is dissatisfied with the current system of buying glasses.2

2

(http://eyeglass.com/noname26.html)

Customers There is a demand throughout many demographic groups for non-prescription eyewear that is worn for fashion at a reasonable price. Interest is highest among a few select groups who place high importance on fashion and appearance. Because of this fact we feel it is prudent to begin by targeting these consumers before expanding our reach to less receptive demographics. To begin with we will target females aged 16 to 40. Because our product will be sold through pogoeyes.com it will be available to anyone in the world, but we will be specifically targeting US residents. According to the Census Bureau there are approximately 51 million females aged 15 to 40 in the United States. We will not segregate our customers based on income or education levels because people rich and poor, educated or not have a desire to “look good.” In addition we have adopted a pricing strategy that makes our product affordable to all but the most impoverished families which should make economic status generally a non-issue. For the same reasons we will not segment our market based on marital status. In the future we may expand our target demographic to include men as well as older women. It should be noted that the purchasers of our product will not always be the end consumer. One of our strategies will be to position Pogo Eyewear as a very “giftable” product. As such we will develop marketing strategies to target gift givers such as children, coworkers, and spouses. Competition At this time we have been unable to identify any direct competition to our planned business model although we will compete with other companies indirectly. We will compete indirectly with prescription frame manufacturers/wholesalers who distribute their products through optometrists and national chains. Examples of these indirect competitors include Safilo and Marchon. In reality few if any consumers will make a direct comparison between our products. It would be like comparing a Timex to a Rolex. Sure both products tell time, but they are so differentiated in terms of price, distribution, and brand imaging that few consumers would seriously consider both a Timex and Rolex as comparable products. Below is a table that includes a competitive analysis of Pogo Eyewear. Niche Pogo Eyewear is unique in that we do not seek to occupy a small niche within a larger market. Rather we seek to define the entire market for non-prescription eyewear. We will offer products delivered with a brand image that is so pervasive that Pogo and non-prescription eyewear will become synonymous.

Promotional Strategy The single most important aspect of Pogo Eyewear will be our promotional strategy. Our strategy is founded based on “Breakaway” positioning. The idea is to breakaway non-prescription glasses from their current association with medical devices and to reclassify them as a fashion accessory. The essence of this strategy is based on building a very strong brand that consumers will associate exclusively with the non-prescription eyewear industry. The Harvard Business Review (HBR) cites many notable success stories of Breakaway Positioning3 including: The Simpsons, Swatch, and EZ-Squirt Ketchup. Here are three outstanding examples of a business taking a product that was stagnant (cartoons, watches, and ketchup) and returning in to a period of growth by redefining it in consumers minds (cartoons for adults, watches for fun, craft food). According to HBR, after implementing a Breakaway strategy consumers no longer “see the breakaway product as simply an alternative to others in its category, consumers will perceive it as altogether different.” In order to accomplish the breakaway strategy you must alter the marketing mix as a way to distance the product from its old class and associate it with a new one in consumer’s minds. There are many tools that can be used in order to execute a Breakaway strategy. Our plan will be focused around three main areas: brand building and protection, viral marketing, and providing value to our customers by offering tips, tutorials, and other fashion and beauty information. Brand Building and Protection One of our first tasks is to develop the logo and packaging that will be associated with Pogo Eyewear products, materials, and web content. Once we have the initial branding package completed we will develop awareness through selective online advertising. We will protect our images, and trademarks, by filing them with the appropriate legal authorities. Our unique brand will establish Pogo eyewear as distinct in consumer’s minds from traditional eyewear. Viral Marketing Pogo will utilize online networks, blogs, and discussion groups in order to develop brand awareness. In addition we will offer free product samples to opinion leaders (actors, the media, etc.) who will present a positive image of our products in the community. We will seek to place our product in features or segments in mass media such as news shows and magazine articles. In addition, we will develop promotional videos which will draw attention to our brand through channels such as YouTube and our website pogoeyes.com Customer Value Once potential customers reach our website we don’t just want to sell them a product. Instead we want to offer our customers tips, advice, and information that
3

Moon, Youngme “Break Free from the Product Lifecycle.” Harvard Business Review May 2005: 87-94

will be of value to them in regards to fashion and beauty in general. Our information will emphasize how adding glasses to your wardrobe can dramatically improve your appearance. Glasses can add sophistication, playfulness, or glamour to your look. Our website will also have specific video tutorials that cover topics related to eyeglass selection. We will have tutorials to cover topics such as face shapes, eyeglass materials, and eyeglass colors. Consumers will have the opportunity to learn how our various products may suit their specific features. Pricing Part of our Breakaway strategy is to differentiate the Pogo product based on price. Traditionally if you wanted to purchase a set of non-prescription eyeglasses you would visit an optometrist and place an order for prescription frames with non-prescription lenses. These frames are generally priced from $100 to $300 per pair with notion that most customers will be billing their insurance. This pricing strategy is not conducive to owning eyeglasses as a fashion accessory for the majority of people. Few people can afford to spend hundreds or thousands of dollars on eyeglasses as a fashion accessory. Our plan is to make non-prescription glasses available to middle and lower income individuals. Our products will be priced to retail between $10 and $30 a pair which will include a high quality case. At this price we hope to allow our customers to add 2, 3, or 4 pairs of Pogos to their wardrobes. Distribution Channels Another way for Pogo Eyewear to differentiate its products is with distribution. Traditionally non-prescription glasses have been distributed alongside prescription glasses in optometrist’s offices and national eyewear chains. This distribution method is outdated and inefficient. In this setting consumers often feel pressured by commissioned salespeople. In addition consumers don’t have a chance to fully consider how a specific frame or color may fit into their wardrobe leaving them with a pair of expensive frames that they later regret purchasing. Pogo’s products will be distributed entirely through our website. Our website will provide a rich shopping environment offering customers tips and advice on how to properly select glasses for fashion. Consumers can make their purchasing decisions based on what they like, not what a salesperson pushes to them. Our customers are invited to take as long as necessary to make their buying decisions and will be able to create and save shopping carts and wish lists so that they can return later to shop and complete their purchases. Once the Pogo brand and customer base are developed (1 – 2 years) we plan to expand distribution to independently owned and regional shops and boutiques. In

the future we also may explore distribution with national chains that exemplify our dedication to affordable fashion. Sales Forecast
Low 1 2 3 4 5 6 7 8 9 10 11 12 Year 1 1 2 3 4 5 6 7 8 9 10 11 12 Year 2 Quantity 100 500 550 550 650 750 1125 1125 1125 1125 1875 3000 12475 3750 3000 3750 3938 4500 5250 6000 6000 6000 6000 6750 7500 62437.5 $$$ $2,049 $10,245 $11,270 $11,270 $13,319 $15,368 $23,051 $23,051 $23,051 $23,051 $38,419 $61,470 $255,613 $76,838 $61,470 $76,838 $80,679 $92,205 $107,573 $122,940 $122,940 $122,940 $122,940 $138,308 $153,675 $1,279,344 Plan Quantity $$$ 200 $4,098 1000 $20,490 1100 $22,539 1100 $22,539 1300 $26,637 1500 $30,735 1500 $30,735 1500 $30,735 1500 $30,735 1500 $30,735 2500 $51,225 4000 $81,960 18700 $383,163 5000 4000 5000 5250 6000 7000 8000 8000 8000 8000 9000 10000 83250 $102,450 $81,960 $102,450 $107,573 $122,940 $143,430 $163,920 $163,920 $163,920 $163,920 $184,410 $204,900 $1,705,793 High Quantity $$$ 350 $7,172 1500 $30,735 1650 $33,809 1650 $33,809 1950 $39,956 2250 $46,103 2250 $46,103 2250 $46,103 2250 $46,103 2250 $46,103 3750 $76,838 6000 $122,940 28100 $575,769 7500 6000 7500 7875 9000 10500 12000 12000 12000 12000 13500 15000 124875 $153,675 $122,940 $153,675 $161,359 $184,410 $215,145 $245,880 $245,880 $245,880 $245,880 $276,615 $307,350 $2,558,689

Please note that sales volumes could vary significantly from projections. These numbers do not account for the potential to land a large national retail account (such as Target).

IV. Operations
The day to day operations of Pogo Eyewear will be eased through the use of technology. We will receive daily updates on customer inquiries from the call center. Upon receipt Pogo’s management can respond as needed. Our website will handle the processing of customer transactions and we will receive placed orders each morning for the prior day. Orders will be processed and shipped immediately from our warehouse. Initially orders will be processed by William. Once sales volume increases we will hire part time employees to process outgoing orders and returns. Other operational tasks involve marketing including making appearances at events, public relations, trade shows, and distributing samples. These duties will be executed by William. Production Our frames will be manufactured by third parties in other countries – primarily China. Once we receive the finished frames we will send them out to our optician to have plastic lenses installed as necessary. After this process is complete we will package the products in our warehouse and prepare them for shipment. Location Our warehouse will be located in Walla Walla, WA. Because our business will be conducted almost exclusively online warehouse location is not important. There is an abundant supply of cheap space available locally. Legal Environment Pogo will include a disclaimer with each of its products that reminds consumers that our product is not designed for children and is solely for fashion – not to correct any vision problems. This should protect us from many legal issues. We will not offer a warranty but rather a 30 day money back guarantee. Consumers must pay return shipping on their returns. Of course we will always have to deal with the implied warranties of merchantability and fitness for use but we do not foresee significant legal issues arising as a result of consumers purchasing our products. We will not have customers visiting our warehouse, but deliverymen will visit so we will carry a liability insurance policy as well as a policy to cover our inventory. Our employees will be covered by state workers compensation insurance. Once we have finalized our logo we will have it registered with the U.S. Patents and Trademarks office in Washington D.C. Otherwise there are few licensing requirements for our business other than obtaining the general state business license which is very simple and costs only

$15. We will only be required to register with Washington State since we won’t have legal “Nexus” in other states. Because products will be shipped from our location in Washington primarily to locations out of state we expect minimal if any state tax liability. Personnel Pogo’s personnel requirements will be minimal to begin with. We will outsource call center functions which means that the only physical labor required will be to receive incoming inventory shipments, prepare orders for shipment, and actually shipping the orders. In addition we will need to process returns. Initially these functions will be done by William. As demand increases part time help will be hired at a rate of approximately $10 per hour with no benefits. There is a large supply of available employees locally due to the fact that there are three colleges in Walla Walla and other job opportunities are scarce. In addition there are a significant number of seasonal employees in the agricultural industry who are always seeking employment. In the future we may bring the call center function in house which will require the hiring of numerous employees and managers all of which can be procured locally. In addition we will likely hire an operations manager to oversee processing of orders and shipments once demand increases. This will free up the owners to be able to focus full time on marketing, public relations, and other promotional responsibilities. An operations manager can be hired locally for approximately $15 per hour with no benefits. Inventory At Pogo Eyewear we will be selling a fashion product which means that trends and tastes can easily render our inventory obsolete which is why we will keep inventory to an absolute minimum. We will fastidiously monitor customer response and demand for various designs and adjust future inventory decisions accordingly. Initial inventory levels are set at 3,750 units which is enough to cover the first four months of projected sales. Initially we want to have some extra inventory on hand in order to accommodate for any unexpected spikes in sales. The management at Pogo believes that in the fashion industry inventory is a liability rather than an asset. We must attempt to walk the fine line between being out of stock and having obsolete inventory sitting on the shelves because of ineffective ordering. In the beginning inventory turns will remain around 3 or 4 because sales will likely be volatile from month to month in the beginning. We will target 10 to 12 inventory turns per year after operations get up and running. Inventory lead times vary by model and supplier anywhere from one week to five months.

We plan to promote Pogo Eyewear as a great gift. As a result we expect inventory levels to increase during the holiday season from late October through year end. Suppliers Initially our products will be sourced exclusively from two different suppliers: Alpha Viana Inc. 10699 Hickson St. #23 El Monte, CA 91731 AA Optical Company 2101 Midway Rd. Suite 100 Carrollton, TX 75006 In the future we may establish relationships with alternate suppliers and/or develop frame designs in house and source frames directly from manufacturers overseas. Credit Policies Payments will be accepted using Paypal or credit/debit cards only.

V. Management and Organization
Pogo Eyewear will be managed and operated primarily by Bill Kinzel. Mr. Kinzel has significant business as well as finance and accounting experience. In the past he has held the position of controller at a manufacturing operation in Yakima, WA with $60 million in annual sales and over 350 employees. Bill has experience and knowledge with all aspects of business operations and management including: accounting, payroll, tax reporting, purchasing, material control, information technology, legal contracts, and human resources. In addition he has experience as the founder of a tax service in Spokane, WA and as a franchisee operating an Avis rental location in Spokane, WA. Bill graduated Summa Cum Laude with a bachelor’s degree in finance. Bill works a flexible schedule in the retail industry in Walla Walla. Initially he will maintain his day job until Pogo’s business increases at which point Bill will transition to part time in his current position and ultimately quit in order to operate Pogo full time.

VI. Start up Expenses and Capitalization PoGo Eyewear
Item Initial Inventory Web Design Packaging Rent Marketing Services SEO Fees Video Production Misc Legal Fees Legal Fees Packaging Design Show/Event Supplies Equipment Tooling -- Packaging Logo Design Insurance Call Center Set Up Trademark Fees Quickbooks Working Capital Contingencies Total Estimated Start up Costs $$$ Notes $75,000 3,750 units at average cost of $20 $10,000 Design of our ecommerce website $7,500 3,750 units at average cost of $2 $7,000 6 months rent on warehouse space $5,000 Design of online advertisements, etc. $5,000 Search Engine Optimization of our website $5,000 Produce Youtube and Videos for website $5,000 State registration fees, etc. $5,000 Writing consumer product warnings $3,000 N/A $3,000 Displays, tables for events and shows $2,000 Shelving for warehouse $2,000 Tooling dies needed to make our packages $1,500 N/A $1,200 Insurance -- 1 year $1,000 Set up 1-800 number for customer service $1,000 N/A $500 Software $10,000 2 Months Operating Expenses $13,970 To cover cost overruns, etc. $163,670

The startup expenses will be funded by an investment from Bill as well as other equity investors.

VII. Forecast Profit and Loss
See Appendix for forecasted profit and loss statements. Please note all statements are on the cash basis.

VIII. Exit Strategy
Based on the forecasted profit and loss statement Pogo Eyewear will have built up a cash position of approximately $311,000. At this point the corporation would have the option of doing a share buyback with $250,000 of the cash which would result in a 52% return on investment for outside investors. Other options include waiting until the end of the third year to execute a corporate share repurchase or selling the business entirely to a third party. Assuming a 2.5 pricing multiple at the end of year 2 the business value would be

$700,000. Assuming a 65% equity interest outside investors would yield approximately $410,000 on the transaction after fees which would result in a 150% return on investment.

IX. Appendix

PoGo Eyewear
Gross Revenue COGS Gross Margin SG&A Part-time Labor Operations Mgr. Rent Insurance Utilities Web Hosting SEO/Ad Design Samples Call Center Web Advertising Misc. Advertising Trans. Fees Travel Total SG&A Operating Income Provision for Taxes Net Income 1 $4,098 $2,459 $1,639 2 $20,490 $12,294 $8,196 3 $22,539 $13,523 $9,016 4 $22,539 $13,523 $9,016 5 $26,637 $15,982 $10,655 Year 1 6 7 $30,735 $30,735 $18,441 $18,441 $12,294 $12,294 8 $30,735 $18,441 $12,294 9 $30,735 $18,441 $12,294 10 $30,735 $18,441 $12,294 11 $51,225 $30,735 $20,490 12 $81,960 $49,176 $32,784 Total $383,163 $229,898 $153,265

$0 $0 $500 $100 $100 $200 $500 $1,000 $400 $3,000 $300 $102 $0 $6,202 -$4,563 -$1,597 -$2,966

$0 $0 $500 $100 $100 $200 $500 $1,000 $400 $3,000 $300 $512 $1,000 $7,612 $584 $204 $379

$0 $0 $500 $100 $100 $200 $500 $1,000 $400 $3,000 $300 $563 $0 $6,663 $2,352 $823 $1,529

$0 $0 $500 $100 $100 $200 $500 $1,000 $400 $3,000 $300 $563 $1,000 $7,663 $1,352 $473 $879

$0 $0 $500 $100 $100 $200 $500 $1,000 $400 $3,000 $300 $666 $1,000 $7,766 $2,889 $1,011 $1,878

$600 $0 $500 $100 $100 $200 $500 $1,000 $400 $3,000 $300 $768 $1,000 $8,468 $3,826 $1,339 $2,487

$600 $0 $500 $100 $100 $200 $500 $1,000 $400 $3,000 $300 $768 $1,000 $8,468 $3,826 $1,339 $2,487

$600 $0 $500 $100 $100 $200 $500 $1,000 $400 $3,000 $300 $768 $1,000 $8,468 $3,826 $1,339 $2,487

$900 $0 $500 $100 $100 $200 $500 $1,000 $400 $3,000 $300 $768 $1,000 $8,768 $3,526 $1,234 $2,292

$900 $0 $500 $100 $100 $200 $500 $1,000 $400 $3,000 $300 $768 $1,000 $8,768 $3,526 $1,234 $2,292

$900 $2,800 $500 $100 $100 $200 $500 $1,000 $400 $3,000 $300 $1,281 $1,000 $12,081 $8,409 $2,943 $5,466

$1,600 $2,800 $500 $100 $100 $200 $500 $1,000 $400 $3,000 $300 $2,049 $1,000 $13,549 $19,235 $6,732 $12,503

$6,100 $5,600 $6,000 $1,200 $1,200 $2,400 $6,000 $12,000 $4,800 $36,000 $3,600 $9,579 $10,000 $104,479 $48,786 $17,075 $31,711

PoGo Eyewear
Gross Revenue COGS Gross Margin SG&A Part-time Labor Operations Mgr. Officers Salary Rent Insurance Utilities Web Hosting SEO/Ad Design Samples Call Center Web Advertising Misc. Advertising Eyewear Design Trans. Fees Travel Total SG&A Operating Income Provision for Taxes Net Income 1 $102,450 $61,470 $40,980 2 $81,960 $49,176 $32,784 3 $102,450 $61,470 $40,980 4 $107,573 $64,544 $43,029 5 $122,940 $73,764 $49,176 Year 2 6 $143,430 $86,058 $57,372 7 $163,920 $98,352 $65,568 8 $163,920 $98,352 $65,568 9 $163,920 $98,352 $65,568 10 $163,920 $98,352 $65,568 11 $184,410 $110,646 $73,764 12 $204,900 $122,940 $81,960 Total $1,705,793 $1,023,476 $682,317

$2,500 $2,800 $2,500 $500 $100 $100 $200 $1,000 $1,000 $500 $3,000 $300 $0 $2,561 $1,000 $18,061 $22,919 $8,022 $14,897

$2,500 $2,800 $2,500 $500 $100 $100 $200 $1,000 $1,000 $500 $3,000 $300 $1,000 $2,049 $1,000 $18,549 $14,235 $4,982 $9,253

$2,500 $2,800 $2,500 $500 $100 $100 $200 $1,000 $1,000 $500 $3,000 $300 $0 $2,561 $2,000 $19,061 $21,919 $7,672 $14,247

$2,500 $2,800 $2,500 $500 $100 $100 $200 $1,000 $1,000 $500 $3,000 $300 $1,000 $2,689 $1,000 $19,189 $23,840 $8,344 $15,496

$3,500 $2,800 $2,500 $500 $100 $100 $200 $1,000 $1,000 $500 $3,000 $300 $0 $3,074 $2,000 $20,574 $28,603 $10,011 $18,592

$4,000 $2,800 $2,500 $500 $100 $100 $200 $1,000 $1,000 $500 $3,000 $300 $1,000 $3,586 $1,000 $21,586 $35,786 $12,525 $23,261

$4,000 $2,800 $2,500 $500 $100 $100 $200 $1,000 $1,000 $500 $3,000 $300 $0 $4,098 $2,000 $22,098 $43,470 $15,215 $28,256

$4,000 $2,800 $2,500 $500 $100 $100 $200 $1,000 $1,000 $500 $3,000 $300 $1,000 $4,098 $1,000 $22,098 $43,470 $15,215 $28,256

$4,000 $2,800 $2,500 $500 $100 $100 $200 $1,000 $1,000 $500 $3,000 $300 $0 $4,098 $2,000 $22,098 $43,470 $15,215 $28,256

$4,000 $2,800 $2,500 $500 $100 $100 $200 $1,000 $1,000 $500 $3,000 $300 $1,000 $4,098 $1,000 $22,098 $43,470 $15,215 $28,256

$4,500 $2,800 $2,500 $500 $100 $100 $200 $1,000 $1,000 $500 $3,000 $300 $0 $4,610 $2,000 $23,110 $50,654 $17,729 $32,925

$5,000 $2,800 $2,500 $500 $100 $100 $200 $1,000 $1,000 $500 $3,000 $300 $0 $5,123 $1,000 $23,123 $58,838 $20,593 $38,244

$43,000 $33,600 $30,000 $6,000 $1,200 $1,200 $2,400 $12,000 $12,000 $6,000 $36,000 $3,600 $5,000 $42,645 $17,000 $251,645 $430,672 $150,735 $279,937

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