LCF Sample Business Plan

1. Little Caesars Frachise

Business Plan


Latoya Pless

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Table of Contents
1.0 Executive Summary ................................................................................................................................ 4
1.1 Objectives........................................................................................................................................... 4
1.2 Mission and Vision ............................................................................................................................. 4
1.3 Keys to Success .................................................................................................................................. 4
1.4 Start-up costs and funding ................................................................................................................. 5
1.5 Company Ownership .......................................................................................................................... 5
1.6 Products and Services ........................................................................................................................ 6
1.7 Market ................................................................................................................................................ 6
1.8 Strategy .............................................................................................................................................. 6
1.9 Management ...................................................................................................................................... 6
1.10 Financials .......................................................................................................................................... 6
1.11 Investor Considerations ................................................................................................................... 7
1.12 Disclaimer ......................................................................................................................................... 7
2.0 Company Summary ................................................................................................................................ 7
2.1 Start-up Summary .............................................................................................................................. 7
2.2 Start-up Funding ................................................................................................................................ 9
2.3 Company Ownership .......................................................................................................................... 9
3.0 Products and Services ............................................................................................................................ 9
3.1 Business Model ................................................................................................................................ 10
3.1.1 Competitive Landscape ............................................................................................................. 10
4.0 Market Analysis Summary ................................................................................................................... 10
4.1 Market Segmentation ...................................................................................................................... 11
4.2 Target Market Segment Strategy ..................................................................................................... 11
5.0 Strategy and Implementation Summary .............................................................................................. 11
5.1 SWOT Analysis .................................................................................................................................. 12
5.1.1 Strengths ................................................................................................................................... 12
5.1.2 Weaknesses............................................................................................................................... 12
5.1.3 Opportunities ............................................................................................................................ 12
5.1.4 Threats ...................................................................................................................................... 13
5.2 Competitive Edge ............................................................................................................................. 13
5.3 Sales Strategy ................................................................................................................................... 13
5.3.1 Sales Forecast ............................................................................................................................ 13
5.4 Milestones ........................................................................................................................................ 16
5.5 Marketing Strategy .......................................................................................................................... 17
5.6 Pricing Strategy ................................................................................................................................ 17
5.7 Sourcing Strategy ............................................................................................................................. 18
5.8 Location and Facilities ...................................................................................................................... 18
6.0 Management Summary ....................................................................................................................... 18
6.1 Personnel Plan ................................................................................................................................. 18
7.0 Financial Plan ....................................................................................................................................... 19
7.1 Break-even Analysis ......................................................................................................................... 19
7.2 Projected Profit and Loss ................................................................................................................. 20

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7.3 Projected Cash Flow ......................................................................................................................... 23
7.4 Projected Balance Sheet .................................................................................................................. 25
7.5 Business Ratios ................................................................................................................................. 26
7.6 Important Assumptions ................................................................................................................... 29
7.6.1 Risks .......................................................................................................................................... 29
7.6.2 Entry Strategy ............................................................................................................................ 30
7.6.3 Investor Interest ........................................................................................................................ 30
7.6.4 Exit Strategy .............................................................................................................................. 31
APPPENDIX ................................................................................................................................................. 33

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1.0 Executive Summary

This business plan will show how a total investment of only $106,000 could yield cumulative net
profits in excess of $141,000 over a three-year period, and average monthly sales of $125,000,
while maintaining adequate levels of liquidity.

The purpose of this plan is to secure additional funding from an investor and a bank ($96,000
investment, and $100,000 ten-year term business loan), to cover the start-up costs.

Little Caesar’s-Camp Creek Marketplace is a start-up business dedicated to providing great value
pizza to the residents of Atlanta, GA, in a manner that generates fair and equitable returns for
present and future owners, and best value to our customers. We specialize in creating and offering
a variety of delicious pizzas.

Atlanta, GA has experienced explosive growth over the past five years. Over one million residents
now live in the area. Local businesses are slowly catching up with this new opportunity. We are
opening Little Caesar’s at Camp Creek Marketplace.

Currently, the closest pizza restaurant is within the marketplace. Little Caesar’s will offer top
quality pizza with great value, something that many Americans look for in a product in this tough
economic times.
1.1 Objectives

 To attract a minimum of 1000 regular customers per day for pizza take-out and
delivery, in the first year of operations;
 To offer our customers delicious pizza with the best value price, and provide
outstanding customer experience by serving the pizzas quick and fast, measured by
minimum 10 percent yearly sales growth, and customer complaints less than 1
percent.
 To generate positive cash flow from operations, and at least 3 percent net profits to sales

1.2 Mission and Vision

Little Caesar’s-Camp Creek Marketplace’s mission is to offer residents of Atlanta, GA the best value
pizza n the area. We are committed to providing top quality great value pizza that our customers
expect.

Our vision is to become the first choice of pizza in Atlanta, GA, and a respected company -- as
measured by our customers, our employees, our shareholders, and the community we live in.

Our values are critical to our success. They are the strong foundation of Little Caesar’s, they define
who we are, and set us apart from our competitors. They underlie our vision of the future. These
values include:

• Performance excellence. We act like responsible owners, always seeking to meet
or exceed expectations.

• Teamwork. We act as a team, committed to each other, and bound by trust and loyalty.
• Integrity. We treat one another, and all our stakeholders with dignity and respect.
Honesty, ethical behavior, and integrity are fundamental characteristics of our business
conduct.
1.3 Keys to Success
Our keys to success are:

• Top quality, great value products that will build and maintain customer loyalty.
• A business location that will assure high company visibility and a high flow of
customers.
• Proven management ability to successfully run a similar business.
• Our commitment to continuous improvement and total quality services.

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1.4 Start-up costs and funding

After spending several months searching for a convenient location, the owners decided to lease a
commercial space in Camp Creek Marketplace, located in a densely populated area of Atlanta, GA.
The start-up capital will be used for paying the franchise fee, legal expenses, kitchen inventory and
equipment, packing and other materials, insurance, rent, promotion, business sign, and inventory
on hand at start-up, as detailed in the company summary section of this plan.

We have estimated total start-up costs of $206,000. The numbers in the start-up and the start-
up funding tables are meant to reflect these estimates. The company capital will be $106,000.

Latoya Pless, as co-owner, will provide the part of the start-up financing in the amount of
$10,000. Approximately $96,000 additional funding is needed. The purpose of this business plan
is to secure financing for that amount.


An investor and co-owner are welcome to participate in the company's capital for the amount of
$96,000, and could be offered a portion of 90.56 percent ownership of the $106,000 company
capital. The funds provided by the investor will be used to buy equipment, and to cover part of the
start-up expenses. More details about the investor's potential interest in the company are provided
in the important assumptions section of this plan.

For the remaining $100,000 additional financing needed to cover the start-up costs, the company
plans to receive a ten-year term commercial loan facility which will meet the cash flow
requirements. The borrowed funds will be used exclusively to buy equipment, based on the list
that will be made available to the lending institution. The loan could be repaid in equal monthly
installments over a ten-year period.

Our cash-flow analysis demonstrates the company's ability to repay the loan and meet the
interest payment obligations, while maintaining adequate liquidity and generating positive cash
flow, and sufficient cash reserves for unforeseen future events.
1.5 Company Ownership

Little Caesar’s-Camp Creek Marketplace will be a privately held C-corporation owned Latoya
Pless. A new investor will be invited to participate in the company's capital.

At the time of formation, Little Caesar’s-Camp Creek Marketplace plans to issue 1,060 shares of
$100 par value common stock. The issued and outstanding common stock would be $106,000.
Latoya Pless would receive 100 shares, at $100 par value, or 10 percent.

In return for investing $96,000 in the company's capital, the new investor would receive 960
$-
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
$1,600,000
$1,800,000
$2,000,000
YEAR 1 YEAR 2 YEAR 3
Highlights
Sales
Gross Margin
Net Profit

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shares at $100 par value, or 90% percent ownership. The new investor would be invited to discuss
the quantity and quality of the stock to be issued, before the incorporation procedures are started.
Additional information about investor's interest, entry, and exit strategy is available in the
important assumptions section of this plan.

1.6 Products and Services

Little Caesar’s-Camp Creek Marketplace will offer a wide variety of pizzas, as well as sauces, sodas,
crazy breads, and chicken wings.

1.7 Market

Atlanta, GA is a growing low-to-middle-class area, counting more than one million residents.
There are about five hundred businesses close to our location. Most of these residents are
families of three or more. The average income for the area is $43,861.

With continued growth in the area, opportunities to serve Atlanta, GA residents will increase. The
company will sell to individuals, but it will also accept some occasional catering jobs to
individuals and companies in the area.

The main market segments are: a) individuals (retail customers) accounting for more than 90
percent of our sales, and b) local businesses (corporate customers) which, in terms of purchase
orders, typically make larger orders for their employees and business needs.

1.8 Strategy

Our strategy is based on delivering a strong customer value proposition in a niche market.
We are looking to offer Atlanta, GA and its surrounding areas top quality, great value pizza.

We are building our marketing infrastructure so that we can eventually reach more customers
with the same pizza offering. We focus on satisfying the needs of low-to-middle class residents
and companies located in Atlanta, GA.

1.9 Management

Our management is expected to use resources wisely, operate profitably, pay debts, and abide
by laws and regulations. Our management philosophy is based on team work, responsibility,
and mutual respect. People who work at Little Caesar’s-Camp Creek Marketplace would want
to be part of our team because we operate in an environment that encourages creativity,
diversity, growth, and performance.

Latoya Pless will be the manager of Little Caesars. She has more than twenty three years
relevant experience in the retails industry, and holds various degrees and certificates in
management and hospitality.

1.10 Financials

According to our conservative estimates, Little Caesar’s-Camp Creek Marketplace is expected to
maintain a healthy financial position over the next three years. Our company is expected to break
even in the second month of operations.

We also expect to be profitable in the first year of operations, with profits increasing over the next
two years, as we establish and increase our customer base.

Our main concern will be to have sufficient cash on hand to meet our payment obligations and be
prepared for unexpected needs of cash. Our conservative projections indicate that our business is
able to generate positive cash flows and sufficient cash reserves.

The ratio analysis clearly shows that Little Caesar’s-Camp Creek Marketplace financial position
is expected to remain strong, as measured by its liquidity, long-term solvency, and cash flow
adequacy ratios.

The company's profitability, as measured by its profitability ratios, is excellent, and will gradually

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increase over the next three years.
1.11 Investor Considerations

For investing $96,000 in the company's capital, the new investor would receive a portion of
ownership of 90.56 percent (960 shares of $100 par value). As the investor will hold 90 percent of
the voting stock, he or she will exercise control over the company's policies.

According to our conservative estimates, the cumulative dividends that would be paid to the new
investor, based on 90.56 percent of ownership, over the next five years, would be $239,124.

Key measures of the expected benefit from the investment are presented in the important
assumptions section of this plan. They clearly show that the risks and benefits of such an
investment would be balanced.

We recognize that any investor in a start-up company, no matter how well on paper, ultimately
needs an exit vehicle. Our purpose is to provide the best alternatives to protect investor's interest,
while maintaining the potential growth of our company, the liquidity, and the profitability of
future operations.

There are several options (exit strategies) that could be discussed while considering alternative
methods for the investor to turn illiquid securities into readily tradable securities or cash. These
options are discussed in the final section of this business plan.
1.12 Disclaimer

The current unfavorable economic conditions and prospects are carefully considered, and the
estimates included in the plan are conservative. However, investors are advised to exercise
caution when considering investment alternatives because actual data almost always differ
from projections.

This business plan is designed to help investors better understand the potential risks, costs and
benefits of this business project, but it is not intended, and is not to be considered in itself or any
part of it, as an investment offer or solicitation, as regulated by law. It was developed for sample
purposes, and any resemblance to real situations, people, or data would be purely coincidental.
2.0 Company Summary

Little Caesar’s is pizza take out service which started its operations on May 8, 1959. From its
single store opened 50 years ago in Garden City, Michigan, it has now grown into a global chain by
franchising operations.

La Toya Pless, franchisee of Little Caesars-Camp Creek Marketplace has 23 years experience in
customer service and fashion retail sales. She started as a Sales Floor representative to Assistant
Manager and Store Manager. She will be inviting two investors to start this business.

Their goal is to provide “top-quality pizza made with fresh ingredients at a great price.” The
company will serve a fifteen-mile area with over 500,000 residents, and a rapidly growing
population. The location is very favorable, providing high visibility and a large flow of customers.
Accordingly, the rent that was accounted for in this plan is higher than in other areas of the city.

Little Caesars price is in line with their core value, which is providing top quality pizza with fresh
ingredients at a great price. Customers get real value for their money, especially in the economic
recession. Thus, we will maintain the high level of customer satisfaction.
2.1 Start-up Summary

After spending several months searching for a convenient location, the owners decided to lease a
store space in Camp Creek Marketplace. The start-up capital will be used for legal expenses,
kitchen inventory and equipment, packing and other materials, insurance, rent, promotion and
business sign, and inventory on hand at start-up, as shown in the table below.

The highest initial expenditure is for the franchise fee. This is required to launch the franchise.
After paying our franchise fee, our only liability to the franchise will be the 6% cost of sales
(royalty fee) and 3% advertising fee.

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Cash requirements for start-up are $50,000 and most of this will sit in a bank saving account for
easy access, and most of this will sit in a bank savings account for easy access. The first month
change in accounts payable will top $ 16,347, so we need this $ 50,000 in the event sales are not
what we expected. If the sales are off the projected target, this $50,000 will help us gather enough
cash to pay off our accounts payable within 30 days.

The principals will invest a combined $106,000 to start-up the franchise. We expect the majority of
this will be paid back to the owners within two years of operations, in the form of dividends. This
investment makes up 50% of the of the total start-up requirements for the company.

The remainder consists of $100,000 long term loan guaranteed by a financing institution. The term
of the expected loan is 10 years.

Table: Start-up
Start-up
Requirements

Start-up Expenses
Franchise Fee $20,000
Kitchen Inventory and Supplies $5,000
Insurance $1,500
Rent $3,000
Grand Opening Advertising $15,000
Training Expenses $10,000
Licenses and Permits $4,000
Utility Expenses $2,500
Total Start-up Expenses $61,000

Start-up Assets
Cash Required $50,000
Start-up Inventory $20,000
Leasehold Improvements $50,000
Furniture, Fixtures and Equipment $25,000
Total Assets $145,000

Total Requirements $206,000






$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
Expenses Assets Investment Loans

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2.2 Start-up Funding

We have estimated total start-up costs of $206,000. The numbers in the start-up and the start-
up funding tables are meant to reflect these estimates. The company capital will be $106,000.

LatoyaPless, as co-owner, will provide start-up financing in the amount of $10,000.
Approximately $196,000 additional funding is needed. The purpose of this business plan is to
secure financing for that amount.

An investor and co-owner is welcome to participate in the company's capital for the amount of
$96,000.00 and could be offered a portion of 90 percent ownership of the $106,000 company
capital. The funds provided by the investor will be used to pay the franchise fee, and to cover part
of the start-up expenses. More details about the investor's potential interest in the company are
provided in the important assumptions section of this plan.

For the remaining $100,000 additional financing needed to cover the start-up costs, the company
plans to receive a ten-year term commercial loan facility which will meet the cash flow
requirements. The borrowed funds will be used exclusively to pay the franchise fee and buy
equipment and leasehold improvements, based on the list that will be made available to the
lending institution. The loan could be repaid in equal monthly installments over a ten-year
period.

Our cash-flow analysis demonstrates the company's ability to repay the loan and meet the
interest payment obligations, while maintaining adequate liquidity and generating positive cash
flow and sufficient cash reserves for unforeseen future events.

For conservative purposes, the annual interest rate has been estimated at 12 percent. The actual
interest rate and the borrowing terms will be negotiated with the participating bank. Strong
collateral could be provided by an SBA guarantee, and by the owners' personal assets (for example,
cash collateral in the form of certificates of deposit, to cover the remaining collateral requirements
in addition to the guarantee).

2.3 Company Ownership

Little Caesars-Camp Creek Marketplace (LC-CCM) will be a privately held C-corporation owned in
majority by Ms. Latoya Pless. New investors will be invited to participate in the company's capital.

At the time of formation LC-CCM plans to issue 1,060 shares of $100 par value common stock. The
issued and outstanding common stock would be $106,000. Latoyawould receive 100 shares of
$100 par value, or 9.43 percent ownership.

In return for investing $96,000 in the company capital, the new investors would receive 960 shares
of $100 par value, or 90.56 percent ownership. The new investors would be invited to discuss the
quantity and quality of the stock to be issued, before the incorporation procedures are started.
Additional information about investor's interest, entry, and exit strategy is available in the
important assumptions section of this plan.
3.0 Products and Services

Little Caesars-Camp Creek Marketplace will offer will offer a wide variety of pizza, and other
products as follows;

1. Hot N’ Ready Pepperoni
2. Hot N’ Ready Cheese
3. Ultimate Supreme Pizza
4. 3 Meat Pizza
5. Hula Hawaiian Pizza
6. Custom Pizza
7. Hot N’ Ready Pizza Combo
8. Hot N’ Ready Caesar Wings
9. Italian Cheese Bread
10. Caesar Dips
11. Pepsi Products

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Pizza is served at the counter, for take-out. We take orders online, by phone, or at our location.

3.1 Business Model

Little Caesars-Camp Creek Marketplace is a typical take-out restaurant where customers order
food and drinks at the counter, as opposed to sit-down restaurants that provide table service. Wait-
staff is therefore not included in our work team.

As explained in the previous section, our main products are a variety of pizzas that are served at
the counter, for take-out, as street snacks. We take orders online, by phone, or at our location.

To prepare pizza, we use high quality ingredients and traditional recipes. State-of-the-art energy-
efficient food preparation equipment and technology will be available to our kitchen staff, as we
plan to invest our capital in valuable long-term assets.

Pizza will be served hot and ready to eat. Special package offers protection and quality
conservation during transportation.

3.1.1 Competitive Landscape

Currently, the closest pizza restaurant, Papa John’s is also within Camp Creek Marketplace
shopping center, our intended location in the Eastpoint, GA. Little Caesars will offer top quality
pizza at a greater value, something that most Americans look for during this economic recession
times.

Other main competitors that we have identified in Eastpoint,GA area are: Best Pizza. Domino’s
Pizza, and Pizza Hut. According to our own market survey (see Appendix M), we distinguish
ourselves from them by providing great value quality pizza. Other differences are included in the
next table.



Competitors We have, they don't They have, we don't
Lower prices
table service

Best Pizza Hot and ready pizza

various other food items


better equipment


lower prices, own delivery


better location, better

Domino’s Pizza Delivery service

quality, faster service


customers


friendly pizza staff luxury environment, high-
Pizza Hut

end customers, music and
Other
color lighting




4.0 Market Analysis Summary

Atlanta, GA is a growing low-to-middle-class area, counting more than one million residents. The
presence of Hartsfield-Jackson International Airport paved the way for economic growth of the
area. The airport can accommodate an average of 252,200 passengers daily. The average income
for the area is $45,000.

With continued growth in the area due to the presence of Hartsfield-Jackson International Airport,
opportunities to serve the public will increase. The company will sell to individuals, but it will also
accept some occasional catering jobs to individuals and companies in the area.

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4.1 Market Segmentation

As explained above, the main market segments are: a) individuals (residents and passengers)
accounting for more than 90 percent of our sales, and b) local businesses (corporate customers)
which, in terms of purchase orders, typically make larger orders for their employees and
business needs.

Next illustration shows the market segmentation, taking into account, for conservative purposes,
only the potential number of individuals that would order pizza. Of the 252,000 daily passengers
of Hartsfield-Jackson International Airport, we estimate that 20% of them would go to Camp
Creek Marketplace to have a take-out snack, and out of this, 30% prefers pizza and then the 10%
who wants to have their pizza quick and fast, thus we project sales of 1,512 pieces pizzas a day. Of
the 1, 512 pizzas a day served, 90% goes to retails customers (passengers) and 10% to
businesses.





4.2 Target Market Segment Strategy

Little Caesars-Camp Creek Marketplace will focus on its target market, low-to-middle class
residents in Atlanta, GA and passengers of Hartsfield-Jackson International Airport, along with
local businesses that are located in the area.

Typically, according to our own market survey, the target individual customers prefer to order
pizza more than once a month, as an occasional alternative to an expensive and time-consuming
lunch or dinner. Businesses prefer to order pizza for their employees, or on different occasions or
less exclusive business events.

We will strive to abide with Little Caesar’s core value, which is serving top quality pizza at great
value, give utmost convenience and service excellence to our customers.


By always focusing on providing great value for money, we will be able to build customer
loyalty and word-of-mouth sales that will help us become number the number pizza store in
Eastpoint, GA.

Target Market Share. The estimated total market in Atlanta, GA is 250,000 pizza pies per month,
and our target market share would be 6.6 percent (16,600 pies / 250,000 pies = .066). We believe
this target market share to be reasonable and achievable. See more details in the sales forecast
section of this plan
5.0 Strategy and Implementation Summary

Our strategy is based on delivering a strong customer value proposition in a niche market. We are
looking to offer Atlanta, GA and the passengers of Hartsfield-Jackson International Airport a new
choice in pizza options.

We are building our marketing infrastructure so that we can eventually reach more customers with
Individuals
90%
Businesses
10%

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the same pizza offering. We focus on satisfying the needs of low-to-middle class residents of
Atlanta, GA and passengers of Hartsfield-Jackson International Airport and the companies located
in Atlanta, GA.

Little Caesars-Camp Creek Marketplace will use the advertising tools created by the main office to
promote the business.

Adequate funding has been accounted for when projecting the advertising expenses. We intend to
spend the marketing dollars in the most cost-effective way. Therefore, many other advertising
options will be evaluated during the project implementation, to make sure that we achieve best
results.

5.1 SWOT Analysis

The SWOT analysis provides us with an excellent opportunity to examine and evaluate the
internal strengths and weaknesses of Little Caesars-Camp Creek Marketplace. It also allows us to
focus on the external opportunities presented by the business environment as well as potential
threats.

Next sections explain major strengths, weaknesses, opportunities, and threats that Little
Caesars-Camp Creek Marketplace should be aware of.

5.1.1 Strengths

Little Caesars-Camp Creek Marketplace has a valuable inventory of strengths that would
help it to be successful. These strengths include:

a) Location

b) Top quality pizza at great value

c) Little Caesar’s successful franchise system for the past 50 years

d) State-of-the art, energy efficient pizza equipment and technology for quick and fast service

e) Clear vision of the market need: we know what the customers wants, we have the
technology, and we can give them pizza products that brings the two together.


5.1.2 Weaknesses

Strengths are valuable, but it is useful to realize the weaknesses. We have identified some of
our weaknesses:

a) cost factor associated with franchising

b) we are new in town

c) start-up challenges

5.1.3 Opportunities

Little Caesar’s-Camp Creek Marketplace strengths and the awareness of its weaknesses will help it
capitalize on emerging opportunities. These opportunities include, but are not limited to:

a) Fast growing population in Atlanta, GA

b) No other specialized pizza take-out restaurant within a five-mile radius from our chosen
location

c) A large segment of low-to-class population, huge number of passengers at Hartsfield-
Jackson International Airport which is only minutes away from our location, and the more than
five hundred businesses in the area.

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d) Increased preference of customers for affordable pizza due to economic recession.

5.1.4 Threats

Threats Little Caesars-Camp Creek Marketplace should be aware of include:

a) slow recovery process of the economy from the current crisis

b) changes in the business environment that might reduce our sales

c) higher taxes in the future

d) the commercial property is leased, not owned by our company

e) tight credit times, higher interest rate, and higher inflation rate than predicted.

5.2 Competitive Edge

Little Caesar’s-Camp Creek Marketplace competitive edge is:

• Location: Little Caesar’s-Camp is located in the heart of Atlanta, GA, near the
Hartsfield-Jackson International Airport. This is the busiest airport in America,
serving an average of 252,000 passengers daily.

• Lower operating cost and reasonable prices: Since Little Caesar’s-Camp Creek
Marketplace policy is to provide top quality pizza product with great value, it will
be able to purchase state of the art equipment that can produce hot and ready
pizzas by volume resulting to lower operating cost and great value prices.

• Excellent products and services, quick and fast pizza preparation and cooking,
convenience in buying.

5.3 Sales Strategy

Though Little Caesar’s-Camp Creek Marketplace is a global pizza brand, still we recognize that we
will need to prove our company's worth to Atlanta,GA and Hartsfield-Jackson International
Airport customers, in order to earn respect and business.


Our sales strategy is based on the belief that there will be a regular flow of first-time customers,
due to our convenient location. The real sales effort will be to focus on the conversion of each
first-time customer into a long-term customer relationship, where these customers come
regularly to our pizzeria, and also bring or recommend new friends to share the experience of a
great pizza.

This focus recognizes that it would cost our company less money to convert a new customer into
a long-term relationship, than it does to attract a new customer. With this in mind, our sales
activities will concentrate on keeping existing customers happy, and always meet or exceed their
expectations.

Consistent, customer-centric service is the absolute requirement in the hospitality industry, and so
it is for all our employees. Every member of our team will be empowered to deal with our
customers' requests in such a way that no customer should leave dissatisfied. Problem solving will
be encouraged throughout the organization, and it would also be fair to say that each employee is
part of the sales staff, not only the first-line servers.

5.3.1 Sales Forecast

The following table and charts illustrate the sales forecast for three years. Though Little Caesar’s is
a popular franchise, we still predict that the first few months will be be slower, a consequence of
being new in town, struggling to become more visible within the community. A steady growth
cycle will occur as the months pass. Profitability is projected to occur during the first half of the
first year.

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The increasing sales forecast suggest an important potential growth. Our projected sales are
actually net sales, which consist of the gross proceeds from sales of merchandise -- gross sales --
less returns and allowances.

The projected average monthly sales are approximately $125,000. Considering an average price of
$7.57 per pie, Little Caesar’s-Camp Creek Marketplace, Inc. would need to sell on average 550 pies
each day ($125,000 average monthly sales / $7.57 per pie / 30 business days per month).

Using our equipment and technology we will be able to produce maximum 1500 pies per day
(theoretical operating capacity). However the normal operating capacity, which takes into account
the usual breaks and the idle periods, is only 1125 pies per day, or 75 percent (usually 12 working
hours per day). That means that the average projected 550 pies per day would be reached at only
44 percent of normal operating capacity (550 pies / 1125 pies = .44), which is a reasonable target.

The question remains, will we be able to attract and maintain at least the minimum number of
customers required to order 550 pies per day? If each customer would order one pie it would
mean a total of 16600 customers per month. This figure is disputable because the companies
typically order a larger number of pizzas, and customers buy more than one pie due to its great
value price. However, it is a good starting point for our analysis.

According to a recent study, pizza sales account for 18 percent of all food service sales and, despite
the economic crisis, continues to outpace overall restaurant growth. Our own market survey
shows that one in five persons interviewed use to order pizza at least once a month.

The population in the Atlanta, GA plus the passengers of Hartsfield-Jackson International Airport
exceeds 1 million, which means that, theoretically, the maximum number of pizza ordered per
month at different restaurants in the area (total market) would be 200,000 pies (1 million
passengers / 5 passenger. To this number we would add the orders that will be made by many of
the five hundred businesses in the area, which we estimate at 5 percent of the retail market,
respectively 50,000 pies (1,000,000 pies x .05).

The estimated total market in Atlanta, GA is 250,000 pies per month, and our target market share
would be 6.6 percent (16,600 pies / 250,000 pies = .066). We believe this target market share to
be reasonable and achievable.

15. 15 | P a g e


YEAR 1 YEAR 2 YEAR 3
Hot N' Ready Pepperoni 103,050 113,355 124,691
Hot N' Ready Cheese 47,980 52,778 58,056
Ultimate Supreme Pizza 24,155 26,571 29,228
3 Meat Treat Pizza 16,510 18,161 19,977
Hula Hawaian Pizza 7,940 8,734 9,607
Veggie Pizza 5,346 5,881 6,469
Other 53,461 58,807 64,687
Total Unit Sales 258,442 284,286 312,715
Unit Prices

Hot N' Ready Pepperoni $5.00 $5.00 $5.00
Hot N' Ready Cheese $5.00 $5.00 $5.00
Ultimate Supreme Pizza $10.99 $10.99 $10.99
3 Meat Treat Pizza $8.99 $8.99 $8.99
Hula Hawaian Pizza $8.99 $8.99 $8.99
Veggie Pizza $9.99 $9.99 $9.99
Other $4.00 $4.00 $4.00
Sales YEAR 1 YEAR 2 YEAR 3
Hot N' Ready Pepperoni $515,250 $566,775 $623,453
Hot N' Ready Cheese $239,900 $263,890 $290,279
Ultimate Supreme Pizza $265,463 $292,010 $321,211
3 Meat Treat Pizza $148,425 $163,267 $179,594
Hula Hawaian Pizza $71,381 $78,519 $86,371
Veggie Pizza $53,407 $58,748 $64,623
Other $213,843 $235,227 $258,750
Total Sales $1,507,669 $1,658,436 $1,824,280
Direct Unit Costs
Hot N' Ready Pepperoni $3.50 $3.50 $3.50
Hot N' Ready Cheese $3.50 $3.50 $3.50
Ultimate Supreme Pizza $7.69 $7.69 $7.69
3 Meat Treat Pizza $6.29 $6.29 $6.29
Hula Hawaian Pizza $6.29 $6.29 $6.29
Veggie Pizza $6.99 $6.99 $6.99
Other $2.80 $2.80 $2.80
Direct Cost of Sales
Hot N' Ready Pepperoni 360,675 396,743 436,417
Hot N' Ready Cheese 167,930 184,723 203,195
Ultimate Supreme Pizza 185,824 204,407 224,848
3 Meat Treat Pizza 103,897 114,287 125,716
Hula Hawaian Pizza 49,966 54,963 60,459
Veggie Pizza 37,385 41,124 45,236
Other 149,690 164,659 181,125
Subtotal Direct Cost of Sales 1,055,368 1,160,905 1,276,996
Gross Profit 452,301 497,531 547,284

16. 16 | P a g e






5.4 Milestones

The following table lists important start-up program milestones, with dates and budgets for each.
The schedule indicates Little Caesar’s-Camp Creek Marketplace emphasis on planning for
implementation.

Milestones


Start
Date Days End Date Budget
Market Research Feb-13 32 3/5/2013 $800
Business Plan Mar-13 20 3/25/2013 $675
Legal Documents Mar-13 68 6/1/2013 $1,200
Insurance Mar-13 97 6/30/2013 $1,500
Find Location, Rent Mar-13 31 4/15/2013 $2,000
Loan, Leasehold Improvements Apr-13 59 5/30/2013 $50,000
Promotion & Business Sign May-13 60 6/30/2013 $15,000
Other Start-up Activities May-13 46 6/30/2013 $84,825
Purchase Equipment Jun-13 10 6/25/2013 $25,000
Purchase Inventory & Materials Jun-13 15 6/30/2013 $25,000
Totals

$206,000
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
$180,000
$200,000
Sales Monthly
Other
Veggie Pizza
Hula Hawaian Pizza
3 Meat Treat Pizza
Ultimate Supreme Pizza
Hot N' Ready Cheese
Hot N' Ready Pepperoni
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
YEAR 1YEAR 2YEAR 3
Sales By Year
Other
Veggie Pizza
Hula Hawaian Pizza
3 Meat Treat Pizza
Ultimate Supreme Pizza
Hot N' Ready Cheese
Hot N' Ready Pepperoni

17. 17 | P a g e





5.5 Marketing Strategy

The marketing strategy of Little Caesar’s-Camp Creek Marketplace centers on creating and
developing a unique identity that clearly defines our market niche in terms that benefit our retail
and corporate customers.

Market needs and trends. Since our target market includes two major segments -- low-to-middle
class residents in the Atlanta, GA, and passengers of Hartsfield-Jackson International Airport-- their
most important needs are fast service and great value.

One of the key points of Little Caesar’s-Camp Creek Marketplace strategy is to focus on these target
segments that wants quick and fast pizza with great value.

Factors such as current local trends and historical sales data of similar businesses in the area
ensure that the high demand for pizza will continue over the next five years.


Trends are in our favor: the last study we saw published in the Atlanta, GA area has fast-food and
limited-service restaurant sales growing at 10 percent per year, while fine-dining restaurants, for
example, experienced and will probably continue to see more than 20 percent decrease in sales.

Little Caesar’s Franchise Package comes with advertising costs which have been proven
effective over the years. This is one of our keys to success.

5.6 Pricing Strategy

Our retail and corporate customers are especially sensitive to product value. Little Caesar’s-Camp
Creek Marketplace, Inc. must ensure that price and service are of great value to our customers. Top
quality pizza will be offered at the best price.

Therefore, our pricing strategy will be the most competitive but we will not rely on the selling
price to overshadow other advantages of doing business with our company, such as other lines of
top-quality pizza products that are hot and ready, with great value price and backed by fast
service.


Feb-13 Mar-13 Apr-13 Jun-13 Jul-13
Market Research
Business Plan
Pay Franchise Fee
Legal Documents
Insurance
Find Location, Rent
Loan, Leasehold Improvements
Promotion & Business Sign
Other Start-up Activities

18. 18 | P a g e

5.7 Sourcing Strategy

All of our pizzeria equipment, food supplies, ingredients, packing and accessories for pizza
preparation will be provided by Little Caesar’s Franchising System.

5.8 Location and Facilities

Little Caesar’s-Camp Creek Marketplace is very favorable, providing high visibility, high traffic and
a high flow of customers (passengers from Hartsfield-Jackson International Airport) wishing to
stop at our restaurant to pick up a pizza. Accordingly, the rent that was accounted for in this plan
is higher than in other areas of the city.

The restaurant will be located with Camp Creek Marketplace which provides shopping, dining, and
entertainment. According to Cole Real Estate, “completed in 2003, Camp Creek Marketplace is a
Class A, 425,000-square-foot, 93% occupied power center. It is strategically located at the
intersection of I-285 and Camp Creek Parkway, a major east-west thoroughfare, in a dense retail
corridor just three miles west of Atlanta’s Hartsfield-Jackson International Airport. With a
population of 600,000 residents within 10 miles of the center, and the nearest comparable power
center approximately 15 to 20 miles away, Camp Creek serves a large trade area.”

All these characteristics of the location are consistent with Little Caesar’s goal of providing great
value pizza for Atlanta, GA.

The restaurant will utilize 1250 square feet. The market rent in this high profile area is between
$1.90 and $2.40 per square foot per month. We have estimated $3,000 monthly rent expense
(1,250 square feet x $2.40 per square foot per month).
6.0 Management Summary

Latoya Riley, owner and general manager will be responsible for all administrative functions,
purchasing, inventory control and promotions.
Ms. Riley began as a Sales floor associate in an upscale Brooklyn, NY boutique in 1991, and in those
years advanced to become one of the stores more prominent sales associates and assistant store
manager.
She also functioned as the inside sales contact and handled a variety of special services for the
boutique. In addition to her role as a sales floor representative, she also held positions as an
assistant manager and Store Manager.
In addition to her retail experience, Ms. Riley is drawing on 23 years in the customer service
industry.
Born in Brooklyn, New York, Ms. Pless is a graduate of the City University of New York in New
York. There she earned a Bachelor of Arts degree, majoring in psychology with concentration in
sociology. During the time of her formal education she was employed for four years with The NYC
Department of Education, (NYCDOE) a branch of municipal government in New York City that
manages the city's public school system. In addition LaToya was an active member of AAA, the
American Auto club Association.
Ms. Riley, 35, is a resident of Atlanta, Georgia, and is a supporter of selected organizations such as
Covenant House GA and Job Corps of America.
6.1 Personnel Plan

The personnel plan reflects the need to bolster our capabilities to match our positioning. Little
Caesar’s-Camp Creek Marketplace will have the following staff:

• Manager

• Cook
• Five Part-time Helps


In our experience, a team of seven multi-skilled employees works best for our kind of business.
Working as a team is critical to our success. We recognize that human resources are Little Caesar’s
most valuable asset. Our personnel strategy focuses on selecting, training, rewarding, and

19. 19 | P a g e

stimulating all employees in order to build employee loyalty, and increase performance.

It will be easy to find and select the best new members of our team. The traditional local food-
service industry, well represented in the area, along with local colleges and schools, have
contributed to the formation and growth of many skilled employees. In the selection process, the
background check is a must in this line of business.

As our restaurant will be open Monday through Sunday from 11:00 AM to 11:00 PM, the team of
seven can operate effectively only by using alternative work schedules that take into account the
busiest periods of the day, the time needed to prepare the food before opening, and a forty hours
week.


In addition to salaries, important bonuses and incentives are included in the personnel table that
will be used to reward employee performance, on a pay-for-performance basis. The cornerstone of
our personnel plan is to maximize productivity and minimize labor burden of the company's
operating expenses, while maintaining strong employee commitment to the success of operations.

Personnel Plan


YEAR 1 YEAR 2 YEAR 3
Manager $22,800 $25,080 $27,588
Cook $20,400 $22,440 $24,684
Part-time Help $16,320 $17,952 $19,747
Part-time Help $16,320 $17,952 $19,747
Part-time Help $16,320 $17,952 $19,747
Part-time Help $16,320 $17,952 $19,747
Part-time Help $16,320 $17,952 $19,747
Bonuses and
Incentives $7,800 $8,580 $9,438
Total Payroll $132,600 $145,860 $160,446
Total People 7 7 7

7.0 Financial Plan

According to our conservative estimates, Little Caesar’s-Camp Creek Marketplace is expected to
maintain a healthy financial position over the next three years. The following plan outlines the
financial development of our company. The business will be initially financed by a $100,000 ten-
year term loan and a total capital investment of $106,000 (Latoya Pless $10,000, plus $96,000 from
investors).

The source to repay the loan will be the cash flow generated from operations. The company will
also finance growth through cash flow.

The projected financial statements have been prepared in accordance with the general accounting
principles, and necessarily include some amounts that are based on reasonable estimates and
judgement. For accounting purposes, the long-term assets are expensed using the straight-line
depreciation method, and inventory is accounted for based on the First-In, First-Out (FIFO)
method.

The following sections outline important financial information.

7.1 Break-even Analysis

For our break-even analysis, we assume fixed costs of approximately $20,280 per month, which
include payroll, utilities, insurance, rent and other fixed costs. We need to sell about 11,330 pies
for minimum $85,920 per month to break even, based on our assumptions.

Since our normal operating capacity is 1,125 pies per day (33,750 pies for $255,000 per month,
as explained in the sales forecast section), and the average projected sales of $125,000 per
month, or 550 pies per day (at only 44 percent of normal operating capacity) are expected to be
much greater than the computed break-even point, we believe that our company is likely to
easily reach and maintain profitability.

20. 20 | P a g e

Little Caesar’s-Camp Creek Marketplace is expected to break even in the second month of
operations.

BREAK EVEN ANALYSIS


Monthly Units Break-even 11,330
Monthly Revenue Break-even $85,920
Assumptions:


Average Per-Unit Revenue $1.79
Average Per-Unit Variable Cost $5.78

Estimated Monthly Fixed Cost $20,280



7.2 Projected Profit and Loss

We expect to be profitable in the first year of operations, with profits increasing over the next two
years, as we establish and increase our customer base.

The following table and charts show the projected profit and loss for three years.

21. 21 | P a g e

Pro Forma Profit and
Loss


YEAR 1 YEAR 2 YEAR 3
Sales $1,507,669 $1,658,436 $1,824,280
Direct Costs of Goods $1,055,368 $1,160,905 $1,276,996
Franchisor Royalty $90,460 $99,506 $109,457
Total Cost of Sales $1,145,828 $1,260,411 $1,386,452
Gross Margin $361,841 $398,025 $437,827
Gross Margin % 24.00% 24.00% 24.00%
Expenses

Payroll $132,600 $145,860 $160,446
Marketing Expenses $45,230 $49,753 $54,728
Depreciation $10,500 $10,500 $10,500
Office Supplies $1,200 $1,320 $1,452
Utilities $6,600 $7,260 $7,986
Insurance $18,000 $19,800 $21,780
Rent $36,000 $39,600 $43,560
Payroll Taxes and
Benefits $38,454 $42,299 $46,529
Other $2,400 $2,640 $2,904
Total Operating
Expenses $290,984 $319,032 $349,886
Profit Before Interest
and Taxes $70,856 $78,992 $87,941
EBITDA $81,356 $89,492 $98,441
Interest Expense $12,000 $12,000 $12,000
Taxes Incurred $17,657 $20,098 $22,782
Net Profit $41,200 $46,895 $53,159
Net Profit/Sales 3% 3% 3%

22. 22 | P a g e







(8,000)
(6,000)
(4,000)
(2,000)
-
2,000
4,000
6,000
8,000
10,000
12,000
14,000
Month
1
Month
2
Month
3
Month
4
Month
5
Month
6
Month
7
Month
8
Month
9
Month
10
Month
11
Month
12
Profit Monthly
-
10,000
20,000
30,000
40,000
50,000
60,000
YEAR 1 YEAR 2 YEAR 3
Profit Yearly

23. 23 | P a g e

7.3 Projected Cash Flow

Many profitable companies go bankrupt because of cash flow deficiencies. That is why our main
concern will be to have sufficient cash on hand to meet our payment obligations, and be prepared
for unexpected needs of cash. Our conservative projections indicate that our business is able to
generate positive cash flows and sufficient cash reserves.

In addition to normal cash inflows and outflows, we will focus on establishing sufficient cash
reserves for contingencies. That includes a possible line of credit with our bank that could be used
in slow sales periods as well. This is a good way to control the cash flow risk.

In addition, excess cash, as projected, should not remain idle, especially during periods of high
interest rates. Management will consider investing idle funds in time deposits or certificates of
deposit at banks, in government securities such as U.S. Treasury notes, or in other trading
securities (cash equivalents).

-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
50,000
Month
1
Month
2
Month
3
Month
4
Month
5
Month
6
Month
7
Month
8
Month
9
Month
10
Month
11
Month
12
Gross Margin Monthly
-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
YEAR 1 YEAR 2 YEAR 3
Gross Margin Yearly

24. 24 | P a g e

The following table and chart show the projected cash flow for three years.







































-
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
500,000
Cash
Net Cash Flow
Cash Balance

25. 25 | P a g e

PRO-FORMA CASH FLOW MONTHLY


YEAR 1 YEAR 2 YEAR 3
CASH RECEIVED

Cash from Operations

Cash Sales

$1,507,669 $1,658,436 $1,824,280
Cash from Receivables

$0 $0 $0
Subtotal Cash from Operations $1,507,669 $1,658,436 $1,824,280
ADDITIONAL CASH RECEIVED

Sales Tax, VAT,HST/GST Received 8.50% $128,152 $140,967 $155,064
New Current Borrowing

$0

New Other Liabilities (Interest Free)

$0

New Long Term Liabilities

$100,000

Sales of Other Current Assets

$0

Sales of Long-term Assests

$0

New Investment Received

$96,000

Subtotal Cash Received $1,831,821 $1,799,403 $1,979,343
EXPENDITURES

Expenditures from Operations

Cash Spending

$132,600 $145,860 $160,446
Bill Payments

$1,140,469 $1,254,516 $1,379,967
Subtotal Spent on Operations $1,273,069 $1,400,376 $1,540,413
ADDITIONAL CASH SPENT

Sales Tax, VAT,HST/GST Paid Out

$128,152 $140,967 $155,064
Principal Repayment of Current
Borrowing

$10,000 $10,000 $10,000
Other Liabilities Principal Repayment

$0
Long term Liabilities Principal
Repayment

$0

Purchase Other Current Assets

$0

Purchase Long Term Assets

$0

Dividends

$0

Subtotal Cash Spent $1,411,221 $1,551,343 $1,705,477
Net Cash Flow $420,600 $248,060 $273,866
Cash Balance $470,600 $718,660 $992,527
7.4 Projected Balance Sheet

We expect a healthy growth in net worth and a healthy financial position. We do not project any
real trouble meeting our debt obligations, as long as we achieve our specific objectives.

The following table is the projected balance sheet for three years.

26. 26 | P a g e

ASSETS YEAR 1 YEAR 2 YEAR 3
Current Assets
Cash $470,600 $718,660 $992,527
Accounts Receivable

Inventory $181,815 $199,996 $219,996
Other Current Assets

Total Current Assets $652,415 $918,656 $1,212,522
Long Term Assets

Long Term Assets $0 $0 $0
Accumulated Depreciation ($10,500) ($21,000) ($31,500)
Total Long Term Assets -$10,500 -$21,000 -$31,500
TOTAL ASSETS $641,915 $897,656 $1,181,022
LIABILITIES AND CAPITAL

Current Liabilities

Accounts Payable $465,715 $693,587 $968,671
Current Borrowing

Other Current Liabilities

Subtotal Current Liabilities $465,715 $693,587 $968,671
Long Term Liabilities $90,000 $80,000 $70,000
TOTAL LIABILITIES $555,715 $773,587 $1,038,671
Paid In Capital $106,000 $106,000 $106,000
Retained Earnings ($61,000) ($19,800) $27,095
Earnings $41,200 $46,895 $53,159
TOTAL CAPITAL $86,200 $124,069 $142,352
TOTAL LIABILITIES AND
CAPITAL $641,915 $897,656 $1,181,022
NET WORTH $86,200 $124,069 $142,352

7.5 Business Ratios

Business ratios for the five years of this plan are shown below.

Management's main responsibility is to put into action and to carry out this plan that is designed to
achieve the financial performance objectives. Little Caesar’s-Camp Creek Marketplace’s
management will constantly monitor key financial performance measures, determine the cause of
any deviations in the measures, and take corrective actions.

A comprehensive ratio analysis can be made to evaluate the financial condition and operating
results of our company, based on the calculations included in the next table.The financial
ratios are calculated based on our conservative projections in terms of liquidity, profitability,
long-term solvency, cash flow adequacy, and market strength.

Liquidity ratios (current and quick ratios, receivables turnover, average collection days,
inventory turnover, average days inventory on hand, payables turnover, and average payment
days) indicate a good debt-paying ability, the effectiveness of customer credit policies, and a
number of days needed to collect receivables, to sell inventory, and to pay account payable that is
consistent with best business practices in our industry.

Liquidity is critical to building a strong and sustainable foundation for future growth. In dealing
with short-term liquidity, we will need to correctly address three key issues: managing cash
during seasonal cycles, setting sales and credit policies, and financing receivables.

Profitability ratios (profit margin, assets turnover, return on assets, and return on equity)
indicate a good profitability of operations, efficient use of assets to produce sales, a good earning
power of the assets, and a good profitability of stockholders' investments.

In addition, we will focus on increasing the gross margin by improving our purchasing methods to
reduce the cost of goods sold. Reducing the selling price is not a preferred option. Our price
strategy is flexible, but we are aware that we cannot compete on price only; there will always be a
competitor offering a lower price.

Long-term solvency ratios (debt to equity, interest coverage) indicate a good capital structure,

27. 27 | P a g e

and more than adequate creditor's protection from default on interest payments.

Cash flow adequacy ratios (cash flow yield, cash flow to sales, cash flow to assets, and net cash
flow) indicate a good ability to generate operating cash flows in relation to net income, a good
ability of sales and assets to generate operating cash flows, and positive cash flow after providing
for commitments.

Market strength ratios (price/earnings ratio and dividend yield) measure investor confidence in
the company, and will be computed only after the company will go public so market price per
share can be determined.

This ratio analysis clearly shows that Little Caesar’s-Camp Creek Marketplace’s financial
condition is expected to remain strong, as measured by its liquidity, long-term solvency, and
cash flow adequacy ratios.

The company's profitability, as measured by its profitability ratios, is excellent, and will gradually
increase over the next three years.

28. 28 | P a g e

FINANCIAL RATIOS YEAR 1 YEAR 1 YEAR 1
Sales Growth 0.00% 10.00% 10.00%
Percent of Total Assets
Accounts Receivable - - -
Inventory 28.32% 22.28% 18.63%
Other Current Assets - - -
Total Current Assets 101.64% 102.34% 102.67%
Long-Term Assets -1.64% -2.34% -2.67%
Total Assets 100.00% 100.00% 100.00%
Current Liabilities 84% 90% 93%
Long-term Liabilities 16% 10% 7%
Total Liabilities 87% 86% 88%
Net Worth 13% 14% 12%
Percent of Sales
Sales 100.00% 100.00% 100.00%
Gross Margin 24.00% 24.00% 24.00%
Selling, General and Administrative
Expenses 3.00% 3.00% 3.00%
Advertising Expenses 0.00% 0.00% 0.00%
Profit Before Interest and Taxes 5.40% 5.40% 5.40%
Main Ratios
Current 1.40 1.32 1.25
Quick 1.01 1.04 1.02
Total Debt to Total Assets 73% 77% 82%
Pre-Tax Return on Net Worth 103% 80% 78%
Pre-Tax Return on Assets 15% 12% 0%
Additional Ratios
Net Profit Margin 3% 3% 3%
Return on Equity 48% 38% 37%
Activity Ratios
Accounts Receivable Turnover - - -
Collection Days - - -
Inventory Turnover 5.80 5.80 5.80
Payment Days - - -
Total Asset Turnover 6% 5% 5%
Debt Ratios
Debt to Net Worth 6.45 6.24 7.30
Current Liab. to Liab. 0.84 0.90 0.93
Liquidity Ratios
Net Working Capital $186,700 $225,069 $243,852
Interest Coverage 6.90 7.58 8.33
Additional Ratios
Assets to Sales 43% 54% 65%
Current Debt/Total Assets 73% 77% 82%
Acid Test 1.01 1.04 1.02
Sales/Net Worth 17.49 13.37 12.82
Dividend Payout - - -

29. 29 | P a g e

7.6 Important Assumptions

Due to the current economic uncertainties, our assumptions are conservative. In judging and
estimating, we have chosen the alternatives that are least likely to overstate assets and
income.

The key underlying assumptions are:

• we assume a slow economic recovery process over the next five years, but no
major depression

• we assume access to capital and financing sufficient to maintain our financial
plan as shown in the tables
• we assume continued popularity of pizza services in our target market

Other important assumptions are included in the next table



YEAR 1 YEAR 2 YEAR 3
Current Interest Rate 9.00% 9.00% 9.00%
Long-term Interest Rate 12.00% 12.00% 12.00%
Tax Rate 30.00% 30.00% 30.00%
Inventory on Hand (days) 21 21 21
Inflation Rate 0.41% 0.41% 0.41%
Max Op. Capacity

(pizzas/day) 1500 1500 1500
Other 0 0 0

7.6.1 Risks

Company management is responsible for constantly evaluating risks and taking corrective actions
to provide adequate prevention, control and risk reserves. We have identified several risks that are
associated with our business project.

There are many possible classifications of risks, but for the purposes of this plan, we have chosen
to group them as follows:

a) External Risks (These risks come from outside the company and are more difficult to
prevent and control.)
 Economic depression. Current trends indicate that the economic downturn is reaching
the bottom, and chances are that the recovery process will begin soon. However, it is likely
to be a slow process, and it will probably take several years until complete recovery and
full growth are achieved. We assess the risk of a major depression to be low.

 Competition and buying patterns changes. There is a high risk that new competitors
will arrive in the relevant marketplace. Our continuous improvement management
strategy and cost control techniques will help us to stay on top of customer preference.
The pizza customer buying patterns are not likely to significantly change over the next
five years. In addition, the population growth predicted in the area will increase the
chances to maintain and boost sales.

 Inflation. According to expert estimates, the inflation rate is likely to remain under
control over the next five years. We have accounted for a 5 percent annual inflation
rate.

 Currency. All our operations are in U.S. dollars, and both equipment and materials
are manufactured in the United States. No currency risk has been accounted for.

 U.S. taxation and economic policy changes. These changes are likely to occur, and it
is not clear how they might influence our financial performance.
That is another reason why our estimates are conservative. This risk is high.

b) Internal Risks (These risks come from inside the company and can be better prevented or
controlled.)

30. 30 | P a g e

 Personnel. There are many skilled food-service employees in Atlanta, GA. We will be able
to select the best new staff members from a large number of valuable applicants. Our
personnel strategy includes modern management techniques that will be applied to
select, hire, motivate, and reward the employees.

This strategy is expected to build and maintain employee loyalty, and increase
productivity. However, before hiring new employees, their background check will be
reviewed, to avoid possible employee theft, which is a frequent risk in the restaurant
industry.

 Cash flow deficiency. Our main concern will be to have sufficient cash on hand to meet
our payment obligations, and be prepared for unexpected needs of cash. Our conservative
projections indicate that our business is able to generate positive cash flows and sufficient
cash reserves to reduce the risk of cash flow deficiency.

 Business continuity over the next three years. In the event something happens to one of
the company's managers and co-owners the other will have the skills and experience
required to take over and continue operations. In addition, the company's incorporation
legal documents include special provisions for protection in such cases.

 Management. Latoya Pless have proven experience in customer service and sales. She
has relevant skills and a solid background in the service industry.
7.6.2 Entry Strategy

Little Caesar’s-Camp Creek Marketplace plans to issue 1,060 shares of $100 per share common
stock. The issued and outstanding par value common stock will be $106,000.

Latoya Pless will invest $10,000 in the company's capital She will receive respectively 100 shares
of $100 par value, or .09 percent ownership.


For investing $96,000 in the company's capital, the new investors would receive a portion of
ownership of 90.56 percent (960 shares of $100 par value). As the investor will hold more than 90
percent of the voting stock, they will exercise control over the company's policies.


7.6.3 Investor Interest

According to our conservative estimates, the cumulative dividends that would be paid to the new
investor, based on 90.56 percent of ownership, over the next three years, would be $127,919.
Dividend payments to the investor would be made as follows:

Year 1 $37,310
Year 2 42,468
Year 3 48,141
Totals $127,919


The other co-owner, Latoya Pless, will not take dividends over the next three years. The reasons
for this decision are: a) she will receive employment compensation and benefits, and b) the
undistributed dividends will increase the amount of retained earnings, as a strategy to strengthen
the company's financial position for sustainable future growth, to increase the company's net
worth, and subsequently its market value.

Key measures of the expected benefit from the investment include:

31. 31 | P a g e


Payback period (the minimum time to recover the initial investment) for the investor's initial
capital contribution of $96,000 is very short, only one year five months, computed as follows:
Initial Cash Investment $96,000
Less Dividends Paid
Year 1 37,310
Year 2 42,468
Year 3 16,222
Unrecovered Investment $0
Payback Period: 2.3369 years, or 2
year 4 months

Weighted average cost of capital (the lowest acceptable rate of return) is estimated at 16
percent.

Net present value (NPV), which evaluates the capital investment by discounting at 16 percent its
future cash flows to their present values, and subtracting the initial investment of $96,000 from
their sum of $151,530 is $55,530, computed as follows:

Net Cash Inflows x
Values


Factor


Year1 $37,310 x .862 $32,161
Year2 42,468 x .743 31,553
Year3 48,141 x .641 30,858
Year 4 52,955 x .552 29,231
Year 5 58,250 x .476 27,727
Total present value of
cash inflows discounted $151,530
at 16%
Less initial investment $96,000
NPV Net present value $55,530


Because the net present value is positive, the investment would achieve at least the minimum
rate of return of 16 percent, and is expected to yield significant additional returns to the
investor.

7.6.4 Exit Strategy

We recognize that any investor in a start-up company, no matter how well on paper, ultimately
needs an exit vehicle. Our purpose is to provide the best alternatives to protect investor's
interest, while maintaining the potential growth of our company, the liquidity, and the
profitability of future operations.

Typically, the fear of investors is that they will become locked into a company that might show no
sign of either going public or going bankrupt. To overcome this potential threat, we are open to
discuss with the investor several exit alternatives, and include the best provisions in the
agreements that are expected be reached by the time of the incorporation.

There are several options that could be discussed while considering alternative methods for the
investor to turn illiquid securities into readily tradable securities or cash. These options include,
but are not limited to:


• IPO (Initial Public Offering)

• Acquisition terms
• Liquidation terms, certain rights and liquidation preferences over common stock
• Selling to a friendly buyer
• Preferred stock, redeemable at option of the holder
• Convertible preferred stock
• Investor's right of first refusal in the next round of financing
• Anti-dilution measures
• Buy-back after the initial five years

32. 32 | P a g e


In addition, we believe that following negotiating terms are expected to increase investor
confidence, and improve management-investor communication:

• A board position and consulting role of the investor

• Good communication between company's management and the investor (For example:
quarterly reports, monthly updates, etc.)
• Setting clear return objectives for the management (projected IRR, potential returns,
sales projections, etc.)
• Not taking certain actions without investor's approval, such as: selling all or substantially
all of the company's assets, setting stock options programs, issuing additional stock to
existing management, selling stock below prices paid by the investor, or creating classes of
stock with liquidation preferences or other rights senior to the investor's class of security.
• Stock price protection, an anti-dilution provision that will result in the investor receiving
more stock, should the company issue stock at a lower price that paid by the investor
• Corporate governance provisions.

33. 33 | P a g e

APPPENDIX

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
Hot N' Ready Pepperoni 3900 4800 6,500 7,700 8,350 8,600 9,000 9,250 10,050 10,750 11,500 12,650
Hot N' Ready Cheese 1700 2050 2780 3500 3650 3650 4100 4250 5,300 5,450 5,500 6,050
Ultimate Supreme Pizza 900 1080 1440 1800 1875 1875 2100 2150 2175 2775 2850 3,135
3 Meat Treat Pizza 600 700 800 1000 1100 1250 1350 1650 1750 1900 2100 2,310
Hula Hawaian Pizza 400 450 450 500 550 600 700 750 800 850 900 990
Veggie Pizza 250 275 303 333 366 403 443 487 536 589 648 713
Other 2500 2750 3025 3328 3660 4026 4429 4872 5359 5895 6484 7133
Total Unit Sales 10,250 12,105 15,298 18,160 19,551 20,404 22,122 23,409 25,970 28,209 29,983 32,981
Unit Prices
Hot N' Ready Pepperoni $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00
Hot N' Ready Cheese $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00
Ultimate Supreme Pizza $10.99 $10.99 $10.99 $10.99 $10.99 $10.99 $10.99 $10.99 $10.99 $10.99 $10.99 $10.99
3 Meat Treat Pizza $8.99 $8.99 $8.99 $8.99 $8.99 $8.99 $8.99 $8.99 $8.99 $8.99 $8.99 $8.99
Hula Hawaian Pizza $8.99 $8.99 $8.99 $8.99 $8.99 $8.99 $8.99 $8.99 $8.99 $8.99 $8.99 $8.99
Veggie Pizza $9.99 $9.99 $9.99 $9.99 $9.99 $9.99 $9.99 $9.99 $9.99 $9.99 $9.99 $9.99
Other $4.00 $4.00 $4.00 $4.00 $4.00 $4.00 $4.00 $4.00 $4.00 $4.00 $4.00 $4.00
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
Hot N' Ready Pepperoni $19,500 $24,000 $32,500 $38,500 $41,750 $43,000 $45,000 $46,250 $50,250 $53,750 $57,500 $63,250
Hot N' Ready Cheese $8,500 $10,250 $13,900 $17,500 $18,250 $18,250 $20,500 $21,250 $26,500 $27,250 $27,500 $30,250
Ultimate Supreme Pizza $9,891 $11,869 $15,826 $19,782 $20,606 $20,606 $23,079 $23,629 $23,903 $30,497 $31,322 $34,454
3 Meat Treat Pizza $5,394 $6,293 $7,192 $8,990 $9,889 $11,238 $12,137 $14,834 $15,733 $17,081 $18,879 $20,767
Hula Hawaian Pizza $3,596 $4,046 $4,046 $4,495 $4,945 $5,394 $6,293 $6,743 $7,192 $7,642 $8,091 $8,900
Veggie Pizza $2,498 $2,747 $3,022 $3,324 $3,657 $4,022 $4,424 $4,867 $5,354 $5,889 $6,478 $7,126

34. 34 | P a g e

Other $10,000 $11,000 $12,100 $13,310 $14,641 $16,105 $17,716 $19,487 $21,436 $23,579 $25,937 $28,531
Total Sales $59,379 $70,205 $88,585 $105,901 $113,737 $118,615 $129,149 $137,059 $150,367 $165,688 $175,707 $193,277
Direct Unit Costs Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9
Month
10 Month 11 Month 12
Hot N' Ready Pepperoni $3.50 $3.50 $3.50 $3.50 $3.50 $3.50 $3.50 $3.50 $3.50 $3.50 $3.50 $3.50
Hot N' Ready Cheese $3.50 $3.50 $3.50 $3.50 $3.50 $3.50 $3.50 $3.50 $3.50 $3.50 $3.50 $3.50
Ultimate Supreme Pizza $7.69 $7.69 $7.69 $7.69 $7.69 $7.69 $7.69 $7.69 $7.69 $7.69 $7.69 $7.69
3 Meat Treat Pizza $6.29 $6.29 $6.29 $6.29 $6.29 $6.29 $6.29 $6.29 $6.29 $6.29 $6.29 $6.29
Hula Hawaian Pizza $6.29 $6.29 $6.29 $6.29 $6.29 $6.29 $6.29 $6.29 $6.29 $6.29 $6.29 $6.29
Veggie Pizza $6.99 $6.99 $6.99 $6.99 $6.99 $6.99 $6.99 $6.99 $6.99 $6.99 $6.99 $6.99
Other $2.80 $2.80 $2.80 $2.80 $2.80 $2.80 $2.80 $2.80 $2.80 $2.80 $2.80 $2.80
Direct Cost of Sales

Hot N' Ready Pepperoni $13,650 $16,800 $22,750 $26,950 $29,225 $30,100 $31,500 $32,375 $35,175 $37,625 $40,250 $44,275
Hot N' Ready Cheese $5,950 $7,175 $9,730 $12,250 $12,775 $12,775 $14,350 $14,875 $18,550 $19,075 $19,250 $21,175
Ultimate Supreme Pizza $6,924 $8,308 $11,078 $13,847 $14,424 $14,424 $16,155 $16,540 $16,732 $21,348 $21,925 $24,118
3 Meat Treat Pizza $3,776 $4,405 $5,034 $6,293 $6,922 $7,866 $8,496 $10,383 $11,013 $11,957 $13,215 $14,537
Hula Hawaian Pizza $2,517 $2,832 $2,832 $3,147 $3,461 $3,776 $4,405 $4,720 $5,034 $5,349 $5,664 $6,230
Veggie Pizza $1,748 $1,923 $2,115 $2,327 $2,560 $2,816 $3,097 $3,407 $3,748 $4,122 $4,535 $4,988
Other $7,000 $7,700 $8,470 $9,317 $10,249 $11,274 $12,401 $13,641 $15,005 $16,506 $18,156 $19,972
Subtotal Direct Cost of
Sales $41,565 $49,143 $62,010 $74,131 $79,616 $83,031 $90,404 $95,941 $105,257 $115,982 $122,995 $135,294
Gross Profit $17,814 $21,061 $26,576 $31,770 $34,121 $35,585 $38,745 $41,118 $45,110 $49,706 $52,712 $57,983

35. 35 | P a g e








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
Manager $1,900 $1,900 $1,900 $1,900 $1,900 $1,900 $1,900 $1,900 $1,900 $1,900 $1,900 $1,900
Cook $1,700 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700 $1,700
Part-time Help $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360
Part-time Help $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360
Part-time Help $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360
Part-time Help $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360
Part-time Help $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360 $1,360
Bonuses and Incentives $650 $650 $650 $650 $650 $650 $650 $650 $650 $650 $650 $650
Total Payroll $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050
Total People 5 5 5 5 5 5 5 5

5 5 5

36. 36 | P a g e

General Assumptions

Plan Month 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 Interest Rate 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00%
Long-term Interest Rate 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% 12.00%
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%
Inflation Rate 0.41% 0.41% 0.41% 0.41% 0.41% 0.41% 0.41% 0.41% 0.41% 0.41% 0.41% 0.41%
Max Op. Capacity

(pizzas/day) 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500 1500
Other 0 0 0 0 0 0 0 0 0 0 0 0

37. 37 | P a g e




Pro Forma Profit and Loss

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

$59,379 $70,205 $88,585 $105,901 $113,737 $118,615 $129,149 $137,059 $150,367 $165,688 $175,707 $193,277
Direct Costs of Goods

$41,565 $49,143 $62,010 $74,131 $79,616 $83,031 $90,404 $95,941 $105,257 $115,982 $122,995 $135,294
Franchisor Royalty 6% $3,563 $4,212 $5,315 $6,354 $6,824 $7,117 $7,749 $8,224 $9,022 $9,941 $10,542 $11,597
Total Cost of Sales $45,128 $53,356 $67,325 $80,485 $86,440 $90,147 $98,153 $104,165 $114,279 $125,923 $133,537 $146,891
Gross Margin

$14,251 $16,849 $21,260 $25,416 $27,297 $28,468 $30,996 $32,894 $36,088 $39,765 $42,170 $46,387
Gross Margin % 24.00% 24.00% 24.00% 24.00% 24.00% 24.00% 24.00% 24.00% 24.00% 24.00% 24.00% 24.00%
Expenses

Payroll

$11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050
Marketing Expenses 3% $1,781 $2,106 $2,658 $3,177 $3,412 $3,558 $3,874 $4,112 $4,511 $4,971 $5,271 $5,798
Depreciation

$875 $875 $875 $875 $875 $875 $875 $875 $875 $875 $875 $875
Office Supplies

$100 $100 $100 $100 $100 $100 $100 $100 $100 $100 $100 $100
Utilities

$550 $550 $550 $550 $550 $550 $550 $550 $550 $550 $550 $550
Insurance

$1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
Rent

$3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Payroll Taxes and Benefits 29% $3,205 $3,205 $3,205 $3,205 $3,205 $3,205 $3,205 $3,205 $3,205 $3,205 $3,205 $3,205
Other

$200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200
Total Operating Expenses $22,261 $22,586 $23,137 $23,657 $23,892 $24,038 $24,354 $24,591 $24,991 $25,450 $25,751 $26,278
Profit Before Interest and Taxes

($8,010) ($5,736) ($1,877) $1,760 $3,405 $4,430 $6,642 $8,303 $11,098 $14,315 $16,419 $20,109
EBITDA

($7,135) ($4,861) ($1,002) $2,635 $4,280 $5,305 $7,517 $9,178 $11,973 $15,190 $17,294 $20,984
Interest Expense

$1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000
Taxes Incurred 30% ($2,703) ($2,021) ($863) $228 $722 $1,029 $1,693 $2,191 $3,029 $3,995 $4,626 $5,733
Net Profit ($6,307) ($4,716) ($2,014) $532 $1,684 $2,401 $3,949 $5,112 $7,068 $9,321 $10,793 $13,376
Net Profit/Sales -10.62% -6.72% -2.27% 0.50% 1.48% 2.02% 3.06% 3.73% 4.70% 5.63% 6.14% 6.92%

38. 38 | P a g e

PRO-FORMA CASH FLOW
MONTHLY

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
CASH RECEIVED

Cash from Operations

Cash Sales

$59,379 $70,205 $88,585 $105,901 $113,737 $118,615 $129,149 $137,059 $150,367 $165,688 $175,707 $193,277
Cash from Receivables

$0

Subtotal Cash from Operations $59,379 $70,205 $88,585 $105,901 $113,737 $118,615 $129,149 $137,059 $150,367 $165,688 $175,707 $193,277
ADDITIONAL CASH RECEIVED

Sales Tax, VAT,HST/GST Received 8.50% $5,047 $5,967 $7,530 $9,002 $9,668 $10,082 $10,978 $11,650 $12,781 $14,083 $14,935 $16,429
New Current Borrowing

New Other Liabilities (Interest Free)

New Long Term Liabilities

$100,000

Sales of Other Current Assets

Sales of Long-term Assests

New Investment Received

$96,000

Subtotal Cash Received $260,426 $76,172 $96,115 $114,903 $123,405 $128,697 $140,126 $148,709 $163,148 $179,772 $190,642 $209,706
EXPENDITURES

Expenditures from Operations

Cash Spending

$11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050 $11,050
Bill Payments

$300 $56,164 $64,716 $79,237 $92,916 $99,107 $102,960 $111,282 $117,531 $128,045 $140,148 $148,063
Subtotal Spent on Operations $11,350 $67,214 $75,766 $90,287 $103,966 $110,157 $114,010 $122,332 $128,581 $139,095 $151,198 $159,113
ADDITIONAL CASH SPENT

Sales Tax, VAT,HST/GST Paid Out

$5,047 $5,967 $7,530 $9,002 $9,668 $10,082 $10,978 $11,650 $12,781 $14,083 $14,935 $16,429
Principal Repayment of Current
Borrowing

$833 $833 $833 $833 $833 $833 $833 $833 $833 $833 $833 $833
Other Liabilities Principal
Repayment
Long term Liabilities Principal
Repayment

Purchase Other Current Assets

39. 39 | P a g e

Purchase Long Term Assets

$0

Dividends

Subtotal Cash Spent $17,231 $74,014 $84,129 $100,122 $114,467 $121,073 $125,821 $134,815 $142,195 $154,011 $166,967 $176,375
Net Cash Flow $243,195 $2,158 $11,985 $14,781 $8,938 $7,625 $14,305 $13,893 $20,953 $25,760 $23,675 $33,331
Cash Balance $293,195 $295,353 $307,339 $322,120 $331,057 $338,682 $352,987 $366,880 $387,833 $413,594 $437,269 $470,600

40. 40 | P a g e

PRO-FORMA BALANCE SHEET Starting


Balances 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

Current Assets

Cash $0 $293,195 $295,353 $307,339 $322,120 $331,057 $338,682 $352,987 $366,880 $387,833 $413,594 $437,269 $470,600
Accounts Receivable $0

Inventory $0 $23,688 $33,203 $44,372 $57,799 $71,932 $86,504 $102,024 $118,256 $135,685 $154,494 $174,304 $181,815
Other Current Assets

Total Current Assets $0 $316,883 $328,556 $351,710 $379,919 $402,990 $425,186 $455,011 $485,136 $523,519 $568,087 $611,573 $652,415
Long Term Assets

Long Term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Accumulated Depreciation

($875) ($1,750) ($2,625) ($3,500) ($4,375) ($5,250) ($6,125) ($7,000) ($7,875) ($8,750) ($9,625) ($10,500)
Total Long Term Assets $0 ($875) ($1,750) ($2,625) ($3,500) ($4,375) ($5,250) ($6,125) ($7,000) ($7,875) ($8,750) ($9,625) ($10,500)
TOTAL ASSETS $0 $316,008 $326,806 $349,085 $376,419 $398,615 $419,936 $448,886 $478,136 $515,644 $559,337 $601,948 $641,915
LIABILITIES AND CAPITAL

Current Liabilities

Accounts Payable

$178,148 $194,495 $219,622 $247,257 $268,602 $288,356 $314,190 $339,161 $370,434 $405,641 $438,291 $465,715
Current Borrowing

Other Current Liabilities

Subtotal Current Liabilities $0 $178,148 $194,495 $219,622 $247,257 $268,602 $288,356 $314,190 $339,161 $370,434 $405,641 $438,291 $465,715
Long Term Liabilities $100,000 $99,167 $98,333 $97,500 $96,667 $95,833 $95,000 $94,167 $93,333 $92,500 $91,667 $90,833 $90,000
TOTAL LIABILITIES $100,000 $277,315 $292,828 $317,122 $343,924 $364,435 $383,356 $408,357 $432,495 $462,934 $497,307 $529,124 $555,715
Paid In Capital $106,000 $106,000 $106,000 $106,000 $106,000 $106,000 $106,000 $106,000 $106,000 $106,000 $106,000 $106,000 $106,000
Retained Earnings ($61,000) ($61,000) ($61,000) ($61,000) ($61,000) ($61,000) ($61,000) ($61,000) ($61,000) ($61,000) ($61,000) ($61,000) ($61,000)
Earnings

($6,307) ($11,023) ($13,036) ($12,504) ($10,821) ($8,420) ($4,471) $641 $7,710 $17,030 $27,823 $41,200
TOTAL CAPITAL $45,000 $38,693 $33,977 $31,964 $32,496 $34,179 $36,580 $40,529 $45,641 $52,710 $62,030 $72,823 $86,200
TOTAL LIABILITIES AND
CAPITAL $145,000 $316,008 $326,806 $349,085 $376,419 $398,615 $419,936 $448,886 $478,136 $515,644 $559,337 $601,948 $641,915
NET WORTH ($100,000) $38,693 $33,977 $31,964 $32,496 $34,179 $36,580 $40,529 $45,641 $52,710 $62,030 $72,823 $86,200