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iTrainer

Fitness, LLC
Feasibility Plan

Robert P. Ellentuck

EMBA 257: Entreprenuership/New Venture


The George Washington University School of Business
George T. Solomon, DBA

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ROBERT P. ELLENTUCK

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TABLE OF CONTENTS
EXECUTIVE SUMMARY .......................................................................................................................................................................... 5
A.

STATEMENT OF PURPOSE ................................................................................................................................................... 5

B.

PRODUCT / SERVICE DESCRIPTION ............................................................................................................................ 5

C.

MARKET OVERVIEW ................................................................................................................................................................ 6

D.

PRODUCT DIFFERENTIATION .......................................................................................................................................... 6

E.

VALUE PROPOSITION ............................................................................................................................................................. 7

MARKET DATA ............................................................................................................................................................................................ 8


A.

TARGET MARKET DEMOGRAPHICS ............................................................................................................................. 8

B.

SOCIAL VALUES / LIFESTYLES......................................................................................................................................... 9

C.

COMPETITION ............................................................................................................................................................................10

MARKET PLAN ...........................................................................................................................................................................................12


A.

PRODUCTS AND SERVICES ...............................................................................................................................................12

B.

COMPETITIVE ADVANTAGE ...........................................................................................................................................12

C.

PROMOTIONAL STRATEGY ..............................................................................................................................................13

D.

PRICING STRATEGY ...............................................................................................................................................................14

E.

GROWTH STRATEGY .............................................................................................................................................................15


Internal Strategic Growth .............................................................................................................................................................15
External Strategic Growth ............................................................................................................................................................15

IMPLEMENTATION PLAN ..................................................................................................................................................................16


A.

PERSONNEL .................................................................................................................................................................................16
Management Team...........................................................................................................................................................................16
Staff...........................................................................................................................................................................................................16
Board of Advisors .............................................................................................................................................................................17

B.

OPERATIONS ...............................................................................................................................................................................17

C.

LEGAL ISSUES .............................................................................................................................................................................18

SWOT ANALYSIS .......................................................................................................................................................................................18


A.

CRITICAL RISKS / BARRIERS TO ENTRY ..................................................................................................................18

B.

SWOT ANALYSIS .......................................................................................................................................................................19

FINANCIAL PLAN ....................................................................................................................................................................................20


A.

START-UP COSTS ......................................................................................................................................................................20


Sources of Funding ..........................................................................................................................................................................20
Applications of Funding ...............................................................................................................................................................20
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B.

BALANCE SHEET ......................................................................................................................................................................22

C.

INCOME PROJECTIONS ........................................................................................................................................................22

D.

CASH FLOW PROJECTIONS ...............................................................................................................................................22

E.

NOTES OF EXPLANATION .................................................................................................................................................22


Sales Projections ................................................................................................................................................................................22
Cash Flow Projections ....................................................................................................................................................................23

REFERENCES ................................................................................................................................................................................................25
A.

ANNOTATED BIBLIOGRAPHY ........................................................................................................................................25

B.

CONSULTED WEBSITES........................................................................................................................................................27

EXHIBITS .........................................................................................................................................................................................................28
A.

Exhibit 1: Median Household Income ..............................................................................................................................28

B.

Exhibit 2: Competitive Analysis ..........................................................................................................................................29

C.

Exhibit 3: Cost-Benefit analysis of Promotional Strategy .......................................................................................30

D.

Exhibit 4: Three-Pronged Media approach for Promotional Strategy .............................................................31

E.

Exhibit 5: Strategic Growth ....................................................................................................................................................32

F.

Exhibit 6: Startup Funding and Expenditures ..............................................................................................................34

G.

Exhibit 7: Startup Funding and Expenditures (Capital)..........................................................................................34

H.

Exhibit 8: Balance Sheet ............................................................................................................................................................34

I.

Exhibit 9: Monthly Income Statement Sheet .................................................................................................................34

J.

Exhibit 10: Annual Income Statement ..............................................................................................................................34

K.

Exhibit 11: Breakdown of 2012 Income ............................................................................................................................34

L.

Exhibit 12: Breakeven Statement .........................................................................................................................................34

M.

Exhibit 13: Owners Compensation ..............................................................................................................................34

N.

Exhibit 14: Ratio Analysis .......................................................................................................................................................34

O.

Exhibit 15: Sales Projections ...................................................................................................................................................34

P.

Exhibit 16: Cash Flow Statement .........................................................................................................................................34

APPENDIX A: FINAL PRESENTATION .......................................................................................................................................35

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EXECUTIVE SUMMARY
A.

STATEMENT OF PURPOSE

The purpose of iTrainer Fitness is to incorporate healthy amounts of exercise into a


hectic professionals lifestyle by delivering a personally tailored fitness regimen that
leverages digital technology with a cost-affordable and time-flexible solution.
iTrainer Fitness Your Fitness. Your Way.
B.

PRODUCT / SERVICE DESCRIPTION

iTrainer Fitness, LLC will produce custom exercise workouts for clients focusing on two
critical areas of physical fitness cardiovascular endurance and strength training. The
expertise of contracted personal trainers will be delivered to clients in two formats:

Face-to-Face Sessions: An initial consultation with a personal trainer and monthly


progress sessions will establish baseline fitness capacity and measure goal attainment
through the recalibration of strength levels/cardiovascular settings. Trainers will assess
progress and adjust exercise levels of future workouts to better assist clients with
reaching their personal fitness goals.

Digital Podcasts: Between in-person sessions with a personal trainer, clients will receive
fitness podcasts, with the voice of their trainer guiding them through a workout overlaid
on music of their preference. These podcasts will be tailored to individual goals activity,
duration, intensity and capabilities weight limits, flexibility, and endurance. The
number and variety of delivered podcasts will be tailored to customer specifications and
package.

Services will be offered in various packages where clients select the number and type of
workouts that fit their personal schedule and goals, with the added benefit of enjoying
greater cost-savings by purchasing larger packages. Other a la carte options will be
offered, including additional and/or activity-specific podcasts (spinning, interval
training, etc.). The iTrainer service will also feature personal portfolios available on the
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iTrainer website, where clients can download digital workouts, access material on
proper exercise techniques and check individual progress via uploaded personal
metrics.
C.

MARKET OVERVIEW

iTrainer Fitness has identified one of the fastest-growing counties in the nation
Loudoun County, VA as its initial target market, primarily due to favorable
demographics for both creating a market presence and fostering sustainable growth.
The following chart denotes basic characteristics of Loudoun for the year 2009.
Population

301,171 (50% males; 50% females)

College Degree

57% of population

Median Income

$112,021

Professional Positions

56% of population

Median Age

34.2 years

The data above reveals a growing, young, professional population with the highest
level of median income in the state. iTrainer fitness seeks to attract clients that are
educated about the health benefits of regular exercise, with discretionary income, and
who can become clients for life from a young age.
D.

PRODUCT DIFFERENTIATION

Flexibility and convenience rest at the core of the iTrainer Fitness concept leveraging
technology to afford busy professionals access to certified exercise specialists. The
program offers the luxury of personal training at a fraction of the cost of other
programs, with the added flexibility of on-demand access to workouts via podcast.
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iTrainer Fitness develops customized workouts based on individual goals, unlike the
other generic technology-based solutions, such as home DVDs, game console systems,
and iTunes workout albums. With a pricing strategy virtually on par with these
lackluster solutions, but offering a service more commensurate with a one-on-one
personal training relationship, iTrainer Fitness clients will receive greater value from
their investment than by pursuing other available market options.
E.

VALUE PROPOSITION

iTrainer Fitness provides unparalleled value to clients through personalized attention,


customized workouts, flexible scheduling and continual feedback on goal realization.
Loudoun County demographics support the initial launch of the business, with growth
expected through targeted marketing espousing the accessibility and affordability of the
service. Since clients will use the service while maintaining their existing gym
memberships, the interaction with personal trainers will expose other gym members to
the benefits of iTrainer Fitness a more in-direct form of marketing.
Sustainability of iTrainer Fitness will be realized through decreasing economies of scale.
Aside from initial start-up costs, ongoing costs will largely consist of staffing, with
decreased effort necessary to create podcasts as an established library of workouts can
be leveraged and tailored for specific individuals. Other future growth areas have also
been identified. iTrainer Fitness will consider expanding its market footprint within
Northern Virginia and the greater Washington, DC area, after building a solid
foundation within the Loudoun community. Growth has also been considered for
additional product/service offerings, such as creating alliances with nutritional centers,
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hosting an educational speaker series on various fitness-related topics and creating a


Smartphone application that will allow clients to interface with the iTrainer website.

MARKET DATA
A. TARGET MARKET DEMOGRAPHICS
For our initial launch of iTrainer Fitness, we have targeted Loudoun County, VA. We
based this decision on key demographics of this region: population growth, income,
age, gender, educational attainment, home ownership, employment, marital status and
mobility. Loudoun is one of the fastest-growing counties in the US with higher than
average income and a substantial demographic consisting of educated professionals
with families. County residents are knowledgeable and comfortable with technology
and seek healthy lifestyles.
According to the US Census Bureau, in 2008, Loudoun was ranked as the number one
county in median household income.

Two neighboring counties to Loudoun also

ranked well - with Fairfax (VA) ranked number two and Howard (MD) ranked number
three (see Exhibit 1 Median Household Income). As of 2009, there were 91,000 households
with an estimated total population of 301,171 (50% males; 50% females) in Loudoun.
Also in this same year, 57% of residents had a college degree or higher and the median
income was $112,021 with 93% coming from earnings.1 These factors contributed to the
rapid growth in home sales with 51% of the county population owning homes. The
Loudoun workforce also enjoys lower rate of unemployment than the national average,

1Accessed:

14 February 2011. http://factfinder.census.gov/servlet/NPTable?_bm=y&-geo_id=05000US51107&qr_name=ACS_2009_5YR_G00_NP01&-ds_name=&-redoLog=false

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with approximately 56% of residents holding professional positions. With a median age
of 34.2 years, the age distribution of the population ranges:

Ages 65 and older 6%


Ages 45 to 64 22%
Ages 25 to 44 35%2

According to the Loudoun County Department of Economic Development, the


population is estimated to grow to 436,558 by 2020.3
B. SOCIAL VALUES / LIFESTYLES
iTrainer Fitness capitalizes on four current social trends: health/fitness, aging baby
boomers, technology, and the economy. For several years, the health/fitness trend has
been on the rise, which industry experts expect to continue, particularly as Americans
become increasingly aware of the link between exercise and health. This trend is
beginning to extend to children with the creation of Michele Obamas Healthy Start
program. As the large number of baby boomers age, a niche market for cost-effective,
fitness solutions based on the unique needs of this demographic is created. Another
lifestyle trend concerns the pervasive use of technology as industry advancements have
made devices easier to use and more affordable. The American Council on Exercise
(ACE) recommends a fitness solution, where integrated technology assists individuals
with meeting exercise goals. The ACE further predicts increased interest in a
technological solution that logs and tracks workouts and makes them available to
clients and trainers, as well as software/websites that [can] aggregate a variety of tools
to create a custom program.4 The economic turmoil over the last few years has caused

Accessed: 14 February 2011. http://factfinder.census.gov/servlet/NPTable?_bm=y&-geo_id=05000US51107&qr_name=ACS_2009_5YR_G00_NP01&-ds_name=&-redoLog=false


3 Accessed: 15 February 2011. http://biz.loudoun.gov/Home/FactsandFigures/Demographics/tabid/79/Default.aspx
4 Accessed: 13 February 2011, http://www.acefitness.org/article/2835/
2

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many consumers to limit discretionary spending, where value and necessity occupy
increasing importance. The iTrainer Fitness concept purports to be recession proof
satisfying a customer need for health/fitness at a cost that cant be construed as
luxury. Greater detail on the four lifestyle trends can be found below:

HEALTH/FITNESS CONSCIOUS

AGING BABY BOOMERS

Fitness clubs are a $41.4B industry, with


memberships totaling 45.3M in 20105

Increasing fitness needs of busy professionals and


aging baby boomers

Centers for Disease Control (CDC) recommends


at least 150 minutes of cardio weekly6
Targeted campaigns by CDC & others to increase
awareness of importance of diet and exercise

According to International Health, Racquet and


Sportsclub Association (IHRSA), people age 55 and
older are fastest growing users of health clubs7
Working longer and have more discretionary
spending; retired Baby Boomers have leisure time

Corporate wellness programs offer fitness advice


and gym discounts

Fitness clubs capitalize on this demographic by


offering classes targeted to older users

TECHNOLOGY

ECONOMIC TURMOIL

Websites offer free routines, calorie counters,


fitness recommendations, nutrition advice

Economic turmoil has prompted a reduction in


discretionary spending of luxury items

iTunes offers both free and for-sale workout


albums
Game consoles with fitness accessories (Wii Fit,
PlayStation Move) have increased in popularity
Mobile applications help users improve
nutrition, coach toward goals, track body
measurements

Average full service health club costs about $750


per year8
Personal trainers cost approx. $50 - $150 per hour
Consumers seeking lower cost options such as
unstaffed facilities, group classes, home workouts

C. COMPETITION
While iTrainer Fitness faces a variety of competition in the marketplace (see Exhibit 2 Competitive Analysis) we consider the two primary competitors to be high-end personal
trainers and gym-based personal trainers. iTrainer Fitness offers the personal attention
and goal attainment of their high-end competitors, with greater flexibility and at a more
affordable price.

Accessed: 13 February 2011. http://www.entrepreneur.com/article/printhis/217508.html


Accessed: 15 February 2011. http://www.cdc.gov/physicalactivity/everyone/guidelines/adults.html
7 Accessed: 13 February 2011. http://www.medicinenet.com/script/main/art.asp?articlekey=56451
8 Accessed: 13 February 2011.
http://www.nytimes.com/2010/12/25/health/25patient.html?scp=1&sq=burning%20calories&st=cse
5
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High-end trainers provide clients with the ability to have personalized, one-on-one
training: at home, at a private studio, or another location.9 Loudoun County currently
sports a number of these competitive alternatives such as Storm Fitness but these
providers have suffered in the recent economic turmoil. Clients who select high-end
trainers tend to be professionals earning greater than $100,000, who are drawn to the
superior instruction, personalization, flexibility and convenience. One session of basic
training with a high-end trainer costs approximately $100, with a package of 24 sessions
costing $75 per session. Additional services, such as classes, nutritional counseling or
rehabilitation work, cost at least 25% more.10
By contrast, gym-based trainers typically work exclusively in one health club chain.11
Gym-based trainers are usually not required to possess specific education or
professional certification. In 2008, there were 261,000 personal trainers nationwide, and
there are anticipated to be 337,900 by 2018.12 While these are nationwide figures, and
many trainers are part-time employees, the 29% growth rate indicates a burgeoning
field. There are a wide variety of gym-based trainers in several health clubs throughout
the county, including ultra-luxury, women-only, and traditional gyms; communityoriented facilities; and specialized facilities (such as Pilates and kick boxing). These
trainers also offer a variety of services to clients including strength training, weight loss
advice and cardio-vascular programs. Gym-based trainers are far less costly than highend trainers, costing as low as $50 for each session when purchased in sets of five.13

Accessed: 12 February 2011, http://www.stormfitness.com/index.html


Accessed: 12 February 2011, http://www.stormfitness.com/index.html
11 Accessed: 12 February 2011, http://www.usahealthclubs.com/sb/health-clubs
12 Accessed: 13 February 2011, http://www.bls.gov/oco/ocos296.htm
13 Accessed: 14 February 2011, http://www.sequoiahealth.com/
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MARKET PLAN
A.

PRODUCTS AND SERVICES

iTrainer Fitness offers a customized, flexible and affordable service designed to appeal
to the previously defined target market. iTrainer Fitness will establish itself as a market
leader with a unique solution and as an innovator focused on quality at an affordable
price. The service offers highly qualified personal trainers, who will tailor programs for
clients that are delivered through technology (digital podcasts) and professionals (faceto-face sessions). An initial session with the personal trainer will establish rapport,
identify client goals and complete an overall body assessment. The information gained
during the consultation will be used to develop a custom workout plan for the client.
Clients will select from four-service level packages: platinum, gold, silver and bronze; a
choice of a la carte options will also be offered.
B.

COMPETITIVE ADVANTAGE

iTrainer Fitness will differentiate itself from the competition by addressing a gap that
exists in the fitness marketplace today - the flexibility and personalization of a personal
trainer at a price more commensurate with generic, technology based solutions.

For

instance, our top-level platinum service provides 10 workouts for the low price of $169
per month whereas the same 10 sessions from a high-end personal trainer would cost
over $750 per month. The iTrainer Fitness solution further differentiates the product
from other competitors by incorporating on-demand technology capabilities for flexible
workout scheduling.

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C.

PROMOTIONAL STRATEGY

iTrainer Fitness has developed a promotional strategy to attract initial customers, retain
clients and expand the target market.

The initial promotional campaign will be

comprised of a three-pronged approach, leveraging a variety of mediums in the


following categories: social media, guerilla marketing and conventional marketing.
Allocating limited resources across a variety of channels will minimize costs while
maximizing return. iTrainer Fitness targets a niche market the void between the
expense of a personal trainer and the absence of personalized attention from just joining
a gym or exercising at home.
The iTrainer Fitness program will offer the convenience and affordability to retain
clients; therefore; the primary challenge will be to attract clients and convince them to
make the initial investment. Promotional messaging will capitalize on iTrainer benefits,
while acknowledging client aspirations and concerns.

Flexibility: Let iTrainer professionals show you that exercise can be a part of even the most hectic
lifestyle.

Affordability: With iTrainer Fitness, everyone can experience the luxury of a personal trainer
several times a week at a fraction of the cost.

Convenience: iTrainer Fitness workouts are ready whenever you are before morning coffee,
during lunch or after the kids are in bed.

Personal Health: Everyone needs help in achieving goals. Let iTrainer Fitness help you realize
your fitness aspirations and develop a healthier lifestyle.

The iTrainer Fitness promotional strategy will operate in concert with the strategic plan:

Pre-Launch: To create awareness and buzz


Launch: To generate excitement and acquire clients
Post-Launch: To reinforce the buzz, retain clients and pursue additional growth

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The sales strategy will be led by the entire venture management team at start-up, with
resources allocated to each area of the three-pronged marketing approach.

Other

promotional tactics will capitalize on word-of-mouth advertising and incentives will be


extended to trainers and clients who refer new customers. A cost-benefit analysis was
conducted to examine the value of promotional mediums - both from a strategic and
financial perspective (see Exhibit 3 - Cost Benefit Analysis of Promotional Strategy and
Exhibit 4 - Three-Pronged Media approach for Promotional Strategy).
D.

PRICING STRATEGY

Our pricing strategy outlined in the chart below is segmented into four tiers to offer
clients greater cost-savings and adheres to our value proposition of flexibility and
affordability. It will also ensure that we are able to cover our costs and generate a
margin of profit.
Service Level

Pricing

Workout Services

Price/Quality

Platinum

$169/month

4 Strength/6 Cardio

Superb-Value Strategy

Gold

$129/month

2 Strength/3 Cardio

Good-Value Strategy

Silver

$109/month

2 Strength/2 Cardio

Good-Value Strategy

Bronze*

$89/month

1 Strength/2 Cardio

Cost-Value Strategy

Initial one-on-one consultation with personal trainer complimentary.


*Cardio and strength workouts interchangeable.
A la carte services:

Interval workouts: Additional $10 per month atop existing package


Spinning workouts: Additional $15 per month atop existing package
One-on-one sessions with trainer: $50 per hour
Greater than 60 minute workouts: Prices negotiable

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E.

GROWTH STRATEGY

The iTrainer programs success is predicated on providing value to clients through


personalized attention, customized workouts, flexible scheduling and continual
feedback on goal progress. Our initial target market will be offered a basic menu of
training services in a limited area; however, future areas of growth have been
considered. Strategic growth is organized by internal and external options. A detailed
cost-benefit analysis of each can be found in Exhibit 5 - Strategic Growth, but some details
are provided below:
INTERNAL STRATEGIC GROWTH

Hire Additional Staff: Current profitable ratio of clients to personal trainer is 120:1.
When client demand exceeds this ratio, additional trainers will be necessary.

Software Investment: Investing in technologically-advanced podcast production software


will provide economies of scale.

Smartphone Application: Clients can check fitness progress, download music and
reference exercise instructions.

Operational Managers: Skilled managerial staff will handle logistics and daily operations
so owners can pursue additional growth opportunities or other business ventures.

EXTERNAL STRATEGIC GROWTH

Nutritional Services: Offer healthy eating services through sub-contracting with


nutritionists or strategic alliances with weight-loss centers.

Educational Speaker Series: Sponsor speakers on healthy lifestyle topicsnutrition,


fitness, stress management, motivation, etc.

Expand Market Area: Offer services beyond initial target market.

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IMPLEMENTATION PLAN
A.

PERSONNEL
MANAGEMENT TEAM

iTrainer Fitness will be managed through start-up and during the initial years by the
four owners, who possess varied levels of experience in a number of areas. While
owners may eventually cede operational control to full-time managers, they understand
the value of hands on interaction with the new venture, that strategic goals are
pursued. Competency areas for each owner include:

Robert Ellentuck: Financial Planning/Reporting, Legal Issues


Noemi C. Arthur: Communications, Procurement
Maryanne Zabala: Marketing, Sales
Moo Hackett: Logistics, Operations

STAFF
iTrainer Fitness will employ personal trainers and technical support staff as
independent contractors, rather than as employees, to minimize payroll costs and
company liability. Feasibility calculations have shown the maximum client-trainer ratio
to be 120:1, assuming one-hour personal training sessions per month, with each trainer
working 8 hours a day (6 hours training and 2 hours creating podcasts) for 5 days a
week. Accordingly, iTrainer Fitness intends to employ only enough trainers to
adequately cover client needs and assumes the following hiring strategy based on
growth projections:

Q1: 3 trainers for maximum 250 clients


Q2: 4 trainers for maximum 500 clients
Q3: 7 trainers for maximum 750 clients
Q4: 9 trainers for maximum 1,000 clients

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iTrainer Fitness will also require technical support staff to assist with generating
podcasts, to troubleshoot technical difficulties, maintain the website, etc. Depending on
client demand, iTrainer Fitness will pursue a strategy that will eventually reduce the
amount of time personal trainers devote to generating podcasts and shift those
functions to technical support staff. Since personal trainers are skilled labor, their time
spent on one-on-one consultations instead of podcast production will produce better
returns on investment.
BOARD OF ADVISORS
iTrainer Fitness will have a five-person board of advisors to provide consultation to the
management team. Specific individuals appointed to the Board include:

B.

Robert Watkins, an attorney practicing corporate law in Washington, DC; Virginia; and
Maryland, with a strong interest in technology related startups. He is a long time advisor to
owner Robert Ellentuck.

Ronald Walker, Director of Business Development for Golds Gym, who has agreed to serve as a
consultant.

Jon Danforth, a small business owner with over 20 years experience and the brother-in-law of
owner Noemi C. Arthur.

Julie Jones, a Human Resources professional for over 15 years, with specific expertise in payroll
issues, staff development, and responsibly employing social media in the workplace.

Erik Kloster, a Certified Public Accountant specializing in small, medium, and large
businesses, including technology startups, in Northern Virginia.

OPERATIONS

All iTrainer Fitness trainer contractors will be provided gym memberships to client
clubs as well as the technical resources to produce podcasts, including laptops,
software, etc. As previously mentioned, trainers will be scheduled for 6 hours a day in
the gyms or homes of clients, conducting initial consultations or monthly progress

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sessions. The remainder of their 8-hour day will be devoted to generating podcasts for
clients. Technical support staff will provide assistance with mixing music, uploading
workouts/progress results to the iTrainer website and troubleshooting difficulties.
Clients will use the website to purchase packages (ecommerce), reference information
(educational), download their customized workouts (distribution) and check fitness
results (metrics).
C.

LEGAL ISSUES

iTrainer Fitness will be registered as a Virginia Limited Liability Company (LLC), an


arrangement that affords the owners protection from liability while conferring tax
benefitsespecially during early years of the venture
iTrainer Fitness has also identified other legal issues that will need to be addressed:

Gyms Prohibiting Outside Trainers: These facilities mostly include national chains, which
will be avoided until suitable accommodation can be made to ensure iTrainer consultations in
these facilities.

Music Copyright: To avoid liability for unlawful distribution of copyrighted materials, all
clients will provide their own music for podcast workouts.

Injury Liability: All clients will sign waivers exempting iTrainer from liability for injuries
sustained during workoutseither with trainers or alone with podcasts.

Licenses/Fees: The company will require a Loudon County Business License, a Virginia
State Sales Tax Permit, a Loudon County Business Professional Occupational License and a
Fictitious Name Certificate.

SWOT ANALYSIS
A.

CRITICAL RISKS / BARRIERS TO ENTRY

iTrainer Fitness chief strength lies in their unique mission to combine personal
training with customized on-demand workouts. The business model has low start-up
and overhead costs, with easily scalable growth options.

Despite these strengths,


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iTrainer Fitness has some weaknesses; most notable is the plethora of fitness options in
the marketplace confronting the average consumer. Additionally, the iTrainer concept
is novel and may invite competitors that could mimic the programs unique service.
At the same time, the company has many opportunities for success.

The iTrainer

proposition offer value and a unique service, to a niche audience. Demographics and
lifestyle for the target market support significant growth predictions. Conversely, there
are some threats to commercial viability notably, the lingering recession, which
constricts discretionary spending. Greater detail can be found in the table below.
B.

SWOT ANALYSIS

STRENGTHS
Combines personal training with customized podcasts

WEAKNESSES

Leverages clients music

No central office to meet clients


Turnover of contract trainers could
impact service

Leverages technology, web site and mobile applications

No existing brand, or reputation

Low start-up costs


Offers tiered-pricing with a la carte options
Provides client support and feedback
Offers cardiovascular and strength training
Ideal demographics in target market

Initial cash flow could be unpredictable


Managing initial promotional costs
Many fitness choices available

OPPORTUNTIES

THREATS

Appealing to busy and hectic professionals


Capitalizes on increasing health and fitness trends
Attractive business model and brand for franchising

Consumers reduction in discretionary


spending
Ensure consistent caliber of trainers
Competitors may mimic us

Growing population of target market


Potential partnerships with weight programs/nutritionists

Volatile gas prices could impact


overhead costs
Resistance to use of technology

19 | P a g e

FINANCIAL PLAN
A.

START-UP COSTS

SOURCES OF FUNDING
iTrainer Fitness, LLC will require approximately $300,000 in start-up capital, of which
$191,600 is for direct startup costs and $108,400 is to provide a cushion until the cash
flow becomes positive and for any unexpected contingencies. Initial capital will be
raised from personal funds provided by the principals. iTrainer Fitness will consider
whether to pursue future through county and state sources, though the owners equity
contribution is used as the basis for this feasibility plan.14 The table below provides a
snapshot of initial funding sources:

SOURCE
Equal investment from each of the four
owners: Arthur, Ellentuck, Hackett and
Zabala

TYPE OF FUNDING

AMOUNT

Personal Investment

300,000

300,000

TOTAL:

APPLICATIONS OF FUNDING
A brief summary of funding is provided below. (For greater detail, see Exhibit 6 - Startup
Funding and Expenditures)

Security Deposits: The security deposit for telephone and high speed Internet was provided
by the companys representative at Verizon. The security deposit for VOIP was provided by
the companys representative at ITP/aptella.

Startup Expenses: These figures include estimated costs for basic legal, accounting, and
consulting services that the new company will require. Insurance premiums of $5,000
during pre-opening reflect a concern about potential liability issues involved in personal
training. After opening, insurance needs and premiums will increase as reflected in the

Accessed 15 February 2011, http://www.loudounsbdc.org/index.cfm


http://loudoun.vhost.vipnet.org/business/financing.htm,
http://biz.loudoun.gov/Home/DoingBusinessinLoudoun/BusinessFinancing/tabid/113/Default.aspx,
http://www.dba.state.va.us/vsbfa.shtml.
14

20 | P a g e

Income Statement. The figures included are based on quotes provided by our insurance
broker, Josh Hykes Insurance Agency.15
o Salaries (Startup): During the six-month period prior to opening, the four owners will
devote 100% of their time to the company and receive no salary (in order to conserve
resources). Trainers (1099) and outsourced technical support staff are not salaried
employees, and compensation during the startup period (where applicable) is listed
elsewhere. (For greater detail, see Exhibit 13 - Owners Compensation).
o Pre-opening Advertising: Also included is pre-opening advertising which is estimated
at $100,000. Advertising will be a fundamental part of developing the brand and creating
demand prior to opening. We will continue to spend heavily on advertising after opening
to fuel growth. Advertising estimates are provided by the companys PR specialist, MGH
Public Relations.16 The creation of an interactive website will cost $5,500 and will allow
orders to be placed and customers to contact customer service via online chat or
telephone. Estimated figures provided by Z-IndexMedia.Com.17
o Capital Expenditures The Capital Expenditure list includes items that will be used
by the company executives, support staff, and personal trainers to run the company,
serve the needs of the support staff, and provide the iTrainer service to the clients. As the
company will function without a central office, the list consists of technology
requirements and associated equipment and furniture. The estimate of capital equipment
necessary was determined by research, discussions with area business owners, and our
service vendors. The costs are broken out in the exhibits, with an explanation below.
o Computer Equipment: Includes 1 server and monitor for the VOIP system
provided by ITP/aptella using a PowerSpec 260 model server running Windows
Software and ITP/aptella proprietary VOIP software and an EdgeMarc QoS router
at $4,000; 1 Dell Desktop Computer at $2,000; 4 Dell Laptop Computers at $1,000
each; and 3 Logitech webcams at $250 each.
o Equipment/Machinery: Includes 4 HP color HP e-print Color LaserJet
CM2320fxi MFP printers at $750 each and 4 ITP/aptella Polycom SoundPoint IP
550 HD Voice Phone VOIP terminals at $250 each.
o Furniture & Fixtures: Includes $1,250 estimate for two Anthro brand racks to hold
the server and the desktop computer.

Accessed 12 February 2011, http://www.joshhykesinsurance.com/


Accessed 12 February 2011, http://www.mghus.com
17 Accessed 14 February 2011, http://www.z-indexmedia.com
15
16

21 | P a g e

B.

BALANCE SHEET

See Exhibit 8 - Balance Sheet


C.

INCOME PROJECTIONS

See Exhibit 9 - Monthly Income Statement


See Exhibit 10 Annual Income Statement
D.

CASH FLOW PROJECTIONS

See Exhibit 16 - Cash Flow Projections


E.

NOTES OF EXPLANATION

SALES PROJECTIONS
There are 340,000 potential customers in Loudon County, with 56% (190,400) falling in
our target market of busy professionals. Calculated revenue based on estimated
packages sold is based on Year 1 projected absorption of just over .5% of potential
consumers purchasing iTrainer packages. A breakdown has been calculated by
package/product type, number of packages sold, price per package and projected
revenue. The below figures represent the full absorption for Year 1 of 1,000 units.
Consumers outside the target market have been excluded from these calculations:

PACKAGE/PRODUCT

SALES PER
MONTH

PRICE

BRONZE

100

SILVER

200

GOLD

500

PLATINUM

PER MONTH

REVENUE

89

100 x 89

8,900

109

200 x 109

21,000

129

500 x 129

64,500

200

169

200 x 169

33,800

INTERVAL

1,700

10

1,000 x 10

17,000

SPINNING

1,700

15

1,700 x 15

25,500

TRAINING

1,850

50

1,850 x 50

92,500

264,000

TOTAL MONTHLY REVENUE:

22 | P a g e

Sales estimates calculated for the year 1 income statement are more conservative than
those used in the above chart. Years 1, 2, 3, 4 and 5 sales are as follows:
Q 1 (25%)

Q 2 (50%)

Q 3 (75%)

Q 4 (100%)

AVG. MONTHLY
REVENUE

YEAR 1

66,000

132,000

198,000

264,000

165,000

YEAR 2

351,438

702,875

1,054,313

1,405,750

878,000

YEAR 3

750,038

$ 1,500,075

2,250,113

3,000,150

1,875,093

YEAR 4

1,603,833

$ 3,207,665

4,811,498

6,415,330

4,009,581

YEAR 5

2,576,949

$ 5,153,897

7,730,846

$ 10,307,795

6,442,372

The following chart shows estimated absorption and was used in calculating sales for
the service in the sales projections for years 1, 2, 3, 4 and 5:
PERIOD

PERIOD

EST.
SALES
25%

PERIOD

EST.
SALES
50%

25%

25%

PERIOD

EST.
SALES
75%

10

EST.
SALES
100%

50%

75%

11

100%

50%

75%

12

100%

CASH FLOW PROJECTIONS


The projected cash flow for year 1 of the companys operations, as shown in the Cash
Flow Statement (see Exhibit 16 - Cash Flow Projections), indicates positive ending cash
balance for each month, and positive cash flow beginning in month 4. This fact reflects
the equity position of the company, which was structured to provide all necessary start
up cash until the cash flow is positive. The companys owners must carefully manage
operations, keep costs under control and maximize revenues in order to assure the
companys continued financial stability during the startup period. The owners may

23 | P a g e

want to pursue a line of credit or other supplementary funding sources to provide


flexibility in the event of any cash shortfalls during this period.

24 | P a g e

REFERENCES

A.

ANNOTATED BIBLIOGRAPHY

United States Census Bureau Fact Finder. (2005-2009) Data Set: American Community Survey 5-Year
Estimates. Accessed: 14 February 2011.
http://factfinder.census.gov/servlet/NPTable?_bm=y&-geo_id=05000US51107&qr_name=ACS_2009_5YR_G00_NP01&-ds_name=&-redoLog=false
This site was referenced to research the demographics of our Target Market. While the American Community
Survey (ACS) produces population, demographic and housing unit estimates and it is the Census Bureau's
Population Estimates Program that produces and disseminates the official estimates.
Loudoun County Department of Economic Development. Accessed: 15 February, 2011.
http://biz.loudoun.gov/Home/FactsandFigures/Demographics/tabid/79/Default.aspx
This site was referenced to research the demographics for Loudoun County that are provided by the county. The
information contained on this site is to assist people who are trying to establish businesses within the county.
US Department of Labor. Accessed: 15 February 2011.
http://www.bls.gov/ro3/eciwb.htm.
This site provides measures labor market activity, working conditions and price changes in the economy.
Konrad, Walecia. (2010) Burning Calories, but Not a Hole in Your Wallet. New York Times. 24
December 2010. Accessed: 13 February 2011.
http://www.nytimes.com/2010/12/25/health/25patient.html?scp=1&sq=burning%20calories&st=cse
This article was referenced to research the effects of economic turmoil on the fitness industry.
Saint Louis, Catherine. (2011) Full-Service Gyms Feel a Bit Flabby. New York Times. 26 January 2010.
Accessed: 13 February 2011.
http://www.nytimes.com/2011/01/27/fashion/27SKIN.html?_r=1&scp=1&sq=full%20service%20gyms
&st=cse
This article was referenced to research the effects of economic turmoil on the fitness industry.
Wang, Jennifer and Kara Ohngren. (2010) The Disrupters: Forces Driving Change in 2011.
Entrepreneur. 2 December 2010. Accessed 13 February 2011.
http://www.entrepreneur.com/article/217508
This article was referenced to research the potential market trends for 2011.
ACE Reveals Economic Growth and Renewed Interest in Personal Training Among the Most Popular
Fitness Trends in 2011. 27 October 2010. Accessed: 13 February 2011.
http://www.acefitness.org/blog/1036/acerevealseconomic/
This article was referenced to research technology, demographic and economic trends in the fitness industry.
6 Technology Trends for Trainers to Watch. American Council on Exercise. Accessed: 13 February 2011.
http://www.acefitness.org/article/2835/
This article was referenced to research technology trends within the fitness industry.
Laino, Charlene. (2004) Try a Kinder, Gentler Workout: Aging Baby Boomers Fuel Hottest Exercise
Trend. Accessed: 13 February 2011.
http://www.medicinenet.com/script/main/art.asp?articlekey=56451
This article was referenced to research baby-boomer trends.

25 | P a g e

Crockett-Lohr, Ashley. (2010) Survey Predicts Top 20 Fitness Trends for 2011. American College of
Sports Medicine. 28 October 2010. Accessed: 13 February 2011.
http://www.acsm.org/AM/Template.cfm?Section=Home_Page&TEMPLATE=/CM/ContentDisplay.cf
m&CONTENTID=15182
This article was referenced to research fitness trends.
Anonymous. (n.d.). Storm Fitness Personal Training. In Storm Fitness. Accessed: February 12, 2011.
http://www.stormfitness.com/index.html.
Storm Fitness was chosen as an example of a high-end personal trainer serving Loudon county and surround areas,
with an emphasis on one on one luxury service in a variety of customized locations.
Anonymous. (n.d.). Health Club's In USA. In Health & Fitness Clubs, Gyms & Spa Centers. Accessed: 12
February 2011.
http://www.usahealthclubs.com/sb/health-clubs.
This information was included to demonstrate the variety of personal training that is available at Health Clubs
throughout the target market area.
Hatzius, J. (2011). U.S. Economics Analyst. In Goldman Sachs Global ECS Research. Accessed: 12
February 2011.
http://www2.goldmansachs.com/ideas/global-economic-outlook/2011-economicoutlook/index.html?cid=31250699.
This information was included to give an overview of the prospects for economic growth in the United States, and
specifically in the target market.
Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, 2010-11
Edition, Fitness Workers. Accessed: 13 February 2011.
http://www.bls.gov/oco/ocos296.htm
This information was included to give an overview of the numbers of individuals employed as personal trainers, as
well as the strong continued growth that is anticipated in the number of personal trainers.
Anonymous, (n.d.) Sequoia Health & Fitness, Inc. - Personal Training, Post Rehab Fitness, Healthy
Weight Loss. Accessed: 14 February 14 2011.
http://www.sequoiahealth.com/
This information was included to demonstrate the difference in cost between training at a high-end facility and one
of the many less exclusive options available.
Welcome to the Loudoun SBDC. (2010, January 1). Welcome to the Loudoun SBDC. Accessed: 15 February
2011.
http://www.loudounsbdc.org/index.cfm
This information was accessed to gain information about various small business development resources in Loudon
County.
Loudoun County . (2005, May 12). Loudoun County. Accessed: 15 February 2011.
http://loudoun.vhost.vipnet.org/business/financing.htm
This information was included to demonstrate the various county financing resources for small businesses in
Loudon County.

26 | P a g e

B.

CONSULTED WEBSITES

Center for Disease Control: http://www.cdc.gov/physicalactivity/everyone/guidelines/index.html


Anytime Fitness: http://www.anytimefitness.com/
SNAP Fitness 24-7: http://www.snapfitness.com/
Washington Post:
http://www.washingtonpostads.com/adsite/_res/files/managed/2011RatecardGeneral.pdf
Loudoun Times Mirror: http://www.loudountimes.com/pdfs/circ_loudoun.pdf
Loudoun Times Mirror: http://www.loudountimes.com/pdfs/rates_display.pdf
Loudoun Chamber of Commerce:
http://www.loudounchamber.org/html/membership_becomemember.html
Facebook: http://www.facebook.com/adsmarketing/index.php?sk=cost
Twitter: http://www.nytimes.com/2009/07/23/business/smallbusiness/23twitter.html

27 | P a g e

EXHIBITS
A.

EXHIBIT 1: MEDIAN HOUSEHOLD INCOME

The 20 highest income counties by median household income (20062008), as compiled by the
American Community Survey of the United States Bureau of the Census.
Rank

County

Median Household Income

Population

Education

1.

Loudoun County, Virginia

$110,643

277,433

58%

2.

Fairfax County, Virginia

$106,785

1,005,980

60%

3.

Howard County, Maryland

$101,710

272,412

60%

4.

Somerset County, New Jersey

$103,227

321,589

53%

5.

Hunterdon County, New Jersey

$100,947

129,000

52%

6.

City of Fairfax, Virginia

$ 98,133

23,281

52%

7.

Morris County, New Jersey

$ 97,565

486,459

52%

8.

Douglas County, Colorado

$ 97,480

270,286

54%

9.

Arlington County, Virginia

$ 96,390

204,889

51%

10.

Montgomery County, Maryland

$ 93,999

942,747

59%

11.

Nassau County, New York

$ 93,579

1,352,817

45%

12.

Stafford County, Virginia

$ 89,536

120,219

36%

13.

Calvert County, Maryland

$ 89,049

88,126

30%

14.

Prince William County, Virginia

$ 88,675

358,719

38%

15.

Putnam County, New York

$ 88,580

99,195

40%

16.

Goochland County, Virginia

$ 88,552

20,494

325%

17.

Williamson County, Tennessee

$ 88,316

165,336

53%

18.

Marin County, California

$ 88,101

246,985

55%

19.

Santa Clara County, California

$ 87,287

1,734,756

46%

20.

Forsyth County, Georgia

$ 86,938

158,009

46%

28 | P a g e

B.

EXHIBIT 2: COMPETITIVE ANALYSIS

Competitive analysis, including service/product details of primary and secondary competitors to


iTrainer Fitness.
SERVICE
Personal
Trainer:
Provides oneon-one private
training

PROS

Gym in-house
trainer: offered
in addition to
monthly fee

Gym no
trainer:
Monthly club
membership at
gym or using
your
community
association
gym

Technology:
Video game
based
workouts

CONS

Expensive
Competing
schedules

$75-125/hr.

Lower cost
Social
Variety of
equipment

Unknown
quality of
trainer
No privacy
Scheduling

$50-75/hr.

Golds Gym
LA Fitness
Lifetime Fitness
Fitness First

Gym fee
only
Flexible
times
Self-paced

Need to be
self-motivated
No support to
vary workout
and educate
Need to be
knowledgeabl
e on fitness
No one to
check your
progress

Part of HOA
fees

Golds Gym
LA Fitness
Lifetime Fitness
Fitness First

Need to be
self-motivated
Limited
exercise
options
Lack of
feedback to
improve your
performance
Need to be
self-motivated
Not tailored
to individual

Varies from free


to $400
depending on
equipment

Apps-Nike Training
Club
Wii Fit/PS3/Xbox
Connect

$10-50
depending on
download

Selfdirected
workouts
Fun and
interactive

Recordings:
Music
downloads

COMPETITORS

Flexible
locations
Privacy
Flexibility
Specialized

EST COSTS

Wide
variety of
music
Selfdirected

Storm Fitness
www.stormfitness.com

$20-80/month

iTunes
Fitness Music CDs

29 | P a g e

C.

EXHIBIT 3: COST-BENEFIT ANALYSIS OF P ROMOTIONAL STRATEGY

Our promotional strategy is considered with a cost-benefit approach.


STRATEGY

MEDIUM

MARKET

EST.
COST

FREQ.

BENEFITS

DRAWBACKS

Visibility
Inform

Inform

Persuade

Web

Social
Media

Newspapers

National

National

Local

$10,000
Start-up

$2,000
Start-up

$550/
Week

Weekly

Wide Market
Coverage

Company
focused

Democratization
of Media

Content
Management

Engaging

Privacy
Concerns

Offer promotions

Declining
Subscribers

Wide coverage

Non-Targeted
Audience

Daily

Weekly
Ads

Focus on article
placement

Inform

Magazines

Local

$400/
Week

Monthly

Local
Community
Coverage

Limited
Audience
Trial and error

Persuade

Guerilla
Marketing

Regional

$4,000/
Year

Daily/
Weekly

Targeted and
Cost Effective

Remind

Directories

National

$500/
Start-up

Ongoing

Standard
Business Practice

Little marketing
impact

Events

Local

$3000/
Month

Monthly

Targeted

Manage Costs
Trial and Error

Persuade

Measurement
can be
challenging

30 | P a g e

D.

EXHIBIT 4: THREE-PRONGED MEDIA APPROACH FOR PROMOTIONAL STRATEGY

Our strategy is a combination of leveraging technology and traditional media for a rapidly
changing market and to minimize costs.
TYPE

MEDIUM
Website

Facebook
Social Media

Twitter

LinkedIn

Email Campaigns
Blogs
Guerilla
Marketing

Webinars
You Tube
Local Events

Newspapers: Loudoun
Times Mirror &
Washington Post

Conventional

Magazine: Northern
Virginia
Collateral: Brochures,
Flyers & Business Cards

Logo Items
Chamber of Commerce

SPECIFIC FOCUS
Company Website:
educate, inform, client
login, exercise video
tutorials and webinars.
Member page
Ads
Send out promotions
and details about
events
Create a business
group for others to join
and connect
Artwork setup for
masthead
Articles on health and
fitness
Software
Video camera
Booth, fees,
sponsorships local
5k/10k
Post: ($27.20/column
inch-4x5 ad: $245
weekly) Sunday
circulation: 845K
Loudoun: ($34/
column inch-4x5 ad:
$306/weekly)
Circulation 64K weekly
4x6 ad print & 2x3 web
3 color tri-fold
brochure: initial run of
3,000 ($1 each)
$3,000/50,000 B/W
flyers ($.05 each)
$2,500/3,000 Business
Cards ($.20 each) $600
Hats, Pens and Shirt
1-5 employees, annual
membership

ESTIMATED COST
$5K to $10K for Start-Up

Minimal Cost
$10-20/day
Min. Cost

Min. Cost

$1,500
$1,000
$2,000
$1,000
$5K/yr.

$ 28,650/yr.

$300/month

$6,100/yr.

$3,000/yr.
$340/yr.

31 | P a g e

E.

EXHIBIT 5: STRATEGIC GROWTH

Our strategic growth options are considered for cost-benefit with a potential time to decide on
implementation identified.
IDEA

TYPE

ADVANTAGES

DISADVANTAGES

DECISION
TIME

INTERNAL

+ Increased ability to offer


profitable one-on-one
training sessions

- Increased labor costs

+ Expansion of trainer
fitness specialties

Hire
Additional
Staff

Invest in
more
technical
podcast
software

Owners
hire
operational
managers

Smartphone
Application

Internal

+ Greater market access, if


subcontracted trainers are
employed by national gym
chains

- Increased
management efforts scheduling / payroll /
etc.

+ Reduce podcast
preparation time - labor
costs

- Initial capital
investment

+ Ability to offer more


variety in podcasts to
clients in less time

- Ongoing software
licensing /
maintenance fees

+ Owners free to pursue


other ventures

- Some loss of
operational control

Internal

+ Owners can focus on


growth/expansion of
brand

- Increased cost of
skilled management
labor

Internal

+ Allow clients to check


progress and download
podcasts from the iTrainer
website

- Investment in
technical design and
security features, to
ensure privacy

Internal

When the client


list exceeds a
ratio of 120
clients: 1 trainer

Based on having
sufficient cash
reserves to
afford capital
investment

Based on
consensus of
owners
Based on costbenefit analysis
of offering the
enhanced
capability and
client demand

32 | P a g e

IDEA

TYPE

ADVANTAGES

DISADVANTAGES

DECISION
TIME

EXTERNAL

Offer
nutritional
services

Expand
Market
Area

Sponsor
educational
speaker
series

External

External

External

+ Offer pantrycleaning & nutritionplanning services

- May require outside expertise via


subcontractor

+ Strategic alliances
with nutritional
centers

- Discounts for alliance participants


reduces revenue

+ Calorie-tracking
progress via website

- Cost of calorie
software/equipment

+ Increased market
size can expand
clientele

- Greater overhead costs from


trainer gym membership fees

+ Establish a market
presence in other
gym chains

- Increased advertising
/promotional costs to establish
iTrainer brand

+ Strategic alliances
with national gym
chains to permit our
trainers to work with
clients
+ Educate current
clients on other
health matters stress, nutrition,
fitness, etc.
+ Advertise our
services to potential
clients

- Potential loss in revenue from


contracts to allow iTrainer
personnel into national gyms

- Cost of event
facilities/refreshments/advertising

- Speaker fees

Based on
client
demand and
profitability
assessment

Based on
establishing
secure
foundation in
Loudoun,
client interest
with national
gyms, etc.

Greater costbenefit
analysis
required
(long-term)

33 | P a g e

F.
EXHIBIT 6: STARTUP FUNDING AND EXPENDITURES
Please see attached table.
G.
EXHIBIT 7: STARTUP FUNDING AND EXPENDITURES (CAPITAL)
Please see attached table.
H.
EXHIBIT 8: BALANCE S HEET
Please see attached table.
I.
EXHIBIT 9: MONTHLY INCOME STATEMENT S HEET
Please see attached table.
J.
EXHIBIT 10: ANNUAL I NCOME STATEMENT
Please see attached table.
K.
EXHIBIT 11: BREAKDOWN OF 2012 INCOME
Please see attached table.
L.
EXHIBIT 12: BREAKEVEN STATEMENT
Please see attached table.
M. EXHIBIT 13: OWNERS COMPENSATION
Owners will be compensated after the business opens with a base monthly salary, plus benefits.
25.55% will be budgeted for total benefits; an additional 11.45% will be budgeted for taxes
(FICA, unemployment, workers compensation, FUTA, and SUTA) taxes.
Please see attached table.
N.
EXHIBIT 14: RATIO ANALYSIS
Please see attached table.
O.
EXHIBIT 15: SALES PROJECTIONS
Please see attached table.
P.
EXHIBIT 16: CASH FLOW STATEMENT
Please see attached table.

34 | P a g e

APPENDIX A: FINAL PRESENTATION

35 | P a g e

F. Exhibit 7: Startup Funding and Expenditures (Capital)


iTrainer Fitness, LLC
Startup Funding and Expenditures
Startup Cash

Amount
Equity Investments

Loan Proceeds

300,000
-

300,000

High Speed Internet Deposit

750

Telephone Deposit

900

VOIP Deposit

750

2,400

Total Startup Cash


Startup Expenditures
Security Deposits

Total Security Deposits


Startup Expenses
Accounting Fees

5,000

Advertising (Preopening)

100,000

Federal Tax ID

350

Fictitious Name Costs (VA, MD, DC)

2,000

High Speed Internet

2,500

Insurance

5,000

Legal & Consulting Fees

2,000

LLC Fees & Taxes

400

Meal & Entertainment

6,000

Miscellaneous Expenses

3,500

Office Supplies

1,000

Other Startup Expenses

4,000

Patent, Trademark, Copyright

5,000

-Salaries & Wages

-Payroll Taxes

-Benefits

-Travel Costs

3,000

-Promotion & Networking

2,000

-Memberships

2,500

Permits, Licenses

1,250

Podcast Web Creation Service

5,000

Printing (cards, stationery, brochures)

3,000

R&D

4,000

Sales Tax Permits

200

Telephone Service

3,000

Virtual Business Office - Domestic (Setup)

1,500

Virtual Business Office - Philippines (Setup)

2,000

VOIP Service

3,000

Web Site Costs (Design, Hosting, & Admin.)

6,000

Total Startup Expenses

173,200

Payroll Expenses (Training & Setup)

Other Costs
$

Computer Equipment

10,750

Equipment/Machinery

4,000

Furniture & Fixtures

1,250

Total Startup Capital Expenditures

16,000

Total Startup Expenditures

191,600

Opening Inventory

Capital Expenditures

G. Exhibit 7: Startup Funding and Expenditures (Capital)


iTrainer Fitness, LLC
Startup Funding and Expenditures
Capital Expenditures
Computer equipment

Amount

1 PowerSpec 260 VOIP server


and EdgeMarc QoS router

4,000

1 Dell Desktop Computer

2,000

4 Dell Laptop Computer

4,000

3 Logitech webcams

750

10,750

3,000

1,000

4,000

1,250

1,250

16,000

Equipment/Machinery
4 HP Color LaserJet CM2320fxi MFP
4 Polycom SoundPoint VOIP terminals

Furniture & Fixtures


2 Anthro Server Racks

Total

H.

Exhibit 8: Balance Sheet

iTrainer Fitness, LLC


Year End Balance Sheet (Projected)
2012

2013

2014

2015

2016

Assets
Current Assets
Cash & Equivalents
Accounts Receivable
Inventory
Security Deposits
Other Current Assets

$
$
$
$
$

737,355
2,400
-

$
$
$
$
$

5,763,146
2,400
-

$ 19,237,763
$
$
$
2,400
$
-

$ 50,252,022
$
$
$
2,400
$
-

$
$
$
$
$

101,981,379
2,400
-

Total Current Assets

739,755

5,765,546

$ 19,240,163

$ 50,254,422

101,983,779

Fixed Assets
Property, Plant and Equipment
Less: Accumulated Depreciation
Other Non-Current Assets

$
$
$

16,000 $
(1,600) $
$

16,000 $
(3,200) $
$

16,000 $
(4,800) $
$

Total Non-Current Assets

14,400

12,800

11,200

Total Assets

754,155

5,778,346

Current Liabilities
Accounts Payable
Line of Credit
Other Current Liabilities

$
$
$

$
$
$

Total Current Liabilities

Long-term Liabilities
Loans
Mortgages
Other Non-Current Liabilities

$
$
$

Total Non-Current Liabilities

16,000 $
(8,000) $
$

16,000
(12,800)
-

8,000

3,200

$ 19,251,363

$ 50,262,422

101,986,979

$
$
$

$
$
$

$
$
$

$
$
$

$
$
$

$
$
$

$
$
$

Total Liabilities

Equity Investments
Retained Earnings
Less: Owner's & Investor's Draws

$
$
$

300,000
454,155
-

$
$
$

300,000
5,478,346
-

$
300,000
$ 18,951,363

$
300,000
$ 49,962,422

$
$

300,000
101,686,979

Total Equity

754,155

5,778,346

$ 19,251,363

$ 50,262,422

101,986,979

Total Liabilities and Equity

754,155

5,778,346

$ 19,251,363

$ 50,262,422

101,986,979

Net Worth

754,155

5,778,346

$ 19,251,363

$ 50,262,422

101,986,979

Liabilities

Equity

I.

Exhibit 9: Monthly Income Statement Sheet

iTrainer Fitness Program, LLC


Monthly Income Statement
2012

Pre-Startup

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jun.

Aug.

Sep.

Oct.

Nov.

Dec.

TOTAL

Net Sales

66,000

66,000

66,000

132,000

132,000

132,000

198,000

198,000

198,000

264,000

264,000

264,000

Cost of Goods Sold

23,438

23,438

23,438

46,875

46,875

46,875

70,313

70,313

70,313

93,750

93,750

93,750

1,980,000
703,125

Gross Income

42,563

42,563

42,563

85,125

85,125

85,125

127,688

127,688

127,688

170,250

170,250

170,250

1,276,875

Operating Expenses:
Accounting

5,000

208

208

208

208

208

208

208

208

208

208

208

208

7,500

Advertising

100,000

8,333

8,333

8,333

8,333

8,333

8,333

8,333

8,333

8,333

8,333

8,333

8,333

200,000
29,700

Bank Charges

2,475

2,475

2,475

2,475

2,475

2,475

2,475

2,475

2,475

2,475

2,475

2,475

Depreciation & Amortization

133

133

133

133

133

133

133

133

133

133

133

133

1,600

Dues & Subscriptions

417

417

417

417

417

417

417

417

417

417

417

417

5,000

High Speed Internet

2,500

583

583

583

583

583

583

583

583

583

583

583

583

9,500

Insurance

5,000

825

825

825

825

825

825

825

825

825

825

825

825

14,900

Marketing & Promotion

833

833

833

833

833

833

833

833

833

833

833

833

10,000

Meals & Entertainment

6,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

18,000

Miscellaneous

3,500

833

833

833

833

833

833

833

833

833

833

833

833

13,500

Office Supplies

1,000

167

167

167

167

167

167

167

167

167

167

167

167

3,000
240,000

Payroll Expenses:
-Salaries & Wages

20,000

20,000

20,000

20,000

20,000

20,000

20,000

20,000

20,000

20,000

20,000

20,000

-Payroll Taxes

2,290

2,290

2,290

2,290

2,290

2,290

2,290

2,290

2,290

2,290

2,290

2,290

27,480

-Benefits

5,110

5,110

5,110

5,110

5,110

5,110

5,110

5,110

5,110

5,110

5,110

5,110

61,320

-Travel Costs

3,000

333

333

333

333

333

333

333

333

333

333

333

333

7,000

-Promotion & Networking

2,000

250

250

250

250

250

250

250

250

250

250

250

250

5,000

-Memberships

2,500

292

292

292

292

292

292

292

292

292

292

292

292

6,000

Permits and Licenses

1,250

833

833

833

833

833

833

833

833

833

833

833

833

11,250

Podcast Creation Web Service

5,000

417

417

417

417

417

417

417

417

417

417

417

417

10,000

Professional Fees

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

12,000

Property Taxes

27

27

27

27

27

27

27

27

27

27

27

27

325

Repairs & Maintenance

18

18

18

18

18

18

18

18

18

18

18

18

215

Shipping & Delivery

25

25

25

25

25

25

25

25

25

25

25

25

300

Telephone Service

3,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

15,000

Training & Development

750

750

750

750

750

750

750

750

750

750

750

750

9,000

Travel

417

417

417

417

417

417

417

417

417

417

417

417

5,000

Utilities

115

115

115

115

115

115

115

115

115

115

115

115

1,374

Virtual Business Office - Philippines

2,000

1,568

1,568

1,568

1,568

1,568

1,568

1,568

1,568

1,568

1,568

1,568

1,568

20,810

Virtual Business Office Domestic

1,500

369

369

369

369

369

369

369

369

369

369

369

369

5,928

VOIP Service
Web Site Costs (Design, Hosting, &
Admin.)

3,000

958

958

958

958

958

958

958

958

958

958

958

958

14,500

6,000

750

750

750

750

750

750

750

750

750

750

750

750

15,000

Total Operating Expenses

152,250

52,329

52,329

52,329

52,329

52,329

52,329

52,329

52,329

52,329

52,329

52,329

52,329

780,202

Operating Income

(152,250) $

(9,767) $

32,796

32,796

32,796

75,358

75,358

75,358

117,921

117,921

117,921

496,673

Interest Expense

Miscellaneous Income

(152,250) $

32,796

32,796

32,796

75,358

75,358

75,358

Income Before Taxes


Net Profit/Sales

(9,767) $

(9,767) $

(9,767) $

(9,767) $

(9,767) $

-23%

-23%

77%

39%

39%

89%

59%

59%

117,921
92%

117,921
69%

117,921
69%

$
$

496,673
292%

J. Exhibit 10: Annual Income Statement


iTrainer Fitness Program, LLC
Year End Income Statement (Projected)
2012

2013

2014

2015

2015

Net Sales
Cost of Goods Sold

$
$

1,980,000
703,125

$
$

10,543,125
3,515,625

$
$

22,501,125
7,031,250

$
$

48,114,975
24,375,000

$
$

77,308,459
36,562,500

Gross Income

1,276,875

7,027,500

15,469,875

23,739,975

40,745,959

Operating Expenses:
Accounting

7,500

3,000

4,000

5,000

6,000

Advertising

200,000

150,000

175,000

200,000

225,000
1,159,627

Bank Charges

29,700

158,147

337,517

721,725

Depreciation & Amortization

1,600

1,600

1,600

1,600

1,600

Dues & Subscriptions

5,000

10,000

15,000

20,000

25,000
386,542

Insurance

14,900

52,716

112,506

240,575

High Speed Internet

9,500

10,000

13,000

20,000

30,000

Permits and Licenses

11,250

10,250

10,500

12,000

14,000

Marketing & Promotion

10,000

11,000

12,000

13,000

14,000

Meals & Entertainment

18,000

15,000

20,000

30,000

50,000

Miscellaneous

13,500

18,000

23,000

30,000

38,000

Office Supplies

3,000

5,000

10,000

15,000

20,000
1,440,000

Payroll Expenses
-Salaries & Wages

240,000

576,000

720,000

960,000

-Payroll Taxes

27,480

65,952

82,440

109,920

164,880

-Benefits

61,320

147,168

183,960

245,280

367,920

-Travel Costs

7,000

5,000

6,000

8,000

15,000

-Promotion & Networking

5,000

4,000

5,000

7,500

10,000

-Memberships

6,000

4,500

5,500

7,000

9,000

Podcast Creation Web Service

10,000

7,500

10,000

15,000

20,000
45,000

Professional Fees

12,000

18,000

24,000

32,000

Property Taxes

325

500

1,000

1,500

2,000

Repairs & Maintenance

215

1,000

1,500

3,000

6,000

Shipping & Delivery

300

500

1,000

2,000

4,000

Telephone Service

15,000

24,000

36,000

42,000

54,000

Training & Development

9,000

18,000

27,000

35,000

48,000

Travel

5,000

10,000

15,000

25,000

50,000
40,746

Utilities

1,374

7,515

16,445

23,740

Virtual Business Office Domestic

5,928

4,871

5,358

5,894

6,483

Virtual Business Office - Philippines

20,810

20,691

22,760

25,036

27,540

VOIP Service

14,500

12,650

13,915

15,307

16,837

Website Maintenance and Upgrades

15,000

15,000

20,000

22,000

24,200

Total Operating Expenses

780,202

1,384,559

1,927,000

2,889,076

4,315,375

Operating Income

496,673

5,642,941

13,542,875

20,850,899

36,430,584

Interest Expense
Miscellaneous Income

$
$

Income Before Taxes

Income Taxes (If C Corporation)

Net Income

496,673
496,673

$
$
$
$
$

5,642,941
5,642,941

$
$
$
$
$

13,542,875
13,542,875

$
$
$
$
$

20,850,899
20,850,899

$
$
$
$
$

36,430,584
36,430,584

K Exhibit 11: Breakdown of 2012 Income


iTrainer Fitness Program, LLC
Breakdown of Income (2012)
Category
IFP Package Sales
IFP Interval Sales
IFP Spinning Sales
IFP Training Sales
Subtotal

Percent of Sales
49%
6%
10%
35%
100%

$
$
$
$
$

Cash Sales
967,500
127,500
191,250
693,750
1,980,000

$
$
$
$
$

Accounts Receivable
-

Total
$
$
$
$
$

967,500
127,500
191,250
693,750
1,980,000

L. Exhibit 12: Breakeven Statement


iTrainer Fitness Program, LLC
Break Even Analysis

Break Even Analysis:


Monthly Units Break Even
Monthly Revenue Break Even

100,819
100,819

Assumptions:
Average Per Unit Revenue
Average Per Unit Variable Cost
Estimated Monthly Fixed Cost

$
$
$

1.00
0.36
65,017

1980000
703125

1
0.355113636

1276875

106406.25

=Total Operating Expenses/12

65017 $

35,802.24

(0.14) $

100,819

iTrainer Fitness Program, LLC


Break Even Analysis

PACKAGE ONLY, NO ADD ON ITEMS


BRONZE
SILVER
GOLD
PLATINUM
TOTAL

INDIVIDUAL PACKAGES
BRONZE
SILVER
GOLD
PLATINUM

TOTAL OPERATING EXPENSES


$
780,202
FIXED COST

PER UNIT VARIABLE

PER UNIT REVENUE

$
$
$
$
$

2,192
5,369
15,885
8,324
31,770

$
$
$
$
$

379
757
1,890
1,021
4,046

$
$
$
$
$

2,991
7,499
22,538
11,780
44,809

$
$
$
$
$

5,563
13,625
40,313
21,125
80,625

$
$

12
381,235

$
$

12
48,556

$
$

12
537,709

$
$

12
967,500

0.55

1.00
GROSS MARGIN

UNIT SALES PRICE


$
$
$
$

VARIABLE COST

SELLING PRICE

BREAK EVEN POINT:


BRONZE
SILVER
GOLD
PLATINUM

89
109
129
169

UNITS
63
125
313
125
625

iTrainer Fitness Program, LLC


Break Even Analysis

PACKAGE ONLY, NO ADD ON ITEMS


BRONZE
SILVER
GOLD
PLATINUM

INDIVIDUAL PACKAGES
BRONZE
SILVER
GOLD
PLATINUM

TOTAL OPERATING EXPENSES


$
780,202
FIXED COST
$
35
$
43
$
51
$
67

$
$
$
$

6
6
6
8

$
$
$
$

48
60
72
94

$
$
$
$

89
109
129
169

$
$

$
$

12
98

$
$

12
1,131

$
$

12
2,028

12
799
UNIT SALES PRICE

$
$
$
$

89
109
129
169

PER UNIT VARIABLE


$

PER UNIT REVENUE


0.55

VARIABLE COST

1.00
GROSS MARGIN

BREAK EVEN POINT:


BRONZE
SILVER
GOLD
PLATINUM

SELLING PRICE

UNITS
63
125
313
125

M. Exhibit 13: Owners Compensation


iTrainer Fitness Program, LLC
Personnel Plan
2012
NOEMI C. ARTHUR

MOO HACKETT

ROBERT P. ELLENTUCK

MARYANNE ZABALA

2013

2014

2015

2016

Base Salary

5,000

12,000

15,000

20,000

30,000

Taxes

573

1,374

1,718

2,890

4,335

Benefits

1,278

3,066

3,833

5,110

7,665

6,850

16,440

20,550

28,000

42,000

Base Salary

5,000

12,000

15,000

20,000

30,000

Taxes

573

1,374

1,718

2,890

4,335

Benefits

1,278

3,066

3,833

5,110

7,665

6,850

16,440

20,550

28,000

42,000

Base Salary

5,000

12,000

15,000

20,000

30,000

Taxes

573

1,374

1,718

2,890

4,335

Benefits

1,278

3,066

3,833

5,110

7,665

6,850

16,440

20,550

28,000

42,000

Base Salary

5,000

12,000

15,000

20,000

30,000

Taxes

573

1,374

1,718

2,890

4,335

Benefits

1,278

3,066

3,833

5,110

7,665

6,850

16,440

20,550

28,000

42,000

Note: The four owners receive equal salaries. No salary is paid prior to opening.

N. Exhibit 14: Ratio Analysis


iTrainer Fitness Program, LLC
Ratio Analysis

2012

2013

2014

Profitability Ratios
Gross Margin

Gross Income

64%

67%

69%

25%

54%

60%

21%

53%

60%

19%

79%

66%

51%

87%

68%

64%

19%

6%

168%

21%

6%

Net Sales
Operating Margin

Operating Income
Net Sales

Net Margin

Net Income
Net Sales

Return on Assets (ROA)

Net Income
Total Assets

Return on Equity (ROE)

Net Income
Total Equity

Liquidity Ratios
Current Ratio

Total Current Assets


Total Current Liabilities

Quick Ratio

Current Assets - Inventory


Current Liabilities

Risk Ratios
Debt Ratio

Total Liabilities
Total Assets

Debt to Equity

Total Liabilities
Total Equity

Efficiency Ratios
Inventory Turnover

Cost of Goods Sold

Inventory
Days Sales Outstanding (DSO)

Accounts Receivable

0%

0%

0%

93%

150%

110%

Net Sales/365
Investment Turnover Ratio

Net Sales
Total Assets

O. Exhibit 15: Sales Projections


iTrainer Fitness Program, LLC
Sales Projections
2012

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Oct.

Nov.

Dec.

TOTAL

Sales Budget
Bronze
Silver
Gold
Platinum
IFP Package Sales

$
$
$
$
$

2,225
5,450
16,125
8,450
32,250

$
$
$
$
$

2,225
5,450
16,125
8,450
32,250

$
$
$
$
$

2,225
5,450
16,125
8,450
32,250

$
$
$
$
$

4,450
10,900
32,250
16,900
64,500

$
$
$
$
$

4,450
10,900
32,250
16,900
64,500

$
$
$
$
$

4,450
10,900
32,250
16,900
64,500

$
$
$
$
$

6,675
16,350
48,375
25,350
96,750

$
$
$
$
$

6,675
16,350
48,375
25,350
96,750

$
$
$
$
$

6,675
16,350
48,375
25,350
96,750

$
$
$
$
$

8,900
21,800
64,500
33,800
129,000

$
$
$
$
$

8,900
21,800
64,500
33,800
129,000

$
$
$
$
$

8,900
21,800
64,500
33,800
129,000

$
$
$
$
$

66,750
163,500
483,750
253,500
967,500

IFP Interval
Bronze
Silver
Gold
Platinum
IFP Interval Sales

$
$
$
$
$

250
500
2,500
1,000
4,250

$
$
$
$
$

250
500
2,500
1,000
4,250

$
$
$
$
$

250
500
2,500
1,000
4,250

$
$
$
$
$

500
1,000
5,000
2,000
8,500

$
$
$
$
$

500
1,000
5,000
2,000
8,500

$
$
$
$
$

500
1,000
5,000
2,000
8,500

$
$
$
$
$

750
1,500
7,500
3,000
12,750

$
$
$
$
$

750
1,500
7,500
3,000
12,750

$
$
$
$
$

750
1,500
7,500
3,000
12,750

$
$
$
$
$

1,000
2,000
10,000
4,000
17,000

$
$
$
$
$

1,000
2,000
10,000
4,000
17,000

$
$
$
$
$

1,000
2,000
10,000
4,000
17,000

$
$
$
$
$

7,500
15,000
75,000
30,000
127,500

IFP Spinning
Bronze
Silver
Gold
Platinum
IFP Spinning Sales

$
$
$
$
$

375
750
3,750
1,500
6,375

$
$
$
$
$

375
750
3,750
1,500
6,375

$
$
$
$
$

375
750
3,750
1,500
6,375

$
$
$
$
$

750
1,500
7,500
3,000
12,750

$
$
$
$
$

750
1,500
7,500
3,000
12,750

$
$
$
$
$

750
1,500
7,500
3,000
12,750

$
$
$
$
$

1,125
2,250
11,250
4,500
19,125

$
$
$
$
$

1,125
2,250
11,250
4,500
19,125

$
$
$
$
$

1,125
2,250
11,250
4,500
19,125

$
$
$
$
$

1,500
3,000
15,000
6,000
25,500

$
$
$
$
$

1,500
3,000
15,000
6,000
25,500

$
$
$
$
$

1,500
3,000
15,000
6,000
25,500

$
$
$
$
$

11,250
22,500
112,500
45,000
191,250

IFP Training
Bronze
Silver
Gold
Platinum
IFP Training Sales

$
$
$
$
$

625
2,500
12,500
7,500
23,125

$
$
$
$
$

625
2,500
12,500
7,500
23,125

$
$
$
$
$

625
2,500
12,500
7,500
23,125

$
$
$
$
$

1,250
5,000
25,000
15,000
46,250

$
$
$
$
$

1,250
5,000
25,000
15,000
46,250

$
$
$
$
$

1,250
5,000
25,000
15,000
46,250

$
$
$
$
$

1,875
7,500
37,500
22,500
69,375

$
$
$
$
$

1,875
7,500
37,500
22,500
69,375

$
$
$
$
$

1,875
7,500
37,500
22,500
69,375

$
$
$
$
$

2,500
10,000
50,000
30,000
92,500

$
$
$
$
$

2,500
10,000
50,000
30,000
92,500

$
$
$
$
$

2,500
10,000
50,000
30,000
92,500

$
$
$
$
$

18,750
75,000
375,000
225,000
693,750

Gross Sales

66,000

66,000

66,000

132,000

132,000

132,000

198,000

198,000

198,000

264,000

264,000

264,000

1,980,000

Less: Returns and allowances

Net Sales
Other Income
Total Income

$
$
$

66,000
66,000

$
$
$

66,000
66,000

$
$
$

66,000
66,000

$
$
$

132,000
132,000

$
$
$

132,000
132,000

$
$
$

132,000
132,000

$
$
$

198,000
198,000

$
$
$

198,000
198,000

$
$
$

198,000
198,000

$
$
$

264,000
264,000

$
$
$

264,000
264,000

$
$
$

264,000
264,000

$
$
$

1,980,000
1,980,000

Credit Management
Sales (Cash)
Sales (Credit)
Received on Account
Bad Debt Expense

$
$
$
$

66,000
-

$
$
$
$

66,000
-

$
$
$
$

66,000
-

$
$
$
$

132,000
-

$
$
$
$

132,000
-

$
$
$
$

132,000
-

$
$
$
$

198,000
-

$
$
$
$

198,000
-

$
$
$
$

198,000
-

$
$
$
$

264,000
-

$
$
$
$

264,000
-

$
$
$
$

264,000
-

$
$
$
$

1,980,000
-

Year 1 Assumptions
IFP Package Sales
IFP Interval Sales
IFP Spinning Sales
IFP Training Sales
Less: Returns and allowances
Sales (Cash)
Sales (Credit)
Received on Account
Bad Debt Expense

Please see notes for all categories of revenue in the notes for the financial plan.

O. Exhibit 15: Sales Projections


iTrainer Fitness Program, LLC
Sales Projections
2013

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Oct.

Nov.

Dec.

TOTAL

Sales Budget
IFP Packages
Bronze
Silver
Gold
Platinum
IFP Package Sales

$
$
$
$
$

12,238
29,975
88,688
46,475
177,375

$
$
$
$
$

12,238
29,975
88,688
46,475
177,375

$
$
$
$
$

12,238
29,975
88,688
46,475
177,375

$
$
$
$
$

24,475
59,950
177,375
92,950
354,750

$
$
$
$
$

24,475
59,950
177,375
92,950
354,750

$
$
$
$
$

24,475
59,950
177,375
92,950
354,750

$
$
$
$
$

36,713
89,925
266,063
139,425
532,125

$
$
$
$
$

36,713
89,925
266,063
139,425
532,125

$
$
$
$
$

36,713
89,925
266,063
139,425
532,125

$
$
$
$
$

48,950
119,900
354,750
185,900
709,500

$
$
$
$
$

48,950
119,900
354,750
185,900
709,500

$
$
$
$
$

48,950
119,900
354,750
185,900
709,500

$
$
$
$
$

367,125
899,250
2,660,625
1,394,250
5,321,250

IFP Interval
Bronze
Silver
Gold
Platinum
IFP Interval Sales

$
$
$
$
$

1,375
2,750
13,750
5,500
23,375

$
$
$
$
$

1,375
2,750
13,750
5,500
23,375

$
$
$
$
$

1,375
2,750
13,750
5,500
23,375

$
$
$
$
$

2,750
5,500
27,500
11,000
46,750

$
$
$
$
$

2,750
5,500
27,500
11,000
46,750

$
$
$
$
$

2,750
5,500
27,500
11,000
46,750

$
$
$
$
$

4,125
8,250
41,250
16,500
70,125

$
$
$
$
$

4,125
8,250
41,250
16,500
70,125

$
$
$
$
$

4,125
8,250
41,250
16,500
70,125

$
$
$
$
$

5,500
11,000
55,000
22,000
93,500

$
$
$
$
$

5,500
11,000
55,000
22,000
93,500

$
$
$
$
$

5,500
11,000
55,000
22,000
93,500

$
$
$
$
$

41,250
82,500
412,500
165,000
701,250

IFP Spinning
Bronze
Silver
Gold
Platinum
IFP Spinning Sales

$
$
$
$
$

2,063
4,125
20,625
8,250
35,063

$
$
$
$
$

2,063
4,125
20,625
8,250
35,063

$
$
$
$
$

2,063
4,125
20,625
8,250
35,063

$
$
$
$
$

4,125
8,250
41,250
16,500
70,125

$
$
$
$
$

4,125
8,250
41,250
16,500
70,125

$
$
$
$
$

4,125
8,250
41,250
16,500
70,125

$
$
$
$
$

6,188
12,375
61,875
24,750
105,188

$
$
$
$
$

6,188
12,375
61,875
24,750
105,188

$
$
$
$
$

6,188
12,375
61,875
24,750
105,188

$
$
$
$
$

8,250
16,500
82,500
33,000
140,250

$
$
$
$
$

8,250
16,500
82,500
33,000
140,250

$
$
$
$
$

8,250
16,500
82,500
33,000
140,250

$
$
$
$
$

61,875
123,750
618,750
247,500
1,051,875

IFP Training
Bronze
Silver
Gold
Platinum
IFP Training Sales

$
$
$
$
$

3,125
12,500
62,500
37,500
115,625

$
$
$
$
$

3,125
12,500
62,500
37,500
115,625

$
$
$
$
$

3,125
12,500
62,500
37,500
115,625

$
$
$
$
$

6,250
25,000
125,000
75,000
231,250

$
$
$
$
$

6,250
25,000
125,000
75,000
231,250

$
$
$
$
$

6,250
25,000
125,000
75,000
231,250

$
$
$
$
$

9,375
37,500
187,500
112,500
346,875

$
$
$
$
$

9,375
37,500
187,500
112,500
346,875

$
$
$
$
$

9,375
37,500
187,500
112,500
346,875

$
$
$
$
$

12,500
50,000
250,000
150,000
462,500

$
$
$
$
$

12,500
50,000
250,000
150,000
462,500

$
$
$
$
$

12,500
50,000
250,000
150,000
462,500

$
$
$
$
$

93,750
375,000
1,875,000
1,125,000
3,468,750

Gross Sales

351,438

351,438

351,438

702,875

702,875

702,875

1,054,313

1,054,313

1,054,313

1,405,750

1,405,750

1,405,750

10,543,125

Less: Returns and allowances

Net Sales
Other Income
Total Income

$
$
$

351,438
351,438

$
$
$

351,438
351,438

$
$
$

351,438
351,438

$
$
$

702,875
702,875

$
$
$

702,875
702,875

$
$
$

702,875
702,875

$
$
$

1,054,313
1,054,313

$
$
$

1,054,313
1,054,313

$
$
$

1,054,313
1,054,313

$
$
$

1,405,750
1,405,750

$
$
$

1,405,750
1,405,750

$
$
$

1,405,750
1,405,750

$
$
$

10,543,125
10,543,125

Credit Management
Sales (Cash)
Sales (Credit)
Received on Account
Bad Debt Expense

$
$
$
$

351,438
-

$
$
$
$

351,438
-

$
$
$
$

351,438
-

$
$
$
$

702,875
-

$
$
$
$

702,875
-

$
$
$
$

702,875
-

$
$
$
$

1,054,313
-

$
$
$
$

1,054,313
-

$
$
$
$

1,054,313
-

$
$
$
$

1,405,750
-

$
$
$
$

1,405,750
-

$
$
$
$

1,405,750
-

$
$
$
$

10,543,125
-

Year 2 Assumptions
IFP Package Sales
IFP Interval Sales
IFP Spinning Sales
IFP Training Sales
Less: Returns and allowances
Sales (Cash)
Sales (Credit)
Received on Account
Bad Debt Expense

Please see notes for all categories of revenue in the notes for the financial plan.

O. Exhibit 15: Sales Projections


iTrainer Fitness Program, LLC
Sales Projections
2014

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Oct.

Nov.

Dec.

TOTAL

Sales Budget
IFP Packages
Bronze
Silver
Gold
Platinum
IFP Package Sales

$
$
$
$
$

26,923
65,945
195,113
102,245
390,225

$
$
$
$
$

26,923
65,945
195,113
102,245
390,225

$
$
$
$
$

26,923
65,945
195,113
102,245
390,225

$
$
$
$
$

53,845
131,890
390,225
204,490
780,450

$
$
$
$
$

53,845
131,890
390,225
204,490
780,450

$
$
$
$
$

53,845
131,890
390,225
204,490
780,450

$
$
$
$
$

80,768
197,835
585,338
306,735
1,170,675

$
$
$
$
$

80,768
197,835
585,338
306,735
1,170,675

$
$
$
$
$

80,768
197,835
585,338
306,735
1,170,675

$
$
$
$
$

107,690
263,780
780,450
408,980
1,560,900

$
$
$
$
$

107,690
263,780
780,450
408,980
1,560,900

$
$
$
$
$

107,690
263,780
780,450
408,980
1,560,900

$
$
$
$
$

807,675
1,978,350
5,853,375
3,067,350
11,706,750

IFP Interval
Bronze
Silver
Gold
Platinum
IFP Interval Sales

$
$
$
$
$

3,025
6,050
30,250
12,100
51,425

$
$
$
$
$

3,025
6,050
30,250
12,100
51,425

$
$
$
$
$

3,025
6,050
30,250
12,100
51,425

$
$
$
$
$

6,050
12,100
60,500
24,200
102,850

$
$
$
$
$

6,050
12,100
60,500
24,200
102,850

$
$
$
$
$

6,050
12,100
60,500
24,200
102,850

$
$
$
$
$

9,075
18,150
90,750
36,300
154,275

$
$
$
$
$

9,075
18,150
90,750
36,300
154,275

$
$
$
$
$

9,075
18,150
90,750
36,300
154,275

$
$
$
$
$

12,100
24,200
121,000
48,400
205,700

$
$
$
$
$

12,100
24,200
121,000
48,400
205,700

$
$
$
$
$

12,100
24,200
121,000
48,400
205,700

$
$
$
$
$

90,750
181,500
907,500
363,000
1,542,750

IFP Spinning
Bronze
Silver
Gold
Platinum
IFP Spinning Sales

$
$
$
$
$

4,538
9,075
45,375
18,150
77,138

$
$
$
$
$

4,538
9,075
45,375
18,150
77,138

$
$
$
$
$

4,538
9,075
45,375
18,150
77,138

$
$
$
$
$

9,075
18,150
90,750
36,300
154,275

$
$
$
$
$

9,075
18,150
90,750
36,300
154,275

$
$
$
$
$

9,075
18,150
90,750
36,300
154,275

$
$
$
$
$

13,613
27,225
136,125
54,450
231,413

$
$
$
$
$

13,613
27,225
136,125
54,450
231,413

$
$
$
$
$

13,613
27,225
136,125
54,450
231,413

$
$
$
$
$

18,150
36,300
181,500
72,600
308,550

$
$
$
$
$

18,150
36,300
181,500
72,600
308,550

$
$
$
$
$

18,150
36,300
181,500
72,600
308,550

$
$
$
$
$

136,125
272,250
1,361,250
544,500
2,314,125

IFP Training
Bronze
Silver
Gold
Platinum
IFP Training Sales

$
$
$
$
$

6,250
25,000
125,000
75,000
231,250

$
$
$
$
$

6,250
25,000
125,000
75,000
231,250

$
$
$
$
$

6,250
25,000
125,000
75,000
231,250

$
$
$
$
$

12,500
50,000
250,000
150,000
462,500

$
$
$
$
$

12,500
50,000
250,000
150,000
462,500

$
$
$
$
$

12,500
50,000
250,000
150,000
462,500

$
$
$
$
$

18,750
75,000
375,000
225,000
693,750

$
$
$
$
$

18,750
75,000
375,000
225,000
693,750

$
$
$
$
$

18,750
75,000
375,000
225,000
693,750

$
$
$
$
$

25,000
100,000
500,000
300,000
925,000

$
$
$
$
$

25,000
100,000
500,000
300,000
925,000

$
$
$
$
$

25,000
100,000
500,000
300,000
925,000

$
$
$
$
$

187,500
750,000
3,750,000
2,250,000
6,937,500

Gross Sales

750,038

750,038

750,038

1,500,075

1,500,075

1,500,075

2,250,113

2,250,113

2,250,113

3,000,150

3,000,150

3,000,150

22,501,125

Less: Returns and allowances

Net Sales
Other Income
Total Income

$
$
$

750,038
750,038

$
$
$

750,038
750,038

$
$
$

750,038
750,038

$
$
$

1,500,075
1,500,075

$
$
$

1,500,075
1,500,075

$
$
$

1,500,075
1,500,075

$
$
$

2,250,113
2,250,113

$
$
$

2,250,113
2,250,113

$
$
$

2,250,113
2,250,113

$
$
$

3,000,150
3,000,150

$
$
$

3,000,150
3,000,150

$
$
$

3,000,150
3,000,150

$
$
$

22,501,125
22,501,125

Credit Management
Sales (Cash)
Sales (Credit)
Received on Account
Bad Debt Expense

$
$
$
$

750,038
-

$
$
$
$

750,038
-

$
$
$
$

750,038
-

$
$
$
$

1,500,075
-

$
$
$
$

1,500,075
-

$
$
$
$

1,500,075
-

$
$
$
$

2,250,113
-

$
$
$
$

2,250,113
-

$
$
$
$

2,250,113
-

$
$
$
$

3,000,150
-

$
$
$
$

3,000,150
-

$
$
$
$

3,000,150
-

$
$
$
$

22,501,125
-

Year 3 Assumptions
IFP Package Sales
IFP Interval Sales
IFP Spinning Sales
IFP Training Sales
Less: Returns and allowances
Sales (Cash)
Sales (Credit)
Received on Account
Bad Debt Expense

Please see notes for all categories of revenue in the notes for the financial plan.

O. Exhibit 15: Sales Projections


iTrainer Fitness Program, LLC
Sales Projections
2015

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Oct.

Nov.

Dec.

TOTAL

Sales Budget
IFP Packages
Bronze
Silver
Gold
Platinum
IFP Package Sales

$
$
$
$
$

59,230
145,079
429,248
224,939
858,495

$
$
$
$
$

59,230
145,079
429,248
224,939
858,495

$
$
$
$
$

59,230
145,079
429,248
224,939
858,495

$
$
$
$
$

118,459
290,158
858,495
449,878
1,716,990

$
$
$
$
$

118,459
290,158
858,495
449,878
1,716,990

$
$
$
$
$

118,459
290,158
858,495
449,878
1,716,990

$
$
$
$
$

177,689
435,237
1,287,743
674,817
2,575,485

$
$
$
$
$

177,689
435,237
1,287,743
674,817
2,575,485

$
$
$
$
$

177,689
435,237
1,287,743
674,817
2,575,485

$
$
$
$
$

236,918
580,316
1,716,990
899,756
3,433,980

$
$
$
$
$

236,918
580,316
1,716,990
899,756
3,433,980

$
$
$
$
$

236,918
580,316
1,716,990
899,756
3,433,980

$
$
$
$
$

1,776,885
4,352,370
12,877,425
6,748,170
25,754,850

IFP Interval
Bronze
Silver
Gold
Platinum
IFP Interval Sales

$
$
$
$
$

6,655
13,310
66,550
26,620
113,135

$
$
$
$
$

6,655
13,310
66,550
26,620
113,135

$
$
$
$
$

6,655
13,310
66,550
26,620
113,135

$
$
$
$
$

13,310
26,620
133,100
53,240
226,270

$
$
$
$
$

13,310
26,620
133,100
53,240
226,270

$
$
$
$
$

13,310
26,620
133,100
53,240
226,270

$
$
$
$
$

19,965
39,930
199,650
79,860
339,405

$
$
$
$
$

19,965
39,930
199,650
79,860
339,405

$
$
$
$
$

19,965
39,930
199,650
79,860
339,405

$
$
$
$
$

26,620
53,240
266,200
106,480
452,540

$
$
$
$
$

26,620
53,240
266,200
106,480
452,540

$
$
$
$
$

26,620
53,240
266,200
106,480
452,540

$
$
$
$
$

199,650
399,300
1,996,500
798,600
3,394,050

IFP Spinning
Bronze
Silver
Gold
Platinum
IFP Spinning Sales

$
$
$
$
$

9,983
19,965
99,825
39,930
169,703

$
$
$
$
$

9,983
19,965
99,825
39,930
169,703

$
$
$
$
$

9,983
19,965
99,825
39,930
169,703

$
$
$
$
$

19,965
39,930
199,650
79,860
339,405

$
$
$
$
$

19,965
39,930
199,650
79,860
339,405

$
$
$
$
$

19,965
39,930
199,650
79,860
339,405

$
$
$
$
$

29,948
59,895
299,475
119,790
509,108

$
$
$
$
$

29,948
59,895
299,475
119,790
509,108

$
$
$
$
$

29,948
59,895
299,475
119,790
509,108

$
$
$
$
$

39,930
79,860
399,300
159,720
678,810

$
$
$
$
$

39,930
79,860
399,300
159,720
678,810

$
$
$
$
$

39,930
79,860
399,300
159,720
678,810

$
$
$
$
$

299,475
598,950
2,994,750
1,197,900
5,091,075

IFP Training
Bronze
Silver
Gold
Platinum
IFP Training Sales

$
$
$
$
$

12,500
50,000
250,000
150,000
462,500

$
$
$
$
$

12,500
50,000
250,000
150,000
462,500

$
$
$
$
$

12,500
50,000
250,000
150,000
462,500

$
$
$
$
$

25,000
100,000
500,000
300,000
925,000

$
$
$
$
$

25,000
100,000
500,000
300,000
925,000

$
$
$
$
$

25,000
100,000
500,000
300,000
925,000

$
$
$
$
$

37,500
150,000
750,000
450,000
1,387,500

$
$
$
$
$

37,500
150,000
750,000
450,000
1,387,500

$
$
$
$
$

37,500
150,000
750,000
450,000
1,387,500

$
$
$
$
$

50,000
200,000
1,000,000
600,000
1,850,000

$
$
$
$
$

50,000
200,000
1,000,000
600,000
1,850,000

$
$
$
$
$

50,000
200,000
1,000,000
600,000
1,850,000

$
$
$
$
$

375,000
1,500,000
7,500,000
4,500,000
13,875,000

Gross Sales

1,603,833

1,603,833

1,603,833

3,207,665

3,207,665

3,207,665

4,811,498

4,811,498

4,811,498

6,415,330

6,415,330

6,415,330

48,114,975

Less: Returns and allowances

Net Sales
Other Income
Total Income

$
$
$

1,603,833
1,603,833

$
$
$

1,603,833
1,603,833

$
$
$

1,603,833
1,603,833

$
$
$

3,207,665
3,207,665

$
$
$

3,207,665
3,207,665

$
$
$

3,207,665
3,207,665

$
$
$

4,811,498
4,811,498

$
$
$

4,811,498
4,811,498

$
$
$

4,811,498
4,811,498

$
$
$

6,415,330
6,415,330

$
$
$

6,415,330
6,415,330

$
$
$

6,415,330
6,415,330

$
$
$

48,114,975
48,114,975

1,603,833

1,603,833

1,603,833

3,207,665

3,207,665

3,207,665

4,811,498

4,811,498

4,811,498

6,415,330

6,415,330

6,415,330

48,114,975

Credit Management
Sales (Cash)
Sales (Credit)
Received on Account
Bad Debt Expense
Year 4 Assumptions
IFP Package Sales
IFP Interval Sales
IFP Spinning Sales
IFP Training Sales
Less: Returns and allowances
Sales (Cash)
Sales (Credit)
Received on Account
Bad Debt Expense

O. Exhibit 15: Sales Projections


iTrainer Fitness Program, LLC
Sales Projections
2016

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Oct.

Nov.

Dec.

TOTAL

Sales Budget
IFP Packages
Bronze
Silver
Gold
Platinum
IFP Package Sales

$
$
$
$
$

97,729
239,380
708,258
371,149
1,416,517

$
$
$
$
$

97,729
239,380
708,258
371,149
1,416,517

$
$
$
$
$

97,729
239,380
708,258
371,149
1,416,517

$
$
$
$
$

195,457
478,761
1,416,517
742,299
2,833,034

$
$
$
$
$

195,457
478,761
1,416,517
742,299
2,833,034

$
$
$
$
$

195,457
478,761
1,416,517
742,299
2,833,034

$
$
$
$
$

293,186
718,141
2,124,775
1,113,448
4,249,550

$
$
$
$
$

293,186
718,141
2,124,775
1,113,448
4,249,550

$
$
$
$
$

293,186
718,141
2,124,775
1,113,448
4,249,550

$
$
$
$
$

390,915
957,521
2,833,034
1,484,597
5,666,067

$
$
$
$
$

390,915
957,521
2,833,034
1,484,597
5,666,067

$
$
$
$
$

390,915
957,521
2,833,034
1,484,597
5,666,067

$
$
$
$
$

2,931,860
7,181,411
21,247,751
11,134,481
42,495,503

IFP Interval
Bronze
Silver
Gold
Platinum
IFP Interval Sales

$
$
$
$
$

10,981
21,962
109,808
43,923
186,673

$
$
$
$
$

10,981
21,962
109,808
43,923
186,673

$
$
$
$
$

10,981
21,962
109,808
43,923
186,673

$
$
$
$
$

21,962
43,923
219,615
87,846
373,346

$
$
$
$
$

21,962
43,923
219,615
87,846
373,346

$
$
$
$
$

21,962
43,923
219,615
87,846
373,346

$
$
$
$
$

32,942
65,885
329,423
131,769
560,018

$
$
$
$
$

32,942
65,885
329,423
131,769
560,018

$
$
$
$
$

32,942
65,885
329,423
131,769
560,018

$
$
$
$
$

43,923
87,846
439,230
175,692
746,691

$
$
$
$
$

43,923
87,846
439,230
175,692
746,691

$
$
$
$
$

43,923
87,846
439,230
175,692
746,691

$
$
$
$
$

329,423
658,845
3,294,225
1,317,690
5,600,183

IFP Spinning
Bronze
Silver
Gold
Platinum
IFP Spinning Sales

$
$
$
$
$

16,471
32,942
164,711
65,885
280,009

$
$
$
$
$

16,471
32,942
164,711
65,885
280,009

$
$
$
$
$

16,471
32,942
164,711
65,885
280,009

$
$
$
$
$

32,942
65,885
329,423
131,769
560,018

$
$
$
$
$

32,942
65,885
329,423
131,769
560,018

$
$
$
$
$

32,942
65,885
329,423
131,769
560,018

$
$
$
$
$

49,413
98,827
494,134
197,654
840,027

$
$
$
$
$

49,413
98,827
494,134
197,654
840,027

$
$
$
$
$

49,413
98,827
494,134
197,654
840,027

$
$
$
$
$

65,885
131,769
658,845
263,538
1,120,037

$
$
$
$
$

65,885
131,769
658,845
263,538
1,120,037

$
$
$
$
$

65,885
131,769
658,845
263,538
1,120,037

$
$
$
$
$

494,134
988,268
4,941,338
1,976,535
8,400,274

IFP Training
Bronze
Silver
Gold
Platinum
IFP Training Sales

$
$
$
$
$

18,750
75,000
375,000
225,000
693,750

$
$
$
$
$

18,750
75,000
375,000
225,000
693,750

$
$
$
$
$

18,750
75,000
375,000
225,000
693,750

$
$
$
$
$

37,500
150,000
750,000
450,000
1,387,500

$
$
$
$
$

37,500
150,000
750,000
450,000
1,387,500

$
$
$
$
$

37,500
150,000
750,000
450,000
1,387,500

$
$
$
$
$

56,250
225,000
1,125,000
675,000
2,081,250

$
$
$
$
$

56,250
225,000
1,125,000
675,000
2,081,250

$
$
$
$
$

56,250
225,000
1,125,000
675,000
2,081,250

$
$
$
$
$

75,000
300,000
1,500,000
900,000
2,775,000

$
$
$
$
$

75,000
300,000
1,500,000
900,000
2,775,000

$
$
$
$
$

75,000
300,000
1,500,000
900,000
2,775,000

$
$
$
$
$

562,500
2,250,000
11,250,000
6,750,000
20,812,500

Gross Sales

2,576,949

2,576,949

2,576,949

5,153,897

5,153,897

5,153,897

7,730,846

7,730,846

7,730,846

10,307,795

10,307,795

10,307,795

77,308,459

Less: Returns and allowances

Net Sales
Other Income
Total Income

$
$
$

2,576,949
2,576,949

$
$
$

2,576,949
2,576,949

$
$
$

2,576,949
2,576,949

$
$
$

5,153,897
5,153,897

$
$
$

5,153,897
5,153,897

$
$
$

5,153,897
5,153,897

$
$
$

7,730,846
7,730,846

$
$
$

7,730,846
7,730,846

$
$
$

7,730,846
7,730,846

$
$
$

10,307,795
10,307,795

$
$
$

10,307,795
10,307,795

$
$
$

10,307,795
10,307,795

$
$
$

77,308,459
77,308,459

2,576,949

2,576,949

2,576,949

5,153,897

5,153,897

5,153,897

7,730,846

7,730,846

7,730,846

10,307,795

10,307,795

10,307,795

77,308,459

Credit Management
Sales (Cash)
Sales (Credit)
Received on Account
Bad Debt Expense
Year 5 Assumptions
IFP Package Sales
IFP Interval Sales
IFP Spinning Sales
IFP Training Sales
Less: Returns and allowances
Sales (Cash)
Sales (Credit)
Received on Account
Bad Debt Expense

P.

EXHIBIT 16 - CASH FLOW STATEMENT

iTrainer Fitness Program, LLC


Cash Flow Statement (Projected)
2012
Beginning Cash Balance

Pre Startup

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jun.

Aug.

Sep.

Oct.

Nov.

Dec.

TOTAL

$0

$108,400

$98,766

$89,133

$79,499

$112,428

$145,357

$178,286

$253,778

$329,269

$404,761

$522,815

$640,869

$0

$66,000

$66,000

$66,000

$132,000

$132,000

$132,000

$198,000

$198,000

$198,000

$264,000

$264,000

$264,000

Cash Inflows:
Cash Sales

$1,980,000

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Equity Received

$300,000

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$300,000

Loans Received

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Collections from Accounts Receivable

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Total Cash Inflows

$300,000

$66,000

$66,000

$66,000

$132,000

$132,000

$132,000

$198,000

$198,000

$198,000

$264,000

$264,000

$264,000

$2,280,000

Total Cash Available

$300,000

$174,400

$164,766

$155,133

$211,499

$244,428

$277,357

$376,286

$451,778

$527,269

$668,761

$786,815

$904,869

$2,388,400
$703,125

Other Cash In

$0

$0

$0

Cash Outflows:
Trainer Compensation - 1099

$0

$23,438

$23,438

$23,438

$46,875

$46,875

$46,875

$70,313

$70,313

$70,313

$93,750

$93,750

$93,750

Accounting

$5,000

$208

$208

$208

$208

$208

$208

$208

$208

$208

$208

$208

$208

$7,500

Advertising

$100,000

$8,333

$8,333

$8,333

$8,333

$8,333

$8,333

$8,333

$8,333

$8,333

$8,333

$8,333

$8,333

$200,000

$0

$2,475

$2,475

$2,475

$2,475

$2,475

$2,475

$2,475

$2,475

$2,475

$2,475

$2,475

$2,475

$29,700
$5,000

Operating Expenses

Bank Charges
Dues & Subscriptions

$0

$417

$417

$417

$417

$417

$417

$417

$417

$417

$417

$417

$417

$350

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$350

Fictitious Name Costs (VA, MD, DC)

$2,000

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$2,000

High Speed Internet

$2,500

$583

$583

$583

$583

$583

$583

$583

$583

$583

$583

$583

$583

$9,500

Insurance

$5,000

$825

$825

$825

$825

$825

$825

$825

$825

$825

$825

$825

$825

$14,900

Legal & Consulting Fees

$2,000

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$400

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$400

$0

$833

$833

$833

$833

$833

$833

$833

$833

$833

$833

$833

$833

$10,000

Meals & Entertainment

$6,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$18,000

Miscellaneous

$3,500

$833

$833

$833

$833

$833

$833

$833

$833

$833

$833

$833

$833

$13,500

Office Supplies

$1,000

$167

$167

$167

$167

$167

$167

$167

$167

$167

$167

$167

$167

Other Startup Expenses

$4,000

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$4,000

Patent, Trademark, Copyright

$5,000

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$20,000

$25,000

$0

$20,000

$20,000

$20,000

$20,000

$20,000

$20,000

$20,000

$20,000

$20,000

$20,000

$20,000

$20,000

$240,000

Federal Tax ID

LLC Fees & Taxes


Marketing & Promotion

$2,000

$3,000

Payroll Expenses:
-Salaries & Wages
-Payroll Taxes

$0

$2,290

$2,290

$2,290

$2,290

$2,290

$2,290

$2,290

$2,290

$2,290

$2,290

$2,290

$2,290

$27,480

-Benefits

$0

$5,110

$5,110

$5,110

$5,110

$5,110

$5,110

$5,110

$5,110

$5,110

$5,110

$5,110

$5,110

$61,320

$3,000

$333

$333

$333

$333

$333

$333

$333

$333

$333

$333

$333

$333

$7,000

-Travel Costs

$5,000

-Promotion & Networking

$2,000

$250

$250

$250

$250

$250

$250

$250

$250

$250

$250

$250

$250

-Memberships

$2,500

$292

$292

$292

$292

$292

$292

$292

$292

$292

$292

$292

$292

$6,000

Permits and Licenses

$1,250

$833

$833

$833

$833

$833

$833

$833

$833

$833

$833

$833

$833

$11,250

Podcast Creation Web Service

$5,000

$417

$417

$417

$417

$417

$417

$417

$417

$417

$417

$417

$417

$10,000

Printing (cards, stationery, brochures)

$3,000

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$3,000

Professional Fees

$0

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$12,000

Property Taxes

$0

$27

$27

$27

$27

$27

$27

$27

$27

$27

$27

$27

$27

$325

R&D
Repairs & Maintenance
Sales Tax Permits
Shipping & Delivery
Telephone Service
Training & Development
Travel

$4,000

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$1,568

$5,568

$0

$18

$18

$18

$18

$18

$18

$18

$18

$18

$18

$18

$18

$215
$200

$200

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$25

$25

$25

$25

$25

$25

$25

$25

$25

$25

$25

$25

$300

$3,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$1,000

$15,000

$0

$750

$750

$750

$750

$750

$750

$750

$750

$750

$750

$750

$750

$9,000

$0

$417

$417

$417

$417

$417

$417

$417

$417

$417

$417

$417

$417

$5,000

$0

$115

$115

$115

$115

$115

$115

$115

$115

$115

$115

$115

$115

$1,374

Virtual Business Office - Philippines

$2,000

$1,568

$1,568

$1,568

$1,568

$1,568

$1,568

$1,568

$1,568

$1,568

$1,568

$1,568

$1,568

$20,810

Virtual Business Office Domestic

$1,500

$369

$369

$369

$369

$369

$369

$369

$369

$369

$369

$369

$369

$5,928

VOIP Service

$3,000

$958

$958

$958

$958

$958

$958

$958

$958

$958

$958

$958

$958

$14,500

Web Site Costs (Design, Hosting, & Admin.)

$6,000

$750

$750

$750

$750

$750

$750

$750

$750

$750

$750

$750

$750

$15,000

$173,200

$75,634

$75,634

$75,634

$99,071

$99,071

$99,071

$122,509

$122,509

$122,509

$145,946

$145,946

$167,514

$1,524,245

$16,000

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$16,000

Utilities

Subtotal
Other Cash Outflows (Non-Operating)
Capital Purchases
Estimated Income Tax Payment

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Interest Payments

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Loan Principal Payments

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Owners Draw

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$2,400

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$2,400

Other Cash Out

$0

$0
Total Cash Outflows

$191,600

$75,634

$75,634

$75,634

$99,071

$99,071

$99,071

$122,509

$122,509

$122,509

$145,946

$145,946

$167,514

Monthly Cash Flow (Cash In - Cash Out)

$108,400

($9,634)

($9,634)

($9,634)

$32,929

$32,929

$32,929

$75,491

$75,491

$75,491

$118,054

$118,054

$96,486

Beginning Cash Balance


Ending Cash Balance

$1,542,645
$737,355

$0

$108,400

$98,766

$89,133

$79,499

$112,428

$145,357

$178,286

$253,778

$329,269

$404,761

$522,815

$640,869

$0

$108,400

$98,766

$89,133

$79,499

$112,428

$145,357

$178,286

$253,778

$329,269

$404,761

$522,815

$640,869

$737,355

$737,355

P.

EXHIBIT 16 - CASH FLOW STATEMENT

iTrainer Fitness Program, LLC


Cash Flow Statement (Projected)
2013
Beginning Cash Balance

Jan.

Feb.

737,355

351,438

Mar.

804,796

351,438

Apr.

872,237

351,438

May

939,678

702,875

Jun.

1,241,369

702,875

Jul.

1,543,060

702,875

Aug.

1,844,750

1,054,313

Sep.

2,380,691

1,054,313

Oct.

2,916,632

1,054,313

Nov.

3,452,573

1,405,750

Dec.

4,222,764

1,405,750

TOTAL

4,992,955

1,405,750

Cash Inflows:
Cash Sales

10,543,125

Collections from Accounts Receivable

Equity Received

Loans Received

Other Cash In

Total Cash Inflows

351,438

351,438

351,438

702,875

702,875

702,875

1,054,313

1,054,313

1,054,313

1,405,750

1,405,750

1,405,750

10,543,125

Total Cash Available

1,088,793

1,156,234

1,223,674

1,642,553

1,944,244

2,245,935

2,899,063

3,435,004

3,970,945

4,858,323

5,628,514

6,398,705

11,280,480

117,188

117,188

117,188

234,375

234,375

234,375

351,563

351,563

351,563

468,750

468,750

468,750

3,028,125

250

250

250

250

250

250

250

250

250

250

250

250

Cash Outflows:
Trainer Compensation - 1099
Operating Expenses
Accounting

3,000

Advertising

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

12,500

150,000

Bank Charges

13,179

13,179

13,179

13,179

13,179

13,179

13,179

13,179

13,179

13,179

13,179

13,179

158,147

833

833

833

833

833

833

833

833

833

833

833

10,000

Dues & Subscriptions

833

Federal Tax ID

Fictitious Name Costs (VA, MD, DC)

High Speed Internet

833

833

833

833

833

833

833

833

833

833

833

833

10,000

Insurance

4,393

4,393

4,393

4,393

4,393

4,393

4,393

4,393

4,393

4,393

4,393

4,393

52,716

Legal & Consulting Fees

833

833

833

833

833

833

833

833

833

833

833

833

10,000

LLC Fees & Taxes

854

854

854

854

854

854

854

854

854

854

854

854

10,250

Marketing & Promotion

917

917

917

917

917

917

917

917

917

917

917

917

Meals & Entertainment

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

15,000

Miscellaneous

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

18,000

Office Supplies

417

417

417

417

417

417

417

417

417

417

417

417

Other Startup Expenses

Patent, Trademark, Copyright

48,000

48,000

48,000

48,000

48,000

48,000

48,000

48,000

48,000

48,000

48,000

48,000

11,000

5,000
576,000

Payroll Expenses:
-Salaries & Wages

48,000

48,000

48,000

48,000

48,000

48,000

48,000

48,000

48,000

48,000

48,000

48,000

576,000

-Payroll Taxes

5,496

5,496

5,496

5,496

5,496

5,496

5,496

5,496

5,496

5,496

5,496

5,496

65,952

-Benefits

12,264

12,264

12,264

12,264

12,264

12,264

12,264

12,264

12,264

12,264

12,264

12,264

147,168

-Travel Costs

417

417

417

417

417

417

417

417

417

417

417

417

5,000

-Promotion & Networking

333

333

333

333

333

333

333

333

333

333

333

333

4,000

-Memberships

375

375

375

375

375

375

375

375

375

375

375

375

4,500

Permits and Licenses

854

854

854

854

854

854

854

854

854

854

854

854

10,250

Podcast Creation Web Service

625

625

625

625

625

625

625

625

625

625

625

625

7,500

Printing (cards, stationery, brochures)

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

18,000

Professional Fees

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

18,000

Property Taxes

42

42

42

42

42

42

42

42

42

42

42

42

500

R&D

83

83

83

83

83

83

83

83

83

83

83

83

1,000

Repairs & Maintenance

83

83

83

83

83

83

83

83

83

83

83

83

1,000

42

Sales Tax Permits

42

42

42

42

42

42

42

42

42

42

42

500

Shipping & Delivery

42

42

42

42

42

42

42

42

42

42

42

42

500

Telephone Service

2,000

2,000

2,000

2,000

2,000

2,000

2,000

2,000

2,000

2,000

2,000

2,000

24,000

Training & Development

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

1,500

18,000

Travel

833

833

833

833

833

833

833

833

833

833

833

833

10,000

Utilities

626

626

626

626

626

626

626

626

626

626

626

626

7,515

Virtual Business Office - Philippines

1,724

1,724

1,724

1,724

1,724

1,724

1,724

1,724

1,724

1,724

1,724

1,724

20,691

Virtual Business Office Domestic

406

406

406

406

406

406

406

406

406

406

406

406

4,871

VOIP Service

1,054

1,054

1,054

1,054

1,054

1,054

1,054

1,054

1,054

1,054

1,054

1,054

12,650

Web Site Costs (Design, Hosting, & Admin.)

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

15,000

Subtotal

283,997

283,997

283,997

401,184

401,184

401,184

518,372

518,372

518,372

635,559

635,559

635,559

5,517,334

Other Cash Outflows (Non-Operating)


Capital Purchases

Estimated Income Tax Payment

Interest Payments

Loan Principal Payments

Owners Draw

Other Cash Out

$
$

Total Cash Outflows


Monthly Cash Flow (Cash In - Cash Out)

$
$

283,997
67,441

$
$

283,997
67,441

$
$

283,997
67,441

$
$

401,184
301,691

$
$

401,184
301,691

$
$

401,184
301,691

$
$

518,372
535,941

$
$

518,372
535,941

$
$

518,372
535,941

$
$

635,559
770,191

$
$

635,559
770,191

$
$

635,559
770,191

$
$

5,517,334
5,025,791

Beginning Cash Balance

737,355

804,796

872,237

939,678

1,241,369

1,543,060

1,844,750

2,380,691

2,916,632

3,452,573

4,222,764

4,992,955

737,355

Ending Cash Balance

804,796

872,237

939,678

1,241,369

1,543,060

1,844,750

2,380,691

2,916,632

3,452,573

4,222,764

4,992,955

5,763,146

5,763,146

P.

EXHIBIT 16 - CASH FLOW STATEMENT

iTrainer Fitness Program, LLC


Cash Flow Statement (Projected)
2014
Beginning Cash Balance

Jan.

Feb.

5,763,146

750,038

Mar.

6,112,537

750,038

Apr.

6,461,928

750,038

May

6,811,319

1,500,075

Jun.

7,676,372

1,500,075

Jul.

8,541,426

1,500,075

Aug.

9,406,479

2,250,113

Sep.

10,787,195

2,250,113

Oct.

12,167,911

2,250,113

Nov.

13,548,627

3,000,150

Dec.

15,445,006

3,000,150

TOTAL

17,341,384

3,000,150

Cash Inflows:
Cash Sales

22,501,125

Collections from Accounts Receivable

Equity Received

Loans Received

Other Cash In

Total Cash Inflows

750,038

750,038

750,038

1,500,075

1,500,075

1,500,075

2,250,113

2,250,113

2,250,113

3,000,150

3,000,150

3,000,150

22,501,125

Total Cash Available

750,038

6,862,574

7,211,965

8,311,394

9,176,447

10,041,501

11,656,592

13,037,308

14,418,024

16,548,777

18,445,156

20,341,534

28,264,271

234,375

234,375

234,375

468,750

468,750

468,750

703,125

703,125

703,125

937,500

937,500

937,500

7,031,250

333

333

333

333

333

333

333

333

333

333

333

333

Cash Outflows:
Trainer Compensation - 1099
Operating Expenses
Accounting

4,000

Advertising

14,583

14,583

14,583

14,583

14,583

14,583

14,583

14,583

14,583

14,583

14,583

14,583

175,000

Bank Charges

28,126

28,126

28,126

28,126

28,126

28,126

28,126

28,126

28,126

28,126

28,126

28,126

337,517

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

15,000

1,250

Federal Tax ID

Fictitious Name Costs (VA, MD, DC)

Dues & Subscriptions

High Speed Internet

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

13,000

9,375

112,506

Insurance

9,375

9,375

9,375

9,375

9,375

9,375

9,375

9,375

9,375

9,375

9,375

Legal & Consulting Fees

875

875

875

875

875

875

875

875

875

875

875

875

10,500

LLC Fees & Taxes

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

12,000

Marketing & Promotion

875

875

875

875

875

875

875

875

875

875

875

875

10,500

Meals & Entertainment

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

12,000

Miscellaneous

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

20,000

Office Supplies

1,917

1,917

1,917

1,917

1,917

1,917

1,917

1,917

1,917

1,917

1,917

1,917

23,000

Other Startup Expenses

833

833

833

833

833

833

833

833

833

833

833

833

10,000

Patent, Trademark, Copyright

60,000

60,000

60,000

60,000

60,000

60,000

60,000

60,000

60,000

60,000

60,000

60,000

Payroll Expenses:
-Salaries & Wages

720,000

6,870

6,870

6,870

6,870

6,870

6,870

6,870

6,870

6,870

6,870

6,870

6,870

82,440

-Benefits

15,330

15,330

15,330

15,330

15,330

15,330

15,330

15,330

15,330

15,330

15,330

15,330

183,960

-Travel Costs

500

500

500

500

500

500

500

500

500

500

500

500

-Payroll Taxes

6,000

-Promotion & Networking

417

417

417

417

417

417

417

417

417

417

417

417

5,000

-Memberships

458

458

458

458

458

458

458

458

458

458

458

458

5,500

833

833

833

833

833

833

833

833

833

833

833

833

10,000

Podcast Creation Web Service

2,000

2,000

2,000

2,000

2,000

2,000

2,000

2,000

2,000

2,000

2,000

2,000

24,000

Printing (cards, stationery, brochures)

83

83

83

83

83

83

83

83

83

83

83

83

1,000

Permits and Licenses

Professional Fees

83

83

83

83

83

83

83

83

83

83

83

83

1,000

Property Taxes

125

125

125

125

125

125

125

125

125

125

125

125

1,500

R&D

83

83

83

83

83

83

83

83

83

83

83

83

1,000

Repairs & Maintenance

83

83

83

83

83

83

83

83

83

83

83

83

1,000

Sales Tax Permits

3,000

3,000

3,000

3,000

3,000

3,000

3,000

3,000

3,000

3,000

3,000

3,000

36,000

Shipping & Delivery

3,000

3,000

3,000

3,000

3,000

3,000

3,000

3,000

3,000

3,000

3,000

3,000

36,000

Telephone Service

2,250

2,250

2,250

2,250

2,250

2,250

2,250

2,250

2,250

2,250

2,250

2,250

27,000

Training & Development

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

15,000

Travel

1,370

1,370

1,370

1,370

1,370

1,370

1,370

1,370

1,370

1,370

1,370

1,370

16,445

446

446

446

446

446

446

446

446

446

446

446

446

5,358

Virtual Business Office - Philippines

1,897

1,897

1,897

1,897

1,897

1,897

1,897

1,897

1,897

1,897

1,897

1,897

22,760

Virtual Business Office Domestic

446

446

446

446

446

446

446

446

446

446

446

446

5,358

Utilities

VOIP Service

1,160

1,160

1,160

1,160

1,160

1,160

1,160

1,160

1,160

1,160

1,160

1,160

13,915

Web Site Costs (Design, Hosting, & Admin.)

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

20,000

Subtotal

400,647

400,647

400,647

635,022

635,022

635,022

869,397

869,397

869,397

1,103,772

1,103,772

1,103,772

9,026,508

Other Cash Outflows (Non-Operating)


Capital Purchases

Estimated Income Tax Payment

Interest Payments

Loan Principal Payments

Owners Draw

Other Cash Out

$
$

Total Cash Outflows


Monthly Cash Flow (Cash In - Cash Out)

$
$

400,647
349,391

$
$

400,647
349,391

$
$

400,647
349,391

$
$

635,022
865,053

$
$

635,022
865,053

$
$

635,022
865,053

$
$

869,397
1,380,716

$
$

869,397
1,380,716

$
$

869,397
1,380,716

$
$

1,103,772
1,896,378

$
$

1,103,772
1,896,378

$
$

1,103,772
1,896,378

$
$

9,026,508
13,474,617

Beginning Cash Balance

5,763,146

6,112,537

6,461,928

6,811,319

7,676,372

8,541,426

9,406,479

10,787,195

12,167,911

13,548,627

15,445,006

17,341,384

5,763,146

Ending Cash Balance

6,112,537

6,461,928

6,811,319

7,676,372

8,541,426

9,406,479

10,787,195

12,167,911

13,548,627

15,445,006

17,341,384

19,237,763

19,237,763

P.

EXHIBIT 16 - CASH FLOW STATEMENT

iTrainer Fitness Program, LLC


Cash Flow Statement (Projected)
2015
Beginning Cash Balance

Jan.

Feb.

19,237,763

1,603,833

Mar.

20,119,660

1,603,833

Apr.

21,001,558

1,603,833

May

21,883,456

3,207,665

Jun.

23,900,437

3,207,665

Jul.

25,917,417

3,207,665

Aug.

27,934,397

4,811,498

Sep.

31,086,460

4,811,498

Oct.

34,238,523

4,811,498

Nov.

37,390,586

6,415,330

Dec.

41,677,731

6,415,330

TOTAL

45,964,877

6,415,330

Cash Inflows:
Cash Sales

48,114,975

Collections from Accounts Receivable

Equity Received

Loans Received

Other Cash In

Total Cash Inflows

1,603,833

1,603,833

1,603,833

3,207,665

3,207,665

3,207,665

4,811,498

4,811,498

4,811,498

6,415,330

6,415,330

6,415,330

48,114,975

Total Cash Available

1,603,833

21,723,493

22,605,391

25,091,121

27,108,102

29,125,082

32,745,895

35,897,958

39,050,020

43,805,916

48,093,061

52,380,207

67,352,738

468,750

468,750

468,750

937,500

937,500

937,500

1,406,250

1,406,250

1,406,250

1,875,000

1,875,000

1,875,000

14,062,500

417

417

417

417

417

417

417

417

417

417

417

417

Cash Outflows:
Trainer Compensation - 1099
Operating Expenses
Accounting

5,000

Advertising

16,667

16,667

16,667

16,667

16,667

16,667

16,667

16,667

16,667

16,667

16,667

16,667

200,000

Bank Charges

60,144

60,144

60,144

60,144

60,144

60,144

60,144

60,144

60,144

60,144

60,144

60,144

721,725

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

20,000

1,667

Federal Tax ID

Fictitious Name Costs (VA, MD, DC)

Dues & Subscriptions

High Speed Internet

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

20,000

20,048

20,048

20,048

20,048

20,048

20,048

20,048

20,048

20,048

20,048

20,048

20,048

240,575

Insurance

Legal & Consulting Fees

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

LLC Fees & Taxes

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

1,000

12,000

Marketing & Promotion

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

13,000

Meals & Entertainment

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

20,000

30,000

Miscellaneous

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

30,000

Office Supplies

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

15,000

Other Startup Expenses

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

13,000

Patent, Trademark, Copyright

80,000

80,000

80,000

80,000

80,000

80,000

80,000

80,000

80,000

80,000

80,000

80,000

Payroll Expenses:
-Salaries & Wages

960,000

9,160

9,160

9,160

9,160

9,160

9,160

9,160

9,160

9,160

9,160

9,160

9,160

109,920

-Benefits

20,440

20,440

20,440

20,440

20,440

20,440

20,440

20,440

20,440

20,440

20,440

20,440

245,280

-Travel Costs

667

667

667

667

667

667

667

667

667

667

667

667

-Payroll Taxes

8,000

-Promotion & Networking

625

625

625

625

625

625

625

625

625

625

625

625

7,500

-Memberships

583

583

583

583

583

583

583

583

583

583

583

583

7,000

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

15,000

Podcast Creation Web Service

2,667

2,667

2,667

2,667

2,667

2,667

2,667

2,667

2,667

2,667

2,667

2,667

32,000

Printing (cards, stationery, brochures)

125

125

125

125

125

125

125

125

125

125

125

125

Permits and Licenses

1,500

Professional Fees

250

250

250

250

250

250

250

250

250

250

250

250

3,000

Property Taxes

167

167

167

167

167

167

167

167

167

167

167

167

2,000

R&D

3,500

3,500

3,500

3,500

3,500

3,500

3,500

3,500

3,500

3,500

3,500

3,500

42,000

Repairs & Maintenance

2,917

2,917

2,917

2,917

2,917

2,917

2,917

2,917

2,917

2,917

2,917

2,917

35,000

Sales Tax Permits

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

25,000

Shipping & Delivery

1,978

1,978

1,978

1,978

1,978

1,978

1,978

1,978

1,978

1,978

1,978

1,978

23,740

Telephone Service

3,500

3,500

3,500

3,500

3,500

3,500

3,500

3,500

3,500

3,500

3,500

3,500

42,000

Training & Development

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

25,000

Travel

1,833

1,833

1,833

1,833

1,833

1,833

1,833

1,833

1,833

1,833

1,833

1,833

22,000

2,086

2,086

2,086

2,086

2,086

2,086

2,086

2,086

2,086

2,086

2,086

2,086

25,036

491

1,978

491

1,978

491

1,978

491

1,978

491

1,978

491

1,978

491

1,978

491

1,978

491

1,978

491

1,978

491

5,894

491

VOIP Service

1,276

1,276

1,276

1,276

1,276

1,276

1,276

1,276

1,276

1,276

1,276

1,276

15,307

Web Site Costs (Design, Hosting, & Admin.)

1,833

1,833

1,833

1,833

1,833

1,833

1,833

1,833

1,833

1,833

1,833

1,833

22,000

721,935

721,935

721,935

1,190,685

1,190,685

1,190,685

1,659,435

1,659,435

1,659,435

2,128,185

2,128,185

2,128,185

17,100,716

Subtotal

1,978

23,740

1,978

$
$

Virtual Business Office Domestic

Utilities
Virtual Business Office - Philippines

Other Cash Outflows (Non-Operating)


Capital Purchases

Estimated Income Tax Payment

Interest Payments

Loan Principal Payments

Owners Draw

Other Cash Out

$
$

Total Cash Outflows


Monthly Cash Flow (Cash In - Cash Out)

$
$

721,935
881,898

$
$

721,935
881,898

$
$

721,935
881,898

$
$

1,190,685
2,016,980

$
$

1,190,685
2,016,980

$
$

1,190,685
2,016,980

$
$

1,659,435
3,152,063

$
$

1,659,435
3,152,063

$
$

1,659,435
3,152,063

$
$

2,128,185
4,287,145

$
$

2,128,185
4,287,145

$
$

2,128,185
4,287,145

$
$

17,100,716
31,014,259

Beginning Cash Balance

19,237,763

20,119,660

21,001,558

21,883,456

23,900,437

25,917,417

27,934,397

31,086,460

34,238,523

37,390,586

41,677,731

45,964,877

19,237,763

Ending Cash Balance

20,119,660

21,001,558

21,883,456

23,900,437

25,917,417

27,934,397

31,086,460

34,238,523

37,390,586

41,677,731

45,964,877

50,252,022

50,252,022

P.

EXHIBIT 16 - CASH FLOW STATEMENT

iTrainer Fitness Program, LLC


Cash Flow Statement (Projected)
2016
Beginning Cash Balance

Jan.

Feb.

50,252,022

2,576,949

Mar.

51,752,066

2,576,949

Apr.

53,252,110

2,576,949

May

54,752,155

5,153,897

Jun.

58,126,023

5,153,897

Jul.

61,499,891

5,153,897

Aug.

64,873,759

7,730,846

Sep.

70,121,450

7,730,846

Oct.

75,369,142

7,730,846

Nov.

80,616,833

10,307,795

Dec.

87,738,348

10,307,795

TOTAL

94,859,864

10,307,795

Cash Inflows:
Cash Sales

77,308,459

Collections from Accounts Receivable

Equity Received

Loans Received

Other Cash In

Total Cash Inflows

2,576,949

2,576,949

2,576,949

5,153,897

5,153,897

5,153,897

7,730,846

7,730,846

7,730,846

10,307,795

10,307,795

10,307,795

77,308,459

Total Cash Available

2,576,949

54,329,015

55,829,059

59,906,052

63,279,920

66,653,788

72,604,604

77,852,296

83,099,988

90,924,628

98,046,143

105,167,658

127,560,481

703,125

703,125

703,125

1,406,250

1,406,250

1,406,250

2,109,375

2,109,375

2,109,375

2,812,500

2,812,500

2,812,500

21,093,750

500

500

500

500

500

500

500

500

500

500

500

500

Cash Outflows:
Trainer Compensation - 1099
Operating Expenses
Accounting

6,000

Advertising

18,750

18,750

18,750

18,750

18,750

18,750

18,750

18,750

18,750

18,750

18,750

18,750

225,000

Bank Charges

96,636

96,636

96,636

96,636

96,636

96,636

96,636

96,636

96,636

96,636

96,636

96,636

1,159,627

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

2,083

25,000

2,083

Federal Tax ID

Fictitious Name Costs (VA, MD, DC)

Dues & Subscriptions

High Speed Internet

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

30,000

32,212

32,212

32,212

32,212

32,212

32,212

32,212

32,212

32,212

32,212

32,212

32,212

386,542

Insurance

Legal & Consulting Fees

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

2,500

LLC Fees & Taxes

1,167

1,167

1,167

1,167

1,167

1,167

1,167

1,167

1,167

1,167

1,167

1,167

14,000

Marketing & Promotion

1,167

1,167

1,167

1,167

1,167

1,167

1,167

1,167

1,167

1,167

1,167

1,167

14,000

Meals & Entertainment

4,167

4,167

4,167

4,167

4,167

4,167

4,167

4,167

4,167

4,167

4,167

4,167

30,000

50,000

Miscellaneous

3,167

3,167

3,167

3,167

3,167

3,167

3,167

3,167

3,167

3,167

3,167

3,167

38,000

Office Supplies

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

20,000

Other Startup Expenses

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

1,083

13,000

Patent, Trademark, Copyright

Payroll Expenses:
-Salaries & Wages

120,000

120,000

120,000

120,000

120,000

120,000

120,000

120,000

120,000

120,000

120,000

120,000

1,440,000

13,740

13,740

13,740

13,740

13,740

13,740

13,740

13,740

13,740

13,740

13,740

13,740

164,880

-Benefits

30,660

30,660

30,660

30,660

30,660

30,660

30,660

30,660

30,660

30,660

30,660

30,660

367,920

-Travel Costs

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

1,250

15,000

-Promotion & Networking

833

833

833

833

833

833

833

833

833

833

833

833

-Memberships

750

750

750

750

750

750

750

750

750

750

750

750

9,000

Permits and Licenses

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

1,667

20,000

Podcast Creation Web Service

3,750

3,750

3,750

3,750

3,750

3,750

3,750

3,750

3,750

3,750

3,750

3,750

45,000

167

-Payroll Taxes

Printing (cards, stationery, brochures)

167

167

167

167

167

167

167

167

167

167

167

10,000

2,000

Professional Fees

500

500

500

500

500

500

500

500

500

500

500

500

6,000

Property Taxes

333

333

333

333

333

333

333

333

333

333

333

333

4,000

R&D

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

54,000

Repairs & Maintenance

4,000

4,000

4,000

4,000

4,000

4,000

4,000

4,000

4,000

4,000

4,000

4,000

48,000

Sales Tax Permits

4,167

4,167

4,167

4,167

4,167

4,167

4,167

4,167

4,167

4,167

4,167

4,167

50,000

Shipping & Delivery

3,395

3,395

3,395

3,395

3,395

3,395

3,395

3,395

3,395

3,395

3,395

3,395

40,746

Telephone Service

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

4,500

54,000

Training & Development

2,295

2,295

2,295

2,295

2,295

2,295

2,295

2,295

2,295

2,295

2,295

2,295

27,540

Travel

2,017

2,017

2,017

2,017

2,017

2,017

2,017

2,017

2,017

2,017

2,017

2,017

24,200

2,295

2,295

2,295

2,295

2,295

2,295

2,295

2,295

2,295

2,295

2,295

2,295

27,540

540

1,403

540

1,403

540

1,403

540

1,403

540

1,403

540

1,403

540

1,403

540

1,403

540

1,403

540

1,403

540

6,483

540

VOIP Service

1,403

1,403

1,403

1,403

1,403

1,403

1,403

1,403

1,403

1,403

1,403

1,403

16,837

Web Site Costs (Design, Hosting, & Admin.)

2,017

2,017

2,017

2,017

2,017

2,017

2,017

2,017

2,017

2,017

2,017

2,017

24,200

1,076,904

1,076,904

1,076,904

1,780,029

1,780,029

1,780,029

2,483,154

2,483,154

2,483,154

3,186,279

3,186,279

3,186,279

25,579,102

Subtotal

1,403

16,837

1,403

$
$

Virtual Business Office Domestic

Utilities
Virtual Business Office - Philippines

Other Cash Outflows (Non-Operating)


Capital Purchases

Estimated Income Tax Payment

Interest Payments

Loan Principal Payments

Owners Draw

Other Cash Out

$
$

Total Cash Outflows


Monthly Cash Flow (Cash In - Cash Out)

$
$

1,076,904
1,500,044

$
$

1,076,904
1,500,044

$
$

1,076,904
1,500,044

$
$

1,780,029
3,373,868

$
$

1,780,029
3,373,868

$
$

1,780,029
3,373,868

$
$

2,483,154
5,247,692

$
$

2,483,154
5,247,692

$
$

2,483,154
5,247,692

$
$

3,186,279
7,121,515

$
$

3,186,279
7,121,515

$
$

3,186,279
7,121,515

$
$

25,579,102
51,729,357

Beginning Cash Balance

50,252,022

51,752,066

53,252,110

54,752,155

58,126,023

61,499,891

64,873,759

70,121,450

75,369,142

80,616,833

87,738,348

94,859,864

50,252,022

Ending Cash Balance

51,752,066

53,252,110

54,752,155

58,126,023

61,499,891

64,873,759

70,121,450

75,369,142

80,616,833

87,738,348

94,859,864

101,981,379

101,981,379

iTrainer Fitness, LLC


Robert Ellentuck, Principal
March 11, 2011

iTrainer Fitness
Your Fitness. Your Way.
 Introduction
 Financing
 Target Market
 Marketing Plan
 SWOT Analysis
 Growth Strategy
 Financials
 Summary

APPENDIX A

Whats iTrainer Fitness?


 FaceFace-toto-face assessment and monthly progress
meetings with personal trainer
 Set goals and track progress via meetings and
web site
 Trainer provides clients with a customized fitness
routine via a digital podcast
 Exercise program based on clients schedule
 Exercise as frequently as you want for one fee
FLEXIBILITY AFFORDABILITY CONVENIENCE

HEALTH
3

Financing Our Venture


Debt:
$0
Invest:
$300K*
Start-Up
Capital:
$300K

APPENDIX A

Investment to be divided among the four Principals

Demographics
 Loudoun County, Virginia
 Ranks #1 for median annual income: $112K*

 Educated and Busy Professionals


 56% college degree
 57% professional

 Median Age: 34.2 years


 Tech savvy growing population: 301,171
 Gender split 5050-50

*US Census Bureau 2008

Typical Client
 Hectic and busy professionals





Targets ages 25 - 44
Offers aging baby boomers a way to stay healthy and fit
Needs flexible schedule to incorporate fitness
Wants the customization of a personal trainer at an
affordable cost

 Social Values
 Health
Health--Fitness conscious
 Avid user of technology
 Stay healthy as you age
 Economic turmoil

iTrainer
Fitness

APPENDIX A

Pricing Strategy
Level

Monthly

Services

Price/Quality

Platinum

$169

4 Strength/6 Cardio Superb Value

Gold

$129

2 Strength/3 Cardio Great Value

Silver

$109

2 Strength/2 Cardio Good Value

Bronze

$ 89

1 Strength/2 Cardio Start-up Value

Complimentary initial one-on-one assessment with trainer


A la cart Services
Interval workouts: $10/month additional
Spinning workouts: $15/month additional
One-on-one with trainer: $50/hour additional
Greater than 60 minutes: rates negotiable

*Note: services interchangeable

Start-up
Costs:
$100K

Promotional Strategy
Inform

Persuade

Social Media
Website:
iTrainerFitness.com

Facebook
Twitter
LinkedIn
Groupon

Pre-Launch

APPENDIX A

Remind

Guerilla

Conventional

Email
Blogs
Webinar
YouTube
Local
Events

Newspapers

Launch

Ongoing

Magazines
Collateral
Promotional
Items
Associations

Service Differentiation
Flexibility

Affordability

Exercise can be part of


a hectic lifestyle
Customized workout
based on client
preferences

Luxury of
personalized training
($50-100/hour)
Monthly tiered
pricing

Convenience

Health

Plans to fit your


schedule
Ready when you are

Initial assessment
Monthly progress
check-ups

SWOT Analysis
Strengths

Weaknesses

Addresses market gap


Leverages clients music
Combines technology,
applications and mobile apps
Ideal demographics in target
market
Cardiovascular & strength
training
Tiered pricing with a la cart
options
Client support and feedback
Low start-up costs

No physical office to meet


with clients
Turnover of contract trainers
Lack of brand, reputation or
market presence
Cash flow could be
unpredictable initially
Managing initial promotional
costs
Many fitness choices in
market

10

APPENDIX A

SWOT Analysis
Opportunities

Threats

Appealing to busy/hectic
professionals
Increasing health/fitness
trends
Business model & brand
attractive for franchising
Growing population of target
market
Potential partnerships

Consumer reduction in
discretionary spending
Consistent caliber of trainers
Competitors may mimic us
Volatile gas prices could
impact overhead costs
Resistance to use of
technology

11

Growth Strategy
 Internal Plans
 Hire additional staff
 Software investment
 Smartphone Application
 Operational Managers
 External Plans
 Nutritional Services
 Educational Webinars
 Expand Market Areas

12

APPENDIX A

Implementation Plan
Management
Team

Robert Ellentuck: Legal and Finances


Moo Hackett: Operations and Logistics
Maryanne Zabala: Marketing and Sales
Noemi Arthur: Coms & Procurement

Staff*

Q1: 3 Trainers 250 clients/Q2: 4 500 clients


Q3: 7 Trainers 750 clientsQ4: 9 Trainers 1000
clients
One Technical Support Person

Board of
Advisors

Identify advisors through entrepreneur


organization and industry experts to
participate

13

*Trainer to client ratio 1:120

Financials: StartStart-up Costs


Total Start-up Costs: $191,600
Acctg/Legal/Permits:
$16,200
Advert/Promotional:
$105,000
Office/Phone/Internet:
$13,000

Podcasts/Web/R&D:
$15,000
Misc./Insurance:
$12,500

Start-up Cash: $300K

APPENDIX A

14

Financials: Cash Flow


Cash Flows
$250,000
$200,000
$150,000
$100,000
$50,000
$0
($50,000)

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Cash Balance

$98,766

$89,133

$79,499

$112,428

$145,357

$178,286

Net Cash Flow

($9,634)

($9,634)

($9,634)

$32,929

$32,929

$32,929

15

Financials: Income Statement


100%
90%
80%
70%

$1,927,000
$22,501,125

$7,031,250

$15,469,875

60%

$13,542,875

$13,542,875

$5,642,941

$5,561,122

50%
40%

$1,384,559

30%
20%

$10,543,125

$3,515,625

$7,027,500

10%
0%

$780,202
$1,980,000

$703,125

Sales

COGs

$1,276,875
Gross Income Total Expenses

Net Profits
2012: 20.89%

$496,673

2013: 52.75%

Operating
Income

$496,673
Net Income

2014: 59.83%
16

APPENDIX A

Summary
 iTrainer Fitness fills a gap in the marketplace
 Focuses on health trends and desire to stay fit
 Aging baby boomers

 Leverages growing use of technology


 Targets demographics of market
 Combines social media and guerilla marketing for
cost--effective marketing
cost

 Financials show a steady and healthy growth rate


17

iTrainer FitnessYour Fitness.


Your Way.

18

APPENDIX A