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Northwind Traders Sample Business Plan

&ntro!uction to the Sample Plan

The following document is a sample of a finished business plan. In your final plan, you have the opportunity to elaborate on those ideas in your outline that you feel are most integral to your business. In composing your business plan, you can follow your outline as loosely or closely as you choose. or instance, in the sample plan, the !"ecutive Summary, which is the last section of the Business Planning #i$ard, is presented first in order to emphasi$e the most impressive features of the business. %our goal in composing a finished business plan is to construct the most comprehensive, thorough document possible, in order to attract investors and to confirm that you have ta&en the time to e"plore as many potential issues for your business as may arise.

Northwind Traders Sample Business Plan

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Northwind Traders Sample Business Plan

Ta le of Contents
EXECUTIVE SUMMARY.................................................................................................................................................1 DESCRIPTION OF THE COMPANY............................................................................................................................... 1 MISSION STATEMENT............................................................................................................................................... 1 PRODUCTS AND SERVICES......................................................................................................................................... 1 FINANCIAL FORECAST.............................................................................................................................................. 2 FINANCING REQUIREMENTS...................................................................................................................................... 2 HISTORY AND POSITION TO DATE............................................................................................................................4 THE COMPANYS MISSION........................................................................................................................................ 4 MANAGEMENT TEAM AND KEY PERSONNEL.............................................................................................................. 4 SERVICES................................................................................................................................................................. 6 TRANSPORTATION.................................................................................................................................................... 7 COMPANY HISTORY.................................................................................................................................................. 7 GUARANTEES AND WARRANTIES............................................................................................................................... 8
USINESS STRUCTURE.............................................................................................................................................. 8

MARKET RESEARCH......................................................................................................................................................8 ECONOMIC AND SOCIAL FACTORS............................................................................................................................. ! COMPETITIVE ENVIRONMENT.................................................................................................................................... ! LONG"TERM OPPORTUNITIES.................................................................................................................................... ! GEOGRAPHIC AREA................................................................................................................................................ 1# MARKET DESCRIPTION........................................................................................................................................... 1# TARGET CUSTOMERS.............................................................................................................................................. 1# MARKET DEFINITION.............................................................................................................................................. 1# MARKET OPPORTUNITIES........................................................................................................................................ 11 COMPETITIVE ANALYSIS......................................................................................................................................... 12 COMPETITIVE ADVANTAGES................................................................................................................................... 1$ COMPETITORS POSITIONS...................................................................................................................................... 14 POTENTIAL FUTURE COMPETITION.......................................................................................................................... 14 BUSINESS STRATEGY...................................................................................................................................................15 CUSTOMER INCENTIVES.......................................................................................................................................... 1% ADVERTISING AND PROMOTION.............................................................................................................................. 1% SALES AND MARKETING......................................................................................................................................... 16 COMMISSION.......................................................................................................................................................... 17 OPERATIONS...................................................................................................................................................................17 PREMISES............................................................................................................................................................... 17 CHOICE OF LOCATION AND PREMISES..................................................................................................................... 17 Northwind Traders Sample Business Plan )

HOURS OF OPERATION............................................................................................................................................ 17 EQUIPMENT............................................................................................................................................................ 18 STAFFING............................................................................................................................................................... 18 FORECASTING................................................................................................................................................................18 SALES FORECAST.................................................................................................................................................... 18 CASH FLOW PRO&ECTIONS...................................................................................................................................... 2# INCOME STATEMENT.............................................................................................................................................. 2#
ALANCE

SHEET.................................................................................................................................................... 21

PERFORMANCE RATIOS........................................................................................................................................... 21
REAK"EVEN.......................................................................................................................................................... 21

FUNDS REQUIRED AND TIMING............................................................................................................................... 21 FUNDING OPTIONS.................................................................................................................................................. 22 BUSINESS CONTROLS...................................................................................................................................................23 ACCOUNTING SYSTEM............................................................................................................................................ 2$ QUALITY CONTROL................................................................................................................................................ 2$ NEW TOUR OPERATORS.......................................................................................................................................... 2$ CAPACITY.............................................................................................................................................................. 2$ LONG"TERM GOALS............................................................................................................................................... 24 STEPS FOR ACHIEVING GOALS................................................................................................................................ 24 POSITION................................................................................................................................................................ 2% RISKS ASSOCIATED WITH GROWTH......................................................................................................................... 2% APPENDIX 1 MARKET RESEARCH..........................................................................................................................2! APPENDIX 2 FINANCIAL FORECASTS....................................................................................................................35

Northwind Traders Sample Business Plan

E'ECUT&(E SUMM)R*
+escription of the Company
Northwind Traders, Inc. provides travel+planning services for !uropean adventure vacations to residents of the ,reater Seattle area. The service industry, including travel agencies, is one of the fastest growing business sectors of the economy, and Northwind Traders intends to capitali$e on the success of this industry by ta&ing advantage of travel planning opportunities in the Pacific Northwest.

President -eather .itchell and /ice President of Sales and .ar&eting 0im 1im currently hold the company2s stoc&. Prior to starting the Northwind Traders travel agency, .s. .itchell cofounded, co+owned, and operated the Northwind Traders clothing store. She has selected a small team with e"tensive travel, sales, and computer s&ills, all of whom will be invaluable to the new venture. -er cowor&ers bring a combined total of () years of travel industry e"perience to the agency.

Mission Statement
The mission of Northwind Traders is to become the premier provider of adventure vacations for ')+ to ()+year+old professionals. Northwind Traders is dedicated to building long+term relationships with customers through 3uality training and customer support, and wants to be recogni$ed as the leading adventure vacation company in the ,reater Seattle area. The company2s goal is to grow steadily, becoming profitable by the second year of operations.

Pro!ucts an! Ser,ices

Northwind Traders recently became the appointed agents for .argie2s Travel, one of the largest and most respected tour operators in the mar&et. #ith virtually no mar&eting effort, Northwind Traders has sold some '44 adventure vacations in the past si" months, netting 5**,644 in commissions. Sales of insurance policies and other services have added to this total and could potentially add much more. Northwind Traders offers a comprehensive range of services to support the adventurous traveler, including pre+ and postvacation briefings, travel insurance, and a directory of services specific to each destination and activity.

Northwind Traders Sample Business Plan

rom des& and field mar&et research carried out on (44 clients, it is clear that there is considerable potential in the adventure travel business. 7esearch indicates that Northwind Traders2 target mar&et finds it difficult to obtain reliable and authoritative advice on destinations and activities. 7esearch also suggests that the customers in this mar&et are unli&ely to purchase their vacations again from the firm who provided their last vacation due to a lac& of informative sales personnel. Northwind Traders will cater to these needs and develop a strong return+ customer base. Because they are currently the only travel agency focused on !uropean adventure vacations that is located in the Seattle area, Northwind Traders has a substantial opportunity to dominate the region. In order to maintain and improve their current position in the region, they will need to invest in a #eb site, as well as database software and systems, and in refurbishing the shop premises. Northwind Traders maintains the following advantages over e"isting competition8 ongoing support to clients9 e"tensive &nowledge of the !uropean adventure vacation field9 superior customer service9 speciali$ed training programs for staff9 informative #eb site9 competitive rates.

#inancial #orecast
Northwind Traders started as a clothing store and has e"panded into the travel agency business, with its focus on adventure travel in !urope. :ast year, Northwind Traders clothing store made 5'44,;44 profit on sales of 51,;1<,)44 and employed seven people. Northwind Traders e"pects that by concentrating full+time on selling adventure vacations, clients will increase from the present level of '44 =achieved over a si"+month period with only a part+time
Northwind Traders Sample Business Plan '

effort>, to at least **4 in the first year, 1;44 in the second, and '144 in the third. To help achieve this growth, .s. .itchell has identified three other tour operators she wishes to represent and has begun negotiations with them. Selling between two and three vacations a day will allow the business to ma&e a modest profit in %ear ?ne. By %ear Two postta" profits should be 5(4;,444 and will increase to nearly 5;<*,444 by %ear Three.

#inancin- Re.uirements
.s. .itchell plans to sell her shares in the clothing shop and invest the proceeds in the new travel business, Northwind Traders. In addition, she will be investing 5;1,@)4 of her own money in the business and see&ing 56(,)44 from outside sources. 7eturn on shareholders capital by %ear Three is proAected to be close to 144 percent. The purpose of the business plan is to communicate this highly profitable opportunity to .s. .itchell2s partners in the clothing shop and to outside investors, and to attract interest in the venture. Blternatively, .s. .itchell is considering loan finance made up of a 5;1,@)4 two+year loan and a credit line of 5)6,;)4. In total, about 51'),')4 will be needed to fund the business during the initial months.

Northwind Traders Sample Business Plan

Northwind Traders Sample Business Plan

/&STOR* )$+ POS&T&O$ TO +)TE

Northwind Traders, Inc. provides travel+planning services to individuals and businesses in the ,reater Seattle area. The business is located at 1'(; ran&lin Street, Seattle, #ashington.

The Company0s Mission

The goal of Northwind Traders is to be the leading provider of hassle+free !uropean adventure vacations to the ')+ to ()+year+old business professional mar&et. Initially operating in the Seattle area in #ashington, Northwind Traders is rapidly e"panding to sell its services worldwide via the Internet. Travel service sales is the fastest growing category of business to consumer activity on the Internet, and by the year '444, the value of this mar&et is estimated at 5;.) billion =see Bppendi" 1, Internet ,rowth and the Sale of Travel Services>. ?ur emphasis will be on providing a complete speciali$ed service based on having a detailed &nowledge of the vacation destination and adventure activities being offered. .ar&et research indicates that the maAor criticism our type of client has of e"isting travel agencies is that their agents C&now nothing about their products, they Aust open the catalogue and read,D to 3uote one of many disappointed travelers. By capitali$ing on our e"perience in the Northwind Traders clothing shop, we will be able to both advise and direct our clients to the type of travel e3uipment they will need to get the very best out of their vacation.

Mana-ement Team an! 1ey Personnel

-eather .itchell, President and E!?. Before founding Northwind Traders, .s. .itchell owned and operated Northwind Traders, an outdoor clothing shop in the Seattle area. Prior to that, she managed the ?lympia branch of one of the larger regional chains of general travel agencies operating throughout western #ashington, where she was responsible for managing the office systems and a staff of four. She has a degree in travel and tourism from State Fniversity. In addition to .s. .itchell, team members 0im 1im and 7ichard Bready will be moving into the new venture on a full+time basis, and Bmy !gert has been recently recruited to cover Saturdays and vacations. reelance business consultant 0ae Pa& will be advising during the business2s changeover from clothing shop to adventure travel agency.
Northwind Traders Sample Business Plan )

0im 1im, /ice President Sales and .ar&eting. Prior to Aoining Northwind Traders, .r. 1im wor&ed for the mar&eting department of a maAor airline. -is current responsibilities include the company2s direct mar&eting campaign and all sales+related issues. 7ichard Bready, ?ffice .anager. Twenty years as a travel agent has given .r. Bready the ideal bac&ground for Northwind Traders. B &nowledgeable salesperson, .r. Bready2s e"pertise in the area of !uropean travel enables him to entice the adventure traveler. Bmy !gert, Sales Bssistant. Bfter completing her undergraduate degree at the Institute of Brt, .s. !gert spent a year traveling abroad and Aoined the staff at Northwind Traders recently as a sales assistant. 0ae Pa&, Business Eonsultant. #ith over '4 years of consulting e"perience in industries ranging from aerospace to technology to retail, .r. Pa&2s &nowledge and guidance will be instrumental to the success of Northwind Traders. The volunteer members of the Board of Girectors provide guidance to the management and staff of Northwind Traders. The board meets twice yearly to discuss policy changes, review the mission statement, and update the business plan if needed. .embers include :isa 0acobson, retail store owner -olly Barrett, EPB 0o Brown, former travel agent #illiam -ollands, lawyer :isa ,armaise, retail store owner Tony Ehor, human resource manager Prasanna Samarawic&rama, caterer

Ser,ices
#e are currently the appointed agents for .argie2s Travel, a maAor supplier in the mar&et. Eurrently, .argie2s Travel offers some ;4 different adventure vacation pac&ages throughout !urope, including horse tre&&ing in Iceland9 above+the+clouds tre&&ing on islands and in remote
Northwind Traders Sample Business Plan *

regions in such areas as Eorsica and Norway9 van+supported inn+to+inn bicycling9 mountain bi&ing and hi&ing adventure tours throughout rance, ,ermany, Italy, and Bustria9 and ballooning across the Blps.

#e intend to be appointed agents by three other maAor adventure travel tour firms with whom we are currently in negotiation8 !nchantment :a&es Eorporation. ?ffers rafting, sea &aya&ing, and yachting trips around remote !uropean rivers and coastline areas, covering such areas as the Bdriatic, the Blac& Sea, and Tur&ey. #est Eoast Sales. ?ffers adventure vacation pac&ages to corporate clients to use as incentives and rewards, and as part of management development programs. They are particularly strong in rance, Italy, and ,ermany. !"ploration Bir. Speciali$es in adventure vacations in !astern !urope and former Soviet countries, covering Bulgaria, 7omania, Poland, and :atvia. These are three relatively new and small tour operators, but they have ac3uired a reputation for innovation and reliabilityHand they are currently underrepresented. In addition, we will offer a comprehensive range of complementary services to support the adventurous traveler, ensuring that they will have a safe, enAoyable, and memorable e"perience. These services will include insurance, pre+ and postvacation briefing pac&s, and a directory of advice and information services particular to each destination and adventure activity.

Transportation
The vacations we will offer will use all principal travel systems, including planes, trains, buses, and where appropriate, ta"is. #e will aim for a standard of travel higher than that offered by the general travel industry. The feeling we are loo&ing for is definitely not that which is engendered by the bac&pac&er mar&et.

Northwind Traders Sample Business Plan

Company /istory
ive years ago -eather .itchell cofounded Northwind Traders, an outdoor clothing shop in Seattle, #ashington. ?ver the years, Northwind Traders has e"tended its product range to include everything the adventurous traveler could want, from tents and sleeping bags to maps, guideboo&s, and insurance. The clothing shop has sales of 51,;'4,444 per year =see Table 1>, ma&es a gross profit of 5'4',;44, and employs seven people, either full+ or part+time. B mail+order service is now provided by catalogue and via a new #eb site. Ta le 23 $orth%in! Tra!ers Clothin- Shop Performance O,er Past #i,e *ears

%ear Sales ,ross Profit

2 516(,@44 5*',*')

2 5;'',)14 51*@

4 5**<,*@4 5144,@41

5 51,4'(,@14 51((,*4'

6ast *ear 51,;'1,1@4 5'41,<1*

Increasingly, shop customers have as&ed for advice on adventurous places to go on vacation. :ast year Northwind Traders ac3uired an agency from .argie2s Travel, one of the largest and most respected tour operators in this mar&et, and began to promote and sell their products. In the si" months that we have been selling travel agency products, some '44 vacation pac&ages, at an average cost of 5((;4, have been sold. Northwind Traders2 commission on the sales has been 5**,644 =14 percent commission>. In addition, () insurance policies have been sold at an average price of 51*@, yielding 51@); =(4 percent commission>. -eather .itchell, one of Northwind Traders2s founding partners, intends to sell her shares in the store and to concentrate on setting up the new travel business, Northwind Traders.

7uarantees an! "arranties

?ur clients will be protected financially against either our own or our tour operator2s failure, by virtue of the B7E bonding held by our principals. #e will only use vacation providers who can provide ';+hour emergency support services for clients while on vacation.

Northwind Traders Sample Business Plan

Business Structure
Northwind Traders is incorporated under the laws of the state of #ashington. The company has authori$ed 14,444 shares, *444 of which are owned by President and E!? -eather .itchell. /ice President of Sales and .ar&eting 0im 1im owns 1444 shares, and the remaining shares are held by the company for future distribution. In the ne"t few wee&s, the business will be set up as an operation independent from the clothing store. This structure will clearly separate the travel business from the clothing shop and ma&e it possible to attract the ris& capital that will be re3uired when the business starts to grow. Bt a later stage the business may wish to sell and issue airline tic&ets and to create its own charter vacations. This will re3uire membership in the B7E =Birline 7eporting Eorporation> and IBTBN =International Birlines Travel Bgency Networ&>. These organi$ations regulate the collection of money and distribution to the appropriate airlines. -owever, in the period covered by this Business Plan we intend to operate only as the appointed agents for a number of tour operators. Bs such we can CshelterD under their licenses and bonds.

M)R1ET RESE)RC/
Guring the current period of strong economic growth, Northwind Traders can capitali$e on the many significant opportunities in the travel industry.

Economic an! Social #actors

Service industries represent the fastest growing sector of the national economy, and travel and tourism agencies are poised to flourish in the midst of today2s economic boom. These services are proAected to grow at an average annual growth rate of ;.1 percent over the period from 1<<4 to '414 =Bppendi" 1>. The travel and tourism industry thrives in a vital economy. The general economic climate in the city of Seattle is very strong. Bn influ" of new businesses has added to the area2s prosperity, and the already large population of young professionals is growing. The city of Seattle is the center for business in 1ing Eounty, with over ;44,444 people employed in industries such as aerospace, transportation e3uipment, health services, tourism, computer software, and biotechnology.

Northwind Traders Sample Business Plan

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Competiti,e En,ironment
The 3uality of service and the number of providers in the travel industry constantly fluctuate. ?ur competitive edge will be in attracting and retaining our customers with the most highly trained and well+informed individuals we can recruit. #ith our e"pertise in !uropean adventure vacations, we will be able to provide the most accurate, up+to+date information possible.

6on-8Term Opportunities
Tourism in general is on the rise =Bppendi" 1>, !urope loo&s li&e it will continue to be the maAor destination, and the Internet will be an important channel into this mar&et. The state of the economy will be the most influential factor in how many people travel. ?ther driving forces for travel will include the cost of tic&ets, fuel prices, the threat of terrorism, and currency rates. The current lac& of leaders in the !uropean adventure travel industry represents an e"ceptional opportunity for Northwind Traders to develop a dominant presence in the ,reater Seattle area. #ith their e"ceptional &nowledge of the adventure travel industry, strong customer base, and competitive prices, the company will be well situated to ta&e advantage of the region2s current economic prosperity.

7eo-raphic )rea
Northwind Traders is based in Seattle, #ashington, and targets individuals interested in adventure vacations in !urope. The region comprises the incorporated cities of 7edmond, Bellevue, and Tacoma and the encompassing counties of 1ing, Snohomish, and Pierce.

Mar9et +escription
The ,reater Seattle areaIincluding all of 1ing, Pierce, and Snohomish countiesIis home to appro"imately ( million people =1<<; figure>, half of whom fall within our target mar&et. Seattle2s Aob rate is climbing at a rate of 14 percent each year, and new Aobs and growth are e"pected through the year '44@. Seattle has become a world+class destination, and the downtown retail and shopping core has grown steadily over the last decade. The following maAor facilities reside in the ,reater Seattle area8 an international airport, several maAor medical centers, a state university, and four other colleges and universities.

Northwind Traders Sample Business Plan

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The percentages of employment by industry are as follows8 '6 percent services, ') percent wholesale and retail, 1* percent manufacturing, 1; percent government, * percent transportation and communication, * percent finance and insurance, and ) percent construction.

Tar-et Customers
SeattleJ1ing EountyKs labor force is highly educated, s&illed, productive, and stable. It consists of individuals who are deeply attached to the area and have tended to stay and wait out past periods of economic downturn. The vital economy, the Northwest lifestyle, and its uni3ue environmental 3ualities attract people. Both public officials and business leaders recogni$e the need to &eep our labor force well e3uipped with mar&etable s&ills. rom within this population, our target customers are individuals who are professionals with incomes of 5;4,444L, ages ') to (), single or married, without children, and college educated.

Mar9et +efinition
The world travel mar&et is forecast to e"pand at a ;.1 percent average annual growth rate until '414. This is faster than the general economic growth rate, which is e"pected to be around '.; percent per year. The !uropean mar&et, while not the fastest growing, will be the most important destination, accounting for over )4 percent of all international arrivals =see Bppendi" 1>. #ithin !urope, rance, Italy, and Spain are the most popular destinations. This is why we have selected tour operators with appropriate products in these areas as our initial partners. igures for the si$e and proAected growth of adventure vacations are s&etchy, but the figures from one recent study =#orld Bdventure Travel Gata Eorp.> are in Table '.

Ta le 23 )!,enture Tra,el (acations 8 "orl! forecast :Million )rri,als;: 2<<0 8 2020

+estination !urope N. Bmerica 7est of #orld Total

2<<0 4.') 4.;) 4.14 4.64

1""7 4.*4 4.*4 4.') 1.;)

2004 1.*4 1.;4 4.<) (.<)

2020 '.() '.'4 1.14 ).*) 11

Northwind Traders Sample Business Plan

)-e 1* + '; ') + () (* + ;) ;*L

2<<0 = *1 '4 1) ; 144

2020 = (6 (1 ') * 144

Source8 #BTG Eorp. 1<<@

Mar9et Opportunities
#e believe that by concentrating on the !uropean travel mar&et, offering a limited but e"tensive range of vacation pac&ages, and targeting our service at affluent professionals, we can meet the needs of our clients. ?ur speciali$ed &nowledge of !urope and adventure travel will allow us both to satisfy our customers and to surpass the services offered by our competitors. ?ur mar&et study =see Bppendi" 1> has shown that the group composed of affluent professionals has specific needs that are not currently being met, as *) percent of those planning vacations would not purchase them from the same source againM Specifically, they want their travel agent to have comprehensive &nowledge of the destination =6@ percent>9 to have an efficient administration system in which they can have confidence =6; percent>9 to go on vacation with similar professional people =61 percent>9 and to be offered useful advice and ancillary services such as insurance =@< percent>. In addition, our mar&et study confirms that !urope is li&ely to be the largest destination mar&et for adventure vacations. ?ur study shows only (4 percent of adventure travelers to be under '; years of age, while the #orld Bdventure Travel Gata study claims *1 percent is under ';. #e feel the difference is because our survey sample is confined to relatively affluent people who had spent at least 5()4 on adventure clothing =see Bppendi" 1>. ?ne further emerging mar&et segment for adventure vacations is that of corporate clients. ?ur research suggests that up to one in five adventure vacations is at this top price end of the mar&et.

Competiti,e )nalysis
Northwind Traders is the only travel agency located in the Seattle area that is focused on !uropean adventure vacations. -owever, there are many adventure travel agents in capital and
Northwind Traders Sample Business Plan 1'

secondary cities such as 7edmond, Bellevue, and Tacoma that compete with Northwind Traders to provide adventure vacation pac&ages. These agencies are described below8 ,eneral Travel Bgents These agents have added adventure vacations to their services but often have little or no &nowledge of adventure destinations or activities. They sell literally from the page, offering limited advice, information, and support. Bccording to our mar&et study, ;4 percent of adventure vacations are boo&ed through these general travel agents, but only a third of clients would use them again. Bdventure Tour ?perators These tour operators who advertise their vacations in the press attract about a 3uarter of all adventure vacation clients. -owever, clients have to shop around several tour operators to find what they want, and clients cannot get unbiased advice or much help with information. ?nly ;) percent would go bac& to a tour operator for their ne"t vacation. Independent Travelers These travelers comprise about 1) percent of those going on adventure vacations, of whom *) percent would travel that way again. #e need to persuade this group that our superior product &nowledge and service is worth their consideration. Internet Providers These providers sell only ) percent of adventure travel vacations9 however, @4 percent of adventure travelers would buy their ne"t vacation via the Internet. There is plenty of scope to offer a superior #eb site. #e believe that by having daily face+to+face contact with clients, we will be better able to manage a fresh, vital, and relevant #eb site aimed at the specific needs of our mar&et segment. Specialist Bdventure Travel Bgencies These agencies sell only about 1) percent of travel pac&ages at present, but we feel this is partially due to lac& of client awareness and to the comparative rarity of such outlets. #e will differentiate ourselves from our competitors by offering the most e"tensive material available from the most up+to+date, well+informed staff. Elients will return for our service, &nowledge and competitive prices.

Northwind Traders Sample Business Plan

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These findings are some of the most powerful results of our research. #hile general travel agents may be the most li&ely resource for those travelers ta&ing an adventure vacation, they are in fact the least li&ely place those clients will return to. Blthough specialist adventure travel agents, such as the business we are setting up, account for only 1) percent of the mar&et, *) percent of clients would use them again. #e aim to increase this percentage through our superior service.

Competiti,e )!,anta-es
Some *) percent of those clients using specialist adventure vacation travel agents would use them againImany more than would use either a direct tour operator or a general travel agent. -owever, these agents were critici$ed for having such a wide range of activities and destinations that their sales agents &new little about them. ?ur research shows that while ;1 percent of clients ta&e adventure vacations in !urope, only '( percent of the )444 adventure tours offered are for !uropean destinations. #e feel that by concentrating on !uropean destinations, which is the largest mar&et for both vacations in general and adventure vacations in particular, we will be able to have superior product &nowledge. #e will need to &now only perhaps 144 destinations and activities well, rather than have only a passing &nowledge of the )444 adventure vacations available. ?ur mar&et research has also shown that many adventure travel agents are catering to the bac&pac&er mar&et, consisting mostly of individuals who are under '; years of age and are generally very cost conscious. This can lead to very different types of clients ending up at the same destination, with some conse3uent dissatisfaction. The bac&pac&er mar&et re3uires a much lower level of service and information than does the mar&et for the more affluent ')+ to ()+year+ old professional.

Competitors0 Positions
The two maAor competitors of Northwind Traders are erguson and Bardell, and :a&es N Sons. erguson and Bardell is the strongest competitor of Northwind Traders, due to its strong client base and e"perienced owner. -owever, its press releases are of a very low 3uality, and its location is undesirable, with difficult par&ing and limited customer service space. In addition, erguson and Bardell lac&s the &nowledge and e"pertise in the field of !uropean adventure travel that is valued so highly by the clientele of Northwind Traders.

Northwind Traders Sample Business Plan

1;

:a&es N Sons will be a formidable competitor for Northwind Traders because of its prime location, well+established business, and e"tensive training program.

Potential #uture Competition

Northwind Traders will occupy a speciali$ed niche in the travel industry, with its focus on adventure vacations in !urope. Blthough it is currently the only !uropean adventure travel agency located in the Seattle area, competitors do e"ist in nearby areas =see above>. In order to stay competitive, Northwind Traders will need to establish itself as the leader in adventure travel planning for !urope with its superior product &nowledge and high+3uality service. The lac& of current adventure travel providers in the area represents a uni3ue opportunity for Northwind Traders to e"pand in a rapidly growing mar&et.

BUS&$ESS STR)TE7*
#ith Northwind Traders2 e"pertise in !uropean adventure travel, we can create customi$ed travel itineraries for our clients and provide the most thorough, informative adventure travel service available. By offering superior customer service, Northwind Traders can distinguish itself from its competitors.

Customer &ncenti,es
?ur mar&et research shows that publicity has the greatest impact on people2s choice of an adventure vacation travel agent, followed closely by having the right location and having a recommendation from a friend, relative, or colleague. ,eneral press advertising seems to be fairly ineffective in this sector, and event specialist press advertising only brings in one out of seven clients. =See Bppendi" 1, Summary of indings from .ar&et 7esearch.>

)!,ertisin- an! Promotion

?ur advertising and promotions will pivot around si" &ey strategies8 public relations, our shop front, an Internet #eb site, customer relations, press advertising, and our association with the Northwind Traders clothing store.
Northwind Traders Sample Business Plan 1)

Public relations. #e will put considerable effort into preparing and disseminating a regular flow of press releases. These will be based on stories about our destinations, activities, corporate clients, and our staff. #e will employ a public relations adviser to help us write copy and locate publications editors. Shop front. #e plan to have an e"citing, informative, and actively managed display window. There will be a video display showing adventure vacations in progress. Gifferent destinations can be selected from outside the window via a control panel9 otherwise, the scenes will rotate on a random basis. Internet #eb site. This is fast becoming a maAor promotional channel, and we believe it will increase in importance over time. Blso, it is the most convenient way for us to have a global presence at the outset. =See Bppendi" 1, Internet ,rowth and the Sale of Travel Services.> Eustomer relations. #e will &eep records of every sales contact. Gata such as source of in3uiry, client needs, previous vacation, Aob, and income will be included. By having superior information on our clients and prospects, we intend to offer a truly personali$ed service. ?ur database will contain full details on all our clients, including the vacations they have ta&en and their postvacation appraisal data. #e will use this data to encourage our satisfied customers to recommend our services to friends, relatives, colleagues, and employers. Press advertising. #e will underta&e a small amount of press advertising in order to enhance our public relations activity. There is considerable research to support the argument that the more often a potential client hears about you, the more li&ely they are to approach you when they have a need for your type of service. Northwind Traders association. #e will write to all past shop clients announcing the establishment of the travel business and offer them a special introductory adventure vacation pac&age.

Sales an! Mar9etin!"cellent selling s&ills are vital in our type of business. Therefore, everyone will be fully trained in sales. Bdditionally, every month we will CauditD each other by observing half+a+day2s selling activity and giving feedbac& on strengths and wea&nesses in s&ills.

Northwind Traders Sample Business Plan

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#e will also be using a Ccontact managementD system that will allow us to monitor the effectiveness of different promotional strategies and of different mar&eting messages. The &ey to our strategic advantage lies in having superior data on prospects and clients.

Commission
The normal commission paid to travel agents for this type of vacation is in the 14 percent to 1) percent range. #hile .argie2s Travel, the first agency we have been appointed to, pays us at the lower end of the scale, they are a prestigious firm to represent. -aving them in our portfolio will enable us to negotiate much higher commissions from our new principals. Bccordingly, we are planning on an average travel agency commission of 11 percent, rising to 1( percent by the end of %ear Three. Eommission on insurance and other services will be (4 percent.

OPER)T&O$S
Premises
It is vital that the travel business has both a storefront facing onto the main street and a visible separate entrance. The goal is for clothing shop clients to be able to move between the premises without going outside. #e will be renting '444 s3uare meters of fully serviced space at a cost of 5(4,4*4 per year. #e will need to spend 5'),4)4 on internal refurbishing. #e plan to do some of this wor& ourselves. Bn additional 5;1@) will be needed for des&s, chairs, and other office furnishings.

Choice of 6ocation an! Premises

#e intend to locate within the e"isting Northwind Traders shop, since this is close to the city center with a high density of both residential and business premises. The pavement is wide, so people can stand and loo& in the window without being in the way of other pedestrians.

/ours of Operation
The telephone lines will be staffed '; hours a day by live operators. Guring the period from < am to * pm, this will be done mostly by our staff. -owever, overload calls during the day and after+ hours calls will go to our live telemar&eting bureau. People consider vacation decisions at home in

Northwind Traders Sample Business Plan

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the evenings after discussion with friends and partners. #e want to be available as their first point of contact with an informed, friendly service. #e believe that since our clients will mostly be busy professional people, off+pea&+hours access to our services is also a &ey way in which we can differentiate ourselves from other travel agencies.

E.uipment
#e will be renting an integrated telephoneJdatabase system from the outset. This will allow up to ten sales staff to answer calls and have full on+screen data on clients and products. Bs service is one of our &ey components, it is essential that we have full access to all relevant data speedily and efficiently.

Staffinrom the outset all staff will have Aob descriptions, a career and training history file, and a record of employee reviews. New staff will ta&e the travel agency Psychometric Bptitude Test and then spend time with each member of the Northwind Traders team. Bll staff will undergo full product training and will spend at least four wee&s a year on+site at &ey travel destinations. ?ur dress code will re3uire us to loo& as though we are on our way to one of our adventure vacations. #e plan to start with a staff of three full+time employees, including the founder, and one part+timer. #e plan to be operating with a staff of thirteen during the fifth year of business.

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#OREC)ST&$7
Sales #orecast
?ur ratio of sales to in3uiries of the adventure travel vacations sold to date, while operating within the outdoor clothing shop, has been one in three. or the purposes of our sales forecast, we are assuming that only one in five in3uiries will actually result in an adventure vacation being boo&ed. This is a very conservative estimate. #e e"pect there to be a steady buildup of clients coming from the clothing shop to tal& to us about vacations =see Table ( below>. -owever, the number of new in3uiries generated by our promotional activity will also build up during the year, gradually overta&ing in3uiries from the clothing shop. This is a trend we e"pect to continue. Based on the proAection below, we are forecasting to sell **4 adventure travel vacations ne"t year at an average price of 5();<. ?nce insurance and other service sales are added in, we e"pect to generate a gross profit of 5'*6,@6( over the first 1' months.

Ta le 43 Sales #orecast Pro>ection

?2 ?2 ?4 ?5 *ear Total In3uiries generated through promotion Shop in3uiries Total in3uiries /acations sold Bverage vacations cost Eommission received Eommission on insurance N other services received Northwind Traders Sample Business Plan '4 (44 )44 144 5((;4 5((,;44 51*@4 (44 @') 1;) 5((;4 5;6,;(4 5((;4 ;)4 6@) 1@) 5(@)6 5@',((1 5)414 ;)4 1'44 ';4 5(@)6 5<6,@)@ 5)6;) 1)44 ((44 **4 5();< 5')',<16 51),6*) '44 ;') ;') @)4 1644

Total commission N fees earned

5(),4@4

5)1,@@4

5@@,(;1

514;,*4'

5'*6,@6(

In %ear Two we are forecasting a gross profit of 5*';,(16, and in %ear Three we plan to reach 5<6*,6;*.

Cash #lo% Pro>ections

The Eash low proAections for %ear ?ne =see Bppendi" '> show that after the owner has put in 5;1,@)4, the business will need additional short+term financing of about 56(,)44. or the last two months of the year, we are forecasting a positive cumulative cash flow and a year+end cash surplus of 51<,<(). In our Eash low proAection, we have assumed the whole 56(,)44 additional financing has come from a ban& loan. #e have allowed for interest on the full amount for the whole period. In practice we would hope to finance part of this at least by a line of credit e3ual to the money actually re3uired. In this way we believe we have made a prudent, conservative provision.

&ncome Statement
#e e"pect to ma&e a small after+ta" profit of 5(;,<41 in the first year =see Bppendi" ' and Table ; below>. This is before the owner2s drawings. Bny owner2s drawings will be contingent on performance being better than that e"pected in the Plan.

Ta le 53 Profits in *ears One to Three

*ear One Sales :ess cost of sales ,ross profit :ess e"penses Net income before ta"es Provision for ta"es Net income after ta"es ',(*;,6(< ',4<*,4)* '*6,@6( '';,@;4 ;;,4;( <1;' 5(;,<41 *ear T%o ),'4',*;) ;,)@6,('@ *';,(16 ';(,;4; (64,<1; @*,16; 5(4;,@(4 *ear Three @,)<1,1(' *,*4;,'6* <6*,6;* (;),*<4 *;1,1)* 1;),@)1 5;<),;4)

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Balance Sheet
The Balance Sheet at the end of %ear ?ne =see Bppendi" '> shows a healthy surplus of current assets over current liabilities. #e have shown a conservative funding position, which does not include any of the additional capital that we hope to secure.

Performance Ratios
#e plan to move our gross profit up from 11 percent in %ear ?ne to 1( percent in %ear Three. These figures loo& 3uite low, but it should be remembered that our gross profit is really the sales commission we earn, not the full price of an adventure vacation. ?ur net income before ta"es is a more accurate measure of performance. This we e"pect to move from ' percent at the outset up to 6 percent by %ear Three. Eommission generated and profit per employee will be among the highest in the industry. Ta le @3 Commission 7enerate! an! Profit per Employee
*ear One ,ross profit O Net income before ta"es O Eommission generated per employee Profit per employee 51',)6; 5*<,')@ 514*,6)6 11 ' 5@*,@<) *ear T%o 1' @ 51(6,@(@ *ear Three 1( 6 51*;,;@(

Brea98E,en
To brea& even we will need to sell between ' and ( vacations per day. This compares with our present sales of 1.( vacations per day, based on our part+time effort out of the clothing shop. #e feel confident that the brea&+even point can be attained within a reasonable period of time.

#un!s Re.uire! an! Timin#e plan to ma&e two maAor investments8 one in #eb site and database development and one in shop premises development. #eb site and database development + this will cost 5;1,('). The database system is one of our &ey differentiators. It will allow us to offer superior service and ensure a high level of repeat
Northwind Traders Sample Business Plan ''

business and referrals. The #eb site is vital if we are to reach this wide and disparate global mar&et. The group of potential clients we have chosen as our target mar&etIaffluent, professional ')+ to ()+year oldsIare prime users of the Internet. !ven those people in our locality will e"pect to be able to research our offers on the Internet before coming to the shop. =See Bppendi" 1, Internet ,rowth and the Sale of Travel Services > Shop premises development + this will cost us 5'<,''). #e have to loo& professional and have an efficient wor& environment. If our staff do not have the right tools, we can hardly e"pect them to deliver superior performance. If clients see CamateurD premises, they will not be inspired to spend thousands of dollars and entrust their adventure vacation plans to us. Both these investments need to be made at the outset to ensure that the business creates the right impression from the start. #e get only one chance to ma&e a first impression. #e have decided to lease our telephone and computer systems, since this is a rapidly changing area and we need to have access to the very latest technology. inancing pac&ages from e3uipment suppliers are currently very attractive.

#un!in- Options
The owner plans to invest 5;1,@)4 of her own money =the proceeds of the sale of her share of the clothing shop business>. The cash flow proAections show that the business will re3uire 56(,)44 of wor&ing capital during the early months of the first year2s operations. In the event that additional funds prove necessary, we have identified two options for raising further funds8 Option 2: The sale of e3uity, perhaps to the original shop partners, could raise between 5;1,@)4 and 51*@,444. This would provide some capital to allow for growth. Bny shortfall could be funded either by a line of credit or a ban& loan. Option 28 Bpproach our ban& with a view to raising a medium+term loan of 5;1,@)4 and a line of credit of 5)6,;)4. -eather .itchell could, with family help, provide any lender with security for part, if not all, of this facility.

Northwind Traders Sample Business Plan

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BUS&$ESS CO$TRO6S
)ccountin- System
#e will be using a computer+based financial management system. #ith this system we can review our sales and mar&eting activities on a regular basis. This will allow us to analy$e the profitability of sales of different vacations through each tour operator. Thus we will be able to reward staff on the basis of profit achieved rather than Aust on sales.

?uality Control
#e will be developing outline scripts to help the sales staff manage in3uiries. This will ensure that all incoming phone calls are dealt with in the same way and meet a high standard. #e will encourage people in3uiring about vacations to give us feedbac& on our service8 ?ur ability to handle their in3uiry The amount of time from the client2s first in3uiry to the date of actual travel The client2s reactions to the vacation in terms of whether it meets their e"pectations

$e% Tour Operators

-eather .itchell will be responsible for reviewing the range of tour operators that we see& to represent and negotiating with prospective new principals.

Capacity
?ur offices can accommodate five sales des&s. !ach sales des& has a capacity to handle four clients per hour, which means over the course of a year, we could handle up to ;4,444 in3uiries. #ith our average sales rate of one in five, we could service <*44 clients from our present facilities. This is well above the numbers we are anticipating in the business plan.

6on-8Term 7oals
The financial obAectives of Northwind Traders are to be operating at or close to brea&+even cash flow by the end of the first year, with steady growth over the ne"t five years. #e aim to be profitable from %ear ?ne onward9 our goal is to earn at least 5(4;,444 postta" profit in %ear Two and nearly 5;<*,444 in %ear Three. ?ur profit margin on sales by %ear Three will be a respectable @ percent.
Northwind Traders Sample Business Plan ';

Steps for )chie,in- 7oals

Northwind Traders2 strategy for achieving our goals consists of si" maAor points8 !stablish an e"tensive public relations campaign 7ecruit well+trained, enthusiastic staff Geliver superior product &nowledge Provide high+3uality customer service Ereate a library of toolsJreference materials for clients ?ffer competitive pricing on vacation pac&ages The first step to achieving our goals is to hire a competent public relations agency. This will be the &ey to producing state+of+the art publicity materials and determining where these materials should be placed for optimum visibility. The second step will be to increase the staff. The individuals recruited will go through an e"tensive training program to ensure that they will be able to provide superior product &nowledge in the field of !uropean adventure travel. The present staff is passionate about adventure vacations, and we intend to maintain their enthusiasm through constant product development and s&ill training. #e will only recruit those individuals who share our vision. #e also want the business to have an enAoyable atmosphere. The third step is to install a library of reference wor&s in the shop. These materials will be available for clients to browse through while in the shop or to Cchec& outD and peruse at home. Bn agent will be on hand at all times to answer any 3uestions.

Position
#hile at present we are offering only other company2s adventure vacations, we have protected our position in a number of ways. irst, we have a two+year agency agreement with .argie2s Travel, which gives us access to all their e"isting vacation products as well as any new ones. This contract is dependent on Northwind Traders achieving sales of at least ')4 vacation pac&ages a year. #e intend to negotiate similar agreements with future suppliers, although sales targets with them will be lower to reflect their relative mar&et position.
Northwind Traders Sample Business Plan ')

Second, we intend to maintain a high service element to our business, e"tending our range of value+added services such as vacation insurance, individuali$ed prevacation boo&lets, postvacation follow+up, and continually updating our client database. In this way, we will see& to build up a high level of repeat business. Eustomer loyalty is vital to our profitable growth.

Ris9s )ssociate! %ith 7ro%th

#e see some ris&s associated with our e"pected growth8 :osing touch with customers :oss of clientele to other providers Puality of services diminished New businesses

The ris&s facing the e"pansion of Northwind Traders can be summed up in one word8 competition. In order to sustain our position in the area as the premier agency for !uropean adventure travel, Northwind Traders needs to outshine its competition. By maintaining our focus on superior product &nowledge and outstanding customer service, we will be able to uphold our position in the industry, thereby retaining current clients and attracting new clients.

Northwind Traders Sample Business Plan

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)PPE$+&' 2: M)R1ET RESE)RC/

&nternational )rri,als y "orl! Re-ion
Up!ate! forecast for the years 2000 an! 2020 :millions;
Bverage annual 1<@) !urope !ast BsiaJPacific Bmericas Bfrica .iddle !ast South Bsia #orld total 1)(.6 6.@ )4.4 ;.@ (.* 1.* '''.( 1<<) ((6.' 6;.) 114.1 16.@ 11.( ;.) )*@.; 1<<* (;@.; <4.1 11).) 1<.; 1).1 ;.) )<'.1 '444 (<@ 1'' 1(6 ') 1; * @4' '414 )') ''< 1<) (@ '1 11 1,416 growth rate =O> 1<<4 + '414 (.1 @.* (.@ ;.* ;.< *.@ ;.1

Source8 ,lobal Stats. Eorp. 1<<@

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&n!ications of Tourism +eman! in 2<<A

International tourist arrivals =" 1,444> Bustria Belgium Genmar& inland rance ,ermany ,reece Ireland Italy :u"embourg Netherlands Portugal Spain Sweden Fnited 1ingdom !F Iceland :iechtenstein Norway !!B Swit$erland !urope+1< 1@,1@( ))*4 1*1; 6() *4,114 1;,6;@ 14,1(4 ;'(1 (1,4)' @*@ *)@; <@4* ;;,66* *6( '',@44 '(4,6*6 1<4 )< '664 '((,<<@ 11,)44 ';),;<@ Nights spent by foreign tourists =.ill> *(.6 1'.6 14.6 (.( );.( ().) (<.* 1;.4 11(.4 '.( 1<.@ ''.' 14@.6 @.< 1*;.< *@'.4 4.6 4.1 @.1 *64.4 (;.4 @1;.4 International tourism receipts =.ill. !EF> 11,1*6 ;@@* '61; 1('4 '4,@;' 1',;46 (1(6 '4)< '4,<<( ;@@* ;<;* (((4 1<,;(1 '*)' 1;,(** 1';,1;( 1'@ nJa 16'* 1'*,4<* @'(* 1((,(('

Source8 ,lobal Stats. Eorp. 1<<@

Northwind Traders Sample Business Plan

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Summary of #in!in-s from Mar9et Research Sur,ey

Three hundred clients of Northwind Traders who had made purchases in e"cess of 5()4 in the past si" months were surveyed. Percenta-e of Sample Customers Ta9in- an! $ot Ta9in- )!,enture (acations Bccording to our research, only '4 percent of our sample customers had never ta&en or considered ta&ing an adventure vacation. Thirty percent, while they had not yet ta&en such a vacation, had at least actively considered doing so. ifty percent of our sample are regular adventure travelers, ta&ing at least one adventure vacation each year. &nformation ) out 2@0 Respon!ents "ho Too9 )t 6east One tra,el (acation Per *ear ,ender8 Status8 .ale .arried *)O '1O emale Single @<O ()O

)!,enture (acation Tra,elersB y )-e an! Percent Bccording to our study, the percentages of adventure vacation travelers in fall into various age groups as follows8 )O are under the age of 1* ')O are ages 1* to '; ;4O are ages ') to () '4O are ages (* to ;) 14O are over the age of ;)

Percenta-e of )!,enture (acation Tra,elers y &ncome 7roup Bccording to our research, the percentages of adventure vacation travelers in various income brac&ets are as follows8 *O earn 51*,@44 or less annually ''O earn between 51*,@41 and 5'),4)4 annually '6O earn between 5'),4)1 and 5((,;44 annually
(4

Northwind Traders Sample Business Plan

')O earn between 5((,;41 and 5;1,@)4 annually 1<O earn more than 5;1,@)4 annually

orty+five percent of respondents ta&ing adventure vacations spend in e"cess of 5((;4 per person per vacation. Twenty percent of the respondents, who tend to be professionals in the ')+ to ()+year age range, typically spend over 5)414 per person. Those respondents spending under 5((;4 are both in the lower income and lower age groups and represent 14 percent of the respondents. Percenta-e y +estination of @000 Ma>or )!,enture Tours ),aila le on the Mar9et B study by destination of appro"imately )444 maAor adventure tours on the mar&et reveals the following8 1'44 are for destinations in !urope 1444 are for destinations in North Bmerica *44 are for destinations in India 614 are for destinations in Bfrica *@) are for destinations in the ar !ast *@) are for other destinations

By contrast, the percentages of the adventure travelers purchasing vacation pac&ages to each of these destinations are as follows8 !urope + ;1O North Bmerica + (4O India + 14O Bfrica @O ar !ast + @O other destinations + )O

?ur research shows that !urope is the most popular destination for adventure vacation travelers. -owever, only 1'44 of the )444 adventure tours on the mar&et are for !uropean destinations. Bfrica, which only attracts @ percent of the mar&et, has 1* percent of the tours aimed at it. It
Northwind Traders Sample Business Plan (1

follows that the !uropean mar&et has scope for e"pansion and that if we concentrate on that mar&et, we only need to have detailed &nowledge of upmar&et !uropean tours, rather than all )444. In that way we can have the advantage of superior &nowledge in our chosen mar&et.

Percenta-e y Source from %hich Tra,eler /ear! ) out 6ast )!,enture (acation ?ur research reveals the following about the source from which adventure travelers originally found out about the last adventure vacation they purchased8 publicity activity + (4O travel agent + ')O friend + 16O adventure press + 1)O press advertising + 6O Internet + ;O

These findings demonstrate the power of publicity. The ne"t most effective way to reach potential clients is via the travel agent2s shop window. Both the press in general and the adventure travel press do not appear to have much effect on buyers in this mar&et.

The percentage of respondents who have not been on an adventure vacation organi$ed by their employer far outnumbers those who have been on a vacation planned by their employer. There is a significant minority of corporate clients who buy adventure vacations to use as rewards, motivation, or as part of a management development program. These corporate customers are also those clients who spend over 5)414 per person per tour.

Northwind Traders Sample Business Plan

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$ORT/"&$+ TR)+ERS ?UEST&O$$)&RE (Your replies are anonymous so confidentiality is assured)

1. 7en!er8 Marrie!: Chil!ren )-e8 .ale %es %es Fnder 1* 1* + '; ') + () (* + ;) ;)L Occupation: emale No No &ncome8 Fnder 51*,@44 51*,@41+5'),4)4 5'),4)1+5((,;44 5((,;41+5;1,@)4 over 5;1,@)4

Self8................................................................... Partner8.............................................................

'.

-ow many adventure vacations have you ta&en in the past three yearsQ None + never considered ta&ing one Eonsidered, but not yet ta&en a vacation Ta&en one adventure vacation Ta&en two adventure vacations Ta&e at least one adventure vacation every year

(.

If you ta&e adventure vacations, how much do you spend per head per vacationQ Fnder 51*@4 51*@1+5((;4 5((;1+5)414 ?ver 5)414

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;.

#ho did you buy your last adventure vacation fromQ #ould you use that source Traveled independently Girectly from the tour operator /ia the Internet rom a specialist adventure travel agent rom a general travel agent %es %es %es %es %es No No No No No

againQ

).

-ow did you hear about the last adventure vacation that you too&Q rom a friendJcolleagueJrelative /ia an advertisement in general press /ia the Internet Saw it in the travel agent2s window /ia an advertisement in specialist adventure travel press !ditorial in pressJT/Jradio

*.

#hat impressed you most about the people you bought your last adventure vacation fromQ 7an&ing for level of impression =1 R e"cellent, ; R useless> 1nowledge of activity 1nowledge of destination 7ange of helpful advice Bdditional services, such as insurance 7an&ing for importance of factor =1 R very high, ; R 3uite unimportant>

@.

#hat did you disli&e most about the last adventure travel vacation that you too&Q The other people on the vacation were not compatible =e.g. much older, younger, or had very different competence levels>

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Too e"pensive

The travel agentJtour operator did not properly e"plain the true nature of the vacation The administrative arrangements were poor + I had to do all the chasingM 6. #hat was the destination of your last adventure travel vacationQ !urope Bsia

N. Bmerica

?ther

Bfrica <.

India

If you have never ta&en an adventure vacation would you consider ta&ing one from a reputable travel agent with proven e"pertise in this mar&etQ %es No

14.

-ave you ever been on an adventure vacation organi$ed by your employerQ %es No

Thank you for your help with our research. We hope this will help Northwind Traders bring you more exciting adventure vacations.

Northwind Traders Sample Business Plan

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&nternet 7ro%th an! the Sale of Tra,el Ser,ices

Sales of travel services on the Internet have risen steadily over the past several years and loo& to continue increasing through the year '444. These sales far outweigh other Internet sales, including PE sales of software and hardware, clothing sales, and boo& sales. or e"ample, in 1<<6 sales of travel services totaled 51.; billion, while PE products e3ualed 51.4 billion, boo&s 5;44 million, and clothing 5')4 million. !uropean users of the Internet are growing rapidly. The Fnited 1ingdom is the second largest Internet user mar&et after ,ermany, followed in decreasing order by the Netherlands, rance, inland, Italy, and Spain. Percenta-e of &nternet Users "ho /a,e Shoppe! OnlineB 2<<CB in Millions #hen it comes to actually using the Internet for online shopping, inland leads the way, with ,ermany and the Fnited 1ingdom sitting s3uarely in the middle, close to the !uropean average. The percentage of Internet users, by region, who have shopped online in 1<<6 are as follows8 inland + *<O the Netherlands + ;(O ,ermany + ;1O Fnited 1ingdom + (6O Italy + ((O Spain + (1O rance + '<O

The average percentage of !uropean Internet users who have shopped online in 1<<6 is ;1 percent.

Northwind Traders Sample Business Plan

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)PPE$+&' 2: #&$)$C&)6 #OREC)STS

Northwind Traders Sample Business Plan

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Northwind Traders Sample Business Plan

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Balance SheetB One *ear :?uarterly;

Balance Sheet - One Year (Quarterly) Qtr 1 ASSETS Current Assets Year 1 Qtr 2 Qtr 3 Qtr 4

Northwind Traders Sample Business Plan

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Cash Marketable securities Accounts receivable, net Inventor !re"ai# e$"enses %ther Total Current Assets $on%-Ter& Assets !ro"ert , "lant, an# e&ui"'ent (ess accu'ulate# #e"reciation +et "ro"ert , "lant, an# e&ui"'ent %ther lon,-ter' assets Total $on%-Ter& Assets Total Assets $(AB($(T(ES A)* S+A,E+O$*E,S- EQ.(TY Current $/a0/l/t/es .hort-ter' #ebt Current 'aturities o/ lon,-ter' #ebt Accounts "a able Inco'e ta$es "a able Accrue# liabilities %ther Total Current $/a0/l/t/es $on%-Ter& $/a0/l/t/es (on,-ter' #ebt less current 'aturities 0e/erre# inco'e ta$es %ther lon,-ter' liabilities Total $on%-Ter& $/a0/l/t/es Sharehol1ers- E2u/ty Co''on stock A##itional "ai#-in ca"ital 1etaine# earnin,s %ther Total Sharehol1ers- E2u/ty Total $/a0/l/t/es an1 Sharehol1ers- E2u/ty

7855 0 5600 0 400 0 13,8

210 0 16,800 0 535 0 1!, 4

20,768 0 35,890 0 835 0 !,4"3

19,935 0 45,818 0 835 0 ##, 88

29,225 )2296* 26,929 0 2#,"2" 4',!84

29,225 )4592* 24,633 0 24,#33 42,1!8

29,225 )6888* 22,337 0 22,33! !",83'

29,225 )9185* 20,040 0 2','4' 8#,#28

0 0 525 0 0 0 2

0 0 640 0 0 0 #4'

0 0 750 3500 0 0 42 '

0 0 835 9142 0 0 ""!!

0 0 0 '

0 0 0 '

0 0 0 '

0 0 0 '

41,750 0 )1,491* 0 4',2 " 4',!84

41,750 0 )212* 41, 38 42,1!8

41,750 0 33,830 ! , 8' !",83'

41,750 0 34,901 0 !#,# 1 8#,#28

Northwind Traders Sample Business Plan

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Cash #lo% #orecastB 22 Months

Cash 3lo4 3orecast - 12 5onths 5onth 6re,ece/7ts Start Cash sales Collections /ro' cre#it +e2 salese&uit in/lo2 (oans receive# %ther Total ,ece/7ts ' 6ay&ents Cash "urchases !a 'ents to cre#itors .alaries an# 2a,es 3'"lo ee bene/its !a roll ta$es 1ent 4tilities 1e"airs an# 'aintenance Insurance 5ravel 5ele"hone !osta,e %//ice su""lies Marketin, an# a#vertisin, !ro/essional /ees 5rainin, an# #evelo"'ent 6ank char,es Miscellaneous %2ner7s #ra2in,s (oan re"a 'ents 5a$ "a 'ents Ca"ital "urchases %ther - #atabase an# 8eb Total site 6ay&ents Cash8lo4 Sur7lus9*e8/c/t (-) O7en/n% Cash Balance Clos/n% Cash Balance 1 2 10,020 3 10,855 251 4 12,525 418 8350 1','2' 11,1'# 21,2"3 14,#"# 1#,3## 14,195 501 # 15,865 501 ! 18,370 585 8350 2!,3' 22,4#2 24,"#! 8 21,710 752 " 24,215 752 1' 26,406 1002 8350 3 ,! 8 2",81' 34,232 11 28,808 1002 12 33,066 1166 Totals 21#,'3 #"3' ' 41,! ' ' 2#4,!1

16,700 1#,!''

'

401 1203 6304 3152 1051 5253 1021 584 1021 1240 1043 438 949 6938 5439 1751 26 0 0 0 0 25,050 0 #2,8#4

326 978 5120 2560 853 4267 830 474 830 1007 847 358 770 5635 4418 1422 21 0 0 0 0 0 0 3',!1#

166 499 2620 1310 437 2183 425 243 425 515 434 182 394 2883 2261 728 11 0 0 0 0 4175 0 1",8"1 (8,!8 )

131 392 2058 1029 343 1715 333 191 333 405 341 143 310 2265 1776 572 9 0 0 0 0 0 10,000 22,34# (1,' 3)

237 713 3728 1864 621 3107 604 345 604 734 617 259 561 4103 3217 1036 16 0 0 0 0 0 0 22,3## (!,#!')

166 499 2620 1310 437 2183 425 243 425 515 434 182 394 2883 2261 728 11 0 0 0 0 0 0 1 ,!1# # '

149 446 2336 1168 389 1947 379 216 379 460 387 162 352 2571 2016 649 10 0 0 0 0 0 10,000 24,'1# 3,28"

149 446 2336 1168 389 1947 379 216 379 460 387 162 352 2571 2016 649 10 0 0 0 0 0 0 14,'1# 8,44#

166 499 2620 1310 437 2183 425 243 425 515 434 182 394 2883 2261 728 11 0 0 0 0 0 0 1 ,!1# ",2 1

113 339 1780 890 297 1483 288 165 288 350 295 124 268 1959 1536 494 7 0 0 0 0 0 21,325 32,''1 3,! !

113 339 1780 890 297 1483 288 165 288 350 295 124 268 1959 1536 494 7 0 0 0 0 0 0 1',#!# 1",134

167 503 2631 1315 438 2192 426 244 426 518 435 183 396 2895 2270 731 11 0 0 0 0 0 0 1 ,!81 18,4 1

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' (4#,1#4) (2',#"#) '

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Northwind Traders Sample Business Plan

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&ncome StatementB Three *ear Summary

(nco&e State&ent - Three Year Year 1 Su&&ary Sales .ales %ther Total Sales $ess Cost o8 :oo1s Sol1 Materials (abor %verhea# %ther Total Cost o8 :oo1s Sol1 :ross 6ro8/t O7erat/n% E;7enses .alaries an# 2a,es 3'"lo ee bene/its !a roll ta$es 1ent 4tilities 1e"airs an# 'aintenance Insurance 5ravel 5ele"hone !osta,e %//ice su""lies Marketin, an# a#vertisin, !ro/essional /ees 5rainin, an# #evelo"'ent 6ank char,es 0e"reciation Miscellaneous %ther Total O7erat/n% E;7enses O7erat/n% (nco&e Interest inco'e )e$"ense* %ther inco'e )e$"ense* Total )ono7erat/n% (nco&e (E;7ense) (nco&e ($oss) Be8ore Ta;es (nco&e Ta;es )et (nco&e ($oss) Cu&ulat/<e )et (nco&e ($oss) 2,364,839 2,3#4,83" Year 2 5,202,645 ,2'2,#4 Year 3 Totals

7,591,132 1 ,1 8,#1# ' !, "1,132 1 ,1 8,#1#

2,096,056 2,'"#,' # 2#8,!83

4,578,327 4, !8,32! #24,318

' ' ' 6,604,286 13,2!8,##" #,#'4,28# 13,2!8,##" "8#,84# 1,8!","4!

36,072 18,036 6012 30,060 5845 3340 5845 7,097 5970 2505 5428 39,700 31,125 10,020 150 9185

40,581 20,291 6764 30,060 5845 3340 9185 17,535 7933 4175 8350 38,410 16,550 16,700 150 9185

58,116 29,058 9686 40,080 6680 3340 16,700 30,895 10,855 8350 12,525 50,100 16,500 35,070 200 9185

21#,3"' 2,3"3 )8350* (83 ') 44,'43 9142 34,"'1 34,"'1

23 ,' 4 38",2#4 )8350* (83 ') 38',"14 76,184 3'4,!3' 33",#31

33!,34' #4", '# )8350* (83 ') #41,1 # 145,751 4" ,4' 83 ,'3#

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Northwind Traders Sample Business Plan

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Sources an! Uses of #un!s

Sources an1 .se o8 3un1s +u'ber o/ /un#in, roun#s e$"ecte# /or /ull /inancin,9 5otal #ollar a'ount bein, sou,ht in this roun#9 :83,500 SO.,CES O3 3.)*S E2u/ty 3/nanc/n%= !re/erre# .tock9 Co''on .tock9 *e0t 3/nanc/n%= Mort,a,e (oans9 %ther (on,-5er' (oans9 .hort-5er' (oans9 Convertible 0ebt9 (n<est&ent 8ro& 6r/nc/7als= .SE O3 3.)*S Ca7/tal E;7en1/tures= !urchase o/ !ro"ert 9 (easehol# I'"rove'ents9 !urchase o/ 3&ui"'ent;<urniture9 %ther9 >or?/n% Ca7/tal= !urchase o/ Inventor 9 .ta// 3$"ansion9 +e2 !ro#uct (ine Intro#uction9 A##itional Marketin, Activities9 %ther 6usiness 3$"ansion Activities9 %ther9 0atabase an# 8eb site *e0t ,et/re&ent= Cash ,eser<e= :41,325 :34,700 :20,000 :29,225 :41,750 1

Northwind Traders Sample Business Plan

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