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Business Plan and Financial Projections

Two Guys With Wieners, LLC

Contact: Grant BelcherPhone: (405) 334-7978

E-mail: [email protected]

_______________________________________________________________________________CONFIDENTIAL – Do Not Distribute Without Permission

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MISSIONTwo Guys With Wieners prides itself on providing a

unique and affordable dining experience for its customers. We aim to be not just a restaurant, but a

one-stop shop for a memorable retail and tourism experience for all.


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Table of Contents

Executive Summary..................................................................................................... 4Ownership & Location....................................................................................................5Trademarks.....................................................................................................................5Allocation of Funds.........................................................................................................6Investor Proposition.......................................................................................................6Financial Highlights.........................................................................................................7

Restaurants................................................................................................................. 8

Merchandise................................................................................................................9Sample Merchandise Designs.........................................................................................9

Market Analysis Summary......................................................................................... 12Market Segmentation...................................................................................................15Competitive Comparison..............................................................................................15

Strategy and Implementation Summary.....................................................................17Competitive Edge..........................................................................................................17Marketing Strategy.......................................................................................................18

Management Summary..............................................................................................19

Financial Forecast...................................................................................................... 20

Appendix................................................................................................................... 28


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Executive SummaryWhat started out as a simple hot dog joint in Crested Butte, Colorado has quickly become the most talked-about restaurant and brand in town. Two Guys with Wieners, LLC (also referred to as “the Company”) is proud to elevate the humble hot dog to a memorable and fun-filled dining experience with endless potential for merchandising, expansion, and national brand recognition.

At Two Guys with Wieners, customers can design their dream dog, topping the world’s best hot dogs—genuine Chicago 100% beef Vienna wieners—with their choice of over 20 classic, unorthodox, and gourmet toppings. Those feeling less creative (or more adventurous) can choose from among our wide and constantly-evolving selection of signature dogs, including:

Capone’s Wiener, a classic Chicago-style dog with all the top-shelf toppings you’d find at a dog shop in Chi Town

The Cronkite, topped with sauerkraut, brown mustard, and melted Swiss cheese Our classic Chili Cheese Dog, or knocked up a notch by adding a handful of jalapenos, making it

a Willie’s Wiener

While we’re known for our wieners, we also offer burgers and burger melts, cheese steaks with grilled onions on fresh hoagies, loaded baked potato fries, chili cheese tots, onion rings, corn dogs for the kids, and much more, including vegetarian and gluten-free options. Our menu, like our clientele, is ever-expanding and the possibilities are endless.

Not hungry? No problem. This is where Two Guys With Wieners strays from the usual restaurant business model: we don’t strictly depend on feeding the masses to succeed. The memorable name and logo of our store immediately struck a chord with locals and visitors alike, and our sign is quickly becoming one of the most photographed locations in Crested Butte. In a city blessed by incredible mountain scenery and abundant wildlife, this is ample evidence of just how popular our

brand truly is. We attract thousands of tourists per year to our humble little paradise, and all of them are eager to carry home a memento of their trip. Two Guys With Wieners merchandise—all of it proudly tagged “Crested Butte, Colorado”—is quickly becoming a must-have souvenir of any trip to our fair city. In just two months, we’ve sold more than 600 t-shirts, and sales show no sign of slowing.

The marketing behind our merchandise is nothing if not extraordinary. From t-shirts to pint glasses, pens to hats, almost every customer leaves wearing or carrying a Two Guys With Wieners billboard out into the world. We aim to expand our merchandise sales to the web and mail order, leveraging social


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media links and the hundreds of humorous t-shirt and souvenir marketplaces online to gain additional exposure. We foresee this avenue becoming an even bigger sales generator than the restaurant itself.

Our successes to date have made it clear: Two Guys With Wieners is far more than simply a restaurant. It’s a one-stop shop for a unique dining experience for all. Our next goal is to open a second location in Stillwater, Oklahoma, where the large local student population will further drive recognition and demand for our food and merchandise. As we move into larger markets and other avenues of commerce, our expectations are high. Our goal is to find the right investors for the next few storefronts, and then to move into full on franchise mode by 2014. Our model works anywhere, but thrives in college towns or large tourist destinations. Building the Wiener Empire has never been more exciting, and we invite you to join us!

To achieve the Company’s objectives, is seeking $60,000 in total investor funding.

Ownership & LocationTwo Guys With Wieners is a Limited Liability Company registered in the state of Colorado. The Company is wholly owned by Grant Belcher and Rebecca Belcher (100%).

TrademarksThe Two Guys With Wieners name, intellectual property, and logo is protected by federal trademark law, and cannot be legally used by any other person or entity in any form. This trademark applies to both the restaurants’ services and all merchandise.


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Allocation of FundsThe table below outlines the sources and uses of funding:

Investor PropositionThe following investor proposition uses a number of variables to determine a hypothetical share of the Company in exchange for investment. The following scenario is up for negotiation and is dependent on operating and valuation assumptions. The investor share is based on an implied Return on Investment (ROI) multiple of 3.71 and a company valuation of 8.00 times year 5 EBITDA. It should be noted that the target rate of return is dependent on subjective measurements of risk and reward, and valuations are subject to market conditions.

The Company is also open to alternative investment scenarios, including—but not limited to—investment in the original Crested Butte store and/or development of a franchise investment program.


Investor $60,000Total Sources $60,000

Start-up ExpensesLease Deposit $7,200

Total Start-up Expenses $7,200

Start-up AssetsWorking Capital $7,800Inventory $5,000Build Out $20,000Kitchen Equipment $10,000Audio Visual Equipment $5,000Interior Design $3,000

Signage $2,000Total Start-up Assets $52,800

Total Uses $60,000

Sources Of Funds

Uses Of Funds

SOURCES & USES

INVESTOR PROPOSITIONInvestment $60,000Target Rate of Return 30.0%Implied ROI Multiple 3.71Value of Investment (Year 5) $222,776

Year 5 EBITDA $268,170EBITDA Multiple 8.00Projected Company Value (Year 5) $2,145,359

Proposed Investor Share 10%

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Financial HighlightsThe following table and graph illustrate the financial goals of the Company during the next five years:


FINANCIAL HIGHLIGHTSYear 1 Year 2 Year 3 Year 4 Year 5

Total Revenue $420,000 $540,979 $655,931 $758,834 $851,475Gross Margin $293,099 $378,704 $460,178 $533,227 $598,900Operating Expenses $176,523 $207,768 $255,257 $296,548 $333,397EBITDA* $119,243 $173,603 $207,587 $239,346 $268,170Net Prof it $116,577 $170,936 $204,921 $236,679 $265,503

Profitability RatiosGross Margin/Revenue 70% 70% 70% 70% 70%EBITDA/Revenue 28% 32% 32% 32% 31%Net Prof it % 28% 32% 31% 31% 31%

Debt Ratios

Debt Ratio (Total Debt/Total Assets) 13.33% 8.51% 6.52% 5.31% 4.46%Interest Coverage Ratio N/A N/A N/A N/A N/A

Debt Service Coverage Ratio N/A N/A N/A N/A N/A

Days on HandReceivables 0 0 0 0 0Inventory 30 30 30 30 30Payables 30 30 30 30 30

Net Cash Flow $139,510 $176,430 $211,703 $242,948 $271,371Cash Balance - Ending $147,310 $323,741 $535,444 $778,391 $1,049,763

*Earnings before interest, taxes, depreciation & amortization

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Financial Highlights

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RestaurantsWhat started as a simple sausage sandwich has become a ubiquitous part of American culture. Simple and delicious, the hot dog has long been associated with summer, street food, and baseball, and is the perfect foundation for infinite topping variations, improvisations, and creations.

Two Guys with Wieners is proud to serve Chicago’s finest all-beef Vienna hot dogs at its Crested Butte, Colorado, location. The Company’s quick service model allows for residents and visitors to this ski town to enjoy a high quality, fresh hot dog every day of the week. Two Guys with Wieners offers numerous signature variations on the classic hot dog, and is expanding its menu to include specialty burgers, corn dogs, loaded corn dogs, chicken strips, chicken pita bombs, chili, cheese steaks, and an assortment of sides. The Company offers a full bar catering to customers 21 and older, but also provides a warm, family-friendly dining atmosphere with multiple kid-approved drinks and dishes.

Two Guys with Wieners’ welcoming environment features seating for up to 40 people. The Company will work diligently to create a similarly lively yet relaxing atmosphere for guests in its new Stillwater, Oklahoma location. The Oklahoma menu will be expanded and optimized to serve a larger population, but will remain true to its roots in affordable, delicious bar and grill specialties. Both Two Guys with Wieners locations will boast a well-designed dining and bar space. From the sights and smells of savory cuisine to thoughtful use of design throughout the space, Two Guys with Wieners will create a memorable environment for friends and family to grab a quick meal, enjoy a drink, or watch the big game.


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MerchandiseTwo Guys With Wieners’ key competitive advantage is the humor and fun embodied in its name and logo. The Company already does a brisk trade in souvenir t-shirts, hats, glasses, and other merchandise featuring its logo and location, and expects this sector of its business to eventually eclipse restaurant sales. Two Guys With Wieners presently sells merchandise at its Colorado restaurant, and will work to place its merchandise in alternative retail settings in the near future, such as truck stop stores, airport gift shops, and t-shirt shops. These opportunities will build additional recognition for the brand without additional overhead costs being incurred by the Company.

Merchandising growth will be supported by the Company’s increased web presence, especially its online store, social media links, and placement of merchandise on numerous humor- and memorabilia-related ecommerce marketplaces. Soon, even people who haven’t been able to travel to Colorado, or who have never sampled a The Homewrecker, will be wearing the Two Guys With Wieners logo proudly. Sample Merchandise Designs


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Market Analysis SummaryAccording to eMarketer, by the close of 2012, the number of U.S. citizens online will expand by 3.1% to 239 million, representing 75.6% of the total population. With more than three-quarters of the U.S. population online, the Internet will reach a larger audience than ever before. Engagement in online activities is also projected to increase. Nearly two-thirds of all web users will use a social network, 169.3 million people will watch online videos, and 88% of users will browse or research products online.1

While the recession that began in late 2007 kept e-commerce sales relatively flat for nearly three years, in 2010, e-commerce sales increased 14.8%, reaching $167.3 billion. The adoption of mobile technology, as well as consumers increasing confidence and access to disposable income, led to a steady increase in online sales. By the close of 2012, sales will have grown 15% from the previous year, reaching $224.2 billion. The following charts from market research firm eMarketer indicate the projected increase in ecommerce sales over the next four years, as well as a breakdown of sales market share by category.2

1 “US Digital Media Usage: A Snapshot of 2012” eMarketer. Obtained at: http://www.emarketer.com/Products/Explore/ReportList.aspx2 “Fashion Adds Fuel to Fast-Growing Retail Ecommerce Sales” eMarketer. March 22, 2012. Obtained at: http://www.emarketer.com/Article.aspx?R=1008919_______________________________________________________________________________

CONFIDENTIAL – Do Not Distribute Without Permission13


More than 60 billion restaurant visits occurred between 2010 and 2011.3 A majority, 61%, of these visits were to quick-serve, or fast food, restaurants. Market research firm IBISWorld indicates that at the close of 2011, the Fast Food Restaurant industry earned a total of $169 billion in revenue. While the industry saw sales decline at the height of the economic recession, increasing employment figures and a subsequent growth in disposable income will encourage revenue growth in the next five years. The following chart provides an overview of the Fast Food Restaurant industry.4

3 Jennings, Lisa. “Fast-casual segment influences restaurant industry.” Restaurant News February 8, 2012. Obtained at: http://nrn.com/article/fast-casual-segment-influences-overall-restaurant-industry4 “Fast Food Restaurants” IBISWorld. December 2011. Obtained at: www.ibisworld.com_______________________________________________________________________________



The Company’s original location in Crestview, Colorado, and new second location in Stillwater, Oklahoma, places the restaurant in well-trafficked areas. Two Guys with Wieners have chosen locations that will be convenient for local consumer traffic. Although Crested Butte has a relatively small year-round population, the town attracts visitors from around the world who enjoy skiing and mountain biking. In the past, the city has hosted the X Games and U.S. Extreme Skiing Championships. Stillwater, Oklahoma, is home to Oklahoma State University, which attracts more than 23,000 students annually. The following table provides pertinent figures for the population surrounding Crested Butte and Stillwater. This data is provided by ESRI, a market research firm.5

5 Business Analyst Online. Obtained at: http://bao.esri.com/_______________________________________________________________________________



Full Demographic ReportCrested Butte,

ColoradoStillwater, Oklahoma

2010 Total Population 1,726 44,9772015 Total Population 1,855 48,373 2010 - 2015 Annual Rate 1.45% 1.47%

2010 Households 786 17,660 2010 Average Household Size 2.19 2.192010 Families 305 8,115 2010 Average Family Size 2.71 2.91

Median Household Income 2000 $41,230 $25,459 2010 $52,128 $34,768 2015 $58,988 $39,200

Per Capita Income 2000 $26,789 $15,789 2010 $33,252 $21,307 2015 $40,216 $22,616

Median Age 2000 30.9 24.4 2010 33.7 25.5 2015 34.0 26.2

2010 Households by IncomeHousehold Income Base 788 17,662 < $15,000 5.7% 25.1% $15,000 - $24,999 6.6% 14.5% $25,000 - $34,999 14.0% 10.6% $35,000 - $49,999 20.9% 14.2% $50,000 - $74,999 23.6% 15.7% $75,000 - $99,999 13.6% 8.0% $100,000 - $149,999 8.1% 8.1% $150,000 - $199,999 2.3% 2.0% $200,000 + 5.2% 1.8%Average Household Income $73,756 $49,564

2010 Population by AgeTotal 1,725 44,975 0 - 4 4.3% 5.0% 5 - 9 3.1% 3.9% 10 - 14 3.5% 3.4% 15 - 24 13.2% 36.8% 25 - 34 29.0% 17.4% 35 - 44 19.0% 8.4% 45 - 54 15.8% 9.0% 55 - 64 8.1% 7.0% 65 - 74 3.0% 4.3%


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75 - 84 0.8% 3.0% 85+ 0.1% 1.8% 18+ 86.4% 85.4%

2010 Population by Sex Males 55.8% 50.7% Females 44.2% 49.3%

2010 Population 25+ by Educational AttainmentTotal 1,308 22,905 Less than 9th Grade 0.2% 2.0% 9th - 12th Grade, No Diploma 0.6% 3.4% High School Graduate 11.1% 17.3% Some College, No Degree 20.6% 20.7% Associate Degree 4.4% 5.2% Bachelor's Degree 47.6% 27.7% Master's/Prof/Doctorate Degree 15.4% 23.8% 2010 Consumer Spending Food Away from Home: Total $ $2,808,174 $43,767,831 Average Spent $3,572.74 $2,478.36 Spending Potential Index 111 77

Market SegmentationTwo Guys with Wieners will target residents of and visitors to Crested Butte, Colorado, and Stillwater, Oklahoma. While both cities have different demographic bases, the Company believes its target audience will possess the following characteristics:

Families College students Tourists and skiers (Colorado) OSU sports fans (Oklahoma) Individuals and couples aged 18-55 Household income range: $30,000 and above

Competitive ComparisonThe Company will face competition from existing restaurants that provide both a full bar and quick, savory meals. Two Guys with Wieners focus on high-quality hot dogs, as well as comfortable dining room and bar with televisions, will set it apart from other fast food restaurants. In Crested Butte, Colorado, competition arises from the Secret Stash Pizza, a local pizzeria that also serves a full bar. As there are few year-round residents of Crested Butte, competition for customers can be fierce. Two Guys with Wieners’ distinctive name and branding, as well as its hot dog menu, will set it apart the Secret Stash.

Competition in Stillwater, Oklahoma, will come from the chain restaurant Buffalo Wild Wings, which has an established national reputation for its chicken wings, bar, and sports viewing. Local restaurant


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Eskimo Joe’s will also provide competition. Operating since 1975, Eskimo Joe’s is a known hang-out for college students; however, the restaurant does not provide quick-service meals. Reviews on Yelp.com complain that Eskimo Joe’s lacks for quality food and service.6

6 Eskimo Joes. http://www.yelp.com/biz/eskimo-joes-stillwater_______________________________________________________________________________



Strategy and Implementation SummaryTwo Guys With Wieners will continue to develop a brand that emphasizes its wide variety of gourmet hotdogs along with a selection of other menu items including French fries, burgers, and various appetizers. Additionally, the Company’s marketing materials will highlight its dedication to continued growth. The Company will continue to encourage adoption of its products and services through a variety of advertising techniques designed to spread brand awareness, facilitated by the continued use of its official, location-specific logos, which are featured on all marketing materials, merchandise, and outdoor signage.

With its brand and guiding principles established, the Company sends a clear message about the benefits its services offer prospective customers. The Company promotes this message using a comprehensive marketing strategy that includes development of promotional merchandise, newspaper and radio advertisements, and continued promotion of its official website. Two Guys With Wieners intends to use this approach to accomplish the following objectives:

Short Term Secure funding Significantly grow online presence and introduce web sales of merchandise Set up merchandise ecommerce through various online marketplaces

Long Term Generate enough revenue to expand operations

o Begin the process of franchising

To achieve these operational benchmarks, Two Guys With Wieners will continue to build on its advantages, as outlined in the section below.

Competitive EdgeThe Company experiences competition from other quick-service and fast-food restaurants, none of which offer the variety of menu items that is a hallmark of Two Guys With Wieners. The Company will continue to capitalize on its competitors’ weaknesses by building on several strengths:

Memorable and funny branding Location-specific logos Focused on merchandising and developing recognizable souvenirs Targeted to a younger demographic Affordable prices


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Unique menu options

Marketing StrategyTwo Guys With Wieners will continue to use a variety of advertising channels to increase its exposure among prospective customers. Specific channels will include:

Traditional Marketing Methods

Print media: Two Guys With Wieners places ads in local print publications. These advertisements include the Company’s locations and may also offer limited-time discounts or other incentives.

Radio: The Company will continue to develop radio ads designed to reach prospective customers. Radio commercial production can be done cost-effectively, and provides flexibility to tailor the message to the right customer segment. Radio also offers the opportunity to work closely with the appropriate stations to use unique promotions to build awareness and drive revenues.

Promotional goods: The Company will continue to invest in promotional products such as drink ware and branded t-shirts emblazoned with the Company’s name and logo. Two Guys With Wieners’ souvenirs has helped to grow the Company’s brand, and will play a pivotal role in its ongoing expansion plan.

Web-Based Marketing Methods

Website: The Company will capitalize on its existing website (www.twoguyswithwieners.com) to generate interest in its products and services. This website is search engine optimized and contains a number of features including: shopping cart, client testimony, photo gallery, company profile, locations, and menu.


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Management SummaryGrant Belcher, Owner Grant Belcher is an experienced small business owner and has worked professionally in a large number of industries. Currently along with owning Two Guys With Wieners, he is the owner of Kochevars Saloon, located in Crested Butte, Colorado. Mr. Belcher has previously worked as a professional Musician with Napalm Records, held the positions of Vice President and Chief Executive Officer of Digger International Entertainment located in Chicago, Illinois, and served as General Manager for Vision Quest Marketing located in Stillwater, Oklahoma. Mr. Belcher was born and raised in Kingwood, Texas.

Rebecca BelcherBecky Belcher is a Colorado native whose family relocated to Oklahoma when she was 10 years old. She attended Oklahoma State University, and graduated with a Bachelor of Science degree. Mrs. Belcher’s ties to Stillwater will help the Company establish its second storefront there. She and Grant are the proud parents of a two-year-old daughter, Peyton.


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Financial ForecastThe following is a five-year revenue forecast. Direct costs include all costs which can be directly tied to revenue and include “cost of goods.”

The table below shows the units and pricing assumptions underlying the revenue forecast:


REVENUE FORECASTYear 1 Year 2 Year 3 Year 4 Year 5

RevenueFood Sales $210,000 $236,633 $258,066 $273,983 $290,882Merchandise Sales $140,000 $186,805 $221,831 $249,964 $281,666Online Sales $70,000 $117,540 $176,034 $234,887 $278,927

Total Revenue $420,000 $540,979 $655,931 $758,834 $851,475

Direct Cost of RevenueFood Sales $61,855 $69,700 $76,013 $80,701 $85,679Merchandise Sales $36,364 $48,521 $57,618 $64,926 $73,160Online Sales $18,182 $30,530 $45,723 $61,010 $72,449

Subtotal Cost of Revenue $116,401 $148,751 $179,355 $206,637 $231,287

Merchant Processing $10,500 $13,524 $16,398 $18,971 $21,287Total Direct Costs $126,901 $162,275 $195,753 $225,608 $252,574

Gross Margin $293,099 $378,704 $460,178 $533,227 $598,900Gross Margin/Revenue 70% 70% 70% 70% 70%

UNIT ASSUMPTIONSYear 1 Year 2 Year 3 Year 4 Year 5

UnitsFood Sales 42,000 47,327 51,613 54,797 58,176Merchandise Sales 5,833 7,784 9,243 10,415 11,736Online Sales 2,917 4,898 7,335 9,787 11,622

Total Units 50,750 60,008 68,191 74,999 81,534

Unit PriceFood Sales $5.00 $5.00 $5.00 $5.00 $5.00Merchandise Sales $24.00 $24.00 $24.00 $24.00 $24.00Online Sales $24.00 $24.00 $24.00 $24.00 $24.00

Direct Unit CostFood Sales $1.47 $1.47 $1.47 $1.47 $1.47Merchandise Sales $6.23 $6.23 $6.23 $6.23 $6.23Online Sales $6.23 $6.23 $6.23 $6.23 $6.23

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The Company’s personnel forecast is outlined below. Personnel wages indicate the average wage per position and personnel costs are total wages for each position.


PERSONNEL FORECASTYear 1 Year 2 Year 3 Year 4 Year 5

Personnel CountPart-Time Labor 3 3 4 4 4Online Fulf illment 1 2 3 4 5

Total Personnel 4 5 7 8 9

Personnel WagePart-Time Labor $9,360 $9,828 $10,319 $10,835 $11,377Online Fulf illment $9,360 $9,828 $10,319 $10,835 $11,377

Personnel CostsPart-Time Labor $28,080 $29,484 $41,278 $43,341 $45,509

Online Fulf illment $9,360 $19,656 $30,958 $43,341 $56,886Total Payroll $37,440 $49,140 $72,236 $86,683 $102,394Payroll/Revenue 8.91% 9.08% 11.01% 11.42% 12.03%

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The Company intends to deploy its funding to maximize growth and profitability. In the Profit and Loss table below, gross margin equals revenue minus direct costs. The “bottom line” or profit (as measured before and after interest, taxes, depreciation, and amortization) equals gross margin minus operating expenses.


PRO FORMA PROFIT & LOSSYear 1 Year 2 Year 3 Year 4 Year 5

Total Revenue $420,000 $540,979 $655,931 $758,834 $851,475Total Direct Cost of Revenue $126,901 $162,275 $195,753 $225,608 $252,574Gross Margin $293,099 $378,704 $460,178 $533,227 $598,900Gross Margin/Revenue 70% 70% 70% 70% 70%

ExpensesRent $28,800 $30,240 $31,752 $33,340 $35,007Utilities $12,000 $12,600 $13,230 $13,892 $14,586Licenses & Fees $3,000 $3,150 $3,308 $3,473 $3,647Maintenance $6,000 $6,300 $6,615 $6,946 $7,293Insurance $6,000 $6,300 $6,615 $6,946 $7,293Accounting $3,000 $3,600 $4,320 $5,184 $6,221Marketing & Promotion $60,000 $72,000 $86,400 $103,680 $114,048Misc. $12,000 $14,400 $17,280 $20,736 $24,883

Depreciation $2,667 $2,667 $2,667 $2,667 $2,667Payroll Taxes & Benefits $5,616 $7,371 $10,835 $13,002 $15,359

Total Personnel $37,440 $49,140 $72,236 $86,683 $102,394Total Op. Expenses $176,523 $207,768 $255,257 $296,548 $333,397

Profit Before Int. & Tax $116,577 $170,936 $204,921 $236,679 $265,503EBITDA $119,243 $173,603 $207,587 $239,346 $268,170Interest Expense $0 $0 $0 $0 $0Taxes Incurred $0 $0 $0 $0 $0

Net Profit $116,577 $170,936 $204,921 $236,679 $265,503Net Profit % 27.8% 31.6% 31.2% 31.2% 31.2%

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The table and chart below demonstrate when the Company is expected to become profitable. Break-even occurs when accumulated revenue equals accumulated expenses. According to the forecasted financials, month 2 will be the point at which break-even will occur.


Break-Even Month 2

Accumulated Gross Revenue $62,323

BREAK-EVEN ANALYSIS

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The following depictions of the Company’s projected cash flow show that the Company expects to maintain sufficient cash balances over the five years of this plan. The “pro forma cash flow” table differs from the “pro forma profit and loss” (P&L) table. Pro forma cash flow is intended to represent the actual flow of cash in and out of the Company. In comparison, the revenue and expense projections on the P&L table include “non-cash” items and exclude funding and investment illustrations.


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CASH FLOWYear 1 Year 2 Year 3 Year 4 Year 5

OPERATINGNet Prof it $116,577 $170,936 $204,921 $236,679 $265,503Adjustments to Net Prof it

Depreciation & Amortization $2,667 $2,667 $2,667 $2,667 $2,667(Increases)/Decreases in Accounts Receivable $0 $0 $0 $0 $0(Additions)/Depletions of Inventory ($5,792) ($2,777) ($2,249) ($2,210) ($1,842)Increases/(Decreases) in Accounts Payable $26,059 $5,605 $6,365 $5,812 $5,044

Net Cash From Operating Activities $139,510 $176,430 $211,703 $242,948 $271,371

INVESTINGPurchase of Other Current Assets $0 $0 $0 $0 $0Sale of Other Current Assets $0 $0 $0 $0 $0Purchase of Land $0 $0 $0 $0 $0Sale of Land $0 $0 $0 $0 $0

Purchase Long-term Assets $0 $0 $0 $0 $0Sale of Long-term Assets $0 $0 $0 $0 $0

Net Cash From Investing Activities $0 $0 $0 $0 $0

FINANCINGInvestment $0 $0 $0 $0 $0Dividends $0 $0 $0 $0 $0New Current Borrow ing $0 $0 $0 $0 $0Current Borrow ing Repay. $0 $0 $0 $0 $0New Long Term Liabilities $0 $0 $0 $0 $0Long Term Liability Repay $0 $0 $0 $0 $0Net Cash From Financing Activities $0 $0 $0 $0 $0NET CASH FLOW $139,510 $176,430 $211,703 $242,948 $271,371Beginning Cash $7,800 $147,310 $323,741 $535,444 $778,391Ending Cash $147,310 $323,741 $535,444 $778,391 $1,049,763

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The balance sheet below highlights the Company’s projected assets, liabilities, and capital:


BALANCE SHEETYear 1 Year 2 Year 3 Year 4 Year 5

AssetsCurrent AssetsCash $147,310 $323,741 $535,444 $778,391 $1,049,763Accounts Receivable $0 $0 $0 $0 $0Inventory $10,792 $13,569 $15,818 $18,028 $19,870Other Current Assets $0 $0 $0 $0 $0

Total Current Assets $158,102 $337,310 $551,262 $796,420 $1,069,633

Fixed AssetsLong-term Assets $40,000 $40,000 $40,000 $40,000 $40,000Accum. Depreciation $2,667 $5,333 $8,000 $10,667 $13,333Land $0 $0 $0 $0 $0

Total Fixed Assets $37,333 $34,667 $32,000 $29,333 $26,667Total Assets $195,436 $371,977 $583,262 $825,753 $1,096,300

Liabilities and Capital

Current LiabilitiesAccounts Payable $26,059 $31,664 $38,029 $43,840 $48,884

Current Borrow ing $0 $0 $0 $0 $0Other Current Liabilities $0 $0 $0 $0 $0

Subtotal Current Liabilities $26,059 $31,664 $38,029 $43,840 $48,884

Long-term Liabilities $0 $0 $0 $0 $0Total Liabilities $26,059 $31,664 $38,029 $43,840 $48,884

Paid-in Capital $60,000 $60,000 $60,000 $60,000 $60,000Retained Earnings ($7,200) $109,377 $280,313 $485,233 $721,912

Earnings $116,577 $170,936 $204,921 $236,679 $265,503Total Capital $169,377 $340,313 $545,233 $781,912 $1,047,416Total Liabilities and Capital $195,436 $371,977 $583,262 $825,753 $1,096,300

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The sensitivity analysis below assumes that revenues are 15% higher or lower than figures projected earlier in this business plan:


BEST CASE SCENARIO


Revenue $483,000 $622,126 $754,321 $872,659 $979,196Cost of Goods $145,936 $186,617 $225,116 $259,449 $290,461Gross Margin $337,064 $435,509 $529,205 $613,211 $688,736Gross Margin/Revenue 70% 70% 70% 70% 70%Operating Expenses $176,523 $207,768 $255,257 $296,548 $333,397Net Prof it $160,542 $227,742 $273,948 $316,663 $355,338Net Prof it/Revenue 33% 37% 36% 36% 36%

Cash Flow $183,475 $233,236 $280,730 $322,932 $361,206Cash Balance $191,275 $424,511 $705,241 $1,028,173 $1,389,379

WORST CASE SCENARIOYear 1 Year 2 Year 3 Year 4 Year 5

Revenue $357,000 $459,832 $557,541 $645,009 $723,754Cost of Goods $107,866 $137,934 $166,390 $191,767 $214,688Gross Margin $249,134 $321,898 $391,151 $453,243 $509,065Gross Margin/Revenue 70% 70% 70% 70% 70%Operating Expenses $176,523 $207,768 $255,257 $296,548 $333,397Net Prof it $72,612 $114,130 $135,894 $156,695 $175,668Net Prof it/Revenue 20% 25% 24% 24% 24%

Cash Flow $95,546 $119,625 $142,676 $162,964 $181,536Cash Balance $103,346 $222,970 $365,647 $528,610 $710,146

REVENUE IS 15% GREATER THAN PROJECTED

REVENUE IS 15% LESS THAN PROJECTED

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Appendix


REVENUE 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

RevenueFood Sales $16,558 $16,724 $16,891 $17,060 $17,231 $17,403 $17,577 $17,753 $17,930 $18,110 $18,291 $18,474Merchandise Sales $9,865 $10,161 $10,465 $10,779 $11,103 $11,436 $11,779 $12,132 $12,496 $12,871 $13,257 $13,655Online Sales $4,398 $4,618 $4,849 $5,091 $5,346 $5,613 $5,893 $6,188 $6,498 $6,822 $7,164 $7,522

Total Revenue $30,821 $31,502 $32,205 $32,930 $33,679 $34,452 $35,249 $36,073 $36,924 $37,803 $38,711 $39,650

Direct Cost of RevenueFood Sales $4,877 $4,926 $4,975 $5,025 $5,075 $5,126 $5,177 $5,229 $5,281 $5,334 $5,387 $5,441Merchandise Sales $2,562 $2,639 $2,718 $2,800 $2,884 $2,970 $3,059 $3,151 $3,246 $3,343 $3,443 $3,547Online Sales $1,142 $1,199 $1,259 $1,322 $1,388 $1,458 $1,531 $1,607 $1,688 $1,772 $1,861 $1,954

Subtotal Cost of Revenue $8,582 $8,765 $8,953 $9,147 $9,348 $9,554 $9,767 $9,988 $10,215 $10,449 $10,692 $10,942Merchant P rocessing $771 $788 $805 $823 $842 $861 $881 $902 $923 $945 $968 $991Total Direct Costs $9,352 $9,552 $9,758 $9,970 $10,190 $10,416 $10,649 $10,889 $11,138 $11,394 $11,659 $11,933

Gross Margin $21,468 $21,950 $22,447 $22,960 $23,489 $24,036 $24,601 $25,184 $25,786 $26,409 $27,052 $27,717Gross Margin/Revenue 70% 70% 70% 70% 70% 70% 70% 70% 70% 70% 70% 70%

UNIT ASSUMPTIONS Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12

UnitsFood Sales 3,312 3,345 3,378 3,412 3,446 3,481 3,515 3,551 3,586 3,622 3,658 3,695Merchandise Sales 411 423 436 449 463 476 491 506 521 536 552 569Online Sales 183 192 202 212 223 234 246 258 271 284 298 313

Total Units 3,906 3,961 4,016 4,073 4,131 4,191 4,252 4,314 4,377 4,442 4,509 4,577

Unit P riceFood Sales $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00Merchandise Sales $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00Online Sales $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00

Direct Unit CostFood Sales $1.47 $1.47 $1.47 $1.47 $1.47 $1.47 $1.47 $1.47 $1.47 $1.47 $1.47 $1.47Merchandise Sales $6.23 $6.23 $6.23 $6.23 $6.23 $6.23 $6.23 $6.23 $6.23 $6.23 $6.23 $6.23Online Sales $6.23 $6.23 $6.23 $6.23 $6.23 $6.23 $6.23 $6.23 $6.23 $6.23 $6.23 $6.23

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PERSONNEL FORECASTMonth 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12

P ersonnel CountP art-Time Labor 3 3 3 3 3 3 3 3 3 3 3 3Online Fulfillment 1 1 1 1 1 1 1 1 1 1 1 1

Total P ersonnel 4 4 4 4 4 4 4 4 4 4 4 4

P ersonnel WageP art-Time Labor $780 $780 $780 $780 $780 $780 $780 $780 $780 $780 $780 $780Online Fulfillment $780 $780 $780 $780 $780 $780 $780 $780 $780 $780 $780 $780

P ersonnel CostsP art-Time Labor $2,340 $2,340 $2,340 $2,340 $2,340 $2,340 $2,340 $2,340 $2,340 $2,340 $2,340 $2,340Online Fulfillment $780 $780 $780 $780 $780 $780 $780 $780 $780 $780 $780 $780

Total P ayroll $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120P ayroll/Revenue 10.12% 9.90% 9.69% 9.47% 9.26% 9.06% 8.85% 8.65% 8.45% 8.25% 8.06% 7.87%

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PRO FORMA PROFIT & 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

Total Revenue $30,821 $31,502 $32,205 $32,930 $33,679 $34,452 $35,249 $36,073 $36,924 $37,803 $38,711 $39,650Total Direct Cost of Revenue $9,352 $9,552 $9,758 $9,970 $10,190 $10,416 $10,649 $10,889 $11,138 $11,394 $11,659 $11,933Gross Margin $21,468 $21,950 $22,447 $22,960 $23,489 $24,036 $24,601 $25,184 $25,786 $26,409 $27,052 $27,717Gross Margin/Revenue 70% 70% 70% 70% 70% 70% 70% 70% 70% 70% 70% 70%

ExpensesRent $2,400 $2,400 $2,400 $2,400 $2,400 $2,400 $2,400 $2,400 $2,400 $2,400 $2,400 $2,400Utilities $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000Licenses & Fees $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250Maintenance $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500Insurance $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500Accounting $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250Marketing & P romotion $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000Misc. $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000Depreciation $222 $222 $222 $222 $222 $222 $222 $222 $222 $222 $222 $222P ayroll Taxes & Benefits $468 $468 $468 $468 $468 $468 $468 $468 $468 $468 $468 $468Total P ersonnel $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120 $3,120

Total Op. Expenses $14,710 $14,710 $14,710 $14,710 $14,710 $14,710 $14,710 $14,710 $14,710 $14,710 $14,710 $14,710

P rofit Before Int. & Tax $6,758 $7,240 $7,737 $8,250 $8,779 $9,326 $9,890 $10,473 $11,076 $11,698 $12,342 $13,007EBITDA $6,980 $7,462 $7,959 $8,472 $9,001 $9,548 $10,113 $10,696 $11,298 $11,921 $12,564 $13,229Interest Expense $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Taxes Incurred $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Net P rofit $6,758 $7,240 $7,737 $8,250 $8,779 $9,326 $9,890 $10,473 $11,076 $11,698 $12,342 $13,007Net P rofit % 21.9% 23.0% 24.0% 25.1% 26.1% 27.1% 28.1% 29.0% 30.0% 30.9% 31.9% 32.8%

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

OPERATINGNet P rofit $6,758 $7,240 $7,737 $8,250 $8,779 $9,326 $9,890 $10,473 $11,076 $11,698 $12,342 $13,007Adjustments to Net P rofit

Depreciation & Amortization $222 $222 $222 $222 $222 $222 $222 $222 $222 $222 $222 $222(Increases)/Decreases in Accounts Receivable $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0(Additions)/Depletions of Inventory ($3,464) ($180) ($186) ($192) ($198) ($204) ($210) ($217) ($224) ($231) ($239) ($247)Increases/(Decreases) in Accounts P ayable $23,514 $197 $203 $209 $216 $223 $230 $237 $245 $253 $261 $270

Net Cash From Operating Activities $27,030 $7,479 $7,976 $8,490 $9,020 $9,567 $10,132 $10,716 $11,319 $11,942 $12,586 $13,252

INVESTINGP urchase of Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Sale of Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0P urchase of Land $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Sale of Land $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0P urchase Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Sale of Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Net Cash From Investing Activities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

FINANCINGInvestment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Dividends $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0New Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Current Borrowing Repay. $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0New Long Term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Long Term Liability Repay $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Net Cash From Financing Activities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0NET CASH FLOW $27,030 $7,479 $7,976 $8,490 $9,020 $9,567 $10,132 $10,716 $11,319 $11,942 $12,586 $13,252

Beginning Cash $7,800 $34,830 $42,309 $50,285 $58,775 $67,795 $77,362 $87,494 $98,210 $109,529 $121,472 $134,058Ending Cash $34,830 $42,309 $50,285 $58,775 $67,795 $77,362 $87,494 $98,210 $109,529 $121,472 $134,058 $147,310

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BALANCE SHEETMonth 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12

AssetsCurrent AssetsCash $34,830 $42,309 $50,285 $58,775 $67,795 $77,362 $87,494 $98,210 $109,529 $121,472 $134,058 $147,310Accounts Receivable $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Inventory $8,464 $8,644 $8,830 $9,022 $9,219 $9,423 $9,634 $9,851 $10,075 $10,306 $10,545 $10,792Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Current Assets $43,294 $50,953 $59,115 $67,797 $77,014 $86,785 $97,128 $108,061 $119,604 $131,778 $144,603 $158,102

Fixed AssetsLong-term Assets $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000Accum. Depreciation $222 $444 $667 $889 $1,111 $1,333 $1,556 $1,778 $2,000 $2,222 $2,444 $2,667Land $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Fixed Assets $39,778 $39,556 $39,333 $39,111 $38,889 $38,667 $38,444 $38,222 $38,000 $37,778 $37,556 $37,333Total Assets $83,072 $90,509 $98,449 $106,908 $115,903 $125,452 $135,572 $146,283 $157,604 $169,556 $182,159 $195,436

Liabilities and CapitalCurrent Liabilities

Accounts Payable $23,514 $23,711 $23,914 $24,123 $24,339 $24,562 $24,792 $25,030 $25,275 $25,528 $25,789 $26,059Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Subtotal Current Liabilities $23,514 $23,711 $23,914 $24,123 $24,339 $24,562 $24,792 $25,030 $25,275 $25,528 $25,789 $26,059

Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Total Liabilities $23,514 $23,711 $23,914 $24,123 $24,339 $24,562 $24,792 $25,030 $25,275 $25,528 $25,789 $26,059

P aid-in Capital $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $60,000Retained Earnings ($7,200) ($7,200) ($7,200) ($7,200) ($7,200) ($7,200) ($7,200) ($7,200) ($7,200) ($7,200) ($7,200) ($7,200)Earnings $6,758 $13,998 $21,735 $29,985 $38,764 $48,090 $57,980 $68,453 $79,529 $91,228 $103,570 $116,577

Total Capital $59,558 $66,798 $74,535 $82,785 $91,564 $100,890 $110,780 $121,253 $132,329 $144,028 $156,370 $169,377Total Liabilities and Capital $83,072 $90,509 $98,449 $106,908 $115,903 $125,452 $135,572 $146,283 $157,604 $169,556 $182,159 $195,436

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