Written a Business Plan

Business Plan Sample Part II

Projected Profit and Loss

Our analysis anticipates significant growth in profits in the next five years with the opening of a second Frank’s All-

American BarBeQue in Darien. The profit margins should increase from in excess of $850,000 in 2011 to nearly

$1,600,000 by 2015 and should be in excess of 20 percent for all five years. A complete analysis of the profit and

loss statements is in Table 16.8 “Profit and Loss”. The annual profits are illustrated in Figure 16.8 “Yearly Profits”.

Table 16.8 Profit and Loss

Pro Forma Profit and Loss 2011 2012 2013 2014 2015

Sales $4,191,683 $4,585,163 $4,904,564 $5,253,740 $5,636,277

Direct cost of sales $2,095,844 $2,292,580 $2,452,282 $2,626,871 $2,817,939

Cooks payroll $120,000 $120,600 $121,500 $122,500 $123,500

Other costs of sales $0 $0 $0 $0 $0

Total cost of sales $2,215,844 $2,413,180 $2,573,782 $2,749,371 $2,941,439

Gross margin $1,975,839 $2,171,983 $2,330,782 $2,504,369 $2,694,838

Gross margin % 47.14% 47.37% 47.52% 47.67% 47.81%

Operating Expenses

Servers payroll $278,400 $278,400 $232,500 $234,500 $212,600

Advertising/promotion $0 $0 $0 $0 $0

Other servers expenses

$0 $0 $0 $0 $0

Total servers expenses $278,400 $278,400 $232,500 $234,500 $212,600

Servers % 6.64% 6.07% 4.74% 4.46% 3.77%

Business Plan Sample Part II

Pro Forma Profit and Loss 2011 2012 2013 2014 2015

General and Administrative Expenses

General and administrative payroll

$96,000 $96,600 $99,000 $100,000 $101,000

Marketing/promotion $12,000 $0 $0 $0 $0

Depreciation $0 $0 $0 $0 $0

Rent $180,000 $0 $0 $0 $0

Utilities $13,200 $0 $0 $0 $0

Insurance $22,000 $0 $0 $0 $0

Payroll taxes $74,160 $74,340 $67,950 $68,550 $65,565

Other general and administrative expenses

$0 $0 $0 $0 $0

Total general and administrative expenses

$397,360 $170,940 $166,950 $168,550 $166,565

General and administrative %

9.48% 3.73% 3.40% 3.21% 2.96%

Other Expenses

Other payroll $0 $0 $0 $0 $0

Consultants $0 $0 $0 $0 $0

Other expenses $0 $0 $0 $0 $0

Total other expenses $0 $0 $0 $0 $0

Business Plan Sample Part II

Pro Forma Profit and Loss 2011 2012 2013 2014 2015

Other % 0.00% 0.00% 0.00% 0.00% 0.00%

Total operating expenses

$675,760 $449,340 $399,450 $403,050 $379,165

Profit before interest and taxes

$1,300,079 $1,722,643 $1,931,332 $2,101,319 $2,315,673

EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization)

$1,300,079 $1,722,643 $1,931,332 $2,101,319 $2,315,673

Interest expense $43,755 $34,995 $30,980 $30,980 $30,980

Taxes incurred $376,897 $506,294 $570,106 $621,102 $685,408

Net profit $879,427 $1,181,354 $1,330,246 $1,449,237 $1,599,285

Net profit/sales 20.98% 25.76% 27.12% 27.58% 28.37%

Figure 16.8 Yearly Profits

Business Plan Sample Part II

Projected Cash Flow

Table 16.9 “Cash Flow Forecast” is a five-year forecast of cash flows for Frank’s All-American BarBeQue. The forecast

shows extremely strong and positive cash flows for each year.

Table 16.9 Cash Flow Forecast

Pro Forma Cash Flow

Cash Received 2011 2012 2013 2014 2015

Cash from Operations

Cash sales $4,191,683 $4,585,163 $4,904,564 $5,253,740 $5,636,277

Subtotal cash from operations $4,191,683 $4,585,163 $4,904,564 $5,253,740 $5,636,277

Subtotal cash received $4,366,683 $4,585,163 $4,904,564 $5,253,740 $5,636,277

Expenditures 2011 2012 2013 2014 2015

Expenditures from Operations

Cash spending $494,400 $495,600 $453,000 $457,000 $437,100

Bill payments $2,500,504 $2,911,392 $3,085,406 $3,338,682 $3,587,794

Subtotal spent on operations $2,994,904 $3,406,992 $3,538,406 $3,795,682 $4,024,894

Other liabilities principal repayment

$54,000 $54,000 $54,000 $0 $0

Long-term liabilities principal repayment

$87,600 $87,600 $0 $0 $0

Subtotal cash spent $3,296,504 $3,548,592 $3,592,406 $3,795,682 $4,024,894

Net cash flow $1,070,179 $1,036,571 $1,312,158 $1,458,058 $1,611,383

Cash balance $1,172,844 $2,209,415 $3,521,573 $4,979,631 $6,591,014

Business Plan Sample Part II

Projected Balance Sheet

Table 16.10 “Balance Sheet Forecast” is a balance sheet forecast for Frank’s All-American BarBeQue.

Table 16.10 Balance Sheet Forecast

Pro Forma Cash Flow

Assets 2011 2012 2013 2014 2015

Current Assets

Cash $1,172,844 $2,209,415 $3,521,573 $4,979,631 $6,591,014

Inventory $72,421 $79,197 $109,296 $117,245 $125,954

Other current assets $278,372 $278,372 $278,372 $278,372 $278,372

Total current assets $1,523,636 $2,566,983 $3,909,241 $5,375,249 $6,995,341

Long-Term Assets

Long-term assets $583,675 $583,675 $583,675 $583,675 $583,675

Accumulated depreciation $145,765 $145,765 $145,765 $145,765 $145,765

Total long-term assets $437,910 $437,910 $437,910 $437,910 $437,910

Total assets $1,961,546 $3,004,893 $4,347,151 $5,813,159 $7,433,251

Liabilities and Capital 2011 2012 2013 2014 2015

Current Liabilities

Accounts payable $189,416 $193,009 $259,021 $275,791 $296,597

Current borrowing $135,000 $135,000 $135,000 $135,000 $135,000

Other current liabilities $20,329 ($33,671) ($87,671) ($87,671) ($87,671)

Subtotal current liabilities $344,745 $294,338 $306,350 $323,120 $343,926

Business Plan Sample Part II

Pro Forma Cash Flow

Long-term liabilities $262,400 $174,800 $174,800 $174,800 $174,800

Total liabilities $607,145 $469,138 $481,150 $497,920 $518,726

Paid-in capital $75,000 $75,000 $75,000 $75,000 $75,000

Retained earnings $399,975 $1,279,402 $2,460,755 $3,791,002 $5,240,239

Earnings $879,427 $1,181,354 $1,330,246 $1,449,237 $1,599,285

Total capital $1,354,402 $2,535,755 $3,866,002 $5,315,239 $6,914,524

Total liabilities and capital $1,961,546 $3,004,893 $4,347,151 $5,813,159 $7,433,251

Net worth $1,354,402 $2,535,755 $3,866,002 $5,315,239 $6,914,524

These figures clearly demonstrate that the proposed opening of a second restaurant is more than economically

viable; it is an extremely lucrative project that promises to increase the net worth of the firm by 500 percent in five

years.