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Table of Contents
Page
Guildford Dry Cleaning Service
The company will have a production facility, but will not need a retail shop front because of our
pick-up and delivery service. However, we will need delivery vans, and customer service trained
drivers.
Customers can choose payment either at the time of each delivery, or by monthly credit card
billing. The Service will send statements to each contract customer, itemising service fees and
the charge for the service to their credit cards for payment, at the end of each month.
The business provides a new door-to-door dry cleaning, laundry, and alteration service in
Guildford that surely will attract customer attention. Working customers may find this service is
convenient for them and want to try it. If they are satisfied with the service quality they are
likely to become repeat customers. When the patronage happens continuously, they become
loyal customers of the service. These customers will recommend Guildford Dry Cleaning
Service to their friends and coworkers. As more and more customers use this service, Guildford
Dry Cleaning Service's image is enhanced and we will gain more and more market share.
Sales forecast gradually increase over Years 1-3 and comprise total sales of £324,700. We
project solid Net profits in the first year. Third year Sales and Net Profits increase significantly.
Chart: Highlights
Highlights
£600,000
£500,000
£400,000
Sales
£300,000
Gross Margin
Net Profit
£200,000
£100,000
£0
Year 1 Year 2 Year 3
Page 1
Guildford Dry Cleaning Service
1.1 Mission
We will offer dry cleaning, laundry, and clothing alteration services with free home pickup and
delivery. Our high quality and convenience will save time for working customers.
1. The business is entering the first year of operation therefore a comprehensive marketing
strategy will be the key to success of the business.
2. It is important to remember that the target customers have money and want to be provided
with a high quality service; therefore they will only use this service if they
are entirely satisfied.
3. Furthermore, the hours of operation must be convenient and service completion must be
timely in order that customers are not harried after a long day working.
1.3 Objectives
In providing laundry and garment alteration services for customers in Guildford area, Guildford
Dry Cleaning Service aims to:
The company will have a production facility, but will not need a retail shop front because of our
pick-up and delivery service. However, we will need delivery vans, and customer service trained
drivers.
Initially, the production facility will be rented. Cleaning equipment will be leased with
accompanying maintenance contracts.
Start-up financing will be through owner investment and bank loans, with a line of credit
established for operations eventualities.
The proposed legal form of business is sole trader. This is a small business and need not
publicly disclose its finances. The business can immediately start without the complicated
procedures associated with partnerships, limited liability companies, or co-operatives.
The owner/founder will be the director and will initially handle the bookkeeping responsibilities.
Page 2
Guildford Dry Cleaning Service
Loan: Lending plan has to be completed and submitted to the bank six months before starting
the business. Loan will be needed two months in advance.
Leasing equipment: Buying new machines costs approximately £30,000 as opposed to leasing
which costs £10,000 per year including maintenance. Evaluating the leasing solution shows NPV
higher than that of buying machines. Moreover, the business is new and has less experience in
maintenance and repair of machine breakdown, therefore the optimal solution is leasing
machines. The following machines will be leased:
Capital plan: The owner will invest £32,000 in the business. Additional capital for the business
will be borrowed from a bank.
Buying a new van, and office/facilities equipment (computer, printer, fax, telephone
instrument, tables, chairs, shelving, work tables, racks, etc…) and initial leasing of laundry
machines: £19,500
Buying another new van in April: £7,000
Annual interest of 6.48% has to be paid on the long-term loans secured with fixed assets.
Page 3
Guildford Dry Cleaning Service
Chart: Start-up
Start-up
£32,000
£28,000
£24,000
£20,000
£16,000
£12,000
£8,000
£4,000
£0
Expenses Assets Investment Loans
Table: Start-up
Start-up
Requirements
Start-up Expenses
Legal £150
Stationery etc. £1,200
Brochures £2,250
Recruitment and Training £400
Insurance £570
Rent £600
Utilities £500
Leased Equipment £834
Research and Development £0
Expensed Equipment £5,000
Other £2,790
Total Start-up Expenses £14,294
Start-up Assets
Cash Required £10,000
Start-up Inventory £500
Other Current Assets £0
Long-term Assets £14,000
Total Assets £24,500
Page 4
Guildford Dry Cleaning Service
Start-up Funding
Start-up Expenses to Fund £14,294
Start-up Assets to Fund £24,500
Total Funding Required £38,794
Assets
Non-cash Assets from Start-up £14,500
Cash Requirements from Start-up £10,000
Additional Cash Raised £12,706
Cash Balance on Starting Date £22,706
Total Assets £37,206
Liabilities
Current Borrowing £0
Long-term Liabilities £19,500
Accounts Payable (Outstanding Bills) £0
Other Current Liabilities (interest-free) £0
Total Liabilities £19,500
Capital
Planned Investment
Investor 1 £32,000
Investor 2 £0
Other £0
Additional Investment Requirement £0
Total Planned Investment £32,000
Page 5
Guildford Dry Cleaning Service
3.0 Services
Guildford Dry Cleaning Service is going to provide the following services for customers with free
home pick-up and delivery in the Guildford area:
Dry cleaning
Laundry for personal clothes and large items such as blankets, duvets, curtains, etc.
Alteration service
Operations plan
There are two ways for customers to take part in the service. Customers can sign contracts
with Guildford Dry Cleaning Service to get regularly scheduled service, or they can also
order over the telephone or e-mail to Guildford Dry Cleaning Service.
Customers can choose payment either at the time of each delivery, or by monthly credit card
billing. The Service will send statements to each contract customer, itemising service fees and
the charge for the service to their credit cards for payment, at the end of each month.
No retail shop will be rented in order to reduce the operation cost. An operations facility for
installing machines and equipment, washing and cleaning activities, and storing not yet cleaned
and cleaned products is needed. The operations facility will require about 200 square metres
divided into four main sections as follows:
The whole operation process will be controlled and monitored by a laundry expert employee,
and generally managed by the business owner.
There are a number of reasons for choosing the dry cleaning, laundry, and alteration service
industry:
Source: "10 Reasons Why The Dry Cleaning Business Continues To Grow",
http://www.mindspring.com/~jimgirone/cleanpage/howto.html
Page 6
Guildford Dry Cleaning Service
Market Analysis
Page 7
Guildford Dry Cleaning Service
Full-time employees
Part-time employees
Other
Table 1 in the previous topic shows the percentages of males and females working full time
from the period 2001 – 2002 which are a lot higher than that of those working part time.
Employment, income, and GDP trends show an increase over the past several years.
These tables show that more and more people have money (standard of living increased) but
have less time to do their housework (laundry) in Guildford. They are often tired after working
all day and tend to spend money to hire someone else to do the housework for them. Moreover,
the demand on clothes of these working people (particularly professionals) usually increases
proportionately with their income. Buying more clothes, especially expensive clothes, makes
them pay more attention to the care and cleaning of those clothes. With careful research, this
business focuses on working and professional class customers as a target segment market.
There are two competitors in dry cleaning, laundry and alteration services in Guildford: Trend
Cleaners and Woodbridge Hill Cleaners and Launderers. They are both small-scale services but
have quite a lot of customers (this information is collected by self research and observation).
However, these shops do not provide door-to-door service free of charge for customers.
Hereunder are the strengths, weaknesses, opportunities and threats pertaining to this business:
Page 8
Guildford Dry Cleaning Service
Strengths:
We offer a new service for dry cleaning, and laundry, providing another choice for
customers.
We provide quick and convenient service in order to save customer’s time.
Weaknesses:
Opportunities:
Threats:
If the business is successful, there will be new competitors who supply the same kind of
service.
New technology changes may bring out new family washing machines for dry cleaning.
Evaluation
The business success will depend on quality and convenience of the service, customer opinions,
and competitor response.
Page 9
Guildford Dry Cleaning Service
Optimism
The business provides a new door-to-door dry cleaning, laundry, and alteration service in
Guildford that surely will attract customer attention. Working customers may find this service is
convenient for them and want to try it. If they are satisfied with the service quality they will
likely become repeat customers. When the patronage happens continuously, they become loyal
customers of the service. These customers will recommend Guildford Dry Cleaning Service to
their friends and coworkers. As more and more customers use this service, Guildford Dry
Cleaning Service's image is enhanced and we will gain more and more market share.
If we attain monthly and annual sales at least as forecasted, total costs and expenses, including
any unanticipated charges, will not exceed our estimates and therefore the monthly and annual
profit will be satisfactorily achieved.
Guildford Dry Cleaning is a start-up and as such has less experience and begins with no market
share at all. Assertive, effective initial marketing efforts will be necessary to gain a customer
base. If existing competitors see us as a major threat and they resort to overtly aggressive and
debilitating actions it will be very difficult for us to become an established player in the
marketplace. Risks caused by competitors are possible, therefore the business has to monitor
and evaluate its performance frequently, and collect customer evaluations and suggestions in
order to continually improve.
The worst case scenario would be that the business cannot support itself on an ongoing basis.
The costs of doing business may be under-estimated, or sales and profit may be less than
expected, making the business difficult to finance. Moreover, in case of social economic
recession, political changes, or inflation, the business may perform even worse than has been
forecasted.
As the UK's economy grows rapidly and quality of life is increased, people tend to spend more
time and money in leisure activities rather than doing their house work. They prefer that
someone else does the cleaning work for them. Guildford has a population of 129,701 served
by three dry cleaning and laundry shops. These existing shops wait for customers to bring their
garments in and pick them up later. Customers have to drive cars to town, find parking places,
carry their clothes or large items such as curtains, blankets, etc. to the shop, and to queue for
being serviced. Then they must repeat this boring process when they come to collect their
items. Moreover, these shops are only open from 9am - 6pm, and closed on Sunday, which are
almost the same working hours of offices; most inconvenient for customers especially those
with full-time jobs.
By understanding and addressing this need, our new dry cleaning, laundry and alteration
service will be established, providing door-to-door service free of delivery charge. We make our
customers' lives simpler by saving them time, and eliminating waiting in queues, parking
problems, forgetting to collect clothes, missing meals, and going home late.
Page 10
Guildford Dry Cleaning Service
Place: Trading directly with customers, conveniently in the customers' houses in Guildford. We
are choosing to not rent a shop in high street in the town centre, thereby reducing costs.
Guildford Dry Cleaning Service will receive clothes from and return them to customers' houses.
Requests for urgent situation pick ups and deliveries will be accommodated, and a nominal fee
charged.
Product: Free home pick up and delivery service, coming to customers' house between 6 - 9
pm twice per week. We provide convenience and high quality dry cleaning, laundry, and
alteration services.
Price: Normally, new businesses set their initial prices lower than their competitors. In
our situation however, the business has higher costs for our delivery service and promotions to
increase customers' awareness and establish our brand name. We will set our prices to match
those of our competitors. The pricing scheme is based on a per-service price. Moreover, the
business targets working and professional customers who often pay less attention to price than
the quality and convenience of service. Kelvin Clancy (in Kotler, 2003) shows that only between
15 and 35 percent of buyers are price sensitive. People with higher incomes are willing to pay
more for features, customer service, quality, and convenience.
Promotion:
Advertise our new service in the Surrey Advertiser, the Internet, public areas such as buses
and train stations, shopping centres and supermarkets etc., and drop advertising material
into families' mailboxes.
Offer 10% discount as an incentive for customers who sign one-year contracts.
Issue coupons with lower price for loyal customers.
Page 11
Guildford Dry Cleaning Service
Sales forecast gradually increase over the year 2006 and comprise total sales of £324,700.
However, in the last three months, October, November and December the sales almost remains
the same due to the demand of this service at the end of years doesn’t increase, and even has
a minor decrease.
As forecasted, turnover of total market continues to rise and the price of dry cleaning and
laundry services also increases from 5-10% http://www.keynote.co.uk/GlobalFrame.htm.
However, to avoid being too optimistic, this sale estimation is calculated based on the turnover
of competitors in the year 2002.
(Source: http://www.startinbusiness.co.uk/listings/bi9zopps/sale/details/flz201_laundry.htm).
Turnover projections of £324,700 for the year were generated in the following areas:
Sales Forecast
Year 1 Year 2 Year 3
Sales
Dry Cleaning £116,892 £151,960 £197,548
Laundry £185,079 £240,603 £312,784
Alteration Service £22,729 £29,547 £38,412
Other £0 £0 £0
Total Sales £324,700 £422,110 £548,744
Page 12
Guildford Dry Cleaning Service
Sales by Year
11 12
10 Month
£600,000
9 Month
£500,000
8 Month
Dry Cleaning
Month
£400,000
Laundry
Month
£300,000 Alteration Service
Month 7
Other
6
£200,000
£100,000 Month
3 Month
4 Month
5
£0
Month
Sales Monthly
£40,000
£36,000
£32,000
£28,000 Dry Cleaning
£24,000 Laundry
£20,000
Alteration Service
£16,000
Other
£12,000
£8,000
£4,000
£0
Page 13
Guildford Dry Cleaning Service
The owner of the business will be director and accountant working full time.
A laundry expert will be employed and will be in charge of the operation and the quality of
garment cleaning. Workers will report to the laundry expert who reports to the owner.
Through the consultation of British Cleaning Council, the term of reference of a laundry expert
and workers are prepared. Employment information will be advertised in the newspaper. The
laundry expert and two part-time workers who have experience in laundry work will be
employed.
The laundry expert will be in charge of the operation and the quality of garment cleaning.
Workers will be responsible for cleaning and classifying work and have the duty to report daily
work to the laundry expert. The expert has to report their working results and problems to the
director.
Two part-time drivers for picking up and delivering clothes work from 17.30 to 21.30, Monday
through Saturday.
The staff should be able to carry out working conditions and requirements:
From April to December 2004, the business has more customers and becomes busier, thus new
staff (a worker and a driver) are employed.
The business prefers to hire extra part-time workers and drivers sharing the total needed
working hours. In case one of them becomes sick or busy, other staff can replace them;
therefore, the working process will not be effected.
Page 14
Guildford Dry Cleaning Service
Table: Personnel
Personnel Plan
Year 1 Year 2 Year 3
Director/Accountant £46,080 £47,462 £48,886
Laundry expert £23,040 £23,731 £24,443
Worker-1 £10,080 £10,382 £10,693
Worker-2 £10,080 £10,382 £10,693
Worker-3 £8,064 £8,306 £8,555
Driver-1 £3,360 £3,461 £3,565
Driver-2 £3,360 £3,461 £3,565
Driver-3 £2,880 £2,966 £3,055
Other £0 £0 £0
Total People 8 8 8
The following topics describe the cash flow statement, profit and loss account, and balance
sheet have been built using forecasted information which is as accurate and realistic as
possible. These financial statements show that the business runs quite well and achieves
expected results.
Sales increase gradually over the 12 months showing the positive trend of sales. Guildford Dry
Cleaning is steadily gaining market share.
Return on capital employed: Pendlebury (2002) indicates this ratio is useful to measure the
efficiency which the long term capital has been employed. The business’ return on capital
employed (ROCE) increases over the 12 months showing the effect of using capital to grow
business, especially in the last months of the year.
General Assumptions
Year 1 Year 2 Year 3
Plan Month 1 2 3
Current Interest Rate 10.00% 10.00% 10.00%
Long-term Interest Rate 6.48% 6.48% 6.48%
Tax Rate 30.00% 30.00% 30.00%
Other 0 0 0
Page 15
Guildford Dry Cleaning Service
Break-even Analysis
£15,000
£12,000
£9,000
£6,000
£3,000
£0
(£3,000)
(£6,000)
(£9,000)
(£12,000)
Break-even Analysis
Assumptions:
Average Percent Variable Cost 11%
Estimated Monthly Fixed Cost £14,493
Page 16
Guildford Dry Cleaning Service
In general, the business might meet some difficulties in the beginning months but after that the
business grows as expected and produces a small profit at the end of the year. It is not
necessary for the business to gain high profit in the first year, breaking even is acceptable.
Here under are the estimated fixed costs and variable costs for the year 2006. These costs
have been divided into two periods:
Jan – Mar
Apr – Dec: One more van (£7,000) will be purchased and new staff recruited; therefore
interest, maintenance, petrol, salary and national insurance are increased
Page 17
Guildford Dry Cleaning Service
Profit Monthly
£12,000
£10,000
£8,000
£6,000
£4,000
£2,000
£0
Profit Yearly
£210,000
£180,000
£150,000
£120,000
£90,000
£60,000
£30,000
£0
Year 1 Year 2 Year 3
Page 18
Guildford Dry Cleaning Service
£30,000
£27,000
£24,000
£21,000
£18,000
£15,000
£12,000
£9,000
£6,000
£3,000
£0
Month 1 Month 3 Month 5 Month 7 Month 9 Month 11
Month 2 Month 4 Month 6 Month 8 Month 10 Month 12
£500,000
£450,000
£400,000
£350,000
£300,000
£250,000
£200,000
£150,000
£100,000
£50,000
£0
Year 1 Year 2 Year 3
Page 19
Guildford Dry Cleaning Service
Expenses
Payroll £106,944 £110,151 £113,455
Sales and Marketing and Other Expenses £2,250 £2,700 £3,000
Depreciation £4,236 £4,700 £4,700
Rent £7,200 £7,200 £7,200
Utilities £11,400 £12,000 £13,000
Inserted Row £0 £0 £0
Petrol £3,150 £3,500 £4,000
Equipment Lease £10,008 £12,000 £15,000
Maintenance £1,050 £1,200 £1,500
Office Cleaning £1,200 £1,500 £1,500
Insurance £6,840 £6,840 £6,840
Payroll Taxes (National Insurance, etc.) £16,042 £16,523 £17,018
Other £3,600 £4,000 £4,000
Page 20
Guildford Dry Cleaning Service
Cash flow increases gradually over the year creating the positive net present value. To exist
and develop in the competitive market are getting more and more difficult. Obtaining loyal
customers and recruiting new customers in term of long run business are extremely difficult
therefore the service aims to achieve low profit create and enhance the service’s image which
are the advantage competition in the market.
Page 21
Month
2
Guildford Dry Cleaning Service
MonthMonth
1
Chart: Cash
Cash
£120,000
£100,000
£80,000
Net Cash Flow
£60,000
Cash Balance
£40,000
£20,000
£0
Page 22
Guildford Dry Cleaning Service
The table below shows the balance sheet annual figures for the first three years of operation.
First year monthly figures are presented in the appendix.
Current Assets
Cash £113,092 £246,595 £456,273
Inventory £4,008 £5,021 £6,527
Other Current Assets £0 £0 £0
Total Current Assets £117,099 £251,616 £462,800
Long-term Assets
Long-term Assets £21,000 £21,000 £21,000
Accumulated Depreciation £4,236 £8,936 £13,636
Total Long-term Assets £16,764 £12,064 £7,364
Total Assets £133,863 £263,680 £470,164
Current Liabilities
Accounts Payable £14,180 £14,282 £18,467
Current Borrowing £0 £0 £0
Other Current Liabilities £0 £0 £0
Subtotal Current Liabilities £14,180 £14,282 £18,467
Business ratios for the years of this plan are shown below. Industry profile ratios for
commercial dry cleaning and laundry establishments are shown for comparison.
Page 23
Guildford Dry Cleaning Service
Table: Ratios
Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth n.a. 30.00% 30.00% 0.41%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 89.02% 89.02% 89.02% 100.00%
Selling, General & Administrative Expenses 55.72% 51.42% 46.64% 78.43%
Advertising Expenses 0.00% 0.00% 0.00% 1.78%
Profit Before Interest and Taxes 35.46% 45.83% 54.17% 3.01%
Main Ratios
Current 8.26 17.62 25.06 1.57
Quick 7.98 17.27 24.71 1.30
Total Debt to Total Assets 27.34% 12.10% 6.59% 57.48%
Pre-tax Return on Net Worth 116.85% 82.90% 67.47% 5.38%
Pre-tax Return on Assets 84.91% 72.87% 63.02% 12.65%
Activity Ratios
Inventory Turnover 12.00 10.27 10.43 n.a
Accounts Payable Turnover 9.69 12.17 12.17 n.a
Payment Days 27 30 27 n.a
Total Asset Turnover 2.43 1.60 1.17 n.a
Debt Ratios
Debt to Net Worth 0.38 0.14 0.07 n.a
Current Liab. to Liab. 0.39 0.45 0.60 n.a
Liquidity Ratios
Net Working Capital £102,920 £237,334 £444,333 n.a
Interest Coverage 78.38 149.12 304.46 n.a
Additional Ratios
Assets to Sales 0.41 0.62 0.86 n.a
Current Debt/Total Assets 11% 5% 4% n.a
Acid Test 7.98 17.27 24.71 n.a
Page 24
Guildford Dry Cleaning Service
Page 25
Appendix
Sales Forecast
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Sales
Dry Cleaning £4,176 £5,364 £6,156 £8,280 £9,216 £9,720 £10,728 £11,520 £12,456 £12,924 £13,212 £13,140
Laundry £6,612 £8,493 £9,747 £13,110 £14,592 £15,390 £16,986 £18,240 £19,722 £20,463 £20,919 £20,805
Alteration Service £812 £1,043 £1,197 £1,610 £1,792 £1,890 £2,086 £2,240 £2,422 £2,513 £2,569 £2,555
Other £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0
Total Sales £11,600 £14,900 £17,100 £23,000 £25,600 £27,000 £29,800 £32,000 £34,600 £35,900 £36,700 £36,500
Direct Cost of Sales Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Dry Cleaning £501 £644 £739 £994 £1,106 £1,166 £1,287 £1,382 £1,495 £1,551 £1,585 £1,577
Laundry £529 £679 £780 £1,049 £1,167 £1,231 £1,359 £1,459 £1,578 £1,637 £1,674 £1,664
Alteration Service £244 £313 £359 £483 £538 £567 £626 £672 £727 £754 £771 £767
Other £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0
Subtotal Direct Cost of Sales £1,274 £1,636 £1,878 £2,525 £2,811 £2,965 £3,272 £3,514 £3,799 £3,942 £4,030 £4,008
Page 1
Appendix
Table: Personnel
Personnel Plan
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Director/Accountant 0% £3,840 £3,840 £3,840 £3,840 £3,840 £3,840 £3,840 £3,840 £3,840 £3,840 £3,840 £3,840
Laundry expert 0% £1,920 £1,920 £1,920 £1,920 £1,920 £1,920 £1,920 £1,920 £1,920 £1,920 £1,920 £1,920
Worker-1 0% £672 £672 £672 £896 £896 £896 £896 £896 £896 £896 £896 £896
Worker-2 0% £672 £672 £672 £896 £896 £896 £896 £896 £896 £896 £896 £896
Worker-3 0% £0 £0 £0 £896 £896 £896 £896 £896 £896 £896 £896 £896
Driver-1 0% £160 £160 £160 £320 £320 £320 £320 £320 £320 £320 £320 £320
Driver-2 0% £160 £160 £160 £320 £320 £320 £320 £320 £320 £320 £320 £320
Driver-3 0% £0 £0 £0 £320 £320 £320 £320 £320 £320 £320 £320 £320
Other 0% £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0
Total People 6 6 6 8 8 8 8 8 8 8 8 8
Total Payroll £7,424 £7,424 £7,424 £9,408 £9,408 £9,408 £9,408 £9,408 £9,408 £9,408 £9,408 £9,408
Page 2
Appendix
General Assumptions
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Plan Month 1 2 3 4 5 6 7 8 9 10 11 12
Current Interest Rate 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00%
Long-term Interest Rate 6.48% 6.48% 6.48% 6.48% 6.48% 6.48% 6.48% 6.48% 6.48% 6.48% 6.48% 6.48%
Tax Rate 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00%
Other 0 0 0 0 0 0 0 0 0 0 0 0
Page 3
Appendix
Gross Margin £10,326 £13,264 £15,222 £20,475 £22,789 £24,035 £26,528 £28,486 £30,801 £31,958 £32,670 £32,492
Gross Margin % 89.02% 89.02% 89.02% 89.02% 89.02% 89.02% 89.02% 89.02% 89.02% 89.02% 89.02% 89.02%
Expenses
Payroll £7,424 £7,424 £7,424 £9,408 £9,408 £9,408 £9,408 £9,408 £9,408 £9,408 £9,408 £9,408
Sales and Marketing and Other
£150 £150 £150 £200 £200 £200 £200 £200 £200 £200 £200 £200
Expenses
Depreciation £275 £275 £275 £275 £392 £392 £392 £392 £392 £392 £392 £392
Rent £600 £600 £600 £600 £600 £600 £600 £600 £600 £600 £600 £600
Utilities £800 £800 £800 £1,000 £1,000 £1,000 £1,000 £1,000 £1,000 £1,000 £1,000 £1,000
Inserted Row £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0
Petrol £150 £150 £150 £300 £300 £300 £300 £300 £300 £300 £300 £300
Equipment Lease £834 £834 £834 £834 £834 £834 £834 £834 £834 £834 £834 £834
Maintenance £50 £50 £50 £100 £100 £100 £100 £100 £100 £100 £100 £100
Office Cleaning £100 £100 £100 £100 £100 £100 £100 £100 £100 £100 £100 £100
Insurance £570 £570 £570 £570 £570 £570 £570 £570 £570 £570 £570 £570
Payroll Taxes (National Insurance,
15% £1,114 £1,114 £1,114 £1,411 £1,411 £1,411 £1,411 £1,411 £1,411 £1,411 £1,411 £1,411
etc.)
Other £300 £300 £300 £300 £300 £300 £300 £300 £300 £300 £300 £300
Total Operating Expenses £12,367 £12,367 £12,367 £15,098 £15,215 £15,215 £15,215 £15,215 £15,215 £15,215 £15,215 £15,215
Profit Before Interest and Taxes (£2,040) £897 £2,856 £5,376 £7,574 £8,820 £11,313 £13,271 £15,586 £16,743 £17,455 £17,277
EBITDA (£1,765) £1,172 £3,131 £5,651 £7,966 £9,212 £11,705 £13,663 £15,978 £17,135 £17,847 £17,669
Interest Expense £104 £102 £101 £137 £135 £133 £131 £129 £127 £125 £123 £121
Taxes Incurred (£643) £239 £827 £1,572 £2,232 £2,606 £3,354 £3,943 £4,638 £4,985 £5,200 £5,147
Net Profit (£1,501) £557 £1,929 £3,668 £5,207 £6,081 £7,827 £9,199 £10,821 £11,633 £12,132 £12,009
Net Profit/Sales -12.94% 3.74% 11.28% 15.95% 20.34% 22.52% 26.27% 28.75% 31.27% 32.40% 33.06% 32.90%
Page 4
Appendix
Expenditures Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Net Cash Flow £3,694 £995 £2,366 £5,510 £5,511 £6,335 £8,711 £9,716 £11,544 £11,842 £12,298 £11,865
Cash Balance £26,400 £27,395 £29,761 £35,270 £40,782 £47,116 £55,827 £65,544 £77,087 £88,929 £101,227 £113,092
Page 5
Appendix
Current Assets
Cash £22,706 £26,400 £27,395 £29,761 £35,270 £40,782 £47,116 £55,827 £65,544 £77,087 £88,929 £101,227 £113,092
Inventory £500 £1,274 £1,636 £1,878 £2,525 £2,811 £2,965 £3,272 £3,514 £3,799 £3,942 £4,030 £4,008
Other Current Assets £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0
Total Current Assets £23,206 £27,674 £29,031 £31,638 £37,796 £43,593 £50,081 £59,099 £69,057 £80,886 £92,871 £105,257 £117,099
Long-term Assets
Long-term Assets £14,000 £14,000 £14,000 £14,000 £21,000 £21,000 £21,000 £21,000 £21,000 £21,000 £21,000 £21,000 £21,000
Accumulated Depreciation £0 £275 £550 £825 £1,100 £1,492 £1,884 £2,276 £2,668 £3,060 £3,452 £3,844 £4,236
Total Long-term Assets £14,000 £13,725 £13,450 £13,175 £19,900 £19,508 £19,116 £18,724 £18,332 £17,940 £17,548 £17,156 £16,764
Total Assets £37,206 £41,399 £42,481 £44,813 £57,696 £63,101 £69,197 £77,823 £87,389 £98,826 £110,419 £122,413 £133,863
Liabilities and Capital Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Current Liabilities
Accounts Payable £0 £5,970 £6,773 £7,457 £9,954 £10,516 £10,897 £12,064 £12,801 £13,789 £14,123 £14,360 £14,180
Current Borrowing £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0
Other Current Liabilities £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0
Subtotal Current Liabilities £0 £5,970 £6,773 £7,457 £9,954 £10,516 £10,897 £12,064 £12,801 £13,789 £14,123 £14,360 £14,180
Long-term Liabilities £19,500 £19,224 £18,946 £18,666 £25,384 £25,020 £24,654 £24,286 £23,916 £23,544 £23,170 £22,794 £22,416
Total Liabilities £19,500 £25,194 £25,719 £26,123 £35,338 £35,536 £35,551 £36,350 £36,717 £37,333 £37,293 £37,154 £36,596
Paid-in Capital £32,000 £32,000 £32,000 £32,000 £32,000 £32,000 £32,000 £32,000 £32,000 £32,000 £32,000 £32,000 £32,000
Retained Earnings (£14,294) (£14,294) (£14,294) (£14,294) (£14,294) (£14,294) (£14,294) (£14,294) (£14,294) (£14,294) (£14,294) (£14,294) (£14,294)
Earnings £0 (£1,501) (£944) £984 £4,652 £9,859 £15,940 £23,767 £32,966 £43,787 £55,420 £67,552 £79,562
Total Capital £17,706 £16,205 £16,762 £18,690 £22,358 £27,565 £33,646 £41,473 £50,672 £61,493 £73,126 £85,258 £97,268
Total Liabilities and Capital £37,206 £41,399 £42,481 £44,813 £57,696 £63,101 £69,197 £77,823 £87,389 £98,826 £110,419 £122,413 £133,863
Net Worth £17,706 £16,205 £16,762 £18,690 £22,358 £27,565 £33,646 £41,473 £50,672 £61,493 £73,126 £85,258 £97,268
Page 6
Appendix
Page 1