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Table of Contents

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


Chart: Highlights .......................................................................................................................... 1
1.1 Objectives.................................................................................................................................... 1
1.2 Mission .......................................................................................................................................... 1
1.3 Keys to Success ........................................................................................................................ 2
2.0 Company Summary ..................................................................................................................... 2
2.1 Company Ownership ............................................................................................................... 2
2.2 Start-up Summary ................................................................................................................... 2
Table: Start-up.............................................................................................................................. 2
Chart: Start-up ............................................................................................................................. 3
3.0 Services ............................................................................................................................................ 3
4.0 Market Analysis Summary ........................................................................................................ 3
4.1 Market Segmentation ............................................................................................................. 4
Table: Market Analysis ............................................................................................................... 4
Chart: Market Analysis (Pie) .................................................................................................... 4
4.2 Target Market Segment Strategy ...................................................................................... 4
4.3 Service Business Analysis ..................................................................................................... 5
4.3.1 Competition and Buying Patterns .............................................................................. 5
5.0 Web Plan Summary ..................................................................................................................... 5
5.1 Website Marketing Strategy................................................................................................. 5
5.2 Development Requirements ................................................................................................. 5
6.0 Strategy and Implementation Summary ............................................................................ 6
6.1 SWOT Analysis .......................................................................................................................... 6
6.1.1 Strengths ............................................................................................................................. 6
6.1.2 Weaknesses ........................................................................................................................ 6
6.1.3 Opportunities ..................................................................................................................... 6
6.1.4 Threats ................................................................................................................................. 6
6.2 Competitive Edge ..................................................................................................................... 6
6.3 Marketing Strategy .................................................................................................................. 7
6.4 Sales Strategy ........................................................................................................................... 7
6.4.1 Sales Forecast ................................................................................................................... 7
Table: Sales Forecast ............................................................................................................. 7
Chart: Sales Monthly .............................................................................................................. 8
Chart: Sales by Year ............................................................................................................... 8
6.5 Milestones.................................................................................................................................... 8
Table: Milestones ......................................................................................................................... 9
Chart: Milestones ....................................................................................................................... 10
7.0 Management Summary ............................................................................................................ 10
7.1 Personnel Plan ......................................................................................................................... 10
Table: Personnel ......................................................................................................................... 10
8.0 Financial Plan ............................................................................................................................... 11
8.1 Start-up Funding .................................................................................................................... 11
Table: Start-up Funding .......................................................................................................... 11
8.2 Important Assumptions ....................................................................................................... 12
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Table of Contents

8.3 Break-even Analysis .............................................................................................................. 12


Table: Break-even Analysis.................................................................................................... 12
Chart: Break-even Analysis ................................................................................................... 13
8.4 Projected Profit and Loss..................................................................................................... 13
Table: Profit and Loss ............................................................................................................... 13
Chart: Profit Monthly ................................................................................................................ 15
Chart: Profit Yearly .................................................................................................................... 15
Chart: Gross Margin Monthly................................................................................................. 16
Chart: Gross Margin Yearly .................................................................................................... 16
8.5 Projected Cash Flow .............................................................................................................. 16
Table: Cash Flow ........................................................................................................................ 17
Chart: Cash .................................................................................................................................. 18
8.6 Projected Balance Sheet ...................................................................................................... 18
Table: Balance Sheet ................................................................................................................ 18
8.7 Business Ratios ....................................................................................................................... 19
Table: Ratios ................................................................................................................................ 19
8.8 Long-term Plan ........................................................................................................................ 21
Table: Sales Forecast ......................................................................................................................... 1
Table: Personnel ................................................................................................................................... 2
Table: Personnel ................................................................................................................................... 2
Table: Profit and Loss ......................................................................................................................... 3
Table: Profit and Loss ......................................................................................................................... 3
Table: Cash Flow .................................................................................................................................. 5
Table: Cash Flow .................................................................................................................................. 5
Table: Balance Sheet .......................................................................................................................... 7
Table: Balance Sheet .......................................................................................................................... 7

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1.0 Executive Summary

Chart: Highlights

Highlights
100,000

80,000

Sales
60,000

Gross Margin
Net Profit

40,000

20,000

0
Year 1

Year 2

Year 3

Year 4

Year 5

1.1 Objectives

The Water Cube seeks to achieve the following goals:


1. Cash flow self sufficiency by the end of the first year.
2. Repay debt from original financing by the end of the second year.
3. Sales over $50K in the first year.
4. Sales of more than $80K by the third year.
1.2 Mission

The Water Cube is a business that envelopes fine dining of excellent sea food taste and the unique
sensation of the underwater world. Our mission is not only to have great tasting food, but have
efficient and friendly services. Our dining environment is not only welcoming and sophisticated, it is
unique in design with the dining space placed inside of a giant aquarium, the first one of this kind to
be built in our country. We concentrate on customer satisfaction and quality food that is always fresh
and specially selected. We will not judge a customer on class or dress, but we expect everyone to be
well-mannered. We want The Water Cube restaurant to be a place where people can enjoy a good
dinner and meet new friends in our subaqatic world.

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1.3 Keys to Success


We believe that our main keys to success include:
Exceptional setting
Easy access with ample parking
Our commitment to providing excellent quality services all the times
Our lively attention happiness of our staff
Competitive pricing
Maintaining an untarnished reputation in the community
2.0 Company Summary

2.1 Company Ownership


The Water Cube is projected as a private corporation limited by shares (private limited
company or "Ltd."), owned by its principal investors and operators.
2.2 Start-up Summary
The Water Cube' start-up costs will cover expense( legal fees), land buying, restaurant building,
cooking equipment, capital to cover losses in the first year, the giant aquarium and the food
supplies needed for the first year.
The expenses costs consist of legal fees, insurance, building' s construction plan, solicitor
counseling and logo&slogan development
The assets are divided into three groups: cash required for paying salaries and bills through
the first year, short-term assets (decorations, tables, ) and long-term assets (land, building,
water tank and fish, parking lots)
Other assets include the food supplies which will be paid in advance, the distributor having
to deliver an exact amount every month.
The financing will be made using a bank loan for small and medium businesses (250,000),
government help (10,000) and European Union funding programme (200,000).
More details are included in the table below:
Table: Start-up

Start-up
Requirements
Start-up Expenses
Advertising
Legal
Insurance
Building construction plan

5,000
500
100
10,000
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Market study
Solicitor
Other
Total Start-up Expenses

100
400
1,000
17,100

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

48,000
17,000
146,000
223,000

Total Requirements

240,100

Chart: Start-up

Start-up

240,000
210,000
180,000
150,000
120,000
90,000
60,000
30,000
0
Expenses

Assets

Investment

Loans

3.0 Services

4.0 Market Analysis Summary

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4.1 Market Segmentation


Our targeted market segment for the first two years is located preponderantly in Bacau . The
measure of this segment is estimated at 40% from the entire population of the city (180 000)
representing approximately 72 000 potential customers (medium and high class society).
After two years of activity we aim to extend our market segment attracting clients from other
towns through the use of publicity. Therefore we predict a 10% increase in the number of
potential customers by the end of each year.
Table: Market Analysis

Market Analysis
Year 1
Potential
Customers
Segment Name
Segment Name
Other
Total

Year 2

Year 3

Year 4

Year 5

Growth
0%
0%
0%
0.00%

CAGR
0
0
0
0

0
0
0
0

0
0
0
0

0
0
0
0

0
0
0
0

0.00%
0.00%
0.00%
0.00%

Chart: Market Analysis (Pie)

Market Analysis (Pie)

Segment Name
Segment Name
Other

4.2 Target Market Segment Strategy


Taking into account some aspects involved in this type of business: high quality services, low
incomes in the first years of activity and other factors which can interfere with the business

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development (inflation, interest rate) is compulsory that an accurate analysis and an effective
market strategy are made. Our policy regarding the marketing and our business promotion
stresses on the uniqueness of the restaurant. Our managerial team must create a market
strategy consisting in methods and specific factors to comply with each stage of the restaurant.
Therefore, in the opening day the restaurant will invite the reputed people of the town such as
the mayor, the prefects and other affluent people and will establish an effective advertising
system:
Visiting cards sent to other firms, commercial societies, public or cultural institutions
Leaflets given out in crowded public areas such as parks
Radio commercials (on local posts at first)
Advertising panels
In spring and summer there will be more intense publicity as the market segment will extend
The opening date will be wisely chosen. It is estimated that the perfect period for inaugurating
the restaurant is the first trimester of the year (the end of December the beginning of March)
since it may come as a gift on the occasion of some holidays such as: Christmas, New year
arrival, Valentines day or 8 March.
The costs of the dishes will depend on the costs offered by the competitors and the differences
could be seen in chefs special demonstrating the distinctive quality of the products and
services.
4.3 Service Business Analysis

4.3.1 Competition and Buying Patterns

5.0 Web Plan Summary


Our website, is an opportunity to offer current information on special events, menu offerings,
public service announcements and comp specials.

5.1 Website Marketing Strategy


Our website will be promoted on all of our menus, and promo pieces. We will link to bacaul.ro
and many other hospitality oriented websites and portals.
5.2 Development Requirements
The Fire Fountain Grille website will be initially developed with few technical resources.
Inmotion will host the site and provide the technical back end. We will maintain a simple,
classy, yet Internet focused site. The website logos, and graphics will be the same artwork

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found on our hard-copy menus, and in various spots in the business plan. Our managers will
maintain the website. As the website rolls out future development such as
restaurant newsletters and downloadable market research reports, a technical resource may
need to be contracted to build the trackable download and the newsletter capabilities. We will
also look into pre-packaged solutions through Inmotion and other Web hosting resources.

6.0 Strategy and Implementation Summary

6.1 SWOT Analysis

The following SWOT analysis captures the key strengths and weaknesses within
the company, and describes the opportunities and threats facing Interior Views.
6.1.1 Strengths
1. Knowledgeable and friendly staff. Our staff is both knowledgeable and
eager to please.

2. Up-scale ambiance. When you walk into Atlantida you will feel like beeing underwater. It
is a verry pleasant sensation, espacially if you are a sea lover.
3. Price-atmosphere-service quality ratio. Our services are of a verry high quality, and the
prices are the best.
4. Good locatin. Atlantida will be situated near town center, and it will be accesible to
everyone.
5. Project idear. It is a revolutinary concept that can help you to discover the fascinating
view of underwater.

6.1.2 Weaknesses
Concurence. There are many different restaurants in this area.
6.1.3 Opportunities
1.Sunny days. When the weather is nice, we will open the ceiling for o more spectacular view.
2. Summer time. In this seaseon, people tend to go to a nice and chill place and we are the
answer.
6.1.4 Threats
1. Low tourism rate. The tourism in this area is not verry well developed.
2. Population income. The population's low budget can be a big threat for our sales.
6.2 Competitive Edge
Clearly, our competitive edge is the customer service experience and approach that our
management team will bring to the table. Our smiling, unassuming and good natured approach
to all of our customers is evident, and highly appreciated. Our recipes are delicious, and the
portions are large. The foods are fresh and satisfying, and the drinks are fulfilling and
refreshing.

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6.3 Marketing Strategy


It is important to the marketing strategy to develop an attractive image for all our possible
customers. This can be done in a number of ways:
1. Advertising. The most powerfull tool that we can use is the internet.The costs for creating
and managing a web site are verry low, considering that we do not need to hire someone for
this.
2. Advertising. Development of a top quality logo and photography which can be used in ads,
brochures, name cards, etc. Not counting printing costs, which relate to quantity and quality of
paper chosen, the design costs for this would run about $1,000.
3. Advertising. Using the news programmes television, we will inform every people in the
country about our bussines. We will make people currious about this new concept and we hope
that there will be many of them who will want to visit this new intreseting building.
6.4 Sales Strategy
We require our servers to have a thorough and comprehensive understanding of the menus,
ingredients and methods of preparation of all of our foods and beverages. We train our staff to
always describe and recommend items, even to regular customers, and to always upsell. The
key to a server's success in upselling is the realization that it almost always brings in better tips
because the checks are higher. An other key feature we demand our employees is basic
knowledge about the species of plants and fish held in the aquarium, therefore being able to
satisfy any customer's cultural interest.
6.4.1 Sales Forecast
The first month sales will open strongly, because of the advantage buzz created by our
advertising campaign and our Grad Opening Festivities. There will be an enormous amount of
tourists comin only for the unique aquarium. Sales wil drop off slightly as the market begins to
segregate our specific customer segment.
We believe that the loss of visitators in the years 4 and 5 will be compensated with a rise in
food sales, thus keeping our sales number constant.
Table: Sales Forecast

Sales Forecast
Sales
Fast-food
Meal
Dinner
Tourist guide
Total Sales
Direct Cost of Sales
Fast-food
Meal
Dinner
Subtotal Direct Cost of
Sales

Year 1

Year 2

Year 3

Year 4

Year 5

4,440
14,481
22,054
46,124
87,099

4,500
18,000
30,400
40,100
93,000

4,510
20,100
36,200
39,000
99,810

4,580
22,000
41,540
38,500
106,620

4,600
22,500
44,100
38,000
109,200

Year 1
2,596
5,181
7,138
14,914

Year 2
2,700
5,500
8,000
16,200

Year 3
2,800
5,800
9,900
18,500

Year 4
2,850
6,100
11,000
19,950

Year 5
2,900
6,450
12,000
21,350

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Chart: Sales Monthly

Sales Monthly
11,000
10,000
9,000
8,000

Fast-food

7,000

Meal

6,000
5,000

Dinner

4,000

Tourist guide

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

Chart: Sales by Year

Sales by Year
110,000
100,000
90,000
80,000

Fast-food

70,000

Meal

60,000

Dinner

50,000

Tourist guide

40,000
30,000
20,000
10,000
0
Year 1

Year 2

Year 3

Year 4

Year 5

6.5 Milestones
The following table lists important program milestones, with dates and managers in charge, and
budgets for each. The milestone schedule indicates our emphasis on planning for
implementation.

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Each function is timed to coincide with the proper execution and time needed to complete each
task. Each manager has specific duties assigned specifically to his area of expertise. The end of
the milestone table also shows the Grand opening and the beginning of the first year marketing
plan.
Table: Milestones

Milestones
Milestone
Busness plan
Secure funding
Making the construction
plan
Building the parking lot
Building the restaurant
Marketing plans

Start Date
4/1/2011
4/15/2011
5/1/2011

End Date
4/15/2011
4/30/2011
5/15/2011

Budget
1,000
1,000
10,000

Manager
Berea Stefan
Berea Stefan
Berea Stefan

Department
Management
Management
Management

5/15/2011
5/15/2011
6/15/2011

5/30/2011
6/30/2011
7/30/2011

14,000
70,000
2,000

Construction
Contruction
Marketing

Ditributing flyers and


leaflets
Decorating the interior
and installing the
cooking equipment
Installing the aquarium
Hiring personell
Waiter courses
Grand opening

6/30/2011

8/15/2011

1,000

7/10/2011

7/20/2011

1,000

Cancel Radu
Cancel Radu
Budau
Alexandru
Budau
Alexandru
Cancel Radu

7/1/2011
7/1/2011
7/15/2011
8/1/2011

7/10/2011
7/15/2011
7/30/2011
8/15/2011

15,000
100
100
1,500

Cancel Radu
Berea Stefan
Berea Stefan
Budau
Alexandru

Design
Management
Management
Marketing

Totals

Advertising
Design

116,700

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Chart: Milestones

Milestones
Busness plan

Making the construction plan

Building the restaurant

Ditributing flyers and leaflets

Installing the aquarium

Waiter courses

Apr `11

May

Jun

Jul

Aug

7.0 Management Summary


We will open with a team of three manager/owners, two chefs, seven waiters, one fish keeper,
two security men, and one cleaner. Each member of the management team has specific
industry experience that will apply to their assignment. There will be three waiters working in
the morning, and four working in the afternoon. Every waiter will have knowledges about fishes
and during the visiting program they will be guides . Each staff member will work in 40
hour weeks. There are no gaps in its structure.
7.1 Personnel Plan
The following table is the personnel plan for Atlantida.
Table: Personnel

Personnel Plan
Manager
Cleaner
Fish keeper
Manager
Manager
Waiter
Waiter
Waiter

Year 1
3,600
1,800
5,400
3,600
3,600
2,520
2,520
2,520

Year 2
3,600
1,800
5,200
3,600
3,600
2,520
2,520
2,520

Year 3
3,600
1,800
5,200
3,600
3,600
2,520
2,520
2,520

Year 4
3,600
1,800
5,200
3,600
3,600
2,520
2,520
2,520

Year 5
3,600
1,800
5,200
3,600
3,600
2,520
2,520
2,520
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Waiter
Waiter
Chef
Chef
Total People

2,520
2,520
3,720
3,720
13

2,520
2,520
3,720
3,720
13

2,520
2,520
3,720
3,720
13

2,520
2,520
3,720
3,720
13

2,520
2,520
3,720
3,720
13

Total Payroll

38,040

38,040

38,040

38,040

38,040

8.0 Financial Plan

8.1 Start-up Funding


The start-up cost of Atlantis will consist primarily of land, estate building, equipment and
fixtures. The company will secure:
a loan in the amount of 200,000 to be paid on a 10-year amortization
a loan in the amount of 48,000 to be paid back on a 2-year amortization
a government funding of 10,000 non-repayable
An amount of 100,000 will be spent on land buying in the center of the metropolitan area of
Bacau.
The construction of
Table: Start-up Funding

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

17,100
223,000
240,100

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

175,000
48,000
20,900
68,900
243,900

Liabilities and Capital


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

48,000
200,000
3,000
0
251,000

Capital
Planned Investment
Owner
Investor
Additional Investment Requirement
Total Planned Investment

10,000
0
0
10,000

Loss at Start-up (Start-up Expenses)


Total Capital

(17,100)
(7,100)

Total Capital and Liabilities

243,900

Total Funding

261,000

8.2 Important Assumptions


We are assuming steady growth from good management, barring any unforseen local, or
national disasters such as the economic slowdown seen by most of the country following the
2008 recession.
8.3 Break-even Analysis

Table: Break-even Analysis

Break-even Analysis
Monthly Revenue Break-even

6,605
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Assumptions:
Average Percent Variable Cost
Estimated Monthly Fixed Cost

17%
5,474

Chart: Break-even Analysis

Break-even Analysis
4,000
3,000
2,000
1,000
0
(1,000)
(2,000)
(3,000)
(4,000)
(5,000)
0

2,000
1,000

4,000
3,000

6,000
5,000

8,000
7,000

9,000

10,000
11,000

8.4 Projected Profit and Loss

Table: Profit and Loss

Pro Forma Profit and Loss


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

Year 1
87,099
14,914
12,000
26,914

Year 2
93,000
16,200
12,000
28,200

Year 3
99,810
18,500
12,000
30,500

Year 4
106,620
19,950
12,000
31,950

Year 5
109,200
21,350
12,000
33,350

Gross Margin
Gross Margin %

60,185
69.10%

64,800
69.68%

69,310
69.44%

74,670
70.03%

75,850
69.46%

Expenses
Payroll
Marketing/Promotion

38,040
3,095

37,840
2,500

37,840
2,000

37,840
1,500

37,840
1,000

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Depreciation
Utilities
Insurance
Payroll Taxes

3,600
19,019
666
1,266

3,700
20,000
670
1,280

3,800
20,000
678
1,290

3,900
21,000
690
1,300

4,000
21,500
700
1,310

Total Operating Expenses

65,686

65,990

65,608

66,230

66,350

Profit Before Interest and


Taxes
EBITDA
Interest Expense
Taxes Incurred

(5,501)

(1,190)

3,702

8,440

9,500

(1,901)
2,261
0

2,510
1,625
0

7,502
1,375
0

12,340
1,125
0

13,500
875
0

0
0
0

0
0
0

0
0
0

0
0
0

0
0
0

0
(7,762)
-8.91%

0
(2,815)
-3.03%

0
2,327
2.33%

0
7,315
6.86%

0
8,625
7.90%

Other Income
Other Income Account Name
Other Income Account Name
Total Other Income
Other Expense
Other Expense Account
Name
Other Expense Account
Name
Total Other Expense
Net Other Income
Net Profit
Net Profit/Sales

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Chart: Profit Monthly

Profit Monthly
2,000

1,000

(1,000)

(2,000)

(3,000)
Month 1
Month 3
Month 5
Month 7
Month 9
Month 11
Month 2
Month 4
Month 6
Month 8
Month 10
Month 12

Chart: Profit Yearly

Profit Yearly
10,000
8,000
6,000
4,000
2,000
0
(2,000)
(4,000)
(6,000)

Year 1

Year 2

Year 3

Year 4

Year 5

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Chart: Gross Margin Monthly

Gross Margin Monthly


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

Chart: Gross Margin Yearly

Gross Margin Yearly


80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
Year 1

Year 2

Year 3

Year 4

Year 5

8.5 Projected Cash Flow


The cash flow depends on assumptions for good daily operational management, good traffic
counts in the restaurant, inventory turnover, payment days, and accounts receivable
management. We will need no new financing until we open our second unit.

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Table: Cash Flow

Pro Forma Cash Flow


Year 1

Year 2

Year 3

Year 4

Year 5

87,099
87,099

93,000
93,000

99,810
99,810

106,620
106,620

109,200
109,200

20,904

22,320

23,954

25,589

26,208

0
0

0
0

0
0

0
0

0
0

0
0

0
0

0
0

0
0

0
0

0
0
108,003

0
0
115,320

0
0
123,764

0
0
132,209

0
0
135,408

Year 1

Year 2

Year 3

Year 4

Year 5

38,040
41,259
79,299

37,840
58,489
80,329

37,840
57,203
80,043

37,840
57,647
80,487

37,840
59,073
80,913

17,491

18,320

19,954

21,589

23,008

48,000

24,996

25,000

25,000

25,000

25,000

Cash Received
Cash from Operations
Cash Sales
Subtotal Cash from
Operations
Additional Cash Received
Non Operating (Other)
Income
Sales Tax, VAT, HST/GST
Received
New Current Borrowing
New Other Liabilities
(interest-free)
New Long-term Liabilities
Sales of Other Current
Assets
Sales of Long-term Assets
New Investment Received
Subtotal Cash Received
Expenditures
Expenditures from
Operations
Cash Spending
Bill Payments
Subtotal Spent on
Operations
Additional Cash Spent
Non Operating (Other)
Expense
Sales Tax, VAT, HST/GST
Paid Out
Principal Repayment of
Current Borrowing
Other Liabilities Principal
Repayment
Long-term Liabilities
Principal Repayment

Page 17

Water Cube

Purchase Other Current


Assets
Purchase Long-term Assets
Dividends
Subtotal Cash Spent

0
0
169,785

0
0
123,649

0
0
123,997

0
0
125,076

0
0
128,921

Net Cash Flow


Cash Balance

(61,783)
7,117

(8,329)
(1,211)

0,233
(0,978)

7,867
8.845

7,513
16.358

Chart: Cash

Cash
60,000
50,000
40,000

Net Cash Flow

30,000

Cash Balance

20,000
10,000
0

Month 1
Month 3
Month 5
Month 7
Month 9
Month 11
Month 2
Month 4
Month 6
Month 8
Month 10 Month 12

8.6 Projected Balance Sheet

Table: Balance Sheet

Pro Forma Balance


Sheet
Year 1

Year 2

Year 3

Year 4

Year 5

7,117
1,586
17,000

(17,211)
6,082
17,000

(33,444)
7,302
17,000

(43,311)
7,436
17,000

(52,824)
7,897
17,000

Assets
Current Assets
Cash
Inventory
Other Current Assets

Page 18

Water Cube

Total Current Assets

25,703

5,871

(9,142)

(18,875)

(27,927)

146,000
3,600

146,000
7,300

146,000
11,100

146,000
15,000

146,000
19,000

142,400
168,103

138,700
144,571

134,900
125,758

131,000
112,125

127,000
99,073

Liabilities and Capital

Year 1

Year 2

Year 3

Year 4

Year 5

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

4,548
0
3,413
7,961

4,830
0
7,413
12,244

4,690
0
11,414
16,104

4,742
0
15,413
20,156

4,865
0
18,613
23,479

Long-term Liabilities
Total Liabilities

175,004
182,965

150,004
162,248

125,004
141,108

100,004
120,160

75,004
98,483

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

10,000
(17,100)
(7,762)
(14,862)
168,103

10,000
(24,862)
(2,815)
(17,677)
144,571

10,000
(27,677)
2,327
(15,350)
125,758

10,000
(25,350)
7,315
(8,035)
112,125

10,000
(18,035)
8,625
590
99,073

Net Worth

(14,862)

(17,677)

(15,350)

(8,035)

590

Long-term Assets
Long-term Assets
Accumulated
Depreciation
Total Long-term Assets
Total Assets

8.7 Business Ratios

Table: Ratios

Ratio Analysis

Sales Growth
Percent of Total Assets
Inventory
Other Current Assets
Total Current Assets
Long-term Assets

Year 1

Year 2

Year 3

Year 4

Year 5

n.a.

6.78%

7.32%

6.82%

2.42%

Industry
Profile
1.65%

0.94%
10.11%
15.29%
84.71%

4.21%
11.76%
4.06%
95.94%

5.81%
13.52%
-7.27%
107.27%

6.63%
15.16%
-16.83%
116.83%

7.97%
17.16%
-28.19%
128.19%

3.00%
51.34%
61.24%
38.76%

Page 19

Water Cube

Total Assets

100.00%

100.00%

100.00%

100.00%

100.00%

100.00%

Current Liabilities
Long-term Liabilities
Total Liabilities
Net Worth

4.74%
104.11%
108.84%
-8.84%

8.47%
103.76%
112.23%
-12.23%

12.81%
99.40%
112.21%
-12.21%

17.98%
89.19%
107.17%
-7.17%

23.70%
75.71%
99.40%
0.60%

23.09%
45.86%
68.95%
31.05%

100.00%
69.10%
78.01%

100.00%
69.68%
72.70%

100.00%
69.44%
67.11%

100.00%
70.03%
63.17%

100.00%
69.46%
61.56%

100.00%
61.00%
23.29%

3.55%
-6.32%

2.69%
-1.28%

2.00%
3.71%

1.41%
7.92%

0.92%
8.70%

2.32%
8.49%

3.23
3.03
108.84%

0.48
-0.02
112.23%

-0.57
-1.02
112.21%

-0.94
-1.31
107.17%

-1.19
-1.53
99.40%

0.97
0.84
68.95%

52.23%

15.93%

-15.16%

-91.04%

1461.72%

48.38%

-4.62%

-1.95%

1.85%

6.52%

8.71%

15.02%

Year 1
-8.91%
0.00%

Year 2
-3.03%
0.00%

Year 3
2.33%
0.00%

Year 4
6.86%
0.00%

Year 5
7.90%
1461.72%

n.a
n.a

Percent of Sales
Sales
Gross Margin
Selling, General &
Administrative
Expenses
Advertising Expenses
Profit Before Interest
and Taxes
Main Ratios
Current
Quick
Total Debt to Total
Assets
Pre-tax Return on Net
Worth
Pre-tax Return on
Assets
Additional Ratios
Net Profit Margin
Return on Equity
Activity Ratios
Inventory Turnover
Accounts Payable
Turnover
Payment Days
Total Asset Turnover

2.89
9.41

4.23
12.17

2.76
12.17

2.71
12.17

2.78
12.17

n.a
n.a

29
0.52

29
0.64

30
0.79

30
0.95

30
1.10

n.a
n.a

Debt Ratios
Debt to Net Worth
Current Liab. to Liab.

0.00
0.04

0.00
0.08

0.00
0.11

0.00
0.17

166.90
0.24

n.a
n.a

17,742
-2.43

(6,373)
-0.73

(25,246)
2.69

(39,031)
7.50

(51,406)
10.86

n.a
n.a

1.93
5%

1.55
8%

1.26
13%

1.05
18%

0.91
24%

n.a
n.a

Liquidity Ratios
Net Working Capital
Interest Coverage
Additional Ratios
Assets to Sales
Current Debt/Total
Assets

Page 20

Water Cube

Acid Test
Sales/Net Worth
Dividend Payout

3.03
0.00
0.00

-0.02
0.00
0.00

-1.02
0.00
0.00

-1.31
0.00
0.00

-1.53
185.07
0.00

n.a
n.a
n.a

8.8 Long-term Plan

Page 21

Appendix
Table: Sales Forecast

Sales Forecast
Sales
Fast-food
Meal
Dinner
Tourist guide
Total Sales
Direct Cost of Sales
Fast-food
Meal
Dinner
Subtotal Direct Cost of
Sales

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month
10

Month
11

Month
12

426
808
1,466
1,600
4,300

315
658
1,438
2,795
5,206

247
466
1,315
3,014
5,042

274
562
1,370
3,014
5,220

315
767
1,425
3,178
5,685

356
1,068
1,534
3,329
6,287

383
1,288
1,890
3,603
7,164

384
1,548
2,055
4,671
8,658

425
1,630
2,205
4,945
9,205

425
1,740
2,384
5,137
9,686

452
1,959
2,479
5,315
10,205

438
1,986
2,493
5,523
10,440

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

194
383
464
1,041

198
398
482
1,078

202
400
495
1,097

206
398
529
1,133

210
411
527
1,148

214
426
588
1,228

218
407
610
1,235

220
430
642
1,292

226
466
662
1,354

Month
10
231
479
698
1,408

Month
11
236
489
715
1,440

Month
12
241
494
726
1,461

Page 1

Appendix
Table: Personnel

Personnel Plan
Manager
Cleaner
Fish keeper
Manager
Manager
Waiter
Waiter
Waiter
Waiter
Waiter
Chef
Chef
Total People
Total Payroll

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9
300
150
450
300
300
210
210
210
210
210
310
310
13

Month
10
300
150
450
300
300
210
210
210
210
210
310
310
13

Month
11
300
150
450
300
300
210
210
210
210
210
310
310
13

Month
12
300
150
450
300
300
210
210
210
210
210
310
310
13

300
150
450
300
300
210
210
210
210
210
310
310
13

300
150
450
300
300
210
210
210
210
210
310
310
13

300
150
450
300
300
210
210
210
210
210
310
310
13

300
150
450
300
300
210
210
210
210
210
310
310
13

300
150
450
300
300
210
210
210
210
210
310
310
13

300
150
450
300
300
210
210
210
210
210
310
310
13

300
150
450
300
300
210
210
210
210
210
310
310
13

300
150
450
300
300
210
210
210
210
210
310
310
13

3,170

3,170

3,170

3,170

3,170

3,170

3,170

3,170

3,170

3,170

3,170

3,170

Page 2

Appendix
Table: Profit and Loss

Pro Forma Profit and


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

Month 1
4,300
1,041
1,000
2,041

Month 2
5,206
1,078
1,000
2,078

Month 3
5,042
1,097
1,000
2,097

Month 4
5,220
1,133
1,000
2,133

Month 5
5,685
1,148
1,000
2,148

Month 6
6,287
1,228
1,000
2,228

Month 7
7,164
1,235
1,000
2,235

Month 8
8,658
1,292
1,000
2,292

Month 9
9,205
1,354
1,000
2,354

Month 10
9,686
1,408
1,000
2,408

Month 11
10,205
1,440
1,000
2,440

Month 12
10,440
1,461
1,000
2,461

Gross Margin
Gross Margin %

2,259
52.53%

3,128
60.08%

2,945
58.41%

3,087
59.14%

3,537
62.22%

4,059
64.56%

4,930
68.81%

6,367
73.53%

6,851
74.43%

7,278
75.14%

7,765
76.09%

7,979
76.43%

Expenses
Payroll
Marketing/Promotion
Depreciation
Utilities
Insurance
Payroll Taxes

3,170
300
300
1,500
50
100

3,170
285
300
1,515
51
101

3,170
284
300
1,530
52
102

3,170
280
300
1,545
53
103

3,170
279
300
1,560
54
104

3,170
273
300
1,576
55
105

3,170
256
300
1,592
56
106

3,170
243
300
1,608
57
107

3,170
235
300
1,624
58
108

3,170
227
300
1,640
59
109

3,170
219
300
1,656
60
110

3,170
214
300
1,673
61
111

5,420

5,422

5,438

5,451

5,467

5,479

5,480

5,485

5,495

5,505

5,515

5,529

(3,161)

(2,294)

(2,493)

(2,364)

(1,930)

(1,420)

(550)

882

1,356

1,773

2,250

2,450

(2,861)
231
0

(1,994)
223
0

(2,193)
215
0

(2,064)
208
0

(1,630)
200
0

(1,120)
192
0

(250)
185
0

1,182
177
0

1,656
169
0

2,073
161
0

2,550
154
0

2,750
146
0

Total Operating
Expenses
Profit Before Interest and
Taxes
EBITDA
Interest Expense
Taxes Incurred

1%
1%

Other Income
Other Income Account
Name
Other Income Account
Name
Total Other Income

Other Expense
Other Expense Account

Page 3

Appendix
Name
Other Expense Account
Name
Total Other Expense
Net Other Income
Net Profit
Net Profit/Sales

0
(3,392)
-78.88%

0
(2,517)
-48.35%

0
(2,709)
-53.73%

0
(2,572)
-49.27%

0
(2,130)
-37.47%

0
(1,612)
-25.63%

0
(735)
-10.26%

0
705
8.14%

0
1,187
12.90%

0
1,612
16.64%

0
2,097
20.55%

0
2,304
22.07%

Page 4

Appendix
Table: Cash Flow

Pro Forma Cash Flow


Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

4,300
4,300

5,206
5,206

5,042
5,042

5,220
5,220

5,685
5,685

6,287
6,287

7,164
7,164

8,658
8,658

9,205
9,205

9,686
9,686

10,205
10,205

10,440
10,440

0
1,032

0
1,249

0
1,210

0
1,253

0
1,364

0
1,509

0
1,719

0
2,078

0
2,209

0
2,325

0
2,449

0
2,506

0
0
0
0
0
0
5,332

0
0
0
0
0
0
6,455

0
0
0
0
0
0
6,251

0
0
0
0
0
0
6,473

0
0
0
0
0
0
7,049

0
0
0
0
0
0
7,796

0
0
0
0
0
0
8,883

0
0
0
0
0
0
10,736

0
0
0
0
0
0
11,415

0
0
0
0
0
0
12,011

0
0
0
0
0
0
12,654

0
0
0
0
0
0
12,945

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

3,170
3,106
6,276

3,170
3,181
6,351

3,170
3,175
6,345

3,170
3,184
6,354

3,170
3,189
6,359

3,170
3,197
6,367

3,170
3,201
6,371

3,170
3,194
6,364

3,170
3,192
6,362

3,170
3,244
6,414

3,170
4,696
7,866

3,170
4,699
7,869

0
1,032
4,000

0
1,249
4,000

0
1,210
4,000

0
1,253
4,000

0
1,364
4,000

0
1,509
4,000

0
1,516
4,000

0
1,612
4,000

0
1,644
4,000

0
1,672
4,000

0
1,684
4,000

0
1,745
4,000

Cash Received
Cash from Operations
Cash Sales
Subtotal Cash from Operations
Additional Cash Received
Non Operating (Other) Income
Sales Tax, VAT, HST/GST
Received
New Current Borrowing
New Other Liabilities (interest-free)
New Long-term Liabilities
Sales of Other Current Assets
Sales of Long-term Assets
New Investment Received
Subtotal Cash Received
Expenditures
Expenditures from Operations
Cash Spending
Bill Payments
Subtotal Spent on Operations

24.00%

Additional Cash Spent


Non Operating (Other) Expense
Sales Tax, VAT, HST/GST Paid Out
Principal Repayment of Current
Borrowing
Other Liabilities Principal
Repayment
Long-term Liabilities Principal
Repayment
Purchase Other Current Assets
Purchase Long-term Assets
Dividends
Subtotal Cash Spent

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

0
0
0
13,391

0
0
0
13,683

0
0
0
13,638

0
0
0
13,689

0
0
0
13,806

0
0
0
13,959

0
0
0
13,970

0
0
0
14,059

0
0
0
14,089

0
0
0
14,169

0
0
0
15,633

0
0
0
15,697

Net Cash Flow

(8,059)

(7,228)

(7,387)

(7,217)

(6,757)

(6,163)

(5,087)

(3,323)

(2,674)

(2,158)

(2,979)

(2,751)

Page 5

Appendix
Cash Balance

60,841

53,613

46,226

39,010

32,253

26,090

21,003

17,680

15,006

12,848

9,869

7,117

Page 6

Appendix
Table: Balance Sheet

Pro Forma Balance Sheet


Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

68,900
12,000
17,000
97,900

60,841
10,959
17,000
88,800

53,613
9,881
17,000
80,494

46,226
8,784
17,000
72,010

39,010
7,651
17,000
63,661

32,253
6,503
17,000
55,756

26,090
5,275
17,000
48,365

21,003
4,040
17,000
42,044

17,680
2,749
17,000
37,429

15,006
1,395
17,000
33,401

12,848
1,487
17,000
31,335

9,869
1,547
17,000
28,416

7,117
1,586
17,000
25,703

146,000
0
146,000
243,900

146,000
300
145,700
234,500

146,000
600
145,400
225,894

146,000
900
145,100
217,110

146,000
1,200
144,800
208,461

146,000
1,500
144,500
200,256

146,000
1,800
144,200
192,565

146,000
2,100
143,900
185,944

146,000
2,400
143,600
181,029

146,000
2,700
143,300
176,701

146,000
3,000
143,000
174,335

146,000
3,300
142,700
171,116

146,000
3,600
142,400
168,103

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

3,000
48,000
0
51,000

3,075
44,000
0
47,075

3,069
40,000
0
43,069

3,077
36,000
0
39,077

3,082
32,000
0
35,082

3,090
28,000
0
31,090

3,095
24,000
0
27,095

3,088
20,000
203
23,291

3,085
16,000
669
19,755

3,088
12,000
1,235
16,322

4,540
8,000
1,887
14,427

4,542
4,000
2,653
11,194

4,548
0
3,413
7,961

Long-term Liabilities
Total Liabilities

200,000
251,000

197,917
244,992

195,834
238,903

193,751
232,828

191,668
226,750

189,585
220,675

187,502
214,597

185,419
208,710

183,336
203,091

181,253
197,575

179,170
193,597

177,087
188,281

175,004
182,965

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

10,000
(17,100)
0
(7,100)
243,900

10,000
(17,100)
(3,392)
(10,492)
234,500

10,000
(17,100)
(5,909)
(13,009)
225,894

10,000
(17,100)
(8,618)
(15,718)
217,110

10,000
(17,100)
(11,190)
(18,290)
208,461

10,000
(17,100)
(13,320)
(20,420)
200,256

10,000
(17,100)
(14,932)
(22,032)
192,565

10,000
(17,100)
(15,667)
(22,767)
185,944

10,000
(17,100)
(14,962)
(22,062)
181,029

10,000
(17,100)
(13,774)
(20,874)
176,701

10,000
(17,100)
(12,163)
(19,263)
174,335

10,000
(17,100)
(10,066)
(17,166)
171,116

10,000
(17,100)
(7,762)
(14,862)
168,103

(7,100)

(10,492)

(13,009)

(15,718)

(18,290)

(20,420)

(22,032)

(22,767)

(22,062)

(20,874)

(19,263)

(17,166)

(14,862)

Assets
Current Assets
Cash
Inventory
Other Current Assets
Total Current Assets
Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets

Starting
Balances

Liabilities and Capital


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

Net Worth

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