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Northwind Traders Sample Business Plan

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Introduction 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. For instance, in the sample plan, the Executive Summary, which is the last section of the Business Planning Wizard, is presented first in order to emphasize the most impressive features of the business. Your 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 taken the time to explore as many potential issues for your business as may arise.

Northwind Traders Sample Business Plan

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Mr. Richard Carey Canton Street Seattle, Washington 22222

Dear Mr. Carey: My attorney, Mr. William Hollands, suggested I write to you regarding my business, Northwind Traders. I am currently seeking funding, and I believe that my company would coincide with your interest in businesses relating to the travel industry makes my company a great investment for you. Northwind Traders is positioned to take advantage of the significant market opportunities available in the customized travel-planning field. Through a professional approach to marketing, experienced management, and an emphasis on outstanding customer support and service, Northwind Traders can become the Greater Seattle area’s premier provider of planning services for European adventure travel through a strong marketing campaign, experienced management, and an emphasis on outstanding customer support and service. From that base, the company will expand to become a regional force. We are seeking $83,500 in funding, and anticipate this to be the extent of the funds required. The funds will be used to refurbish the shop, to expand the staff, and to developincrease marketing activities, primarily our Web site and databasee development. I appreciate your consideration of the business plan for Northwind Traders. I will contact you next week in approximately ten days to see if you have any questions andor to discuss how we may proceed. Thank you. Sincerely,

Heather Mitchell President

Northwind Traders Sample Business Plan

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Northwind Traders Sample Business Plan 4 .

..............1 DESCRIPTION OF THE COMPANY.4 MANAGEMENT TEAM AND KEY PERSONNEL.......17 OPERATIONS...............................................................................................................15 ADVERTISING AND PROMOTION.........................................................................................................................................................................................................................................................2 FINANCING REQUIREMENTS.............1 FINANCIAL FORECAST............................................................................................................................................................................................................4 SERVICES....................................................................................................................7 GUARANTEES AND WARRANTIES...................................................................................................................................................................................................11 COMPETITIVE ANALYSIS.............................................................12 COMPETITIVE ADVANTAGES............................................................................1 MISSION STATEMENT...............................................................10 MARKET DEFINITION...................................8 BUSINESS STRUCTURE..................................................................16 COMMISSION..................................................................................................................................................................................9 LONG-TERM OPPORTUNITIES......................................................................................................................................................................14 BUSINESS STRATEGY...............................................................................................................9 GEOGRAPHIC AREA.........................................................................................................................................................................................................................................10 MARKET OPPORTUNITIES...............................................15 SALES AND MARKETING............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................15 CUSTOMER INCENTIVES........................................................................................................................................................................................................................................................................................................17 CHOICE OF LOCATION AND PREMISES........................................................................................................................................................................................................10 TARGET CUSTOMERS..........4 THE COMPANY’S MISSION......................8 ECONOMIC AND SOCIAL FACTORS.............................................................................................10 MARKET DESCRIPTION..........................................................................................................17 PREMISES...............8 MARKET RESEARCH...........................2 HISTORY AND POSITION TO DATE................13 COMPETITORS ’ POSITIONS............................................................................................................................................................................................................7 COMPANY HISTORY..............................................................................................................9 COMPETITIVE ENVIRONMENT....................Table of Contents EXECUTIVE SUMMARY.17 Northwind Traders Sample Business Plan 5 ..................................................................................................................................6 TRANSPORTATION................................................................................................................................................................................................................................................................14 POTENTIAL FUTURE COMPETITION............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................1 PRODUCTS AND SERVICES.........................................................................

.....................................................................................8 MANAGEMENT................................................................................................................18 CASH FLOW PROJECTIONS..........................................................................................................................................................................25 RISKS ASSOCIATED WITH GROWTH...................................................................................................................................................................................................................................................................21 BREAK-EVEN...............................................................18 FORECASTING....................................23 ACCOUNTING SYSTEM............................7 TARGET MARKET...................................................................................................................................................................................................................................................................................................8 FUNDING............................24 STEPS FOR ACHIEVING GOALS........................................................................................................................................................................10 THE COMPANY’S MISSION......................................................................................................................................................................9 HISTORY AND POSITION TO DATE...............21 PERFORMANCE RATIOS....................................................................................................................................................................................................................................................23 LONG-TERM GOALS.......................................................................................................................................................................................................................................................................................................................................................................................................17 EQUIPMENT..........................................................................................................HOURS OF OPERATION.....................................................................................................................................7 OPERATIONS.................................................................................................................................................................................................................................23 CAPACITY............................23 QUALITY CONTROL.....................................................................................................................................................................25 APPENDIX 1: MARKET RESEARCH.........................................................................................................................................................................................................................................................................................................................................................6 PRODUCTS AND SERVICES.........................................................................................................................................................................22 BUSINESS CONTROLS.............................................................................18 STAFFING.......................................................................................26 APPENDIX 2: FINANCIAL FORECASTS......................................20 BALANCE SHEET.......................................................................................................................................................6 THE COMPETITION................................................................21 FUNDS REQUIRED AND TIMING....................................................................................................................................................20 INCOME STATEMENT.......................8 FINANCIALS................................................................................................................................................................................................................................21 FUNDING OPTIONS................................................................................................................................................................................................................35 EXECUTIVE SUMMARY..............................................................................................................................................6 THE COMPANY.........................................................18 SALES FORECAST................6 MARKETING AND SALES TECHNIQUES.......................................................................................................................................................................10 Northwind Traders Sample Business Plan 6 ........................................................................................................................................................................................................................................................................................................................23 NEW TOUR OPERATORS ........24 POSITION..............................6 THE COMPANY’S MISSION............................................................................................................................................................................................................................................................................

........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................23 ADVERTISING AND PROMOTION.....................................................................................................................................................................................................................................26 HOURS OF OPERATION...........15 COMPETITIVE ENVIRONMENT......................23 CUSTOMER INCENTIVES.........................................................................................29 PERFORMANCE RATIOS........................................................................................................26 STAFFING......................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................15 GEOGRAPHIC AREA...10 SERVICES......................................................................................................................22 COMPETITORS ’ POSITIONS................29 BREAK-EVEN................................................................................................26 EQUIPMENT............................................................................................................................................................................................................14 BUSINESS STRUCTURE.................................................................................................................................18 COMPETITIVE ANALYSIS................................................................................................................28 INCOME STATEMENT...............MANAGEMENT TEAM AND KEY PERSONNEL.............................................................................................13 GUARANTEES AND WARRANTIES....................................................................................................................................................................................................25 PREMISES..........................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................19 COMPETITIVE ADVANTAGES...........................................................................................................................................................................................................................................27 SALES FORECAST.................................23 BUSINESS STRATEGY........................13 COMPANY HISTORY.................................................................................................................................................................................................................25 OPERATIONS................................................24 SALES AND MARKETING.................................................................................................17 MARKET OPPORTUNITIES............................................................................................................................16 TARGET CUSTOMERS...........14 MARKET RESEARCH.......14 ECONOMIC AND SOCIAL FACTORS......................................17 MARKET DEFINITION...................................................................................................................................................................................................................................................................................................................................................................................................................................................................................12 TRANSPORTATION.....................................................27 CASH FLOW PROJECTIONS....................................22 POTENTIAL FUTURE COMPETITION..................................................................28 BALANCE SHEET.........................................................................................................................................................................................................................................................................................................................................................................................................................................................30 Northwind Traders Sample Business Plan 7 ................................................................................................25 COMMISSION....................................................................................................................................................................16 MARKET DESCRIPTION...........................................26 FORECASTING...............................................................................25 CHOICE OF LOCATION AND PREMISES.................29 FUNDS REQUIRED AND TIMING...............................................................................................................15 LONG-TERM OPPORTUNITIES....................................

.........................................................................................................................................46 INCOME STATEMENT.....31 QUALITY CONTROL..........48 BALANCE SHEET AT END OF YEAR ONE.........................................................................32 CAPACITY...............................FUNDING OPTIONS.........................................................................................................................................................................................................34 APPENDIX 1: MARKET RESEARCH.............................................................................51 SOURCES AND USES OF FUNDS.........................................................................................32 POSITION................................................46 CASH FLOW PROJECTION YEAR ONE........................................44 APPENDIX 2: FINANCIAL FORECASTS...........................................31 NEW TOUR OPERATORS .............................................................41 INTERNET GROWTH AND THE SALE OF TRAVEL SERVICES.................................................................................................................................................................................................................................................................................................................32 LONG-TERM GOALS.......................................................................................................................................................................32 STEPS FOR ACHIEVING GOALS................................31 ACCOUNTING SYSTEM........................................................................................................................................................................................... YEARS ONE TO THREE..............................................................................................................................37 NORTHWIND TRADERS QUESTIONNAIRE.....................................................33 RISKS ASSOCIATED WITH GROWTH........................................................................................................................................31 BUSINESS CONTROLS.................................................................................................................................53 Northwind Traders Sample Business Plan 8 .........36 SUMMARY OF FINDINGS FROM MARKET RESEARCH SURVEY............................................................................35 INDICATIONS OF TOURISM DEMAND IN 1997..............................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................................35 INTERNATIONAL ARRIVALS BY WORLD REGION........................................................................................................................................

Northwind Traders Sample Business Plan 1 .

Northwind Traders Sample Business Plan 2 . She has selected a small team with extensive travel. With virtually no marketing effort. Northwind Traders offers a comprehensive range of services to support the adventurous traveler. The company’s goal is to grow steadilyy expansion. one of the largest and most respected tour operators in the market. Northwind Traders has sold some 200 adventure vacations in the past six months. Inc. including pre. Mitchell cofounded. including travel agencies. and could potentially add much more. Prior to starting the Northwind Traders travel agency. Ms. President Heather Mitchell and Vice President of Sales and Marketing Jim Kim currently hold the company’s stock. co-owned. all of whom will be invaluable to the new venture. Northwind Traders is dedicated to building long-term relationships with customers through quality training and customer support.and postvacation briefings. Her coworkers bring a combined total of 35 years of travel industry experience to the agency. becoming profitable by the secondthird year of operations.to 35. provides travel-planning services for European adventure vacations to residents ofindividuals in the Ggreater SeattleRedmond area. and Northwind Traders intends to capitalize on the success of this industry by taking advantage of travel planning opportunities in the Pacific Northwest region. netting $66. The Company’s Mission Statement The mission of Northwind Traders is to become the premier provider of adventure vacations for 25.800 in commissions. and a directory of services specific to each destination and activity. and operated the Northwind Traders clothing store. sales. and computer skills. and wants to be recognized as the leading adventure vacation company in the Ggreater SeattleRedmond area. The service industry. Products and Services Northwind Traders recently became the appointed agents for Margie’s Travel.EXECUTIVE SUMMARY The Description of the Company Northwind Traders. travel insurance. President Heather Mitchell and Vice President of Sales and Marketing Jim Kim currently hold the company’s stock.year-old professionals. Sales of insurance policies and other services have added to this total. is one of the fastest growing business sectorsareas of the economy.

Northwind Traders will cater to these needs and develop a strong returncustomer base. In order to maintain and improve their current position in the region. Northwind Traders outdoor clothing shop. they will need to invest in a Web site.Marketing and Sales Techniques Northwind Traders believes that by concentrating on one market segment and one geographic destination. looks set for explosive growth. Northwind Traders has a substantial opportunity to dominate the region. it is clear that there is considerable potential in the adventure travel business. informative Web site. Northwind Traders maintains the following advantages over existing competition: ongoing support to clients. competitive rates. by offering discount services to shop customers. Adventure vacations. extensive knowledge of the European adventure vacation field. Northwind Traders plans to leverage its relationship with its sister business. as well as database software and systems. superior customer service. Published research shows that tourism is a fast-growing business sector and that Europe is the favored location for most travelers. and in refurbishing the shop premises. it will be able to deliver a service that is superior to anything currently on the market. Because they are currently the only travel agency focused on European adventure vacations that is located in the SeattleRedmond area. specialized training programs for staff. In addition to targeting adventure travelers and working as the appointed agents for established travel tour firms. Research also suggests that the customers in this market are unlikely to purchase their vacations again from the firm who provided their last vacation due to a lack of informative sales personnel. while a relatively new and small market. The Competition From desk and field market research carried out on 300 clients. Research indicates that Northwind Traders’ target market finds it difficult to obtain reliable and authoritative advice on destinations and activities. informative Web site Northwind Traders Sample Business Plan 3 .

1400 in the second. and operated the Northwind Traders clothing store. Last year.400 profit on sales of $1. Northwind Traders expects that by concentrating full-time on selling adventure vacations. to at least 660 in the first year. Ms. as well as from the clientele it will gain through its proximity to the already established Northwind Traders clothing store. and 2100 in the third. Mitchell cofounded. The business will benefit both from its accessible location in the heart of SeattleRedmond’s downtown shopping district. and computer skills. clients will increase from the present level of 200 (achieved over a six-month period with only a part-time effort). She has selected a small team with extensive travel.500 and employed seven people. Management Prior to starting the Northwind Traders travel agency.419.competitive rates Target Market From desk and field market research carried out on 300 clients. Research indicates that Northwind Traders’ target market finds it difficult to obtain reliable and authoritative advice on destinations and activities. Operations The Northwind Traders travel agency business will operate from a self-contained facility within the existing clothing shop. Her coworkers bring a combined total of 35 years of travel industry experience to the agency. Financial Forecasts Northwind Traders started as a clothing store and has expanded into the travel agency business. co-owned. Northwind Traders will cater to these needs and develop a strong returncustomer base. Mitchell has identified three other tour operators she wishes to represent and has begun negotiations with them. it is clear that there is considerable potential in the adventure travel business. Ms. To help achieve this growth. sales. Northwind Traders clothing store made $200. all of whom will be invaluable to the new venture. Research also suggests that the customers in this market are unlikely to purchase their vacations again from the firm who provided their last vacation due to a lack of informative sales personnel. with its focus on adventure travel in Europe. with its own shop window and entrance from the main street. Northwind Traders Sample Business Plan 4 .

she will be investing $41.0600. Mitchell is considering loan finance made up of a $41. while makeing a modest profit in Year One. In addition. Mitchell plans to sell her shares in the clothing shop and invest the proceeds in the new travel business. and will increase to nearly $496501. Mitchell’s partners in the clothing shop and to outside investors. In total. Northwind Traders Sample Business Plan 5 . Alternatively.750 two-year loan and a credit line of $58. By the Year Two posttax profits should be $3040. Return on shareholders capital by Year Three is projected to be close to 100 percent. The purpose of the business plan is to communicate this highly profitable opportunity to Ms. about $125. Ms. Northwind Traders.Selling between two and three vacations a day will allow the business to reach cash flow breakeven in Year One. and to attract interest in the venture. FundingFinancing Requirementss Sought and Utilization Ms.450. and seeking $83.750 of her own money in the business.250 will be needed to fund the business during the initial months.000 by Year Three.500 from outside sources.

Northwind Traders Sample Business Plan 6 .

The Company’s Mission The goal of Northwind Traders is to be the leading provider of hassle-free European adventure vacations to the 25.500M billion (see Appendix 1. The business is located at 1234 Franklin Street. In addition to Ms. Internet Growth and the Sale of Travel Services). team members Jim Kim and Richard Bready will be moving into the new venture on a full-time basis. By capitalizing on our experience in the Northwind Traders clothing shop.to 35-year-old business professional market. Prior to that. Northwind Traders is rapidly expanding to sell its services worldwide via the Internet. Inc. an outdoor clothing shop in the Seattle area. She has a degree in travel and tourism from State University. and by the year 2000. Market research indicates that the major criticism our type of client has of existing travel agencies is that their agents “know nothing about their products. Initially operating in the SeattleRedmond area inoutside of Seattle. President and CEO. where she was responsible for managing the office systems and a staff of four. SeattleRedmond. Travel service sales is the fastest growing category of business to consumer activity on the Internet. Mitchell owned and operated Northwind Traders. she managed the Olympia branch of one of the larger regional chains of general travel agencies operating throughout western Washington. Ms. Before founding Northwind Traders. the value of this market is estimated at $4. they just open the catalogue and read. Our emphasis will be on providing a complete specialized service based on having a detailed knowledge of the vacation destination and adventure activities being offered. we will be able to both advise and direct our clients to the type of travel equipment they will need to get the very best out of their vacation.” to quote one of many disappointed travelers. and Amy Egert has been recently recruited to cover Saturdays and Northwind Traders Sample Business Plan 7 . Washington. provides travel-planning services to individuals and businesses in the Ggreater SeattleRedmond area. Management Team and Key Personnel Heather Mitchell. Washington. Mitchell.HISTORY AND POSITION TO DATE Northwind Traders.

Pak’s knowledge and guidance will be instrumental to the success of Northwind Traders. Prior to joining Northwind Traders. and update the business plan if needed. Jim Kim. retail store owner Tony Chor. The volunteer members of the Board of Directors provide guidance to the management and staff of Northwind Traders. With over 20 years of consulting experience in industries ranging from aerospace to technology to retail. Egert spent a year traveling abroad and joined the staff at Northwind Traders recently as a sales assistant. Ms. Business Consultant. After completing her undergraduate degree at the Institute of Art. caterer Northwind Traders Sample Business Plan 8 . review the mission statement. CPA Jo Brown. Mr. Sales Assistant. Kim worked for the marketing department of a major airline. Bready the ideal background for Northwind Traders. lawyer Lisa Garmaise. Jae Pak. Members include Lisa Jacobson. human resource manager Prasanna Samarawickrama. retail store owner Holly Barrett. His current responsibilities include the company’s direct marketing campaign and all sales-related issues. A knowledgeable salesperson. Twenty years as a travel agent has given Mr. Richard Bready. Mr. Bready’s expertise in the area of European travel enables him to entice the adventure traveler. Amy Egert. Freelance business consultant Jae Pak will be advising during the business’s changeover from clothing shop to adventure travel agency. Office Manager. Vice President Sales and Marketing. The board meets twice yearly to discuss policy changes. Mr.vacations. former travel agent William Hollands.

trains. and Turkey. the Black Sea. and ballooning across the Alps. In addition. Transportation Systems The vacations we will offer will use all principal travel systems. covering such areas as the Adriatic. a major supplier in the market. and as part of management development programs. and where appropriate. above-the-clouds trekking on islands and in remote regions in such areas as Corsica and Norway. Exploration Air. West Coast Sales.and postvacation briefing packs. ensuring that they will have a safe. Margie’s Travel offers some 40 different adventure vacation packages throughout Europe. These are three relatively new and small tour operators. and Latvia. Currently. including horse trekking in Iceland. including planes. enjoyable. They are particularly strong in France. Offers rafting. but they have acquired a reputation for innovation and reliability–and they are currently underrepresented. Germany. and Germany. taxis. Romania. and yachting trips around remote European rivers and coastline areas. We intend to be appointed agents by three other major adventure travel tour firms with whom we are currently in negotiation: Enchantment Lakes Corporation. and a directory of advice and information services particular to each destination and adventure activity. These services will include insurance. pre. Italy. we will offer a comprehensive range of complementary services to support the adventurous traveler. van-supported inn-to-inn bicycling. Offers adventure vacation packages to corporate clients to use as incentives and rewards. mountain biking and hiking adventure tours throughout France. covering Bulgaria. We will aim for a standard of travel higher than that offered by the Northwind Traders Sample Business Plan 9 . Specializes in adventure vacations in Eastern Europe and former Soviet countries. and memorable experience.Services We are currently the appointed agents for Margie’s Travel. buses. Poland. and Austria. Italy. sea kayaking.

The clothing shop has sales of $1.421. Table 1. We will only use vacation providers who can provide 24-hour emergency support services for clients while on vacation.625 2 $422. Company History Five years ago Heather Mitchell cofounded Northwind Traders. Northwind Traders Sample Business Plan 10 .or part-time.710 $133. In the six months that we have been selling travel agency products.602 Last Year $1. Last year Northwind Traders acquired an agency from Margie’s Travel. Northwind Traders has extended its product range to include everything the adventurous traveler could want. Guarantees and Warranties Our clients will be protected financially against either our own or our tour operator’s failure.916 Increasingly. yielding $1754 (30 percent commission). Washington. The feeling we are looking for is definitely not that which is engendered by the backpacker market. In addition. one of the largest and most respected tour operators in this market. 35 insurance policies have been sold at an average price of $167. A mail-order service is now provided by catalogue and via a new Web site.170 $201.023. Northwind Traders. one of Northwind Traders’s founding partners. and employs seven people. from tents and sleeping bags to maps. Over the years.701 4 $1. have been sold. some 200 vacation packages.670 $100. guidebooks. and began to promote and sell their products. makes a gross profit of $202. Heather Mitchell.general travel industry.800 (10 percent commission). Northwind Traders Clothing Shop Performance Over Past Five Years Year Sales Gross Profit 1 $183. and insurance. shop customers have asked for advice on adventurous places to go on vacation.400. at an average cost of $3340.700 $62.510 $167 3 $669. an outdoor clothing shop in SeattleRedmond. Northwind Traders’ commission on the sales has been $66. intends to sell her shares in the store and to concentrate on setting up the new travel business. either full.000 per year (see Table 1).420. by virtue of the ARC bonding held by our principals.

in the period covered by this Business Plan we intend to operate only as the appointed agents for a number of tour operators. health services. These services are projected to grow at an average annual growth rate of 4. At a later stage the business may wish to sell and issue airline tickets and to create its own charter vacations. Northwind Traders can capitalize on the many significant opportunities in the travel industry. the business will be set up as an operation independent from the clothing store. and the already large population of young professionals is growing. Nearby. Vice President of Sales and Marketing Jim Kim owns 1000 shares.000 shares. tourism. An influx of new businesses has added to the area’s prosperity. 6000 of which are owned by President and CEO Heather Mitchell.000 people employed in industries such as aerospace. and the remaining shares are held by the company for future distribution. with over 400. This structure will clearly separate the travel business from the clothing shop and make it possible to attract the risk capital that will be required when the business starts to grow. Economic and Social Factors Service industries represent the fastest growing sector of the national economy. However. transportation equipment.1 percent over the period from 1990 to 2010 (Appendix 1). In the next few weeks. and travel and tourism agencies are poised to flourish in the midst of today’s economic boom. The company has authorized 10. MARKET RESEARCHINDUSTRY ANALYSIS During the current period of strong economic growth. Northwind Traders Sample Business Plan 11 . As such we can “shelter” under their licenses and bonds. The travel and tourism industry thrives in a vital economy. computer software. This will require membership in the ARC (Airline Reporting Corporation) and IATAN (International Airlines Travel Agency Network). The general economic climate in the city of SeattleRedmond is very strong. These organizations regulate the collection of money and distribution to the appropriate airlines. tThe city of Seattle is the center for business in King County. and biotechnology.Business StructureLegal Status Northwind Traders is incorporated under the laws of the state of Washington.

With our expertise in European adventure vacations. Northwind Traders Can Develop Strong Position in Region The current lack of industry leaders in the European adventure travel industry represents an exceptional opportunity for Northwind Traders to develop a dominant presence in the European adventure travel industry in the Ggreater SeattleRedmond area. The state of the economy will be the most influential factor in how many people travel. we will be able to provide the most accurate. and the Internet will be an important channel into this market. the threat of terrorism. TARGET MARKET ANALYSIS Geographic Area Northwind Traders is basedoperates in the SeattleRedmond. area. Long-Term Opportunities Tourism in general is on the rise (Appendix 1). the company will be well situated to take advantage of the region’s current economic prosperity. strong customer base. The region comprisesgeographic area includes the incorporated cities ofof Redmond. Snohomish. With their exceptional knowledge of the adventure travel industry. Bellevue. and Tacoma and the encompassing counties of King. RedmondSeattle Bellevue Tacoma and the encompassing counties of Northwind Traders Sample Business Plan 12 . Washington. and Pierce. and targets individuals interested in adventure vacations in Europe. and competitive prices. tThe qualitylevel of service and the number of providers in the travel industry constantly fluctuatebroadly uneven. and currency rates. up-to-date information possible. fuel prices.Competitive Environment Currently. and providers enter and leave the field rapidly. Europe looks like it will continue to be the major destination. Our competitive edge will be in attracting and retaining our customers with the most highly trained and well-informed individuals we can recruit. Other driving forces for travel will include the cost of tickets.

productive. Seattle has become a world-class destination.000+. 14 percent government.. while not the fastest growing. Northwind Traders Sample Business Plan 13 . single or married. Target Customers Seattle/King County's labor force is highly educated. and a state university. and new jobs and growth are expected through the year 2007. Market Definition The world travel market is forecast to expand at a 4. It consists of individuals who are deeply attached to the area and have tended to stay and wait out past periods of economic downturn.000+. will be the most important destination. our target customers are individuals who are professionals with incomes of $40. The percentages of employment by industry are as follows: 28 percent services. Pierce.1 percent average annual growth rate until 2010. and 5 percent construction. several major medical centers. From within this population. and college educated. half of whom fall within our target market. 6 percent finance and insurance. without children. The following major facilities reside in the Ggreater Seattle area: an international airport. and stable. and Snohomish counties—is home to approximately 3 million people (1994 figure). Both public officials and business leaders recognize the need to keep our labor force well equipped with marketable skills. accounting for over 50 percent of all international arrivals (see Appendix 1). Seattle’s job rate is climbing at a rate of 10 percent each year. which is expected to be around 2. skilled. The European market. This is faster than the general economic growth rate. ages 25 to 35. and four other colleges and universities. 25 percent wholesale and retail. the Northwest lifestyle. 6 percent transportation and communication. 16 percent manufacturing.4 percent per year. The vital economy. and its unique environmental qualities attract people. and the downtown retail and shopping core has grown steadily over the last decade. with incomes of $40.• • King Snohomish Pierce Market Size and Description The Ggreater Seattle area—including all of King. Within Europe.

95 3.35 2.45 1990 % 61 20 15 4 100 2003 1.) are in Table 2.25 0.35 36 .France. Our specialized knowledge of Europe and adventure travel will allow us both to satisfy our customers and to surpass the services offered by our competitors. and Spain are the most popular destinations.20 1. and targeting our service at affluent professionals.45 46+ 1990 0. but the figures from one recent study (World Adventure Travel Data Corp. as 65 percent of those planning vacations Northwind Traders Sample Business Plan 14 . Table 2.10 5.25 1.45 0.40 0. offering a limited but extensive range of vacation packages. we can meet the needs of our clients.60 0. Our market study (see Appendix 1) has shown that theis group composed of affluent professionals has specific needs that are not currently being met.60 0.24 25 . Adventure Travel Vacations . Figures for the size and projected growth of adventure vacations are sketchy. Italy.10 0.95 2010 2.80 1997 0. 1997 Market Opportunities We believe that by concentrating on the European travel market. This is why we have selected tour operators with appropriate products in these areas as our initial partners.65 2010 % 38 31 25 6 100 Source: WATD Corp.2010 Destination Europe N.60 1.World forecast (Million Arrivals): 1990 . America Rest of World Total Age 16 .

We feel the difference is because our survey sample is confined to relatively affluent people who had spent at least $350 on adventure clothing (see Appendix 1). and Tacoma that compete with Northwind Traders to provide adventure vacation packages. • Adventure Tour Operators These tour operators who advertise their vacations in the press attract about a quarter of all adventure vacation clients.would not purchase them from the same source again! Specifically. One further emerging market segment for adventure vacations is that of corporate clients. but only a third of clients would use them again. According to our market study. while the World Adventure Travel Data study claims 61 percent is under 24. offering limited advice. 40 percent of adventure vacations are booked through these general travel agents. information. clients have to shop around several tour operators to find what they want. they want their travel agent to have comprehensive knowledge of the destination (87 percent). to go on vacation with similar professional people (81 percent). our market study confirms that Europe is likely to be the largest destination market for adventure vacations. and clientsthey cannot get unbiased advice or much help with information. and support. However. there are many adventure travel agents in capital and secondary cities such as RedmondSeattle. They sell literally from the page. CompetitiveOMPETITIVE AnalysisNALYSIS Northwind Traders is the only travel agency located in the Seattle area that is focused on European adventure vacations. However. Bellevue. In addition. These agencies are described below: • General Travel Agents These agents have added adventure vacations to their services. Our research suggests that up to one in five adventure vacations is at this top price end of the market. but often have little or no knowledge of adventure destinations or activities. to have an efficient administration system in which they can have confidence (84 percent). Our study shows only 30 percent of adventure travelers to be under 24 years of age. and to be offered useful advice and ancillary services such as insurance (79 percent). Northwind Traders Sample Business Plan 15 .

we will be better able to manage a fresh. While general travel agents may be the most likely resource for those travelers taking an adventure vacation. We believe that by having daily face-to-face contact with clients. Competitive Advantages Some 65 percent of those clients using specialist adventure vacation travel agents would use them again—many more than would use either a direct tour operator direct or a general travel agent. vital. only 23 percent of the 5000 adventure tours offered are for Northwind Traders Sample Business Plan 16 . however. 65 percent of clients would use them again. well-informed staff. account for only 15 percent of the market.Only 45 percent would go back to a tour operator for their next vacation. of whom 65 percent would travel that way again. they are in fact the least likely place those clients will return to. Clients will return for our service. and relevant Web site aimed at the specific needs of our market segment. • Independent Travelers These travelers comprise about 15 percent of those going on adventure vacations. but we feel this is partially due to lack of client awareness and to the comparative rarity of such outlets. • Internet Providers These providers sell only 5 percent of adventure travel vacations. And tAlthough specialist adventure travel agents. knowledge and competitive prices. We need to persuade this group that our superior product knowledge and service is worth their consideration. We aim to increase this percentage through our superior service. We will differentiate ourselves from our competitors by offering the most extensive material available from the most up-to-date. However. such as the business we are setting up. • Specialist Adventure Travel Agencies These agencies sell only about 15 percent of travel packages at present. These findings are some of the most powerful results of our research. these agents were criticized for having such a wide range of activities and destinations that their sales agents knew little about them. Our research shows that while 41 percent of clients take adventure vacations in Europe. There is plenty of scope to offer a superior Web site. 70 percent of adventure travelers would buy their next vacation via the Internet.

The lack of current adventure travel providers in the area represents a unique opportunity for Northwind Traders to expand in a rapidly growing market. which is the largest market for both vacations in general and adventure vacations in particular. and itstheir location is undesirable. In addition. Ferguson and Bardell is the strongest competitor of Northwind Traders. due to its strong client base and experienced owner.to 35-year-old professional. well-established business. and Lakes & Sons. rather than have only a passing knowledge of the 5000 adventure vacations available. We will need to know only perhaps 100 destinations and activities well. Ferguson and Bardell lacks the knowledge and expertise in the field of European adventure travel that is valued so highly by the clientele of Northwind Traders. Competitors’ Positions The two major competitors of Northwind Traders are Lakes & Sons and Ferguson and Bardell. Although they areit is currently the only European adventure travel agency located in the SeattleRedmond area. with some consequent dissatisfaction. itstheir press releases are of a very low quality. 25–35 year old market. Potential Future Competition Northwind Traders will occupy a specialized niche in the travel industry. with difficult parking and limited customer service space. we will be able to have superior product knowledge. Northwind Traders will need to establish itself as the leader in adventure travel planning for Europe with its superior product knowledge and high-quality service. This can lead to very different types of clients ending up at the same destination. In order to stay competitive. Northwind Traders Sample Business Plan 17 . We feel that by concentrating on European destinations. Our market research has also shown that many adventure travel agents are catering to the backpacker market. It is also noteworthy that t The backpacker market requires a much lower level of service and information than does the market for the more affluent 25.European destinations. with its focus on adventure vacations in Europe. there are competitors do exist in nearby areas (see above). consisting mostly of individuals who are under 24 years of age and are generally very cost conscious. Lakes & Sons will be a formidable competitor for Northwind Traders because of itstheir prime location. However. and extensive training program.

Different destinations can be selected from outside the window via a control panel. and our staff. informative. We plan to have an exciting. Shop front. corporate clients. informative adventure travel service available. an Internet Web site. and our association with the Northwind Traders clothing store. We will employuse a freelance public relations adviser to help us write copy and locate publications editors. Public relations. General press advertising seems to be fairly ineffective in this sector. the scenes will rotate on a random basis. Customer Incentives Our market research shows that publicity has the greatest impact on people’s choice of an adventure vacation travel agent.) Advertising and Promotion Our advertising and promotions will pivot around six key strategies: public relations. otherwise. (See Appendix 1. Northwind Traders can distinguish itself from its competitors. We will put considerable effort into preparing and disseminating a regular flow of press releases. press advertising.. activities. we can create customized travel itineraries for our clients and provide the most thorough. our shop front. and actively managed display window. or colleague. Summary of Findings from Market Research. relative. There will be a video display showing adventure vacations in progress.BUSINESS STRATEGYMARKETING & SALES PLANNING With Northwind Traders’ expertise in European adventure travel. By offering superior customer service. Northwind Traders Sample Business Plan 18 . customer relations. These will be based on stories about our destinations. and event specialist press advertising only brings in one out of seven clients. followed closely by having the right location. and having a recommendation from a friend.

and employers. Accordingly. We will write to all past shop clients announcing the establishment of the travel business and offer them a special introductory adventure vacation package. we intend to offer a truly personalized service. pays us at the lower end of the scale.) Customer relations. everyone will be fully trained in sales. We will also be using a “contact management” system that will allow us to monitor the effectiveness of different promotional strategies and of different marketing messages. (See Appendix 1. job. previous vacation.Internet Web site. Sales and Marketing Excellent selling skills are vital in our type of business. Commission The normal commission paid to travel agents for this type of vacation is in the 10 percent to 15 percent range. Additionally. relatives. By having superior information on our clients and prospects. it is the most convenient way for us to have a global presence at the outset. Press advertising. Our database will contain full details on all our clients. This is fast becoming a major promotional channel. the more likely they are to approach you when they have a need for your type of service. We will undertake a small amount of specialist press advertising in order to enhance our public relations activity. we are Northwind Traders Sample Business Plan 19 . There is considerable research to support the argument that the more often a potential client hears about you. Having them in our portfolio will enable us to negotiate much higher commissions from our new principals. Also. We will keep records of every sales contact. Internet Growth and the Sale of Travel Services. Data such as source of inquiry. including the vacations they have taken and their postvacation appraisal data. they are a prestigious firm to represent. the first agency we have been appointed to. colleagues. and income will be included. While Margie’s Travel. client needs. The key to our strategic advantage lies in having superior data on prospects and clients. Northwind Traders association. Therefore. We will use this data to encourage our satisfied customers to recommend our services to friends. every month we will “audit” each other by observing half-a-day’s selling activity and giving feedback on strengths and weaknesses in skills. and we believe it will increase in importance over time.

Opening Hours of Operation The telephone lines will be staffed 24 hours a day by live operators. off-peak. We plan to do some of this work ourselves. We will be renting 2000 square meters of fully serviced space at a cost of $30. People consider vacation decisions at home in the evenings after discussion with friends and partners. and other office furnishings. OPERATIONS Premises It is vital that the travel business has both a storefront facing onto the main street and a visible separate entrance. Choice of Location and Premises We intend to locate within the existing Northwind Traders shop. so people can stand and look in the window without being in the way of other pedestrians. Commission on insurance and other services will be 30 percent. by virtue of the ARC bonding held by our principals. throughout. An additional $4175 will be needed for desks. this will be done mostly by our staff. During the period from 9 am to 6 pm. friendly service. The pavement is wide. overload calls during the day and afteroutof-hours calls will go to our live telemarketing bureau.hours access to our services is also a key way in which we can differentiate ourselves from other travel agencies. Northwind Traders Sample Business Plan 20 . chairs. We want to be available as their first point of contact with an informed. However. rising to 13 percent by the end of Year Three. The goal is for clothing shop clients to be able to move between the premises without going outside.planning on an average travel agency commission of 11 percent. sinceas this is close to the city center with a high density of both residential and business premises.060 per year fully serviced. We will need to spend $25.050 on internal refurbishing. Guarantees and Customer Protection Our clients will be protected financially against either our own or our tour operator’s failure. We will only use vacation providers who can provide 24-hour emergency support services for clients while on vacation. We believe that since our clients will mostly be busy professional people.

This will ensure that all incoming phone calls are dealt with in the same way and meet a high standard. As service is one of our key components. We plan to start with a staff of three full-time employees. All staff will undergo full product training. We plan to be operating with a staff of thirteen during the fifth year of business. Staffing From the outset all staff will have job descriptions. This will allow up to ten sales staff to answer calls and have full on-screen data on clients and products. and a record of employee reviews. it is essential that we have full access to all relevant data speedily and efficiently. We will encourage people inquiring about vacations to give us feedback on: • Our ability to handle their inquiry • The amount of time from the client’s first inquiry to the date of actual travel Northwind Traders Sample Business Plan 21 . and one part-timer. and will spend at least four weeks a year on-site at key travel destinations. a career and training history file. and then spend time with each member of the Northwind Traders team.Equipment We will be renting an integrated telephone/data-base system from the outset. Thus we will be ableQuality Control We will be developing outline scripts to help the sales staff manage inquiries. including the founder. Our dress code will require us to look as though we are on our way to one of our adventure vacations. With this system we can review our sales and marketing activities on a regular basis. New staff will take the travel agency Psychometric Aptitude Test.

we could service 9600 clients from our present facilities. Each sales desk has a capacity to handle four clients per hour. This is well above the numbers we are anticipating in the business plan. Capacity Our offices can accommodate five sales desks.• The client’s reactions to the vacation in terms of whether it meets their expectations New Tour Operators Heather Mitchell will be responsible for reviewing the range of tour operators that we seek to represent. MANAGEMENT & ORGANIZATION Northwind Traders Sample Business Plan 22 . With our average sales rate of one in five.000 inquiries. which means over the year we could handle up to 40. and negotiating with prospective new principals.

His current responsibilities include the company’s direct marketing campaign and all sales related issues. Egert spent a year traveling abroad and joined the staff at Northwind Traders recently as a sales assistant.Key Employees Heather Mitchell. President and CEO. an outdoor clothing shop in the Redmond area. Ms. Freelance business consultant Jae Pak will be advising during the business’s changeover from clothing shop to adventure travel agency. Northwind Traders Sample Business Plan 23 . Before founding Northwind Traders. and Amy Egert has been recently recruited to cover Saturdays and vacations. team members Jim Kim and Richard Bready will be moving into the new venture on a full-time basis. Prior to joining Northwind Traders. Kim worked for the marketing department of a major airline. Mitchell. Amy Egert. Sales Assistant. Vice President Sales and Marketing. Bready’s expertise in the area of European travel enables him to entice the adventure traveler. She has a degree in travel and tourism from State University. After completing her undergraduate degree at the Institute of Art. Jim Kim. Twenty years as a travel agent has given Mr. where she was responsible for managing the office systems and a staff of four. In addition to Ms. Ms. she managed the Olympia branch of one of the larger regional chains of general travel agencies operating throughout western Washington. Mr. A knowledgeable salesperson. Prior to that. Richard Bready. Mr. Mitchell owned and operated Northwind Traders. Office Manager. Bready the ideal background for Northwind Traders.

retail store owner Tony Chor. Pak’s knowledge and guidance will be instrumental to the success of Northwind Traders. Mr. former travel agent William Hollands. caterer Northwind Traders Sample Business Plan 24 . Business Consultant. CPA Jo Brown. Lawyer Lisa Garmaise. human resource manager Prasanna Samarawickrama. The board meets twice yearly to discuss policy changes. review the mission statement. retail store owner Holly Barrett. and update the business plan if needed. Members include: Lisa Jacobson. (Heather Mitchell’s CV is in Appendix 3) Board of Directors The volunteer members of the Board of Directors provide guidance to the management and staff of Northwind Traders.Jae Pak. With over twenty years of consulting experience in industries ranging from aerospace to technology to retail.

Northwind Traders Sample Business Plan 25 .

our goal is to earn at least $300. Our financial objectives are to be operating at or close to break-even cash flow by the end of the first year. Our profit margin on sales by Year Three will be a respectable 7 percent. This individual will be the key to producing state-of-the art publicity materials and determining where these materials should be placed for optimum visibility.000 in Year Three. and we intend to maintain their enthusiasm through constant product development and skill Northwind Traders Sample Business Plan 26 . becoming the premier provider of European adventure vacations in the greater Redmond area.000 post tax profit in the Year Two. The present staff is passionate about adventure vacations. and nearly $500.Long-Term Goals Northwind Traders plans to grow steadily over the next five years. enthusiastic staff • Deliver superior product knowledge • Provide high quality customer service • Create library of tools/reference materials for clients • Offer competitive pricing on vacation packages The first priority is to hire a competent public relations consultant. We aim to be profitable from Year One onward. The second priority will be to increase the staff. Strategy for Achieving Goals • Extensive public relations campaign • Recruit well-trained. The individuals recruited will go through an extensive training program to ensure that they will be able to provide superior product knowledge in the field of European adventure travel.

individualized prevacation booklets. we have protected our position in a number of ways. and continually updating our client database. Position While at present we are offering only other company’s adventure vacations. Customer loyalty is vital to our profitable growth. which gives us access to all their existing vacation products as well as any new ones. First. we will seek to build up a high level of repeat business. Second. We intend to negotiate similar agreements with future suppliers. or to “check out” and peruse at home. This contract is dependent on Northwind Traders achieving sales of at least 250 vacation packages a year. We will only recruit those individuals who share our vision. In this way. Risks Associated with Growth • Losing touch with customers • Loss of clientele to other providers • Quality of services diminished Northwind Traders Sample Business Plan 27 . we intend to maintain a high service element to our business. although sales targets with them will be lower to reflect their relative market position. postvacation follow-up. We also want the business to have an enjoyable atmosphere. An agent will be on hand at all times to answer any questions.training. These materials will be available for clients to browse through while in the shop. we have a two-year agency agreement with Margie’s Travel. extending our range of value added services such as vacation insurance. The third priority is to install a library of reference works in the shop.

has been one in three. Table 3. we are forecasting to sell 660 adventure travel vacations next year at an average price of $3549. By maintaining our focus on superior product knowledge and outstanding customer service. Based on the projection below. This is a trend we expect to continue.783 over the first 12 months. we will be able to uphold our position in the industry. For the purposes of our sales forecast. In order to sustain our position in the area as the premiere European adventure travel business. we are assuming that only one in five inquiries will actually result in an adventure vacation being booked. gradually overtaking inquiries from the clothinges shop. we expect to generate a gross profitn income of $268. Once insurance and other service sales are added in. This is a very conservative estimate. while operating within the outdoor clothing shop. thereby retaining current clients and attracting new clients. FORECASTING Sales Forecast Our ratio of sales to inquiries ofn the adventure travel vacations sold to date. the number of new inquiries generated by our promotional activity will also build up during the year. Northwind Traders needs to outshine our competition.• New businesses The risks facing the expansion of Northwind Traders can be summed up in one word: competition. We expect there to be a steady buildup of clients coming from the clothing shop to talk to us about vacations (see Table 3 below). However. Sales Forecast Projection Q1 Q2 Q3 Q4 Year Total Inquiries generated through promotion Northwind Traders Sample Business Plan 28 200 425 425 750 1800 .

conservative provision.901 in the first year of $34.500 additional financing has come from a bank loan. In this way we believe we have made a prudent. For the last two months of the year. the business will need additional short-term financing of about $83.602 $268.341 $104.400 $1670 300 725 145 $3340 $48. Cash Flow Projections The Cash Flow projections for Year One (see Appendix 2) show that after the owner has put in $41.770 $77.935.318.430 $3340 450 875 175 $3758 $72. This is before the owner’s drawings.918 $15.Shop inquiries Total inquiries Vacations sold Average vacations cost Commission received Commission on insurance & other services received Total commission & fees earned 300 500 100 $3340 $33. We have allowed for interest on the full amount for the whole period. In our Cash Flow projection. Table 4.tax profit of $34.750.783 In Year Two we are forecasting a gross profitcommissions of $624. Any owner’s drawings will be contingent on performance being better than that expected in the Plan.901 (see Appendix 2 and Table 4 below). we are forecasting a positive cumulative cash flow and a year-end cash surplus of $19.865 $35.500.331 $5010 450 1200 240 $3758 $98.070 $51.757 $5845 1500 3300 660 $3549 $252.846. Income Statement We expect to make a small after. Profits in Years One to Three will be Northwind Traders Sample Business Plan 29 . In practice we would hope to finance part of this at least by a line of credit equal to the money actually required. and in Year Three we plan to reach $986. we have assumed the whole $83.

184 $304. but it should be remembered that our gross profitincome is really the sales commission we earn. We have shown a conservative funding position. These figures look quite low.690 641.473 Northwind Traders Sample Business Plan 30 . Table 5.737 Year Three 13 8 $164. Performance Ratios We plan to move our gross profit up from 11 percent in Year One.096.Year One Sales Less cost of sales Gross profit Less expenses Net income before taxes Provision for taxes Net income after taxes 2.901 Year Two 5.846 345.604.4043 380.858 11 2 $76.056 268.591.578. This we expect to move from 2 percent at the outset.584 $69. to 13 percent in Year Three.795 Year Two 12 7 $138.202.327 624.318 243. which does not include any of the additional capital that we hope to secure.645 4.132 6. Our net income before taxes is a more accurate measure of performance.783 224.405 Balance Sheet The Balance Sheet at the end of Year One (see Appendix 2) shows a healthy surplus of current assets over current liabilities.286 986.043 9142 $34.9145 76.257 $106.156 145.740 44.7301 Year Three 7. Commission generated and profit per employee will be among the highest in the industry. not the full price of an adventure vacation.751 $495. Commission Generated and Profit per Employee Year One Gross profit % Net income before taxes % Commission generated per employee Profit per employee $12. up to 8 percent by Year Three.839 2.364.

are prime users of the Internet. Funds Required and Timing We plan to make two major investments: one in Web site and database development and one in shop premises development. We get only one chance to make a first impression.325750. (See Appendix 1. Financing packages from equipment suppliers are currently very attractive. If our staff do not have the right tools.year olds—. We feel confident that the break-even point can be attained within a reasonable period of time. Internet Growth and the Sale of Travel Services ) • Shop premises development .to 35. Even those people in our locality will expect to be able to research our offers on the Internet before coming to the shop.750 of her own money (the proceeds of the sale of her share of the clothing shop business).225. affluent. It will allow us to offer superior service and ensure a high level of repeat business and referrals.this will cost us $29. professional 25. The Web site is vital if we are to reach this wide and disparate global market. sinceas this is a rapidly changing area and we need to have access to the very latest technology. based on our part-time effort out of the clothing shop.3 vacations per day. Funding Options The owner plans to invest $41.this will cost $41. make are the: • Web site and data base development . Both these investments need to be made at the outset to ensure that the business creates the right impression from the start.Break-Even To break even we will need to sell between 2 and 3 vacations per day. they will not be inspired to spend thousands of dollars and entrust their adventure vacation plans to us. If clients see “amateur” premises. We have to look professional and to have an efficient work environment. The cash flow projections show that the business will require $83. we can hardly expect them to deliver superior performance.500 of working capital during the early months of the first year’s operations. We have decided to lease our telephone and computer systems. This compares with our present sales of 1. The group of potential clients we have chosen as our target market—. The data base system is one of our key differentiators. We think we should provide Northwind Traders Sample Business Plan 31 .

This will ensure that all incoming phone calls are dealt with in the same way and meet a high standard. perhaps to the original shop partners.term loan of $41. of this facility.520: Option 1: The sale of equity.020 for unforeseen eventualities.450. In this way we can review our sales and marketing activities on a regular basis. Financial We will be using a computer-based financial management system. We will encourage people inquiring about vacations to give us feedback on our service: • • Our ability to handle their inquiry The amount of time from the client’s first inquiry to the date of actual travel 32 Northwind Traders Sample Business Plan . Option 2: Approach our bank with a view to raising a medium. This would provide some capital to allow for growth.000. we have identified two options for raising further fundsthis $93. Quality Control We will be developing outline scripts to help the sales staff manage inquiries. This will allow us to analyze the profitability of sales of different vacations through each tour operator. It will also allow us to reward staff on the basis of profit achieved rather than just on sales. provide any lender with security for part.750 and a line of credit of $58. with family help. This will allow us to analyze the profitability of sales of different vacations through each tour operator.an additional $10. BUSINESS CONTROLS Accounting System We will be using a computer-based financial management system.750 and $167. Heather Mitchell could. could raise between $41. We are considering In the event that additional funds prove necessary. if not all. Any shortfall could be funded either by a line of credit or a bank loan. Thus we will be able to reward staff on the basis of profit achieved rather than just on sales. With this system we can review our sales and marketing activities on a regular basis.

which means over the course of a year.000 in Year Three. We aim to be profitable from Year One onward. This will be the key to producing state-of-the art publicity materials and determining where these materials should be placed for optimum visibility. we could service 9600 clients from our present facilities.000 posttax profit in Year Two and nearly $496. Each sales desk has a capacity to handle four clients per hour. Northwind Traders Sample Business Plan 33 . becoming the premier provider of European adventure vacations in the Greater Seattle area. our goal is to earn at least $304. enthusiastic staff Deliver superior product knowledge Provide high-quality customer service Create a library of tools/reference materials for clients Offer competitive pricing on vacation packages The first step to achieving our goals is to hire a competent public relations agency.• The client’s reactions to the vacation in terms of whether it meets their expectations New Tour Operators Heather Mitchell will be responsible for reviewing the range of tour operators that we seek to represent and negotiating with prospective new principals. Our profit margin on sales by Year Three will be a respectable 7 percent.000 inquiries. with steady growth over the next five years. OurThe financial objectives of Northwind Traders are to be operating at or close to break-even cash flow by the end of the first year. Capacity Our offices can accommodate five sales desks. This is well above the numbers we are anticipating in the business plan. Steps for Achieving Goals Northwind Traders’ strategy for achieving our goals consists of six major points: Establish an extensive public relations campaign Recruit well-trained. With our average sales rate of one in five. we could handle up to 40. Long-Term Goals Northwind Traders plans to grow steadily over the next five years.

extending our range of value-added services such as vacation insurance. although sales targets with them will be lower to reflect their relative market position. An agent will be on hand at all times to answer any questions. which gives us access to all their existing vacation products as well as any new ones. These materials will be available for clients to browse through while in the shop or to “check out” and peruse at home. Risks Associated with Growth We see some risks associated with our expected growth: • • • • Losing touch with customers Loss of clientele to other providers Quality of services diminished New businesses Northwind Traders Sample Business Plan 34 . postvacation follow-up. The third step is to install a library of reference works in the shop. This contract is dependent on Northwind Traders achieving sales of at least 250 vacation packages a year. Position While at present we are offering only other company’s adventure vacations. we have a two-year agency agreement with Margie’s Travel. we intend to maintain a high service element to our business. Customer loyalty is vital to our profitable growth. we will seek to build up a high level of repeat business. In this way. we have protected our position in a number of ways. We intend to negotiate similar agreements with future suppliers. and we intend to maintain their enthusiasm through constant product development and skill training. We also want the business to have an enjoyable atmosphere. and continually updating our client database. The individuals recruited will go through an extensive training program to ensure that they will be able to provide superior product knowledge in the field of European adventure travel. individualized prevacation booklets. We will only recruit those individuals who share our vision. First.The second step will be to increase the staff. The present staff is passionate about adventure vacations. Second.

Northwind Traders needs to outshine its competition. By maintaining our focus on superior product knowledge and outstanding customer service. thereby retaining current clients and attracting new clients. Northwind Traders Sample Business Plan 35 .The risks facing the expansion of Northwind Traders can be summed up in one word: competition. we will be able to uphold our position in the industry. In order to sustain our position in the area as the premier agency for European adventure travel.

Northwind Traders Sample Business Plan 36 .

8 8.1 Source: Global Stats.7 11.5 19.6 3.1 115. Corp.4 90.5 567.018 growth rate (%) 1990 .5 110.7 50.6 4.5 592.6 1.1 18.7 4.0 4.2 84.1 7. 1997 Northwind Traders Sample Business Plan 37 .1 4.9 6.1 2000 397 122 138 25 14 6 702 2010 525 229 195 37 21 11 1.6 222.3 4.4 15.APPENDIX 1: MARKET RESEARCH International Arrivals by World Region Updated forecast for the years 2000 and 2010 (millions) Average annual 1975 Europe East Asia/Pacific Americas Africa Middle East South Asia World total 153.4 1996 347.7 4.2010 3.3 1995 338.7 3.

408 3138 2059 20.0 International tourism receipts (Mill.1 7.2 107.9 672.173 5560 1614 835 60.0 113.997 11.000) Austria Belgium Denmark Finland France Germany Greece Ireland Italy Luxembourg Netherlands Portugal Spain Sweden United Kingdom EU Iceland Liechtenstein Norway EEA Switzerland Europe-19 17.9 164.8 0.8 7.0 2.3 54.052 767 6574 9706 44.Indications of Tourism Demand in 1997 International tourist arrivals (x 1.1 680.168 4776 2814 1320 20.3 35.3 19.096 7236 133. ECU) 11.0 34.8 12. 1997 Northwind Traders Sample Business Plan 38 .993 4776 4946 3330 19.0 0.0 714.110 14.7 22.700 230.366 124.8 10.886 683 22.847 10.8 3.497 Nights spent by foreign tourists (Mill) 63.6 14.500 245.742 12.130 4231 31.5 39.868 190 59 2880 233.332 Source: Global Stats.143 127 n/a 1826 126.431 2652 14. Corp.

Thirty percent. by Age and Percent According to our study.Summary of Findings from Market Research Survey Three hundred clients of Northwind Traders who had made purchases in excess of $350 in the past six months were surveyed.401 and $41.701 and $25.750 annually 39 Northwind Traders Sample Business Plan .051 and $33.400 annually 25% earn between $33. while they had not yet taken such a vacation. Percentage of Sample Customers Taking and Not Taking Adventure Vacations According to our research.050 annually 28% earn between $25. Fifty percent of our sample are regular adventure travelersusers. the percentages of adventure vacation travelers in fall into various age groups as follows: • • • • • 5% are under the age of 16 25% are between the ages of 16 toand 24 40% are between the ages of 25 toand 35 20% are between the ages of 36 toand 45 10% are over the age of 45 Percentage of Adventure Vacation Travelers by Income Group According to our research. taking at least one adventure vacation each year. Information About 150 Respondents Who Took At Least One travel Vacation Per Year Gender: Status: Male Married 65% 21% Female Single 79% 35% Adventure Vacation Travelers. had at least actively considered doing so.700 or less annually 22% earn between $16. only 20 percent of our sample customers had never taken or considered taking an adventure vacation. the percentages of adventure vacation travelers in various income brackets are as follows: • • • • 6% earn less than $16.

• 19% earn more than $41. the percentages of the market adventure travelers devoted purchasing vacation packages to each of these regions destinations is are as follows: • • • • • • Europe . However. Percentage by Destination of 5000 Major Adventure Tours Available on the Market A study by destination of approximately 5000 major adventure tours on the market reveals the following: • • • • • • 1200 of the 5000 offered are for destinations in Europe 1000 of the 5000 offered are for destinations in North America 600 of the 5000 offered are for destinations in India 810 of the 5000 offered are for destinations in Africa 675 of the 5000 offered are for destinations in the Far East 675 of the 5000 offered are for other destinations By contrast.750 annually Forty-five percent of respondents taking adventure vacations spend in excess of $3340 per person per vacation.5% of adventure travelers purchase vacation packages for destinations in other regions Our research shows that Europe is the most popular destination for adventure vacation travelersakers.to 35year age range.10% of adventure travelers purchase vacation packages for destinations in India Africa 7% of adventure travelers purchase vacation packages for destinations in Africa Far East . typically spend over $5010 per person. who tend to be professionals in the 25. only 1200 of the 5000 adventure tours on the market are for European Northwind Traders Sample Business Plan 40 . Those respondents spending under $3340 are both in the lower income and lower age groups and represent 10 percent of the respondents.7% of adventure travelers purchase vacation packages for destinations in the Far East other destinations .30% of adventure travelers purchase vacation packages for destinations in North America India . Twenty percent of the respondents.41% of adventure travelers purchase vacation packages for destinations in Europe North America .

Africa.8% heard about their vacation package through press advertising Internet .destinations. which only attracts 7 percent of the market. It follows that the European market has scope for expansion and that if we concentrate on that market.18% heard about their vacation package through a friend adventure press .4% heard about their vacation package through the Internet These findings demonstrate the power of publicity. In that way we can have the advantage of superior knowledge in our chosen market. The next most effective way to reach potential clients is via the travel agent’s shop window. These corporate customers are also those clients who spend over $5010 per person per tour. Both the press in general and the adventure travel press do not appear to have much effect on buyers in this market.25% heard about their vacation package through a travel agent friend . we only need to have detailed knowledge of upmarket European tours. rather than all 5000. has 16 percent of the tours aimed at it. There is a significant minority of corporate clients who buy adventure vacations to use as rewards. The percentagemajority of respondents who have not been on an adventure vacation organized by their employer far outnumbers those who have been on a vacation planned by their employer.15% heard about their vacation package through adventure press press advertising . or as a part of a management development program. Percentage by Source from which Traveler Heard About Last Adventure Vacation Our research reveals the following about the source from which adventure travelers originally found out about the last adventure vacation they purchased: • • • • • • publicity activity . motivation. Northwind Traders Sample Business Plan 41 .30% heard about their vacation package through publicity activity travel agent .

NORTHWIND TRADERS QUESTIONNAIRE (Your replies are anonymous so confidentiality is assured)
1. Gender: Married: Children Age: Male Yes Yes Under 16 16 - 24 25 - 35 36 - 45 45+ Occupation: Female No No Income: Under $16,700 $16,701-$25,050 $25,051-$33,400 $33,401-$41,750 over $41,750

Self:................................................................... Partner:.............................................................

2.

How many adventure vacations have you taken in the past three years? None - never considered taking one Considered, but not yet taken a vacation Taken one adventure vacation Taken two adventure vacations Take at least one adventure vacation every year

3.

If you take adventure vacations, how much do you spend per head per vacation? Under $1670 $1671-$3340 $3341-$5010 Over $5010

4.

Who did you buy your last adventure vacation from? Would you use that source Traveled independently Directly from the tour operator Yes Yes No No
42

again?

Northwind Traders Sample Business Plan

Via the Internet From a specialist adventure travel agent From a general travel agent 5.

Yes Yes Yes

No No No

How did you hear about the last adventure vacation that you took? From a friend/colleague/relative Via an advertisement in general press Via the Internet Saw it in the travel agent’s window Via an advertisement in specialist adventure travel press Editorial in press/TV/radio

6.

What impressed you most about the people you bought your last adventure vacation from? Ranking for level of impression (1 = excellent, 4 = useless) Knowledge of activity Knowledge of destination Range of helpful advice Additional services, such as insurance Ranking for importance of factor (1 = very high, 4 = quite unimportant)

7.

What did you dislike most about the last adventure travel vacation that you took? The other people on the vacation were not compatible (e.g. much older, /younger, or had very different competence levels) Too expensive The travel agent/tour operator did not properly explain the true nature of the vacation The administrative arrangements were poor - I had to do all the

Northwind Traders Sample Business Plan

43

chasing! 8. What was the destination of your last adventure travel vacation? Europe N. America Africa 9. Asia Other India

If you have never taken an adventure vacation would you consider taking one from a reputable travel agent with proven expertise in this market? Yes No

10.

Have you ever been on an adventure vacation organized by your employer? Yes No

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

Northwind Traders Sample Business Plan

44

The percentage of Internet users.38% of Internet users in the United Kingdom have shopped online Italy . including PC sales of software and hardware. clothing sales.29% of Internet users in France have shopped online The average percentage of European Internet users who have shopped online in 1998 is 41 percent.41% of Internet users in Germany have shopped online United Kingdom . Finland. by region.4 billion00M.0 billion00M.33% of Internet users in Italy have shopped online Spain . The United Kingdom is the second largest Internet user market after Germany. who have shopped online in 1998 are as follows: • • • • • • • Finland .Internet Growth and the Sale of Travel Services Sales of travel services on the Internet have risen steadily over the past several years and look to continue increasing through the year 2000. For example. 1998. Italy. while PC products equaled $1. France.69% of Internet users in Finland have shopped online% the Netherlands . Northwind Traders Sample Business Plan 45 . Finland leads the way. and Spain. close to the European average. sales of travel services totaled $1. It is also evident that the European users of the Internet are growing rapidly. books $400 million0M.43% of Internet users in the Netherlands have shopped online Germany . followed in decreasing order by the Netherlands. These sales far outweigh other Internet sales. with Germany and the United Kingdom sitting squarely in the middle. and clothing $250 million0M. in 1998.31% of Internet users in Spain have shopped online France . Percentage of Internet Users Who Have Shopped Online. and book sales. in Millions When it comes to actually using the Internet for online shopping.

620 1.855 251 12.021 1.891 2.776 572 9 0 0 0 0 0 10.152 1.168 389 1.346 4.103 3.716 2.261 728 11 0 0 0 0 0 0 15.571 2.000 24.422 21 0 0 0 0 0 0 30.304 3.267 830 474 830 1.710 752 Payments Cash Purchases Payments to Creditors Salaries and Wages Employee Benefits Payroll Taxes Rent Utiltities Repairs and Maintenance Insurance Travel Telephone Postage Office Supplies Advertising (delete row) Marketing and Advertising Professional Fees Training and Development Bank Charges Miscellaneous Owner's Drawings Loan Repayments Tax Payments Capital Purchases Other .571 2.864 621 3.366 2.293 14.865 501 18.020 11.016 401 1.043 438 949 326 978 5.261 728 11 0 0 0 0 4.007 847 358 770 166 499 2.700 8.350 10.183 425 243 425 515 434 182 394 131 392 2.336 1.000 22.700 10.016 649 10 0 0 0 0 0 10.217 1.883 2.635 4.728 1.106 21.696 16.240 1.058 1.418 1.439 1.560 853 4.029 343 1.350 8.Database and Web Site Total Payments 0 6.051 5.864 5.310 437 2.366 27.253 1.370 585 21.12 Months Month: Pre-Start 1 2 3 4 5 6 7 8 Receipts Cash Sales Collections from Credit Sales New Equity Inflow Loans Received Other Total Receipts 0 16.715 333 191 333 405 341 143 310 237 713 3.265 1.020 10.036 16 0 0 0 0 0 0 22.016 2.938 5.716 2.883 2.195 501 15.525 418 14.203 6.947 379 216 379 460 387 162 352 149 446 2.107 604 345 604 734 617 259 561 166 499 2.336 1.168 389 1.021 584 1.016 649 10 0 0 0 0 0 0 14.APPENDIX 2: FINANCIAL FORECASTS Cash Flow Projection Year One Cash Flow Forecast .050 0 62.947 379 216 379 460 387 162 352 Northwind Traders Sample Business Plan 46 .120 2.462 16.183 425 243 425 515 434 182 394 149 446 2.305 22.620 1.310 437 2.751 26 0 0 0 0 25.175 0 19.

164) (66.718) (80.718) (80.670) 650 3.860) (75.785) (1.698) (84.983) Northwind Traders Sample Business Plan 47 .645) (76.368) (83.698) (84.053) (7.368) (83.429) Closing Cash Balance 0 (46.164) (20.429) (71.696) (8.164) (66.645) (76.289 8.Cashflow Surplus/Deficit (-) 0 (46.860) (75.446 Opening Cash Balance 0 0 (46.

364.097 5.072 18.350 12.933 4.700 31.550 50.291 6.080 6. Profit and Loss Statement .83 5.175 8.1 39 Less Cost of Goods Sold Materials Labor Overhead Other Total Cost of Goods Sold Gross Profit 2.581 20.64 7.13 9 5 2 2 Month 2 3 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 268.28 6 7 6 2.058 9.340 5.845 7.100 16.78 624.202.096.680 3.012 30.535 7.32 6.350 58.764 30.578.202.604.036 6.505 5.12 Months Year Year Year 1 Period Starting: Month 1 Sales Sales Other Total Sales 2.845 3.125 38.060 5.591.604.31 986.525 Northwind Traders Sample Business Plan 48 .591.364.410 16.Income Statement.6 7.855 8.3 6.845 3.0 4.340 9.2 56 27 86 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 45 32 0 0 0 0 0 0 0 0 2.970 2.116 29.500 36.185 17.340 16.84 3 8 6 Operating Expenses Salaries and Wages Employee Benefits Payroll Taxes Rent Utilities Repairs and Maintenance Insurance Travel Telephone Postage Office Supplies Advertising (delete row) Marketing and Advertising Professional Fees 39.428 40.060 5.096.895 10. Years One to Three Income Statement.700 30.05 4.578.8 5.686 40.

50 4 6 (8.901 304.Training and Development Bank Charges Depreciation Miscellaneous Other Total Operating Expenses Operating Income 10.901 339.34 0 52.03 1 6 6 6 6 6 6 6 6 6 Northwind Traders Sample Business Plan 49 .020 150 9.26 649.03 835.350) 0 0 0 0 0 0 0 0 44.63 835.043 380.03 835.185 35.350) 0 0 0 0 0 0 0 0 Interest Income (Expense) Other Income (Expense) Total Nonoperating Income (Expense) Income (Loss) Before Taxes Income Taxes (8.751 Net Income (Loss) 34.03 835.03 835.350) (8.350) (8.03 835.39 235.15 4 6 0 0 0 0 0 0 0 0 9.03 835.05 337.142 76.700 150 9.350) (8.40 0 5 0 0 0 0 0 0 0 0 Cumulative Net Income (Loss) 34.185 216.393 4 0 0 0 0 0 0 0 0 0 389.91 641.73 495.03 835.03 835.184 145.070 200 9.350) (8.185 16.

935 0 45.040 86.185 20. Plant. and Equipment Less Accumulated Depreciation Net Property. Plant.977 0 0 0 0 0 0 Northwind Traders Sample Business Plan 50 .040 0 20.628 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 19. Net Inventory Prepaid Expenses Other Total Current Assets Long-Term Assets Property.142 0 0 9.225 9.818 0 835 0 66.Balance Sheet at end of Year One Balance Sheet .588 0 0 0 0 0 0 LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Short-Term Debt Current Maturities of Long-Term Debt Accounts Payable Income Taxes Payable Accrued Liabilities Other Total Current Liabilities Long-Term Liabilities Long-Term Debt Less Current Maturities Deferred Income Taxes Other Long-Term Liabilities Total Long-Term Liabilities Shareholders' Equity 0 0 0 0 0 0 0 0 0 0 0 0 835 9.Two Years (Quarterly) Year 1 Qtr 1 Qtr 2 Qtr 3 Qtr 4 Qtr 1 Year 2 Qtr 2 Qtr 3 Qt ASSETS Current Assets Cash Marketable Securities Accounts Receivable. and Equipment Other Long-Term Assets Total Long-Term Assets Total Assets 29.

901 0 76.628 0 0 0 0 0 0 0 0 0 0 0 0 Northwind Traders Sample Business Plan 51 .Common Stock Additional Paid-In Capital Retained Earnings Other Total Shareholders' Equity Total Liabilities and Shareholders' Equity 41.750 0 34.651 86.

500 1 $29.750 $83.225 $20.Sources and Uses of Funds Sources and Use of Funds Number of funding rounds expected for full financing: Total dollar amount being sought in this round: SOURCES OF FUNDS Equity Financing: Preferred Stock: Common Stock: Debt Financing: Mortgage Loans: Other Long-Term Loans: Short-Term Loans: Convertible Debt: Investment from Principals: USE OF FUNDS Capital Expenditures: Purchase of Property: Leasehold Improvements: Purchase of Equipment/Furniture: Other: Working Capital: Purchase of Inventory: Staff Expansion: New Product Line Introduction: Additional Marketing Activities: Other Business Expansion Activities: Other: Database and Web site Debt Retirement: Cash Reserve: $41.000 $ 34.325 Northwind Traders Sample Business Plan 52 .700 $ 41.

Sources and Use of Funds Number of funding rounds expected for full financing: Total dollar amount being sought in this round: SOURCES OF FUNDS Equity Financing: Preferred Stock: Common Stock: Debt Financing: Mortgage Loans: Other Long-Term Loans: Short-Term Loans: Convertible Debt: Investment from Principals: USE OF FUNDS Capital Expenditures: Purchase of Property: Leasehold Improvements: Purchase of Equipment/Furniture: Other: Working Capital: Purchase of Inventory: Staff Expansion: New Product Line Introduction: Additional Marketing Activities: Other Business Expansion Activities: Other: Database and Web site Debt Retirement: Cash Reserve: $41. One Year (Quarterly) Balance Sheet .500 1 $29.750 Balance Sheet.750 $83.One Year (Quarterly) Year 1 Northwind Traders Sample Business Plan 53 .275 $41.000 $34.225 $20.

633 0 24.750 0 (1.890 0 835 0 57.580 79. and equipment Other long-term assets Total Long-Term Assets Total Assets LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Short-term debt Current maturities of long-term debt Accounts payable Income taxes payable Accrued liabilities Other Total Current Liabilities Long-Term Liabilities Long-term debt less current maturities Deferred income taxes Other long-term liabilities Total Long-Term Liabilities Shareholders' Equity Common stock Additional paid-in capital Retained earnings Other Total Shareholders' Equity Total Liabilities and Shareholders' Equity Qtr 2 Qtr 3 Qtr 4 7855 0 5600 0 400 0 13.750 0 (212) 41.545 20.178 41.784 41.Qtr 1 ASSETS Current Assets Cash Marketable securities Accounts receivable.633 42. and equipment Less accumulated depreciation Net property.628 0 0 525 0 0 0 525 0 0 640 0 0 0 640 0 0 750 3500 0 0 4250 0 0 835 9142 0 0 9977 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 41.491) 0 40.901 0 76.040 0 20.225 (4592) 24.538 42.830 41.818 0 835 0 66.259 40.178 29.493 19.750 0 33.800 0 535 0 17.750 0 34.225 (2296) 26.588 29.855 210 0 16.784 29. plant.768 0 35.830 29.935 0 45.929 0 26.651 86.337 79.929 40.830 75. plant.337 0 22. net Inventory Prepaid expenses Other Total Current Assets Long-Term Assets Property.225 (9185) 20.040 86.628 Northwind Traders Sample Business Plan 54 .225 (6888) 22.

035 6930 0 41.645) (76.284 6.967 8 21.134 167 503 2631 1315 438 2192 426 244 426 518 435 183 396 2895 2270 731 11 0 0 0 0 0 0 15.020 11.715 16.325 286.053) 237 713 3728 1864 621 3107 604 345 604 734 617 259 561 4103 3217 1036 16 0 0 0 0 0 0 22.864 326 978 5120 2560 853 4267 830 474 830 1007 847 358 770 5635 4418 1422 21 0 0 0 0 0 0 30.700 0 401 1203 6304 3152 1051 5253 1021 584 1021 1240 1043 438 949 6938 5439 1751 26 0 0 0 0 25.368) (83.000 24.289 149 446 2336 1168 389 1947 379 216 379 460 387 162 352 2571 2016 649 10 0 0 0 0 0 0 14.983) (62.database and Web Total Payments site Cashflow Surplus/Deficit (-) Opening Cash Balance Closing Cash Balance 1 2 10.696 16.696) 0 0 (46.732) (58.366 (7.001 3.525 418 8350 10.810 34.462 24.855 251 4 12.370 585 8350 27.Cash Flow Forecast.933 17.429) (71.758 29.698) (84.406 1002 8350 35.676 19.750 0 264.305 22.164) (66.232 11 28.698) (84.966 5989 29.645) (76.007 9982 150 0 0 0 0 29.710 752 9 24.545 31. 12 Months Cash Flow Forecast .293 14.943 5823 3329 5823 7069 5949 2499 5408 39.860) (75.446 166 499 2620 1310 437 2183 425 243 425 515 434 182 394 2883 2261 728 11 0 0 0 0 0 0 15.716 9.325 32.016 3.225 41.975) (39.785) 131 392 2058 1029 343 1715 333 191 333 405 341 143 310 2265 1776 572 9 0 0 0 0 0 10.891 (8.390) 0 (46.066 1166 Totals 216.865 501 7 18.860) (75.841) (21.346 (1.000 22.983) (62.975) (39.451 2.12 Months Month PreReceipts Start Cash sales Collections from credit New equity inflow sales Loans received Other Total Receipts 0 Payments Cash purchases Payments to creditors Salaries and wages Employee benefits Payroll taxes Rent Utilities Repairs and maintenance Insurance Travel Telephone Postage Office supplies Marketing and advertising Professional fees Training and development Bank charges Miscellaneous Owner's drawings Loan repayments Tax payments Capital purchases Other .808 1002 12 33.716 650 149 446 2336 1168 389 1947 379 216 379 460 387 162 352 2571 2016 649 10 0 0 0 0 0 10.718) (80.215 752 10 26.700 16.670) 166 499 2620 1310 437 2183 425 243 425 515 434 182 394 2883 2261 728 11 0 0 0 0 0 0 15.732) (58.164) (20.429) (71.718) (80.020 3 10.368) (83.050 0 62.016 8.164) (66.841) 0 (46.106 21.390) Northwind Traders Sample Business Plan 55 .195 501 6 15.366 5 14.757 113 339 1780 890 297 1483 288 165 288 350 295 124 268 1959 1536 494 7 0 0 0 0 0 0 10.856 35.716 166 499 2620 1310 437 2183 425 243 425 515 434 182 394 2883 2261 728 11 0 0 0 0 4175 0 19.781 18.105 (21.251 113 339 1780 890 297 1483 288 165 288 350 295 124 268 1959 1536 494 7 0 0 0 0 0 21.

286 13.113 231.060 5845 3340 9185 17.156 145.604.097 5970 2505 5428 39.318 0 0 0 6.591.163 (25.291 6764 30.895 10.340 649.096.462 100.210 64.604.202.060 5845 3340 5845 7.669 6.839 Other Total Sales 2.058 9686 40.036 Northwind Traders Sample Business Plan 56 .846 1.303 128.175 61.700 150 9185 58.043 9142 34.020 150 9185 40.616 2.202.020 31.506 (8350) (8350) 641.385 22.947 36.730 55.Income Statement.070 200 9185 216.278.132 15.914 76.080 6680 3340 16.631 337.278.730 339.096.327 624.901 235.036 835.645 5.036 134.184 304.525 50.758 15.555 0 0 788.030 26.879.327 4.784 1.370 10.054 389.077 835.669 986.790 500 27. Three Year Summary Income Statement .645 Year 3 Totals 7.527 24.550 16.200 18.364.410 16.036 6012 30.578.158.578.056 268.393 (8350) (8350) 44.500 35.125 10.264 (8350) (8350) 380.056 2.364.581 20.700 30.091.286 13.783 4.901 34.132 15.405 835.158.751 495.839 Less Cost of Goods Sold Materials Labor Overhead Other Total Cost of Goods Sold Gross Profit Operating Expenses Salaries and wages Employee benefits Payroll taxes Rent Utilities Repairs and maintenance Insurance Travel Telephone Postage Office supplies Marketing and advertising Professional fees Training and development Bank charges Depreciation Miscellaneous Other Total Operating Expenses Operating Income Interest income (expense) Other income (expense) Total Nonoperating Income (Expense) Income (Loss) Before Taxes Income Taxes Net Income (Loss) Cumulative Net Income (Loss) Year 2 5.116 29.100 16.050) 0 (25.591.066.Three Year Year 1 Summary Sales Sales 2.700 31.769 67.616 0 7.072 18.390 52.535 7933 4175 8350 38.855 8350 12.050) 1.

325 $34.750 1 Northwind Traders Sample Business Plan 57 .000 $29.Sources and Uses of Funds Sources and Use of Funds Number of funding rounds expected for full financing: Total dollar amount being sought in this round: $83.225 $41.500 SOURCES OF FUNDS Equity Financing: Preferred Stock: Common Stock: Debt Financing: Mortgage Loans: Other Long-Term Loans: Short-Term Loans: Convertible Debt: Investment from Principals: USE OF FUNDS Capital Expenditures: Purchase of Property: Leasehold Improvements: Purchase of Equipment/Furniture: Other: Working Capital: Purchase of Inventory: Staff Expansion: New Product Line Introduction: Additional Marketing Activities: Other Business Expansion Activities: Other: Database and Web site Debt Retirement: Cash Reserve: $41.700 $20.

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