I Need Help With The Following Please 1 How Do I Come Up With A List Of At Least

I need help with the following please: 

1.   How do I come up with a list of at least 6

values for the Glass Boot Pizza Company. (Explain what the values mean and why they are important for this company).

2.  How do I develop a vision and mission statement for the Glass Boot Pizza Company. (Explain how your statements will be used by the company).

3.  How do I develop and identify items for a SWOT analysis for the Glass Boot Pizza Company.

4.  What leader style is recommended for the owner of Glass Boot Pizza Company, including what impact that style will have, why its recommend it over other leader styles.

5.  What recommendations to the owners of the Glass Boot Pizza Company relating to implementation of ethical values. 

6.   Help the owners of the Glass Boot Pizza Company develop at least 2 new products or services.

7.   How and why can the owner of the Glass Boot Pizza Company be a transformational leader. 

Glass Boot Pizza Company – Business Plan

1.0 Executive Summary

The Glass Boot Pizza Company is a new enterprise in the restaurant industry. The Glass Boot is in a stable and familiar collegiate town that has a strong need for entertaining and responsive dining options. Bolstered by the need for more choices in entertainment-oriented dining experiences, combined with the option for home-delivery, the Glass Boot is positioned to take advantage of the market need and serve the University of Kansas students, families, and selected clubs and organizations in the Lawrence area.

Lawrence’s population is rapidly growing with new subdivisions and young families moving to the rural suburb of the Hewgton area just east of town. It is Glass Boot Pizza Company’s strategy to exploit the first-mover opportunity and establish itself as the preferred pizza provider to the area. We believe a locally-owned restaurant is the best option to serve the rapidly growing population with a fresh, unique menu as opposed to a national chain franchise.

This business plan calls for an exciting, profitable start-up year ahead with future forecasted growth as we meet the demands of the community. In all, this plan describes a healthy company with good growth prospects, looking to manage its orderly growth in the near future.

1.1        Mission

The Glass Boot Pizza Company offers the best mix of dining entertainment, quality food, and customer service for university students, families, and local clubs and organizations in the greater Lawrence, KS area. The intent for our restaurant is to provide a safe, fun, and accommodating place wherein customers and business partners want to participate in collective social interaction. The intent for our delivery service is to provide fast and dependable home and office food deliveries.

1.2 Keys to Success

Our customers are our neighbors as we are residents of our market area. We fashion and nurture a healthy, creative, respectful, and fun working environment, in which our business partners are fairly compensated and encouraged to respect the customer and the quality of the product we produce. Our vested employees are our business partners. We seek fair and responsible profit, enough to keep the company financially healthy for the long term and to fairly compensate owner, investors, and business partners for their investment, risk, and hard work.

The keys to success in this business are:

•            Delivering the customer value proposition

o            Fun environment

o            Responsive to local interests

o            Safe and clean

o            Great food value

o            Fast delivery service

•            Valuing employees as business partners 

•            Target marketing to local clubs and organizations

•            Product quality and consistency

•            Providing entertainment opportunities that have meaning in the community

•            College-oriented atmosphere that highlights the local university as well as local clubs and organizations

•            Management: fast delivery service; responsiveness to community trends; control costs; customer orientation

•            Eye on the profit line

•            Reporting and controls in place for inventory and financials

1.2        Goals and Objectives

Glass Boot Pizza Company goals and objectives are separated into short term and long term interests. Short term interests are those that will be accomplished within 12 months and long term interests will be accomplished within 36-60 months. At times these goals and objectives will carry over from short to long term.

Short term goals and objectives are:

Goal 1: Visualize and adopt a business plan – September 30, 2017

              Objective 1: Complete business plan – March 1, 2017

Objective 2: Business plan adopted by investors – September 30, 2017

Goal 2: Acquire $200,000 in funding – October 31, 2017

              Objective 1: Complete funding plan that is adopted by investors by March 30, 2017

              Objective 2: Account for investor funding by April 15, 2017

              Objective 3: Acquire bank or another investor funding for that portion or the

                         $200,000 not covered by initial investors by September 1, 2017

Goal 3: Acquire business location – August 1, 2017

              Objective 1: Describe details of business location requirements including selection

                          and evaluation criteria – February 1, 2012

              Objective 2: Identify at least two possible locations and describe them in terms of the

                         selection and evaluation criteria – March 1, 2012

              Objective 3: Select a business location – April 1, 2012

              Objective 4: Lease or purchase property – July 1, 2012

Goal 4: Hire business partners – September 30, 2012

              Objective 1: Describe corporate positions in terms of competencies, skills,

                          knowledge, and attributes – March 1, 2012

              Objective 2: Describe compensation standards – March 1, 2012

              Objective 3: Interview and hire key management positions – September 30, 2012

              Objective 4: Interview and hire other business partners – August 15, 2012

              Objective 5: Train business partners – August 15-30, 2012

Goal 5: Formulate and execute initial marketing plan

              Objective 1: Devise initial marketing plan that targets all local high schools, the

                         University of Kansas housing folks, and at least five other local clubs or

                         organizations – March 30, 2017

              Objective 2: Plan opening day activities and get these activities adopted by the

                          investors – March 30, 2017

              Objective 3: Make positive contact and tacit agreements with targeted clubs and

                         organizations – April 30, 2017

              Objective 4: Execute initial marketing plan – November 30, 2017

Goal 6: Acquire business fixtures and tools – October 15, 2017

              Objective 1: List business fixtures and equipment required and price them out as part of

                          This business plan

              Objective 2: Acquire all business fixtures and equipment by opening day

Goal 7: To establish the market presence needed to support sales objectives and to attract customers sufficient to make the Company show a net profit by each year

     Objective 1: After initial purchases for fixtures and equipment, pay cash for all other   

                           purchases

              Objective 2: Produce sales in each category in accordance with the matrix in Appendix B

              Objective 3: Eliminate sales categories that are not profitable by the end of the first year.

Long term goals and objectives are:

Goal 1: Visualize and adopt a business plan – September 30, 2017

              Objective 1: Complete business plan – March 1, 2017

Objective 2: Business plan adopted by investors – September 30, 2017

Goal 2: To establish the market presence needed to support sales objectives and to attract customers sufficient to make the Company show a net profit by each year

     Objective 1: Pay cash for all purchases

              Objective 2: Produce sales in each category in accordance with the matrix in Appendix B

              Objective 3: Eliminate sales categories that are not profitable at the end of each year

              Objective 4: Show a 10% net profit by the end of year three

Goal 3: Open at least one new location by the end of year five

              Objective 1: Complete expansion plan – March 1, 2019

Objective 2: Expansion plan adopted by investors – September 30, 2019

Objective 3: Open new location

2.0 Company Summary

The Glass Boot Pizza Company is a privately-owned pizza company offering a product menu that does not currently exist in the area and the first to offer home or office delivery with very short (10-15 minutes) delivery time. Our customers are many of the young families and students in the area, but because of our entertainment offerings and location, we will over time also attract some tourist type customer base.

2.1 Company Ownership

The Glass Boot Pizza Company will be established as a limited liability company (LLC) with Gimme Pizza as the sole owner.

2.2 Start-up Summary

The Glass Boot Pizza Company start-up costs cover the renovation of the occupied restaurant location (currently a warehouse space), professional fees, and expenses associated with opening our first location. The start-up costs are to be financed by direct owner investment, financial institutions, and private investors. Of the $200,000 estimated start-up costs, $100,000 will be invested by the owner, $50,000 from private investors, and $50,000 from financial institutions. The assumptions are shown in the following table and illustration.

Start-up

Requirements    

Start-up Expenses           

Professional Fees (Legal, Accounting, Consulting)              $1,800

Placemats, Stationery, Business Cards                                $1,100

Renovation                                                                                   $8,300

Marketing                                                                                     $2,500

Rent                                                                                                $2,000

Expensed Equipment                                                                  $5,000

Insurance                                                                                        $350

Website Development                                                               $1,000

Misc Expense                                                                               $3,800

Total Start-up Expenses                                                           $25,850

Start-up Assets 

Cash Required                                                                              $23,100

Start-up Inventory                                                                      $6,000

Other Current Assets                                                                 $5,250

Long-term Assets                                                                        $20,300

Total Assets                                                                                  $54,650

Total Requirements                                                                    $80,500

Start-up Funding              

Start-up Expenses to Fund                                                      $25,850

Start-up Assets to Fund                                                           $54,650

Total Funding Required                                                          $80,500

Assets   

Non-cash Assets from Start-up                                             $31,550

Cash Requirements from Start-up                                        $23,100

Additional Cash Raised                                                           $0

Cash Balance on Starting Date                                               $23,100

Total Assets                                                                                 $54,650

Liabilities and Capital     

Liabilities            

Current Borrowing                                                                     $0

Long-term Liabilities                                                                  $25,000

Accounts Payable (Outstanding Bills)                                   $9,500

Other Current Liabilities (interest-free)                                $0

Total Liabilities                                                                            $34,500

Capital 

Planned Investment       

Investor 1                                                                                     $15,000

Owners $30,000

Additional Investment Requirement                                     $1,000

Total Planned Investment                                                        $46,000

Loss at Start-up (Start-up Expenses)                                     ($25,850)

Total Capital                                                                                $20,150

Total Capital and Liabilities                                                      $54,650

Total Funding                                                                              $80,500

Services

Glass Boot Pizza Company offers high quality pizza to a growing community that currently has limited availability of restaurants and no availability to delivery. At start up we will be open for dinner 4 p.m. to 10 p.m. Sunday – Thursday and 3 p.m. to 11 p.m. Friday and Saturday. We will consider opening earlier and serving lunch if there is a demand, and if forecast and financial analysis can justify the increased costs.

Our menu will include 4 sizes of pizzas with various combinations of toppings. Predefined, high-margin pizzas will be highlighted on the menu. Additionally, breadsticks, beer, and soda will be included in the initial menu offerings.

Market Analysis Summary

Our primary target market is people who desire a comfortable, family-oriented environment for dine-in pizza. Our secondary target market also desires a delivery service for pizza, or a take-out approach. There is overlap of these segments.

Lawrence and its surrounding communities are a growing middle-class area with nearly 14,000 residents. A majority of these residents are families of four or more. The boom in the area is primarily in response to an exodus of families moving out of the over-populated areas and into a more rural setting. 

According to a Growth Plan Lawrence conducted in 2001, population within Lawrence is expected to increase. However, the number of persons per household is expected to decline, meaning the need for additional housing in Lawrence will continue to grow. From the same plan, population is listed as being evenly distributed by age groupings, with approximately 33% of the population being minors. Another 40% are less than 54 years of age, indicating a major concentration of the Lawrence population being families. The report forecasts there being nearly 1,900 households in the Lawrence by 2005. This is driving the need for more quality, family-oriented restaurants.

Additionally, Lawrence residents frequently visit the building in which Glass Boot Pizza Company is located. Tanning and video rental businesses are adjacent to the restaurant, so we are providing a new convenience for families to select a movie and pick up a pizza.

With the expected continued growth in the area, estimated at 7% annually, opportunities to serve Lawrence and its surrounding communities will increase. The company will sell predominantly to individuals, but it will also accept some catering jobs to individual parties, schools, and company functions in the Lawrence area.

4.1 Market Segmentation

Those residents of neighboring communities of Lawrence, including Doughbuoy, d’Ohtown, and Doe Valley are included in the Market Segmentation. Only those residents of Lawrence are included in the delivery, as delivery radius is limited to a 5-mile radius in the city of Lawrence. An estimated 53% of Lawrence residents live within the Sanitary District, or within this 5-mile radius.

Market Analysis                                                                                          

                                                          Year 1   Year 2   Year 3   Year 4   Year 5   

Potential Customers       Growth                                                                           CAGR

Dine-In or Take-Out       7%         13,860  14,830  15,868  16,979  18,168  7.00%

Delivery                            7%         5,000    5,350    5,725    6,126    6,555    7.00%

Total                                  7.00%   18,860  20,180  21,593  23,105  24,723  7.00%

4.2 Target Market Segment Strategy

Including Lawrence and its surrounding areas, no pizza establishments exist. In Lawrence one to two restaurants serve pizza, but not as a primary menu item. These pizza outlets are in taverns which are not conducive to family-oriented atmosphere. No eating establishments in the Lawrence area provide home-delivery service.

4.3 Service Business Analysis

Other family-oriented restaurants in the area include: Subway(R), What’s Cookin’ diner, and Colonial House supper club. Subway serves sandwiches, wraps, and salads, none of which are direct competition to the pizza establishment. The diner is open until 2 p.m. each day and focuses on the breakfast crowd, with a limited sandwich availability for lunch. The supper club has a Chicken and Pizza buffet once a week for approximately $6; the pizza served as part of the buffet are frozen pizzas. Other restaurants in Lawrence are taverns and are not conducive to family activities. One of the bars in Lawrence serves a homemade pizza.

In conversations with an independent pizza operator in Lakeshore Haven, an hour’s drive away, he indicated pizza sales in his community are thriving despite competition from 4 other pizza establishments, including Pizza Hut(R). While exact figures were not shared, he indicated a high level of penetration into the pizza market in his area with profitable margins.  He also provided suggestions and tips to minimize costs, and components of his restaurant he would do differently, including payroll handling, vendors, and layout. 

4.3.1 Competition and Buying Patterns

There is minimal competition for pizza in the Lawrence area, besides the bar establishments previously mentioned. The closest locales for pizza to the Lawrence area are Bolingbrooke, Avro, and de Havilland. None of these competing pizza locations deliver to the Lawrence area. Additionally, Glass Boot Pizza Company would be the only family-oriented, non-smoking restaurant in Lawrence.

Strategy and Implementation Summary

Our strategy is based on delivering a strong customer value proposition in a niche market. The world is full of small, family-oriented towns that do not have endless opportunities for dining out. We are looking to offer the Lawrence and its surrounding areas a new choice in food options.

Also:

•            What begins as a need to satisfy a need in the community, can eventually turn into a mainstay in the small-town community. 

•            We are building our marketing infrastructure so that we can eventually reach additional towns with the same offering. 

•            We focus on satisfying the needs of small towns.

5.1 Competitive Edge

Our competitive edge is to be first-to-the-market with pizza in a friendly, non-smoking, family-oriented dine-in experience, and first-to-the-area with food delivery.

Additionally, the location of Glass Boot Pizza Company is crucial as a convenience model to customers. Lawrence residents frequent the video rental store adjacent to the restaurant. This location is directly in the center of activity in this rural community–it is within walking distance of the middle and high schools, the local church, and within 2 miles of the existing large subdivisions and apartment complexes in the area.

5.2 Marketing Strategy

To drive customers to Glass Boot Pizza Company, we will employ several techniques outlined below.

Advertising in Bolingbrooke Post, de Havilland Buyer’s Guide, Lawrence Register, and Lawrence Shopping News will be used to promote the Grand Opening of Glass Boot Pizza Company. As part of the advertising, a coupon will be available to customers. Intermittent newspaper advertisements will continue throughout the year to promote upcoming events. Most initiatives will focus on the local Lawrence papers as the target of these papers is specifically the Lawrence residents. Additional marketing efforts will come in the form of on-box coupons for future purchases.

Additionally, family-oriented events will be hosted by Glass Boot Pizza Company to attract customers such as trivia nights, birthday parties, and prize giveaways. Frequent buyer cards will be employed to entice repeat customers. Glass Boot Pizza Company will also sponsor a local Little League baseball team, and a bowling team to publicize the restaurant within the community events.

Future plans of working in coordination with the adjacent video store to offer “bundle savings” if both pizza and video rentals are purchased will be pursued within the second year of operation.

5.3 Sales Strategy

The Lawrence area has expressed its need for additional restaurants, specifically a desire for pizza. Because of this, there is pent-up demand for pizza in this area. We will expect a high rate of sales growth within the first 3 months as this customer desire is met.

For the next year, we continue to focus on a growing presence in the community and advertising heavily throughout the community. As a major convention center and water park open in nearby Fairchild, we will focus our attention on becoming the recognized provider of pizza to that establishment.

5.3.1 Sales Forecast

Our sales forecast assumes a modest change in annual costs to accommodate new entry into the market. 

We are expecting to increase sales modestly but steadily over the next year, which is a respectable growth rate. The growth forecast is assumed given this is a new product for the area using new channels of availability. We are not projecting significant change in the product line, or in the proportion between different lines. 

Based on industry averages and the absence of competition for pizza in the Lawrence area, we are predicting an average of 25 pizzas sold each week night (Sunday – Wednesday). On the weekends (Thursday – Saturday), we are estimating 40 pizzas are sold each day. Of those pizzas ordered, we are expecting approximately 1/3 to be dine-in customers. Those customers dining in will most likely order drinks and/or beer (on average 4 for each family). Additionally, we are estimating that approximately one-third of the pizza orders will be accompanied by an order for breadsticks. Our estimated average prices for each item are as follows:

•            Pizza: $12

•            Breadsticks: $2.50

•            Beer: $2.50/pint

•            Drinks: $1.70 refillable

Sales Forecast

                                                        Year 1                 Year 2                 Year 3

Sales                                   

Pizza                                               $133,900            $143,808            $153,875

Breadsticks                                    $18,667              $19,973              $21,371

Beer                                                $37,333              $39,947              $42,743

Drinks                                             $50,773              $54,327              $58,130

Total Sales                                     $240,673            $258,055            $276,120

Direct Cost of Sales                      Year 1                 Year 2                 Year 3

Pizza                                                $42,848              $44,990              $47,240

Breadsticks                                    $3,733               $3,920               $4,116

Beer                                                 $7,467               $7,840               $8,232

Drinks                                             $2,539               $2,666               $2,799

Subtotal Direct Cost of Sales       $56,587              $59,416              $62,387

5.4 Milestones

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

Milestones

Milestone                         Start Date          End Date            Budget Manager             Department

Business Plan                  1/8/2016            1/31/2016          $0         Jim                      Management

Secure Start-up Funding 2/1/2016            3/1/2016            $0         Jim                      Management

Site Selection                  1/8/2016            2/1/2016            $0                                      Operations

Architect Designs/Redesign2/15/2016      3/1/2016            $500                                  Operations

Technology Design         3/15/2016          4/1/2016            $5,000                              Technical

Personnel Plan                3/1/2016            3/15/2016          $0                                      Management

Accounting Plan                            3/1/2016            3/31/2016          $400                                  Management

Renovation                      4/1/2017            5/15/2017          $7,800                              Operations

Equipment Installation  5/1/2017            5/15/2017          $2,000                              Operations

Marketing Plans              3/4/2015            4/30/2015          $2,500                              Marketing

Grand Opening               5/1/2017            5/15/2017          $2,500                              Marketing

Totals                                                                                            $20,700                             

Web Plan Summary

The Glass Boot Pizza Company website will be the virtual business card and portfolio for the company, as well as its online “home.” It will showcase the history, product information, and offers for Glass Boot Pizza Company. Special online-only offers will be made available on the website, along with customer’s opportunity to sign-up for email news and offers. 

The Glass Boot Pizza Company website needs to be a simple yet classy and well-designed website that, at the same time, is in keeping with the latest trends in user interface design. Customers will be coming to the site for product information, history, and offers. 

Future elements of the site can contain online ordering, if customers express an interest in this functionality.

6.1 Website Marketing Strategy

Our Internet marketing activities will be focused on product information and offers. Future opportunities exist in offering online ordering. We need to develop a comprehensive coupon program.

6.2 Development Requirements

The Glass Boot Pizza Company website will be initially developed with few technical resources. A simple hosting provider, Yahoo! Web services, will host the site and provide the technical back end. The owner’s expertise in professional Web development will lead this effort. 

The user interface designer will work with a graphic artist to come up with the website logo, and the website graphics.  

The maintenance of the site will be done by the owners. If the website rolls out future development such as newsletters and online ordering, the internal staff at Glass Boot Pizza Company will design, implement, and execute the technology.

Management Summary

We are a small company owned and operated by a husband and wife team, as a partnership. Management style reflects the participation of the owners. The company respects its community of co-workers and treats all workers well. 

The wife is a 1998 graduate of University School of Business with High Honors and Distinction in Business. Her experience with general business, technology, and operations is a great asset to this venture. 

Additionally, Otho Colderobby is an advisor to the owners. Otho is a 1991 graduate of State College with a degree in Economics. Furthermore, Otho graduated in 1995 with a Masters in Business Administration from University School of Business with emphases in Marketing and Finance. Otho held a senior finance management position with Frito Lay for 5 years. Otho is currently a managing consultant with a marketing strategy firm. He also spent 5 years in a strategic services consulting practice.

7.1 Personnel Plan

The personnel table assumes a level need of employees, and 5% per annum pay raises. Staffing for a 7-day a week restaurant necessitates two shifts. In addition to the hours open for serving we anticipate an additional hour before opening for prep and as much as an hour after closing for cleanup. This is approximately 8 hours of staffing necessary Sunday – Thursday and 10 hours on both Friday and Saturday.

The two kitchen lead positions are part-time, earning $9/hr. The kitchen leads will serve as the shift leaders of the kitchen/wait staff. Kitchen staff will serve as the wait staff. There will be one dedicated dishwashing position per shift. Wages for kitchen/wait staff, dishwashers, and delivery drivers, who are all part-time, are $6/hr, with opportunities for all to share the combined earn tips. It is imperative the people serving as the kitchen lead are over 21 and can legally serve alcohol.

Hourly part-time positions as kitchen/wait, dishwashing, and delivery staff average out to be approximately 30 hours per week each. Delivery staff will work 5 hour shifts each night, with an extra delivery staff member added on Thursdays, Fridays, and Saturdays. During the week if this person is not delivering, they will work in the kitchen as needed, directed by the kitchen lead.

Personnel Plan

                            Year 1                 Year 2                 Year 3

Kitchen Leads    $28,080              $29,484              $30,958

Kitchen/Wait     $37,440              $39,312              $41,278

Dishwasher        $15,600              $16,380              $17,199

Owner                $9,000               $9,450               $9,923

Delivery              $15,600              $16,380              $17,199

Total People      12                        12                       12

Total Payroll      $105,720            $111,006            $116,556

Financial Plan

The financial picture is quite encouraging. We will be slow to take on debt and heavily investing our own assets, but with our increase in sales we do expect to apply for a credit line with the bank, to a limit of $50,000. The credit line is supported by assets.

8.1 Important Assumptions

The financial plan depends on important assumptions, most of which are shown in the following table. The key underlying assumptions are:

•            We assume a fairly high-growth economy for pizza in the Lawrence area, given the lack of competition and interest in having a pizza restaurant available in the area and pent-up demand. 

•            We assume, of course, that there are no unforeseen changes in technology to make our products immediately obsolete. 

•            We assume access to equity capital and financing sufficient to maintain our financial plan as shown in the tables.

General Assumptions

                                           Year 1   Year 2   Year 3

Plan Month                      1            2            3

Current Interest Rate     6.00%   6.00%   6.00%

Long-term Interest Rate 5.00%   5.00%   5.00%

Tax Rate                           30.00% 30.00% 30.00%

Other                                 0            0            0

8.2 Break-even Analysis

Our break-even analysis is based on running costs, the “burn-rate” costs we incur to keep the business running, not on theoretical fixed costs that would be relevant only if we were closing. The essential insight here is that our sales level seems to be running comfortably above break-even. 

Break-even Analysis

Monthly Revenue Break-even    $16,283

Assumptions:     

Average Percent Variable Cost   24%

Estimated Monthly Fixed Cost   $12,454

8.3 Projected Profit and Loss

We expect to be profitable in the first year, with profits increasing over the next two years, as we establish a loyal customer base.

Pro Forma Profit and Loss

              Year 1   Year 2   Year 3

Sales     $240,673            $258,055            $276,120

Direct Cost of Sales        $56,587              $59,416              $62,387

Other Costs of Goods     $0         $0         $0

Total Cost of Sales          $56,587              $59,416              $62,387

Gross Margin     $184,087            $198,639            $213,733

Gross Margin % 76.49% 76.98% 77.41%

Expenses                                          

Payroll  $105,720            $111,006            $116,556

Sales and Marketing and Other Expenses              $7,250 $7,250 $7,500

Depreciation      $2,040 $1,836 $1,652

Rent      $14,400              $14,400              $14,400

Utilities $7,200 $7,200 $7,200

Insurance           $4,200 $4,500 $4,800

Payroll Taxes     $8,042 $8,444 $8,866

Website Hosting and Maintenance          $600     $50       $50

Other    $0         $0         $0

Total Operating Expenses            $149,452            $154,686            $161,024

Profit Before Interest and Taxes $34,635              $43,954              $52,709

EBITDA $36,675              $45,790              $54,361

Interest Expense             $1,088 $700     $225

Taxes Incurred  $10,064              $12,976              $15,745

Net Profit           $23,483              $30,278              $36,739

Net Profit/Sales 9.76%   11.73% 13.31%

8.4 Projected Cash Flow

Pro Forma Cash Flow

              Year 1   Year 2   Year 3

Cash Received                                 

Cash from Operations                                  

Cash Sales          $240,673            $258,055            $276,120

Subtotal Cash from Operations  $240,673            $258,055            $276,120

Additional Cash Received                                          

Sales Tax, VAT, HST/GST Received            $0         $0         $0

New Current Borrowing $0         $0         $0

New Other Liabilities (interest-free)         $0         $0         $0

New Long-term Liabilities            $0         $0         $0

Sales of Other Current Assets     $0         $0         $0

Sales of Long-term Assets            $0         $0         $0

New Investment Received           $0         $0         $0

Subtotal Cash Received $240,673            $258,055            $276,120

Expenditures      Year 1   Year 2   Year 3

Expenditures from Operations                                 

Cash Spending   $105,720            $111,006            $116,556

Bill Payments     $105,383            $114,835            $120,750

Subtotal Spent on Operations    $211,103            $225,841            $237,306

Additional Cash Spent                                  

Sales Tax, VAT, HST/GST Paid Out            $0         $0         $0

Principal Repayment of Current Borrowing          $0         $0         $0

Other Liabilities Principal Repayment      $0         $0         $0

Long-term Liabilities Principal Repayment            $6,000 $10,000              $9,000

Purchase Other Current Assets  $0         $0         $0

Purchase Long-term Assets         $0         $0         $0

Dividends            $0         $0         $0

Subtotal Cash Spent       $217,103            $235,841            $246,306

Net Cash Flow   $23,570              $22,214              $29,813

Cash Balance     $46,670              $68,884              $98,698

8.5 Projected Balance Sheet

As shown in the balance sheet in the following table, we expect a healthy growth in net worth. The monthly projections are in the appendices. 

Pro Forma Balance Sheet

              Year 1   Year 2   Year 3

Assets                                 

Current Assets                                

Cash     $46,670              $68,884              $98,698

Inventory            $1,720 $1,806 $1,896

Other Current Assets     $5,250 $5,250 $5,250

Total Current Assets       $53,640              $75,940              $105,844

Long-term Assets                                          

Long-term Assets            $20,300              $20,300              $20,300

Accumulated Depreciation          $2,040 $3,876 $5,528

Total Long-term Assets  $18,260              $16,424              $14,772

Total Assets       $71,900              $92,364              $120,616

Liabilities and Capital     Year 1   Year 2   Year 3

Current Liabilities                                          

Accounts Payable            $9,267 $9,454 $9,967

Current Borrowing          $0         $0         $0

Other Current Liabilities $0         $0         $0

Subtotal Current Liabilities          $9,267 $9,454 $9,967

Long-term Liabilities       $19,000              $9,000 $0

Total Liabilities  $28,267              $18,454              $9,967

Paid-in Capital  $46,000              $46,000              $46,000

Retained Earnings           ($25,850)            ($2,367)              $27,911

Earnings              $23,483              $30,278              $36,739

Total Capital      $43,633              $73,911              $110,649

Total Liabilities and Capital         $71,900              $92,364              $120,616

Net Worth          $43,633              $73,911              $110,649

8.6 Business Ratios

Standard business ratios are included in the following table. Industry profile ratios are shown for comparison, and are based on Standard Industrial Classification (SIC) code 5812.0600, Pizza Restaurants. The ratios show a plan for balanced, healthy growth. Our return on sales and return on assets remain strong in percentage terms. 

Ratio Analysis

                                                          Year 1                 Year 2                 Year 3                 Industry Profile

Sales Growth                                  0.00%                 7.22%                 7.00%                 5.24%

Percent of Total Assets                                               

Inventory                                         2.39%                 1.96%                 1.57%                 3.54%

Other Current Assets                   7.30%                 5.68%                 4.35%                 34.82%

Total Current Assets                     74.60%               82.22%               87.75%               43.85%

Long-term Assets                          25.40%               17.78%               12.25%               56.15%

Total Assets                                    100.00%             100.00%             100.00%             100.00%

Current Liabilities                          12.89%               10.24%               8.26%                 20.80%

Long-term Liabilities                     26.43%               9.74%                 0.00%                 28.42%

Total Liabilities                               39.31%               19.98%               8.26%                 49.22%

Net Worth                                       60.69%               80.02%               91.74%               50.78%

Percent of Sales                                             

Sales                                                 100.00%             100.00%             100.00%             100.00%

Gross Margin                                  76.49%               76.98%               77.41%               61.18%

Selling, Gen & Admin Expenses  39.83%               39.27%               38.77%               38.56%

Advertising Expenses                   0.00%                 0.00%                 0.00%                 2.28%

Profit Before Interest and Taxes 14.39%               17.03%               19.09%               1.44%

Main Ratios                                                    

Current                                             5.79                    8.03                    10.62                  0.99

Quick                                                5.60                    7.84                    10.43                  0.67

Total Debt to Total Assets            39.31%               19.98%               8.26%                 52.80%

Pre-tax Return on Net Worth     76.88%               58.52%               47.43%               2.77%

Pre-tax Return on Assets              46.66%               46.83%               43.51%               5.88%

Additional Ratios            Year 1   Year 2   Year 3   

Net Profit Margin            9.76%   11.73% 13.31% n.a

Return on Equity             53.82% 40.97% 33.20% n.a

Activity Ratios                                                

Inventory Turnover         31.29    33.70    33.70    n.a

Accounts Payable Turnover         11.35    12.17    12.17    n.a

Payment Days   30         30         29         n.a

Total Asset Turnover      3.35      2.79      2.29      n.a

Debt Ratios                                                     

Debt to Net Worth         0.65      0.25      0.09      n.a

Current Liab. to Liab.     0.33      0.51      1.00      n.a

Liquidity Ratios                                              

Net Working Capital       $44,373              $66,487              $95,877              n.a

Interest Coverage           31.85    62.79    234.26 n.a

Additional Ratios                                                         

Assets to Sales  0.30      0.36      0.44      n.a

Current Debt/Total Assets           13%      10%      8%        n.a

Acid Test            5.60      7.84      10.43    n.a

Sales/Net Worth             5.52      3.49      2.50      n.a

Dividend Payout              0.00      0.00 

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