Thanks for downloading a sample plan

from Bplans.com
A sample plan is a great way to get started, but you cant just print
this plan out and turn it into the bank. Youre still going to have to put
in all your own information and do all of your own financial forecasts.
With LivePlan, you can easily use this sample as inspiration and create
your own plan, complete with financial tables and graphs. Youll also
be able to:

Save time with linked financial tables (the formulas are built in,
so you dont have to do the calculations!)
Benefit from tons of help, advice, and resources.
Present your plan with confidence, with automatic charts and
graphs corresponding to your financial data.
Work on your plan anywhere, on any computer.

For 20 dollars I ended up getting a quarter of a million dollars of

funding. Thats worth it!
Todd C. Tablegate
Click here to save 50% off the first month of LivePlan!

Cover Page

This sample business plan has been made available to users of Business Plan Pro , business
planning software published by Palo Alto Software. Names, locations and numbers may have been
changed, and substantial portions of text may have been omitted from the original plan to preserve
confidentiality and proprietary information.
You are welcome to use this plan as a starting point to create your own, but you do not have
permission to reproduce, resell, publish, distribute or even copy this plan as it exists here.
Requests for reprints, academic use, and other dissemination of this sample plan should be emailed
to the marketing department of Palo Alto Software at marketing@paloalto.com. For product
information visit our Website: www.paloalto.com or call: 1-800-229-7526.

Copyright

Palo Alto Software, Inc., 1995-2009 All rights reserved.

Legal Page
Confidentiality Agreement
The undersigned reader acknowledges that the information provided by
_________________________ in this business plan is confidential; therefore, reader agrees not to
disclose it without the express written permission of _________________________.
It is acknowledged by reader that information to be furnished in this business plan is in all respects
confidential in nature, other than information which is in the public domain through other means
and that any disclosure or use of same by reader, may cause serious harm or damage to
_________________________.
Upon request, this document is to be immediately returned to _________________________.
___________________
Signature
___________________
Name (typed or printed)
___________________
Date

This is a business plan. It does not imply an offering of securities.

Table of Contents

1.0 Executive Summary.....................................................................................................................1

Chart: Highlights...........................................................................................................................1
1.1 Objectives....................................................................................................................................1
1.2 Mission...........................................................................................................................................1
1.3 Keys to Success.........................................................................................................................2
2.0 Company Summary......................................................................................................................2
2.1 Start-up Summary....................................................................................................................2
Table: Start-up...............................................................................................................................2
Chart: Start-up..............................................................................................................................3
Table: Start-up Funding..............................................................................................................4
2.2 Company Locations and Facilities.......................................................................................4
3.0 Products and Services.................................................................................................................4
3.1 Product and Service Description.........................................................................................5
3.2 Competitive Comparison........................................................................................................5
3.3 Technology...................................................................................................................................5
4.0 Market Analysis Summary.........................................................................................................5
4.1 Market Segmentation..............................................................................................................6
Table: Market Analysis................................................................................................................6
Chart: Market Analysis (Pie).....................................................................................................6
4.2 Target Market Segment Strategy........................................................................................7
4.2.1 Market Trends.....................................................................................................................7
4.2.2 Market Growth....................................................................................................................7
4.2.3 Market Needs......................................................................................................................7
4.3 Service Business Analysis......................................................................................................7
4.3.1 Business Participants.......................................................................................................7
5.0 Strategy and Implementation Summary.............................................................................8
5.1 Competitive Edge......................................................................................................................8
5.2 Marketing Strategy...................................................................................................................8
5.2.1 Pricing Strategy.................................................................................................................8
5.3 Sales Strategy............................................................................................................................8
5.3.1 Sales Forecast....................................................................................................................9
Table: Sales Forecast...............................................................................................................9
Chart: Sales Monthly...............................................................................................................9
6.0 Management Summary.............................................................................................................10
6.1 Personnel Plan..........................................................................................................................10
Table: Personnel..........................................................................................................................10
7.0 Financial Plan................................................................................................................................11
7.1 Important Assumptions........................................................................................................11
Table: General Assumptions...................................................................................................11
7.2 Key Financial Indicators........................................................................................................11
Chart: Benchmarks.....................................................................................................................11
7.3 Break-even Analysis...............................................................................................................12
Chart: Break-even Analysis....................................................................................................12
Table: Break-even Analysis.....................................................................................................12
Page 1

Table of Contents

7.4 Projected Profit and Loss.....................................................................................................13

Table: Profit and Loss................................................................................................................13
Chart: Profit Monthly.................................................................................................................14
Chart: Profit Yearly.....................................................................................................................14
Chart: Gross Margin Monthly.................................................................................................15
Chart: Gross Margin Yearly.....................................................................................................15
7.5 Projected Cash Flow...............................................................................................................16
Chart: Cash...................................................................................................................................16
Table: Cash Flow.........................................................................................................................17
7.6 Projected Balance Sheet......................................................................................................18
Table: Balance Sheet.................................................................................................................18
7.7 Business Ratios........................................................................................................................19
Table: Ratios.................................................................................................................................19
Table: Sales Forecast...........................................................................................................................1
Table: Personnel....................................................................................................................................2
Table: General Assumptions.............................................................................................................3
Table: Profit and Loss..........................................................................................................................4
Table: Cash Flow...................................................................................................................................5
Table: Balance Sheet...........................................................................................................................6

Page 2

Corporate Software Sales

1.0 Executive Summary

This business plan outlines the strategy for sales of enterprise software planning solutions to
medium-sized companies and franchises. Corporate Software Sales (CSS) will act as the direct
sales arm of a software manufacturing firm based in Oregon. We expect a high degree of
profitability based on our plan to key in on businesses that have already expressed the need for
such services and products to the software manufacturer. Our management expertise in dealing
with corporate decision makers and our partner's reputation will be the cornerstone of our
success.

Chart: Highlights

1.1 Objectives

Market a business planning software package to corporate managers and achieve $60K in
commission fees in year one.
Customize the software to the individual needs of each client.
Provide training and follow-up service to each client.

1.2 Mission
The employees of CSS recognize that information is vital for management and presenting that
information in an efficient and easily understood framework is crucial. Also, not every business
manager requires similar tools; what works for a service based company might be useless for a
manufacturer. That's why we market an already proven third-party software planning tool which
we will customize to the client's individual needs. Although we recognize the intimate
relationship between profitability and quality products, we know that our success is ultimately
dependent on the well-being of our employees.

Page 1

Corporate Software Sales

1.3 Keys to Success

The success of our company is dependent on our ability to:

Anticipate clients needs.

Adapt software solutions to these needs.
Identify industries/corporations that need planning tools.

2.0 Company Summary

CSS provides enterprise-corporate planning software solutions. We identify companies' planning
needs and work with a third-party manufacturer to create software to address these needs.
Although the actual software is produced out-of-house, we guarantee the customer the right
solution.
2.1 Start-up Summary
Start-up expenses, which cover phone calls, office furniture, letterhead and business cards
come to $3,050. We also need $11,000 of cash on hand. These costs will either be financed by
owner investment or through financing from the software manufacturing partner. Details and
assumptions are summarized in the following chart and table.
Table: Start-up

Start-up
Requirements
Start-up Expenses
Legal
Stationery etc.
Brochures
Consultants
Insurance
Rent
Research and development
Expensed equipment
Other
Total Start-up Expenses

$300
$250
$0
$0
$1,000
$0
$0
$1,500
$0
$3,050

Start-up Assets
Cash Required
Other Current Assets
Long-term Assets
Total Assets

$11,000
$0
$0
$11,000

Total Requirements

$14,050

Page 2

Corporate Software Sales

Chart: Start-up

Page 3

Corporate Software Sales

Table: Start-up Funding

Start-up Funding
Start-up Expenses to Fund
Start-up Assets to Fund
Total Funding Required

$3,050
$11,000
$14,050

Assets
Non-cash Assets from Start-up
Cash Requirements from Start-up
Additional Cash Raised
Cash Balance on Starting Date
Total Assets

$0
$11,000
$0
$11,000
$11,000

Liabilities and Capital

Liabilities
Current Borrowing
Long-term Liabilities
Accounts Payable (Outstanding Bills)
Other Current Liabilities (interest-free)
Total Liabilities

$0
$0
$500
$0
$500

Capital
Planned Investment
Investor 1
Investor 2
Other
Additional Investment Requirement
Total Planned Investment

$9,000
$4,550
$0
$0
$13,550

Loss at Start-up (Start-up Expenses)

Total Capital

($3,050)
$10,500

Total Capital and Liabilities

$11,000

Total Funding

$14,050

2.2 Company Locations and Facilities

The company will be located in a home-based office in Portland, Oregon. This location is ideal,
as it is close to the software manufacturer's facilities and several of the first potential clients'
home offices.
3.0 Products and Services
CSS will provide medium- and large-sized companies with enterprise-wide collaborative
planning solutions. We will also provide consulting services by helping companies recognize
opportunities for using technology to streamline their business processes. Finally, we will
provide complete training for the use of solutions purchased from us.

Page 4

Corporate Software Sales

3.1 Product and Service Description

Software
CSS software products consist of a business planning software package that is proven in the
consumer market. In fact, this product is the top-rated and best-selling small business planning
package. The enterprise version will be similar to the consumer version however, it will be
modified to fit the needs of different clients. The product will allow corporate sales forces and
franchises to use planning tools to achieve tremendous efficiencies in their business processes.
In essence, a sales force will be able to write concise business plans for any customer and
through the use of an extranet, allow the customer to collaboratively plan their own account.
Franchises will be able to create a road map of their business plans that corporate managers
can monitor and adjust accordingly. The possibility exists to customize the product to work with
other collaborative tools such as LotusNotes and the clients email applications.
Consulting
CSS will perform an analysis of all potential clients' planning strategies and tactics as well as
their degree of aptitude with planning software and information technology. The goal of this
analysis is to ensure that all clients get a solution that best fits their needs and capabilities.
Whether they decide to purchase the product or not they will have an expert analysis of their
planning strategies.
Training
CSS will provide further value to our customers, and ease the customer service burden on our
partner, by ensuring that all product users are properly trained in the use of all software
solutions.
Interface
Through the software manufacturer, CSS will provide an additional product which will give the
client a dedicated service representative--eliminating the need for product updates. This will in
essence create a "living" product which can grow and adapt with the clients' needs. The
interface representative will function through the clients' established extranet.
3.2 Competitive Comparison
Alternative products do not offer a complete package of tools. For example, to get similar
results from another product(s) the client would have to integrate complex spreadsheets, word
processing software, instructions and Web based collaboration themselves.
3.3 Technology
The software package runs on Windows 95, 98, 2000, Windows NT, and Macintosh platforms.
4.0 Market Analysis Summary
We operate in the business-to-business segment of e-commerce which recent research
estimates transactions in excess of $160 billion (www.e-commerceguide.com). Our market is
further segmented into companies with sales forces greater than 100 people and companies
with branches, divisions or franchises in excess of 100 units.

Page 5

Corporate Software Sales

4.1 Market Segmentation

We segment our market by size of sales force and number of company subunits. Our target
customers will have sales operations in excess of 100 direct sales representatives or more than
100 organizational subdivisions or franchises. For the first three years of operation we will focus
on U.S. companies in the Pacific Northwest, California and the Southwest. Geographically this
make sense as our office is central to these regions and management has established key client
contacts in each of these areas. Larger clients are more likely to benefit from the efficiencies
our product offers and will provide fees that will sustain our profitability. Exact figures for the
number of businesses are hard to determine, however, the lean structure of our company will
allow us to be profitable by generating two to three new clients per year.
Table: Market Analysis

Market Analysis
Potential Customers

Growth

Sales Companies
Franchises
Other
Total

3%
2%
5%
2.49%

Year 1

Year 2

Year 3

Year 4

Year 5

500
800
200
1,500

515
812
210
1,537

530
824
221
1,575

546
836
232
1,614

562
849
244
1,655

CAGR
2.97%
1.50%
5.10%
2.49%

Chart: Market Analysis (Pie)

Page 6

Corporate Software Sales

4.2 Target Market Segment Strategy

Our strategy is designed to target:

Medium- to large-size organizations whose sales forces provide their clients with proposals
and plans that the client either collaborates on, or would benefit from collaboration.
Companies that sell franchise rights and take an active role in the success of their
franchises.
Larger clients that will provide greater revenues through a larger volume of software
licensing sales and greater chance of selling client interface solution.

4.2.1 Market Trends

The most significant trend affecting our company is the growth of business-to-business ecommerce. More and more firms recognize the need to take advantage of the exchange of
information over the Internet and our products and services rely on this.
4.2.2 Market Growth
The fastest growing segment of the e-commerce industry is the business-to-business sector.
This segment has gone from less than $50 billion to more than $160 billion in three years.
4.2.3 Market Needs
Customization-products that strengthen their brand and address their differences:

We will "Private Label" the solution so as to further strengthen the clients' brand.
We recognize that different clients will have varying levels of sophistication and we will
design different product templates for each customer.

Speed, efficiency and information:

Our product will allow the client to make better and faster business decisions and receive
quicker feedback from their end-customer.
Managers will have the ability to monitor the progress and profitability of their staff.

4.3 Service Business Analysis

Customers tend to buy enterprise software solutions based on reputation, price and reliability.
Also, compatibility with existing or legacy systems is very important. With this in mind, the key
decision makers and influencer(s) will be the companies' chief financial officer and chief
information officer.
4.3.1 Business Participants
There are currently several companies that provide business planning software for desktop
applications, but as yet none of these offer enterprise-wide solutions. Additional competitors are
companies which provide word processing, spreadsheet and collaborative planning software, as
well as publishers of business planning literature.

Page 7

Corporate Software Sales

5.0 Strategy and Implementation Summary

Various strategy/and implementation topics are discussed in the following sections.
5.1 Competitive Edge
Our greatest strength and competitive edge is the reputation and success of the desktop
software product. This product is the market leader in sales and consumer ratings. Our success
will rely upon building on those strengths. We will also rely on our experience working with
decision makers at the corporate level.
5.2 Marketing Strategy
We will position CSS as the best planning consultant for large corporations interested in the
desktop software we sell. The software's reputation is already established, so we need to focus
on our understanding of the needs of large corporations and franchises, and how we can
translate that into finding the correct software solution.
5.2.1 Pricing Strategy
This is an expensive solution to develop and maintain, and the price will reflect the premium
quality of the offering. Set-up costs to the client will run between $100K-$200K. The dedicated
service option is approximately $5K/year. Software licenses are $100/year.
5.3 Sales Strategy
We will first target the corporate offices of franchises with more than 100 units, and companies
with sales forces in excess of 100 personnel. The software manufacturer has already provided
the names and contact information for several firms which fit this profile. These firms have
approached the software manufacturer about enterprise solutions in the past. The software firm
has also provided a list of larger businesses that purchased an executive version of their
desktop product. We will contact these firms with the idea of helping them take this planning
tool to the next level.
Management of CSS has business contacts at the decision maker level for several more
prospects as well. These will be our secondary targets.
Tertiary targets will come from lists of firms fitting the above criteria which management has
generated through Web-based market research efforts. Tactics for approaching these prospects
will be indirect, i.e., we will contact sales managers and/or franchisees to establish whether the
firm fits our profile and then probe for upper or middle level management contact information.
We will attempt to establish a face-to-face meeting with decision makers (CFO, CIO, COO)
where we will present a proposal tailored to their needs. If possible, we will also have this
proposal reside on an extranet so that the client can modify the proposal and see first-hand
how the product and service work.

Page 8

Corporate Software Sales

5.3.1 Sales Forecast

Our sales consist of two services--consulting and training, and one product-the
software/extranet package (called start-up sales). Our services provide a fraction of the
revenue we will receive for the software/extranet solution, but they will sustain our cash flow
needs while we develop the enterprise sales. Sales of consulting, training and product are
predicted to grow at 30%, 20% and 10% respectively. Costs associated with these sales are
estimated at 10% for start-up sales, 40% for consulting fees and 50% for training. We expect
these costs to decrease two, five, and ten percentage points respectively in years two and
three.
Table: Sales Forecast

Sales Forecast
Year 1

Year 2

Year 3

$150,000
$2,400
$2,550
$154,950

$165,000
$3,120
$3,060
$171,180

$189,750
$4,368
$3,978
$198,096

Year 1
$15,000
$960
$1,275
$17,235

Year 2
$13,200
$1,092
$1,224
$15,516

Year 3
$15,180
$1,529
$1,591
$18,300

Sales
Start-up fees
Consulting fees
Training fees
Total Sales
Direct Cost of Sales
Start-up fees
Consulting fees
Training fees
Subtotal Direct Cost of Sales

Chart: Sales Monthly

Page 9

Corporate Software Sales

6.0 Management Summary

Ronald Ivanhoe, 33, founded the company in September of 2000 to take advantage of a
partnership opportunity with a highly successful Pacific NW software company. He has an MBA
in marketing and e-commerce from the University of Arizona, and has designed numerous
successful business plans for companies in the manufacturing, e-commerce and entertainment
sectors. He consults with insurance brokers, e-commerce, and manufacturing companies in
marketing strategies. He has lived in Asia for five years, speaks Japanese fluently and currently
resides in Portland, OR.
6.1 Personnel Plan
Payroll expenses reflect the salary of Mr. Ivanhoe.
Table: Personnel

Personnel Plan
Year 1

Year 2

Year 3

Ivanhoe
Other
Total People

$80,000
$0
0

$85,000
$0
0

$90,000
$0
0

Total Payroll

$80,000

$85,000

$90,000

Page 10

Corporate Software Sales

7.0 Financial Plan

The most crucial issue affecting our financial plan is the receipt of start-up fees for the
customization and installation of the software and extranet solution. This drives our cash flow,
and all other aspects of our operation.
7.1 Important Assumptions
This table summarizes the general assumptions used to project our balance sheet.
Table: General Assumptions

General Assumptions
Plan Month
Current Interest Rate
Long-term Interest Rate
Tax Rate
Other

Year 1

Year 2

Year 3

1
10.00%
8.00%
30.00%
0

2
10.00%
8.00%
30.00%
0

3
10.00%
8.00%
30.00%
0

7.2 Key Financial Indicators

The chart below shows the relative relationships, year-to-year, of four business indicators;
sales, gross margin, operating expenses, collection days of accounts receivable.

Chart: Benchmarks

Page 11

Corporate Software Sales

7.3 Break-even Analysis

We have a break-even point in sales/month for year one as shown below.

Chart: Break-even Analysis

Table: Break-even Analysis

Break-even Analysis
Monthly Revenue Break-even

$8,450

Assumptions:
Average Percent Variable Cost
Estimated Monthly Fixed Cost

11%
$7,510

Page 12

Corporate Software Sales

7.4 Projected Profit and Loss

Monthly P&L fluctuate drastically due to the work required before a sale is closed. One to two
months prior to closing a sale, we will incur travel costs and other miscellaneous expenses
associated with our consulting service. Expenses are approximately 40% of fees. Set-up costs
to the client (our commission), drive revenue in the period a sale is made, as do training fees.
Associated direct costs are 10% and 50% respectively; however, as we anticipate a learning
curve in training costs, these decrease to a flat rate in year two of eight percent.
The direct cost of start-up fees is our major expense. As the client prepares to go live with the
product, we will need to travel more frequently to the site, bring in their key end-customers,
and travel to the manufacturer more frequently as well. We have anticipated that start-up fees
will grow 10% in year two and 15% in year three. Consulting fees are projected to grow at a
steady rate of 20% and training fees at 30%. As a result, net profit is projected to grow at a
conservative and realistic rate for the first three years.

Table: Profit and Loss

Pro Forma Profit and Loss

Year 1

Year 2

Year 3

Sales
Direct Cost of Sales
Other
Total Cost of Sales

$154,950
$17,235
$0
$17,235

$171,180
$15,516
$0
$15,516

$198,096
$18,300
$0
$18,300

Gross Margin
Gross Margin %

$137,715
88.88%

$155,664
90.94%

$179,796
90.76%

Payroll
Marketing/Promotion
Depreciation
Utilities
Insurance
Rent
Payroll Taxes
Other

$80,000
$4,000
$0
$480
$1,440
$4,200
$0
$0

$85,000
$5,000
$0
$500
$1,440
$4,200
$0
$0

$90,000
$6,000
$0
$550
$1,440
$4,350
$0
$0

Total Operating Expenses

$90,120

$96,140

$102,340

Profit Before Interest and Taxes

EBITDA
Interest Expense
Taxes Incurred

$47,595
$47,595
$0
$14,279

$59,524
$59,524
$0
$17,857

$77,456
$77,456
$0
$23,237

Net Profit
Net Profit/Sales

$33,317
21.50%

$41,667
24.34%

$54,219
27.37%

Expenses

Page 13

Corporate Software Sales

Chart: Profit Monthly

Chart: Profit Yearly

Page 14

Corporate Software Sales

Chart: Gross Margin Monthly

Chart: Gross Margin Yearly

Page 15

Corporate Software Sales

7.5 Projected Cash Flow

Our cash flow assumptions are dependent on the start-up fee. We will receive 15-20% of the
total fee in commission. Historical values of start-up fees are from $150K to $200K and the
accounts have taken from one to four months to close. Conservative estimates lead us to
believe that we can attain sales revenue from start-up fees of between $135K and $140K in
year one.

Chart: Cash

Page 16

Corporate Software Sales

Table: Cash Flow

Pro Forma Cash Flow

Year 1

Year 2

Year 3

$77,475
$76,895
$154,370

$85,590
$85,529
$171,119

$99,048
$98,947
$197,995

$0
$0
$0
$0
$0
$0
$0
$154,370

$0
$0
$0
$0
$0
$0
$0
$171,119

$0
$0
$0
$0
$0
$0
$0
$197,995

Year 1

Year 2

Year 3

$80,000
$33,015
$113,015

$85,000
$49,973
$134,973

$90,000
$53,107
$143,107

$0
$0
$0
$0
$0
$0
$0
$113,015

$0
$0
$0
$0
$0
$0
$0
$134,973

$0
$0
$0
$0
$0
$0
$0
$143,107

$41,355
$52,355

$36,146
$88,501

$54,888
$143,389

Cash Received
Cash from Operations
Cash Sales
Cash from Receivables
Subtotal Cash from Operations
Additional Cash Received
Sales Tax, VAT, HST/GST Received
New Current Borrowing
New Other Liabilities (interest-free)
New Long-term Liabilities
Sales of Other Current Assets
Sales of Long-term Assets
New Investment Received
Subtotal Cash Received
Expenditures
Expenditures from Operations
Cash Spending
Bill Payments
Subtotal Spent on Operations
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out
Principal Repayment of Current Borrowing
Other Liabilities Principal Repayment
Long-term Liabilities Principal Repayment
Purchase Other Current Assets
Purchase Long-term Assets
Dividends
Subtotal Cash Spent
Net Cash Flow
Cash Balance

Page 17

Corporate Software Sales

7.6 Projected Balance Sheet

Balance sheet is a result of key assumptions and estimated sales/cash flows.
Table: Balance Sheet

Pro Forma Balance Sheet

Year 1

Year 2

Year 3

$52,355
$580
$0
$52,935

$88,501
$641
$0
$89,142

$143,389
$742
$0
$144,131

$0
$0
$0
$52,935

$0
$0
$0
$89,142

$0
$0
$0
$144,131

Year 1

Year 2

Year 3

Accounts Payable
Current Borrowing
Other Current Liabilities
Subtotal Current Liabilities

$9,119
$0
$0
$9,119

$3,659
$0
$0
$3,659

$4,428
$0
$0
$4,428

Long-term Liabilities
Total Liabilities

$0
$9,119

$0
$3,659

$0
$4,428

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

$13,550
($3,050)
$33,317
$43,817
$52,935

$13,550
$30,267
$41,667
$85,483
$89,142

$13,550
$71,933
$54,219
$139,703
$144,131

Net Worth

$43,817

$85,483

$139,703

Assets
Current Assets
Cash
Accounts Receivable
Other Current Assets
Total Current Assets
Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets
Liabilities and Capital
Current Liabilities

Page 18

Corporate Software Sales

7.7 Business Ratios

The following table outlines important business ratios for pre-packaged software, as described
by the standard industry classification (SIC) index, 7372.
Table: Ratios

Ratio Analysis
Year 1

Year 2

Year 3

Industry Profile

n.a.

10.47%

15.72%

9.70%

Accounts Receivable
Other Current Assets
Total Current Assets
Long-term Assets
Total Assets

1.10%
0.00%
100.00%
0.00%
100.00%

0.72%
0.00%
100.00%
0.00%
100.00%

0.51%
0.00%
100.00%
0.00%
100.00%

21.50%
45.70%
70.20%
29.80%
100.00%

Current Liabilities
Long-term Liabilities
Total Liabilities
Net Worth

17.23%
0.00%
17.23%
82.77%

4.10%
0.00%
4.10%
95.90%

3.07%
0.00%
3.07%
96.93%

42.40%
19.20%
61.60%
38.40%

100.00%
88.88%
65.84%
0.00%
30.72%

100.00%
90.94%
64.01%
0.00%
34.77%

100.00%
90.76%
60.68%
0.00%
39.10%

100.00%
100.00%
79.40%
1.30%
2.20%

5.81
5.81
17.23%
108.62%
89.91%

24.36
24.36
4.10%
69.63%
66.77%

32.55
32.55
3.07%
55.44%
53.74%

1.51
1.16
61.60%
3.50%
9.20%

Sales Growth
Percent of Total Assets

Percent of Sales
Sales
Gross Margin
Selling, General & Administrative Expenses
Advertising Expenses
Profit Before Interest and Taxes
Main Ratios
Current
Quick
Total Debt to Total Assets
Pre-tax Return on Net Worth
Pre-tax Return on Assets
Additional Ratios

Year 1

Year 2

Year 3

Net Profit Margin

Return on Equity

21.50%
76.04%

24.34%
48.74%

27.37%
38.81%

n.a
n.a

133.58
60
4.57
67
2.93

133.58
3
12.17
52
1.92

133.58
3
12.17
27
1.37

n.a
n.a
n.a
n.a
n.a

0.21
1.00

0.04
1.00

0.03
1.00

n.a
n.a

$43,817
0.00

$85,483
0.00

$139,703
0.00

n.a
n.a

0.34
17%
5.74
3.54

0.52
4%
24.19
2.00

0.73
3%
32.38
1.42

n.a
n.a
n.a
n.a

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

Page 19

Corporate Software Sales

Dividend Payout

0.00

0.00

0.00

n.a

Page 20

Appendix
Table: Sales Forecast

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

$0
$500
$0
$500

$45,000
$300
$300
$45,600

$25,000
$0
$250
$25,250

$0
$600
$0
$600

$0
$200
$0
$200

$30,000
$0
$400
$30,400

$0
$0
$0
$0

$0
$400
$0
$400

$0
$200
$0
$200

$50,000
$0
$600
$50,600

$0
$200
$1,000
$1,200

$0
$0
$0
$0

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

$0

$4,500

$2,500

$0

$0

$3,000

$0

$0

$0

$5,000

$0

$0

$200

$120

$0

$240

$80

$0

$0

$160

$80

$0

$80

$0

Sales
Start-up fees
Consulting fees
Training fees
Total Sales
Direct Cost of Sales
Start-up fees
Consulting fees
Training fees
Subtotal Direct Cost of Sales

0%
0%
0%

$0

$150

$125

$0

$0

$200

$0

$0

$0

$300

$500

$0

$200

$4,770

$2,625

$240

$80

$3,200

$0

$160

$80

$5,300

$580

$0

Page 1

Appendix
Table: Personnel

Personnel Plan
Ivanhoe
Other
Total People
Total Payroll

0%
0%

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

$6,000
$0
0

$6,000
$0
0

$6,000
$0
0

$6,000
$0
0

$6,000
$0
0

$6,000
$0
0

$6,000
$0
0

$6,000
$0
0

$6,000
$0
0

$6,000
$0
0

$10,000
$0
0

$10,000
$0
0

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$10,000

$10,000

Page 2

Appendix
Table: General Assumptions

General Assumptions
Plan Month
Current Interest Rate
Long-term Interest Rate
Tax Rate
Other

Tax Rate

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

10

11

Month 12
12

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

10.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

8.00%

30.00%
0

30.00%
0

30.00%
0

30.00%
0

30.00%
0

30.00%
0

30.00%
0

30.00%
0

30.00%
0

30.00%
0

30.00%
0

30.00%
0

Page 3

Appendix
Table: Profit and Loss

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

$500

$45,600

$25,250

$600

$200

$30,400

$0

$400

$200

$50,600

$1,200

$0

Direct Cost of Sales

$200

$4,770

$2,625

$240

$80

$3,200

$0

$160

$80

$5,300

$580

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$200

$4,770

$2,625

$240

$80

$3,200

$0

$160

$80

$5,300

$580

$0

Other
Total Cost of Sales
Gross Margin
Gross Margin %

$300

$40,830

$22,625

$360

$120

$27,200

$0

$240

$120

$45,300

$620

$0

60.00%

89.54%

89.60%

60.00%

60.00%

89.47%

0.00%

60.00%

60.00%

89.53%

51.67%

0.00%

Expenses
Payroll

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$10,000

$10,000

Marketing/Promotion

$0

$1,000

$1,000

$0

$0

$1,000

$0

$0

$0

$1,000

$0

$0

Depreciation

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$40

$40

$40

$40

$40

$40

$40

$40

$40

$40

$40

$40

Insurance

$120

$120

$120

$120

$120

$120

$120

$120

$120

$120

$120

$120

Rent

$350

$350

$350

$350

$350

$350

$350

$350

$350

$350

$350

$350

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$6,510

$7,510

$7,510

$6,510

$6,510

$7,510

$6,510

$6,510

$6,510

$7,510

$10,510

$10,510

Profit Before Interest and Taxes

($6,210)

$33,320

$15,115

($6,150)

($6,390)

$19,690

($6,510)

($6,270)

($6,390)

$37,790

($9,890)

($10,510)

EBITDA

($6,210)

$33,320

$15,115

($6,150)

($6,390)

$19,690

($6,510)

($6,270)

($6,390)

$37,790

($9,890)

($10,510)

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

($1,863)

$9,996

$4,535

($1,845)

($1,917)

$5,907

($1,953)

($1,881)

($1,917)

$11,337

($2,967)

($3,153)

($4,347)

$23,324

$10,581

($4,305)

($4,473)

$13,783

($4,557)

($4,389)

($4,473)

$26,453

($6,923)

($7,357)

-869.40%

51.15%

41.90%

-717.50%

-2236.50%

45.34%

0.00%

-1097.25%

-2236.50%

52.28%

-576.92%

0.00%

Utilities

Payroll Taxes
Other
Total Operating Expenses

Interest Expense
Taxes Incurred
Net Profit
Net Profit/Sales

15%

Page 4

Appendix
Table: Cash Flow

Pro Forma Cash Flow

Month 1

Month 2

Month 3

$250

$22,800

$12,625

$0

$8

$1,002

$250

$22,808

$13,627

$0
$0

$0
$0

New Other Liabilities (interest-free)

$0

New Long-term Liabilities

$0

Sales of Other Current Assets

Month 4

Month 5

Month 6

$300

$100

$15,200

$22,461

$12,214

$293

$22,761

$12,314

$15,493

$0
$0

$0
$0

$0
$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Sales of Long-term Assets

$0

$0

New Investment Received

$0

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

$0

$200

$100

$25,300

$600

$0

$603

$14,693

$7

$197

$940

$24,477

$603

$14,893

$107

$25,497

$1,540

$24,477

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0
$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$250

$22,808

$13,627

$22,761

$12,314

$15,493

$603

$14,893

$107

$25,497

$1,540

$24,477

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$6,000

$10,000

$10,000

($653)

($572)

$16,022

$7,286

($2,386)

($929)

$8,820

($2,606)

($2,498)

($678)

$15,665

($4,457)

$5,347

$5,428

$22,022

$13,286

$3,615

$5,071

$14,820

$3,394

$3,502

$5,322

$25,665

$5,543

Sales Tax, VAT, HST/GST Paid Out

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Principal Repayment of Current Borrowing

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Other Liabilities Principal Repayment

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Long-term Liabilities Principal Repayment

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Purchase Other Current Assets

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Purchase Long-term Assets

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Dividends

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$5,347

$5,428

$22,022

$13,286

$3,615

$5,071

$14,820

$3,394

$3,502

$5,322

$25,665

$5,543

($5,097)

$17,380

($8,396)

$9,475

$8,700

$10,422

($14,217)

$11,499

($3,396)

$20,175

($24,125)

$18,934

Cash Received
Cash from Operations
Cash Sales
Cash from Receivables
Subtotal Cash from Operations
Additional Cash Received
Sales Tax, VAT, HST/GST Received
New Current Borrowing

Subtotal Cash Received

Expenditures

0.00%

Expenditures from Operations

Cash Spending
Bill Payments
Subtotal Spent on Operations
Additional Cash Spent

Subtotal Cash Spent

Net Cash Flow

Page 5

Appendix
Cash Balance

$5,903

$23,283

$14,888

$24,363

$33,063

$43,485

$29,268

$40,767

$37,372

$57,546

$33,421

$52,355

Table: Balance Sheet

Pro Forma Balance Sheet

Assets

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

$11,000
$0
$0
$11,000

$5,903
$250
$0
$6,153

$23,283
$23,042
$0
$46,325

$14,888
$34,665
$0
$49,553

$24,363
$12,504
$0
$36,867

$33,063
$390
$0
$33,453

$43,485
$15,297
$0
$58,781

$29,268
$14,693
$0
$43,961

$40,767
$200
$0
$40,967

$37,372
$293
$0
$37,665

$57,546
$25,397
$0
$82,943

$33,421
$25,057
$0
$58,478

$52,355
$580
$0
$52,935

$0
$0
$0
$11,000

$0
$0
$0
$6,153

$0
$0
$0
$46,325

$0
$0
$0
$49,553

$0
$0
$0
$36,867

$0
$0
$0
$33,453

$0
$0
$0
$58,781

$0
$0
$0
$43,961

$0
$0
$0
$40,967

$0
$0
$0
$37,665

$0
$0
$0
$82,943

$0
$0
$0
$58,478

$0
$0
$0
$52,935

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

Starting Balances

Current Assets
Cash
Accounts Receivable
Other Current Assets
Total Current Assets
Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets
Liabilities and Capital
Current Liabilities
Accounts Payable
Current Borrowing
Other Current Liabilities
Subtotal Current Liabilities

$500
$0
$0
$500

$0
$0
$0
$0

$16,848
$0
$0
$16,848

$9,495
$0
$0
$9,495

$1,115
$0
$0
$1,115

$2,173
$0
$0
$2,173

$13,719
$0
$0
$13,719

$3,456
$0
$0
$3,456

$4,851
$0
$0
$4,851

$6,021
$0
$0
$6,021

$24,846
$0
$0
$24,846

$7,304
$0
$0
$7,304

$9,119
$0
$0
$9,119

Long-term Liabilities
Total Liabilities

$0
$500

$0
$0

$0
$16,848

$0
$9,495

$0
$1,115

$0
$2,173

$0
$13,719

$0
$3,456

$0
$4,851

$0
$6,021

$0
$24,846

$0
$7,304

$0
$9,119

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

$13,550
($3,050)
$0
$10,500
$11,000

$13,550
($3,050)
($4,347)
$6,153
$6,153

$13,550
($3,050)
$18,977
$29,477
$46,325

$13,550
($3,050)
$29,558
$40,058
$49,553

$13,550
($3,050)
$25,253
$35,753
$36,867

$13,550
($3,050)
$20,780
$31,280
$33,453

$13,550
($3,050)
$34,563
$45,063
$58,781

$13,550
($3,050)
$30,006
$40,506
$43,961

$13,550
($3,050)
$25,617
$36,117
$40,967

$13,550
($3,050)
$21,144
$31,644
$37,665

$13,550
($3,050)
$47,597
$58,097
$82,943

$13,550
($3,050)
$40,674
$51,174
$58,478

$13,550
($3,050)
$33,317
$43,817
$52,935

Net Worth

$10,500

$6,153

$29,477

$40,058

$35,753

$31,280

$45,063

$40,506

$36,117

$31,644

$58,097

$51,174

$43,817

Page 6