Kitsch Internet Cafe Business Plan

KITSCH INTERNET CAFE add-in of Contents 1. Executive stocky5 1. 1 Objectives6 1. 2 Keys to Success6 1. 3 Mission6 1. 4 Risks7 2. Company Description7 2. 1 Company Ownership7 2. 2 Start-up Summary8 2. 3 Company Locations and Facilities10 3. Description of piss11 3. 1 Competitive Comparison11 3. 2 divine service Description11 3. 3 Fulfillment12 3. 4 Technology12 3. 5 Future Services12 4. commercialise abbreviation13 4. 1 Target securities industry Segment Strategy13 4. 1. 1 Market Tr stamp outs13 4. 1. 2 Market Needs13 4. 2 Market partition14 4. Service Business Analysis15 4. 3. 1 Competition and Buying Patterns16 4. 3. 2 Business take officipants16 4. 3. 3 Distributing a Service17 5. Marketing Strategy18 5. 1 Strategy Pyramid18 5. 1. 1 Attract Power cyberspace Users18 5. 1. 2 neighborly Hub18 5. 1. 3 Attract Novice net in get Users19 5. 2 SWOT Analysis19 5. 2. 1 Weaknesses20 5. 2. 2 Opportunities20 5. 2. 3 Threats20 5. 2. 4 Strengths21 5. 3 Competitive Edge21 5. 4 Marketin g Strategy21 5. 4. 1 Pricing Strategy22 5. 4. 2 advance Strategy22 5. 5 sales Strategy23 5. 5. 1 gross sales Forecast23 . 6 Milestones26 6. Operating formulate27 6. 1 Personnel Plan27 7. Financial Plan29 7. 1 Start-up bloodlineing29 7. 2 in-chief(postnominal) Assumptions31 7. 3 Key Financial Indicators32 7. 4 Break-even Analysis32 7. 5 Projected Profit and Loss33 7. 6 Projected funds Flow37 7. 7 Projected equilibrium Sheet40 7. 8 Business Ratios42 8. Appendix46 Kitsch earnings coffee shop Executive Summary Kitsch, unalike a typical coffeehouse, entrust give up a unique forum for communication and entertainment with the medium of the earnings. Kitsch is the answer to an increasing demand.The public wants (1) rile to the methods of communication and volumes of information now available on the Internet, and (2) access at a terms they can afford and in such a look that they arnt tenderly, economically, or politically isolated. Kitschs goal is to provide the community with a social, educational, entertaining, atmosphere for worldwide communication. handsome(prenominal)lights pic 1. 1 Objectives Kitschs objectives for the graduation exercise three years of operation include The creation of a unique, upscale, innovative milieu that leave alone differentiate Kitsch from topical anesthetic hot chocolate houses. Educating the community on what the Internet has to offer. The formation of an environment that go forth bring people with diverse interests and backgrounds together in a common forum. Good coffee and bakery items at a reasonable price. Affordable access to the resources of the Internet and other(a) online improvements. 1. 2 Keys to Success The keys to the victor for Kitsch argon The creation of a unique, innovative, upscale atmosphere that go forth differentiate Kitsch from other local coffee shops and future Internet cafes. The establishment of Kitsch as a community hub for socialization and entertainment. The creation of an environment that wont restrain the novice user. Kitsch will position itself as an educational resource for individuals wishing to learn about the benefits the Internet has to offer. Great coffee and bakery items. 1. 3 Mission As the popularity of the Internet continues to grow at an exponential function rate, easy and affordable accessis quickly becoming a necessity of life. Kitsch provides communities with the ability to access the Internet, extol a cup of coffee, and shargon Internet experiences in a comfor confuse environment. mass of all ages and backgrounds will come to enjoy the unique, upscale, educational, and innovative environment that Kitsch provides. 1. 4 Risks The risks involved with starting Kitsch were Will there be a demand for the services offered by Kitsch in capital of Cyprus? Will the popularity of the Internet continue to grow, or is the Internet a fad? Will individuals be willing to pay for the service Kitsch offers? Will the cost of accessing the Inte rnet from home drop so significantly that there will non be a market for Internet Cafes such as Kitsch? Company DescriptionKitsch, is located at the area of Agioi Omologites at 15 Chiou Street, offering the community easy and affordable access to the Internet. Kitsch is providing full access to netmail, WWW, FTP, Usenet and other Internet applications such as Telnet and Gopher. Kitsch will in like manner provide customers with a unique and innovative environment for enjoying gigantic coffee, specialty beverages, and bakery items. Kitsch is collectioning to individuals of all ages and backgrounds. The instructional Internet classes, and the helpful staff that Kitsch provides, will appeal to the audience that does not associate themselves with the computing machine age.This educational aspect attracts younger and elderly members of the community who are rapidly gaining interest in the unique resources that online communications have to offer. The downtown location will provide b usiness people with convenient access to their morning coffee and online needs. 2. 1 Company Ownership Kitsch is own by M & T Corporation with the manager Loizos Loizou to possess the main share (80%). 2. 2 Start-up Summary Kitschs start-up costs covered coffee making equipment, site restoration and modification, capital to cover losings in the first year, and the communications equipment necessary to get its customers online.The communications equipment necessary to provide Kitschs customers with a high school-speed familiarity to the Internet and the services it has to offer make up a large tract of the start-up costs. These costs included the computer endpoints and all costs associated with their set-up. Costs were also designated for the purchase of deuce optical maser printers and a scanner. additional to those, one espresso machine, an automatic coffee grinder, and minor additional equipment will be purchased from Petersons ltd. The create at 15 Chiou Street required f unds for renovation and modification. A single estimated figure was allocated for this purpose.The renovation/modification cost estimated included the costs associated with preparing the building for opening business. Start-up disbursal Details 11 computers = 22,000 two printers = 1,000 one scanner = 500 software = 810 one espresso machine = 10,700 one automatic espresso grinder = 795 other fixtures and remodeling o two coffee/food preparation antagonistics = 1,000 o one information disp drop off counter = 1,000 o one drinking/eating counter = 500 o half a dozenteen stools = 1,600 o six computer desks w/chairs = 2,400 o stationery goods = 500 o two telephones = 200 o ornament expense = 13,000 Start-up Requirements Start-up Expenses Legal 500 Stationery etc. 500 Brochures 500 Consultants 2,000 redress 700 Rent 1,445 4-group self-regulating Coffee Machine 10,700 Bean Grinder 795 Computer Systems (x11), Software, Printer, Scanner 24,310 Communicatio n Lines 840 Fixtures/Remodel 20,000 integral Start-up Expenses 62,290 Start-up Assets funds Required 24,000 Start-up gunstock 2,000 different legitimate Assets 0 semipermanent Assets 0 entirety Assets 26,000 extreme Requirements 88,290 2. 3 Company Locations and Facilities A site has been elect at 15 Chiou Street in Agioi Omologites. This site was chosen for various reasons, including Proximity to the downtown business community. Proximity to trendy, upscale restaurants such as Bagatelle, Steak & Co, Paragadi fish restaurant, Aperitivo green Set and others Parking availability. Low cost rent . 85 per square foot for 1700 square feet. High visibility.All of these qualities are consistent with Kitschs goal of providing a central hub of communication and socialization for the Eugene community. Description of Services Kitsch is providing full access to email, WWW, FTP, Usenet and other Internet applications such as Telnet and Gopher. Printing, scanni ng, and introductory courses to the Internet are also available to the customer. Kitsch also provides customers with a unique and innovative environment for enjoying swell coffee, specialty beverages, and bakery items. 3. 1 Competitive Comparison Kitsch is the first Internet cafe in Agioi Omologites. Kitsch differentiates itself from the strictly-coffee cafes in Agioi Omologites by providing its customers with Internet and calculate services. 3. 2 Service DescriptionKitsch provides its customers with full access to the Internet and common computer software and hardware. rough of the Internet and computing services available to Kitschs customers are listed below Access to external POP3 and IMAP email accounts. Customers can sign up for a Kitsch email account. This account will be managed by Kitsch servers and well-disposed from computer systems outside the Kitsch network. FTP, Telnet, Gopher, and other popular Internet utilities will be available. Access to salaryscape, Goog le Chrome, Mozilla Firefox and Internet adventurer browser. Access to laser and color printing. Access to popular software applications like Adobe PhotoShop and Microsoft Office.Kitsch also provides its customers with access to introductory Internet and email classes. These classes will be held in the afternoon and late in the evening. By providing these classes, Kitsch builds a client dish familiar with its services. The computers, Internet access, and classes wouldnt mean half as much if taken out of the environment Kitsch provides. Good coffee, specialty drinks, bakery goods, and a comfor circuit board environment provide Kitsch customers with a home away from home. Kitsch is a place to enjoy the benefits of computing in a comfortable and kept up(predicate) environment. 3. 3 Fulfillment Kitsch obtains computer support and Internet access from Logitech Computers located in Agioi Omologites.CYTA and CYTACOM Solutions provide the Internet connections and network consulting. Pe tersons ltd will provide Kitsch with coffee equipment, bulk coffee, and paper supplies. A contract for the bakery items has not been yet completed. 3. 4 Technology Kitsch cloaks in high-speed computers to provide its customers with a fast and efficient connection to the Internet. The computers are reliable and fun to work with. Kitsch will continue to upgrade and modify the systems to stay actual with communications technology. One of the main attractions associated with Internet cafes, is the state of the art equipment available for use. Not everyone has a Pentium PC in their home or office. 3. 5 Future ServicesAs Kitsch grows, more communications systems will be added. The possibility of additional units has been accounted for in the current floor intent. As the demand for Internet connectivity increases, along with the increase in competition, Kitsch will continue to add new services to keep its customer base coming back for more. Market Analysis Kitsch is faced with the excit ing opportunity of being the first-mover in Nicosias cyber-cafe market. The consistent popularity of coffee, combined with the growing interest in the Internet, has been proven to be a amiable concept in other markets and will produce the same results in Nicosia. 4. 1 Target Market Segment StrategyKitsch intends to cater to people who want a guided tour on their first spin around the Internet and to experienced users eager to indulge their passion for computers in a social setting. Furthermore, Kitsch is a magnet for local and professionals who desire to work or check their email messages in a friendly atmosphere. These professionals will either use Kitschs PCs, or plug their notebooks into Internet connections. Kitschs fool market covers a wide range of ages from members of Generation X who grew up surrounded by computers, to Baby Boomers who have come to the realization that people today cannot afford to ignore computers. 4. 1. 1 Market TrendsA market behold was conducted in th e Fall of 2007. Key questions were asked of fifty potential customers. Some key findings include 35 subjects express they would be willing to pay for access to the Internet. One euro per hour was the most popular hourly Internet fee at that time. 24 subjects use the Internet to communicate with others on a regular basis. 4. 1. 2 Market Needs Factors such as current trends, addiction, and historical sales selective information ensure that the high demand for coffee will remain constant over the next five years. The rapid ripening of the Internet and online services, that has been witnessed worldwide, is only the tip of the iceberg.The potential growth of the Internet is enormous, to the point where one day, a computer terminal with an online connection will be as common and necessary as a telephone. This may be 10 or 20 years down the road, but for the next five years, the online service provider market is sure to experience tremendous growth. Being one of the firsts cyber-cafe in Nicosia, Kitsch will enjoy the first-mover advantages of name recognition and customer loyalty. Initially, Kitsch will hold a 100 pct share of the cyber-cafe market in Nicosia. In the next five years, competitors will enter the market. Kitsch has set a goal to maintain greater than a 50 percent market share. 4. 2 Market Segmentation Kitschs customers can be divided into two groups.The first group is familiar with the Internet and desires a forward-moving and inviting atmosphere where they can get out of their offices or bedrooms and enjoy a great cup of coffee. The sanction group is not familiar with the Internet, yet, and is just waiting for the right opportunity to enter the online community. Kitschs target market waterfall anywhere between the ages of 15 and 50. This extremely wide range of ages is due to the position that both coffee and the Internet appeal to a variety of people. In addition to these two broad categories, Kitschs target market can be divided into more sp ecific market segments. The major(ip)ity of these individuals are students and business people. See the Market Analysis chart and table below for more specifics. pic Market Analysis division 1 twelvemonth 2 Year 3 building block gross revenue Coffee- fairish 12,016 14,068 15,475 posture Drinks- average 6,654 7,913 8,705 e-mail Memberships 8,703 10,505 11,556 Hourly Internet Fees 38,269 46,365 51,002 Baked Goods- average 32,673 42,150 46,365 good Unit sales 98,315 121,001 133,103 Unit Prices Year 1 Year 2 Year 3 Coffee- average 1. 00 1. 00 1. 00 Specialty Drinks- average 2. 00 2. 00 1. 00 telecommunicate Memberships 10. 00 10. 00 10. 00 Hourly Internet Fees 2. 50 2. 50 2. 50 Baked Goods- average 1. 25 1. 25 1. 0 Sales Coffee- average 12,016 14,068 15,475 Specialty Drinks- average 13,308 15,826 8,705 email Memberships 87,030 105,050 115,560 Hourly Internet Fees 95,673 115,913 127,505 Baked Goods- average 40,841 52,688 46,36 5 enumerate Sales 248,868 303,544 313,610 Direct Unit Costs Year 1 Year 2 Year 3 Coffee- average 0. 5 0. 25 0. 25 Specialty Drinks- average 0. 50 0. 50 0. 25 Email Memberships 2. 50 2. 50 2. 50 Hourly Internet Fees 0. 63 0. 63 0. 63 Baked Goods- average 0. 31 0. 31 0. 25 Direct Cost of Sales Coffee- average 3,004 3,517 3,869 Specialty Drinks- average 3,327 3,957 2,176 Email Memberships 21,758 26,263 28,890 Hourly Internet Fees 23,918 28,978 31,876 Baked Goods- average 10,210 13,172 11,591 Sub fundamental Direct Cost of Sales 62,217 75,886 78,403 5. 6 MilestonesThe Kitsch management team has established some basic milestones to keep the business plan priorities in place. Responsibility for implementation falls on the shoulders of Loizos Loizou. This Milestones Table below will be updated as the year progresses using the actual tables. new(a) milestones added as the first year of operations commences. pic 6. Operating Plan Kitsch is owned and opera ted by Mr. Loizos Loizou. The company, being downhearted in nature, requires a simple organizational structure. Implementation of this organizational form calls for the owner, Mr. Loizou, to make all of the major management decisions in addition to monitoring all other business activities. 6. 1 Personnel PlanThe staff will consist of six part-time employees working thirty hours a week at 5. 50 per hour. In addition, one full-time technician (who is more technologically oriented to handle minor terminal repairs/inquiries) will be employed to work forty hours a week at 10. 00 per hour. The two snobbish investors, Andreas Augoustinos and Panagiotis Metaxas will not be included in management decisions. This simple structure provides a great deal of flexibility and allows communication to disperse quickly and directly. Because of these characteristics, there are few coordination problems seen at Kitsch that are common within larger organizational chains. This strategy will enable Kitsc h to react quickly to changes in the market. Personnel Plan Year 1 Year 2 Year 3 Owner 24,000 26,400 29,040 Part condemnation 1 7,920 7,920 7,920 Part Time 2 7,920 7,92 7,920 Part Time 3 7,920 7,920 7,920 Part Time 4 7,920 7,920 7,920 Part Time 5 7,920 7,920 7,920 Part Time 6 3,960 7,920 7,920 Technician 21,731 23,904 26,294 Manager 4,000 24,000 26,400 Total People 9 9 9 Total Payroll 93 121,824 129,254 291 7. Financial Plan The following sections lay out the details of our financial plan for the next three years. 7. 1 Start-up Funding This business plan is prepared to obtain financing in the amount of 24,000. The supplemental financing is required to begin work on site preparation and modifications, equipment purchases, and to cover expenses in the first year of operations. additive financing has already been secured as follows 19,000 of personal savings from owner Loizos Loizou 36,000 from two investors and 9,290 in the form of short-term gives Start-u p Funding Start-up Expenses to Fund 62,290 Start-up Assets to Fund 26,000 Total Funding Required 88,290 Assets Non-cash Assets from Start-up 2,000 bills Requirements from Start-up 24,000 Additional funds Raised 0 property Balance on Starting Date 24,000 Total Assets 26,000 Liabilities and groovy Liabilities menstruum Borrowing 9,290 Long-term Liabilities 24,000 Accounts payable (Outstanding Bills) 0 other contemporary Liabilities (interest-free) 0 Total Liabilities 33,290 dandy Planned Investment Loizos Loizou 43,000 Private Investor 12,000 Additional Investment Requirement 0 Total Planned Investment 55,000 Loss at Start-up (Start-up Expenses) (62,290) Total hood (7,290) Total Capital and Liabilities 26,000 Total Funding 88,290 7. 2 Important Assumptions Basic assumptionsare presented in the table below. General Assumptions Year 1 Year 2 Year 3 Plan Month 1 2 3 Current hobby tread 8. 00% 8. 00% 8. 00% Long-term Interest Rate 10. 00% 10. 00% 10. 00% Tax Rate 30. 00% 30. 00% 30. 00% Other 0 0 0 7. 3 Key Financial Indicators Important benchmark data is presented in the chart below. Benchmarks pic 7. 4 Break-even Analysis Break-even data is presented in the chart and table below. pic Break-even Analysis periodic Units Break-even 7,294 periodical Revenue Break-even 18,462 Assumptions Average Per-Unit Revenue 2. 53 Average Per-Unit Variable Cost 0. 63 Estimated Monthly Fixed Cost 13,847 7. 5 Projected Profit and Loss Payroll Expense The founder of Kitsch, Loizos Loizou, will receive a salary of 24,000 in year one, 26,400 in year two, and 29,040 in year three. Kitsch intends to engage six part-time employees by the end of year one at 5. 75/hour and a full-time technician at 10. 00/hour. Rent Expense Kitsch is leasing a 1700 square foot facility at . 85/sq. oot. The lease agreement Kitsch signed specifies that we pay 2,000/month for a total of 36 months. At the end of the third year, the lease is open for negotiations and Kitsch may or may not re-sign the lease depending on the demands of the lessor. Utilities Expense As stated in the contract, the lessor is responsible for the payment of utilities including gas, garbage disposal, and real estate taxes. The only utilities expense that Kitsch must pay is the phone bill generated by fifteen phone lines thirteen will be dedicated to modems and two for business purposes. The basic monthly service charge for each line provided by CYTA is 17. 29.The 13 lines used to connect the modems will make local calls to the network provided by CYTACOM Solutions resulting in a monthly charge of 224. 77. The two additional lines used for business communication will cost 34. 58/month plus long distance fees. Kitsch assumes that it will not make more than 40. 00/month in long distance calls. Therefore, the total cost associated with the two business lines is estimated at 74. 58/month and the total phone expense at 299. 3 5/month. In addition, there will be an additional return expense of 800 for estimated EWEB bills. Marketing Expense Kitsch allocated 33,750 for promotional expenses over the first year.These were used for advertising in local newspapers in order to build consumer awareness. For additional information, please refer to section 5. 0 of the business plan. Insurance Expense Kitsch has allocated 1,440 for insurance for the first year. As revenue increases in the second and third year of business, Kitsch intends to invest more money for additional insurance coverage. Depreciation In depreciating our capital equipment, Kitsch used the change Accelerated Cost Recovery Method. We depreciated our computers over a five-year time period and our fixtures over seven years. Taxes Kitsch is not taxed. However, there is a 15% payroll burden. Detailed Profit and Loss data is presented in the table below. pic pic pic Pro Forma Profit and Loss Year 1 Year 2 Year 3 Sales 248,868 303,544 313,610 Di rect Cost of Sales 62,217 75,886 78,403 Other Costs of Sales 0 0 0 Total Cost of Sales 62,217 75,886 78,403 Gross Margin 186,651 227,658 235,208 Gross Margin % 75. 00% 75. 00% 75. 0% Expenses Payroll 93,291 121,824 129,254 Marketing/Promotion 33,750 40,000 43,000 Depreciation 0 0 0 Rent 24,000 24,000 24,000 Utilities 9,120 9,120 9,120 Insurance 6,000 6,000 6,000 Payroll Taxes 0 0 0 Other 0 0 0 Total Operating Expenses 166,161 200,944 211,374 Profit Before Interest and Taxes 20,490 26,714 23,834 EBITDA 20,490 26,714 23,834 Interest Expense 2,325 1,470 1,100 Taxes Incurred 5,450 7,573 6,820 Net Profit 12,716 17,671 15,913 Net Profit/Sales 5. 11% 5. 82% 5. 07% 7. 6 interchange Flow Cash flow data is presented in the chart and table below. Accounts Payable Kitsch acquired a 24,000 loan from a bank at a 10% interest rate. The loan paid back at 800/month over the next three years.The 9,290 short term loan paid back at a rate of 8%. Cash (0 00 ) pic Pro Forma Cash Flow Year 1 Year 2 Year 3 Cash Received Cash from Operations Cash Sales 248,868 303,544 313,610 Subtotal Cash from Operations 248,868 303,544 313,610 Additional Cash Received Sales Tax, VAT, Received 0 0 0 current Current Borrowing 2,000 5,000 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 250,868 308,544 313,610 Expenditures Year 1 Year 2 Year 3 Expenditures from Operations Cash Spending 93,291 121,824 129,254 Bill Payments 133,870 165,945 168,467 Subtotal Spent on Operations 227,161 287,769 297,721 Additional Cash Spent Sales Tax, VAT, stipendiary Out 0 0 0 Principal Repayment of Current Borrowing 9,290 2,000 0 Other Liabilities Principal Repayment 0 0 0 Long-term Liabilities Principal Repayment 9,600 5,000 4,800 Purchase Other Current Assets 0 0 0 Purchase Long-term Assets 0 0 0 Dividends 0 0 0 Subtotal Cash Spent 246,051 294,769 302,521 Net Cash Flow 4,817 13,775 11,089 Cash Balance 28,817 42,592 53,681 7. 7 Projected Balance Sheet Our projected balance sheet is presented in the table below. Pro Forma Balance Sheet Year 1 Year 2 Year 3 Assets Current Assets Cash 28,817 42,592 53,681 Inventory 6,980 8,514 8,796 Other Current Assets 0 0 0 Total Current Assets 35,797 51,106 62,478 Long-term Assets Long-term Assets 0 0 0 Accumulated Depreciation 0 0 0 Total Long-term Assets 0 0 0 Total Assets 35,797 51,106 62,478 Liabilities and Capital Year 1 Year 2 Year 3 Current Liabilities Accounts Payable 13,972 13,610 13,868 Current Borrowing 2,000 5,000 5,000 Other Current Liabilities 0 0 0 Subtotal Current Liabilities 15,972 18,610 18,868 Long-term Liabilities 14,400 9,400 4,600 Total Liabilities 30,372 28,010 23,468 Paid-in Capital 55,000 55,000 55,000 R etained Earnings (62,290) (49,574) (31,904) Earnings 12,716 17,671 15,913 Total Capital 5,426 23,096 39,010 Total Liabilities and Capital 35,797 51,106 62,478 Net Worth 5,426 23,096 39,010 7. 8 Business Ratios The Standard Industrial Classification (SIC) Code for the Internet Service Provider industry is Remote data base information retrieval 7375. 9903. We used the report for randomness retrieval services 7375 to generatethe industry profile. As we are also a food cafe we could have used the ratios based on SIC classification 5812, Eating places. The combined nature of Kitsch Cafe makes our ratios a blend of the two industries. Ratio Analysis Year 1 Year 2 Year 3 Industry Profile Sales Growth 0. 00% 21. 97% 3. 32% 0. 90% Percent of Total Assets Inventory 19. 50% 16. 66% 14. 08% 2. 17% Other Current Assets 0. 00% 0. 00% 0. 00% 84. 8% Total Current Assets 100. 00% 100. 00% 100. 00% 86. 95% Long-term Assets 0. 00% 0. 00% 0. 00% 13. 05% Total Assets 100. 00 % 100. 00% 100. 00% 100. 00% Current Liabilities 44. 62% 36. 41% 30. 20% 28. 33% Long-term Liabilities 40. 23% 18. 39% 7. 36% 16. 21% Total Liabilities 84. 84% 54. 1% 37. 56% 44. 54% Net Worth 15. 16% 45. 19% 62. 44% 55. 46% Percent of Sales Sales 100. 00% 100. 00% 100. 00% 100. 00% Gross Margin 75. 00% 75. 00% 75. 00% 100. 00% Selling, General & administrative 69. 89% 69. 18% 69. 93% 79. 0% Expenses Advertising Expenses 0. 00% 0. 00% 0. 00% 1. 01% Profit Before Interest and Taxes 8. 23% 8. 80% 7. 60% 1. 62% Main Ratios Current 2. 24 2. 75 3. 31 0. 00 Quick 1. 80 2. 29 2. 85 0. 0 Total Debt to Total Assets 84. 84% 54. 81% 37. 56% 0. 00% Pre-tax Return on Net Worth 334. 80% 109. 30% 58. 28% 0. 00% Pre-tax Return on Assets 50. 74% 49. 40% 36. 39% 0. 00% Additional Ratios Year 1 Year 2 Year 3 Net Profit Margin 5. 11% 5. 82% 5. 07% n. a Return on Equity 234. 36% 76. 1% 40. 79% n. a military action Ratios Inventory Tur nover 12. 00 9. 80 9. 06 n. a Accounts Payable Turnover 10. 58 12. 17 12. 17 n. a Payment Days 27 30 30 n. a Total Asset Turnover 6. 95 5. 94 5. 02 n. Debt Ratios Debt to Net Worth 5. 60 1. 21 0. 60 n. a Current Liab. to Liab. 0. 53 0. 66 0. 80 n. a Liquidity Ratios Net Working Capital 19,826 32,496 43,610 n. Interest Coverage 8. 81 18. 17 21. 67 n. a Additional Ratios Assets to Sales 0. 14 0. 17 0. 20 n. a Current Debt/Total Assets 45% 36% 30% n. a Acid Test 1. 80 2. 29 2. 85 n. a Sales/Net Worth 45. 87 13. 14 8. 4 n. a Dividend Payout 0. 00 0. 00 0. 00 n. a 8. Appendix 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 Assets Starting Balances Current Assets Cash 24,00 23,026 18,600 13,589 16,879 16,066 19,557 20,657 22,308 24,307 26,675 27,415 28,817 Inventory 2,000 1,900 2,683 3,106 5,203 5,403 5,614 5,819 6,034 6,256 6,49 0 6,730 6,980 Other Current Assets 0 0 0 0 0 0 0 0 0 0 0 0 0 Total Current Assets 26,00 24,926 21,282 16,696 22,082 21,469 25,170 26,476 28,342 30,562 33,165 34,145 35,797 Long-term Assets Long-term Assets 0 0 0 0 0 0 0 0 0 0 0 0 0 Accumulated Depreciation 0 0 0 0 0 0 0 0 0 0 0 0 0 Total Long-term Assets 0 0 0 0 0 0 0 0 0 0 0 0 0 Total Assets 26,00 24,926 21,282 16,696 22,082 21,469 25,170 26,476 28,342 30,562 33,165 34,145 35,797 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 6,503 8,785 8,701 13,654 12,180 12,578 12,709 13,055 13,410 13,786 13,581 13,972 Current Borrowing 9,290 8,540 7,790 7,040 6,290 5,540 6,790 6,040 5,290 4,540 3,790 3,040 2,000 Other Current Liabilities 0 0 0 0 0 0 0 0 0 0 0 0 0 Subtotal Current Liabilities 9,290 15,043 16,575 15,741 19,944 17,720 19,368 18,749 18 ,345 17,950 17,576 16,621 15,972 Long-term Liabilities 24,00 23,200 22,400 21,600 20,800 20,000 19,200 18,400 17,600 16,800 16,000 15,200 14,400 Total Liabilities 33,29 38,243 38,975 37,341 40,744 37,720 38,568 37,149 35,945 34,750 33,576 31,821 30,372 Paid-in Capital 55 55 55 55 55 55 55 55 55 55 55 55 55 Retained Earnings 62,29 62,29 62,29 62,29 62,29 62,29 62,29 62,29 62,29 62,29 62,29 62,29 62,29 Earnings 0 6,027 10,403 13,356 11,372 8,961 6,108 3,382 313 3,103 6,879 9,614 12,716 Total Capital 7,290 13,317 17,693 20,646 18,66 16,251 13,398 10,672 7,603 4,187 411 2,324 5,426 Total Liabilities and Capital 26,00 24,926 21,282 16,696 22,082 21,469 25,170 26,476 28,342 30,562 33,165 34,145 35,797 Net Worth 7,290 13,317 17,693 20,646 18,662 16,251 13,398 10,672 7,603 4,187 411 2,324 5,426