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Financial Plan 2.0

The financial plan outlines startup funding, projected profit and loss, cash flow, and balance sheets for the first three years of Protein Quake. It expects to obtain loans to fund $7,322 in startup costs and projects annual net profits of $8,934 in Year 1, $37,719 in Year 2, and $44,336 in Year 3 as sales increase and costs stabilize. Key assumptions include continued economic growth, stable production costs, and securing additional financing as needed.

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Viet Quang Tran
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77 views

Financial Plan 2.0

The financial plan outlines startup funding, projected profit and loss, cash flow, and balance sheets for the first three years of Protein Quake. It expects to obtain loans to fund $7,322 in startup costs and projects annual net profits of $8,934 in Year 1, $37,719 in Year 2, and $44,336 in Year 3 as sales increase and costs stabilize. Key assumptions include continued economic growth, stable production costs, and securing additional financing as needed.

Uploaded by

Viet Quang Tran
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 8

7.

0 Financial Plan
The financial prospects for Protein Quake is quite promising. Since Protein Quake is a pioneer in the market,
the business is expected to grow fast due to high existing, untapped demand. Investment will play a major
role in financing our growth and cushioning the initial losses.
We hope to expand to other outlets by Year 3 when we most likely have repaid most of the debts. However,
for the purpose of this financial plan, we assume that there will be no additional outlets within 3 years.

7.1 Start-up Funding


The majority of our funding for start-up requirements will come from short-term loans from VPBank and/or
Agribank, as both banks are well known for charging a lower interest rate and higher amount of loanable
funds for entrepreneurs. Furthermore, as the maximum loanable funds at both banks is at $9412, after the
required start-up cost of $7322, there is a $2090 cushion for unexpected overhead costs.
Other current liabilities include but not limited to:
Taxes
Insurance
Start-up Stocks
The owners of Protein Quake has gathered an additional funding of $500 to support the company for the
first few months. We hope to able to secure an investment of $30,000, which will be paid out in dividends of
2% per month after the first year.
Start-up Funding
Start-up Expenses to Fund
Start-up Assets to Fund
Total Funding Required
Assets
Non-cash Assets from Start-up
Cash Requirements from Start-up
Additional Cash Raised
Cash Balance on Starting Date
Total Assets

$4,672
$2,650
$7,322
$2,150
$500
$31,363
$31,863
$34,013

Liabilities and Capital


Liabilities
Current Borrowing
Long-term Liabilities
Other Current Liabilities (interest-free)
Total Liabilities

$7,322
$0
$863
$8,185

Capital
Planned Investment
Owner
Investor
Total Planned Investment

$500
$30,000
$30,500

Page 1

Loss at Start-up (Start-up Expenses)

($4,672)
$25,828

Total Capital and Liabilities

$34,013

Total Funding

$38,685

Total Capital

7.2 Important Assumptions


The financial plan depends on important assumptions, most of which are shown in the following table. The
key underlying assumptions are:
1. A quick-growth economy, without major recession or overheating.
2. There are no unforeseen changes in public health perceptions of its general products.
3. No additional outlets are opened within the assessed period.
4. Access to equity capital and financing sufficient to maintain its financial plan as shown in the tables.

Additionally,
Tax rate for private businesses is expected to drop from 22% to 20% in 2016.
The interest rate is estimated based on public statements from VPBank and Agribank.

7.3 Break-even Analysis


Our break-even analysis is summarized by the following chart and table.

Break-even Analysis
Monthly Units Break-even
Monthly Revenue Break-even
Assumptions:
Average Per-Unit Revenue
Average Per-Unit Variable Cost
Estimated Monthly Fixed Cost

3,708
$10,778
$2.91
$1.44
$5,429

Page 2

7.4 Projected Profit and Loss


There are a multitude of factors and consideration to include when determining projected profit and loss,
including but not limited to:

Pro Forma Profit and Loss


Year 1
$153,819
$76,340
$0
$76,340

Year 2
$193,539
$95,891
$0
$95,891

Year 3
$212,913
$105,494
$0
$105,494

Gross Margin
Gross Margin %

$77,479
50.37%

$97,648
50.45%

$107,419
50.45%

Expenses
Payroll
Marketing/Promotion
Depreciation
Rent
Utilities
Payroll Taxes
Other

$6,720
$20,900
$120
$34,800
$600
$469
$1,540

$7,251
$4,300
$350
$34,800
$750
$508
$1,694

$7,828
$4,300
$1,020
$34,800
$1,000
$782
$1,863

Total Operating Expenses

$65,149

$49,653

$51,593

Profit Before Interest and Taxes


EBITDA
Interest Expense
Taxes Incurred

$12,330
$12,450
$877
$2,520

$47,995
$48,345
$847
$9,430

$55,826
$56,846
$406
$11,084

Sales
Direct Cost of Sales
Other Costs of Sales
Total Cost of Sales

Page 3

Net Profit
Net Profit/Sales

$8,934
5.81%

$37,719
19.49%

$44,336
20.82%

Page 4

7.5 Projected Cash Flow


Our projected cash flow is outlined in the following chart and table.

Pro Forma Cash Flow


Year 1

Year 2

Year 3

Page 5

Cash Received
Cash from Operations
Cash Sales
Subtotal Cash from Operations

$153,819
$153,819

$193,539
$193,539

$212,913
$212,913

Additional Cash Received


Sales Tax, VAT, HST/GST Received
Subtotal Cash Received

$0
$153,819

$0
$193,539

$0
$212,913

Year 1

Year 2

Year 3

Expenditures from Operations


Cash Spending
Subtotal Spent on Operations

$144,765
$144,765

$155,470
$155,470

$167,557
$167,557

Additional Cash Spent


Sales Tax, VAT, HST/GST Paid Out
Principal Repayment of Current Borrowing
Dividends
Subtotal Cash Spent

$0
$176
$0
$144,941

$0
$176
$7,200
$162,846

$0
$7,176
$7,200
$181,933

$8,878
$40,741

$30,693
$71,433

$30,980
$102,413

Expenditures

Net Cash Flow


Cash Balance

Page 6

7.6 Projected Balance Sheet


The table below outlines the projected balance sheet.

Pro Forma Balance Sheet


Year 1

Year 2

Year 3

Current Assets
Cash
Other Current Assets
Total Current Assets

$40,741
$580
$41,321

$71,433
$580
$72,013

$102,413
$580
$102,993

Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets

$1,570
$120
$1,450
$42,771

$1,570
$470
$1,100
$73,113

$1,570
$1,490
$80
$103,073

Year 1

Year 2

Year 3

Current Liabilities
Current Borrowing
Other Current Liabilities
Subtotal Current Liabilities

$7,146
$863
$8,009

$6,970
$863
$7,833

($206)
$863
$657

Long-term Liabilities
Total Liabilities

$0
$8,009

$0
$7,833

$0
$657

Paid-in Capital
Retained Earnings
Earnings
Total Capital
Total Liabilities and Capital

$30,500
($4,672)
$8,934
$34,762
$42,771

$30,500
($2,938)
$37,719
$65,280
$73,113

$30,500
$27,580
$44,336
$102,416
$103,073

Net Worth

$34,762

$65,280

$102,416

Assets

Liabilities and Capital

7.7 Business Ratios


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Ratio Analysis
Sales Growth
Percent of Total Assets
Other Current Assets
Total Current Assets
Long-term Assets
Total Assets
Current Liabilities
Long-term Liabilities

Year 1
n.a.

Year 2
25.82%

Year 3
10.01%

1.36%
96.61%
3.39%
100.00%

0.79%
98.50%
1.50%
100.00%

0.56%
99.92%
0.08%
100.00%

18.73%
0.00%

10.71%
0.00%

0.64%
0.00%

Page 7

Total Liabilities
Net Worth

18.73%
81.27%

10.71%
89.29%

0.64%
99.36%

100.00%
50.37%
44.56%

100.00%
50.45%
30.97%

100.00%
50.45%
29.63%

13.59%
8.02%

2.22%
24.80%

2.02%
26.22%

Main Ratios
Current
Quick
Total Debt to Total Assets
Pre-tax Return on Net Worth
Pre-tax Return on Assets

5.16
5.16
18.73%
32.95%
26.78%

9.19
9.19
10.71%
72.22%
64.49%

156.72
156.72
0.64%
54.11%
53.77%

Additional Ratios
Net Profit Margin
Return on Equity

Year 1
5.81%
25.70%

Year 2
19.49%
57.78%

Year 3
20.82%
43.29%

15.18
3.60

12.17
2.65

12.17
2.07

0.23
1.00

0.12
1.00

0.01
1.00

$33,312
14.06

$64,180
56.67

$102,336
137.55

0.28
19%
5.16
4.42
0.00

0.38
11%
9.19
2.96
0.19

0.48
1%
156.72
2.08
0.16

Percent of Sales
Sales
Gross Margin
Selling, General & Administrative
Expenses
Advertising Expenses
Profit Before Interest and Taxes

Activity Ratios
Accounts Payable Turnover
Total Asset Turnover
Debt Ratios
Debt to Net Worth
Current Liab. to Liab.
Liquidity Ratios
Net Working Capital
Interest Coverage
Additional Ratios
Assets to Sales
Current Debt/Total Assets
Acid Test
Sales/Net Worth
Dividend Payout

Page 8

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