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Table of Contents
1.0 Executive Summary .................................................................................................................... 1
Chart: Highlights .......................................................................................................................... 2
1.1 Objectives.................................................................................................................................... 2
1.2 Mission .......................................................................................................................................... 2
1.3 Keys to Success ........................................................................................................................ 2
2.0 Company Summary ..................................................................................................................... 3
2.1 Company Ownership ............................................................................................................... 3
2.2 Start-up Summary ................................................................................................................... 3
Table: Start-up Funding ............................................................................................................ 4
Chart: Start-up ............................................................................................................................. 5
Table: Start-up.............................................................................................................................. 5
3.0 Products ........................................................................................................................................... 6
4.0 Market Analysis Summary ........................................................................................................ 6
4.1 Market Segmentation ............................................................................................................. 7
Table: Market Analysis ............................................................................................................... 8
Chart: Market Analysis (Pie) .................................................................................................... 9
4.2 Target Market Segment Strategy ...................................................................................... 9
4.3 Industry Analysis ...................................................................................................................... 9
4.3.1 Competition and Buying Patterns ............................................................................ 10
5.0 Strategy and Implementation Summary .......................................................................... 10
5.1 Competitive Edge ................................................................................................................... 11
5.2 Marketing Strategy ................................................................................................................ 11
5.3 Sales Strategy ......................................................................................................................... 11
5.3.1 Sales Forecast.................................................................................................................. 12
Table: Sales Forecast ........................................................................................................... 13
Chart: Sales Monthly ............................................................................................................ 14
Chart: Sales by Year ............................................................................................................. 14
5.4 Milestones.................................................................................................................................. 15
Table: Milestones ....................................................................................................................... 15
Chart: Milestones ....................................................................................................................... 15
6.0 Web Plan Summary ................................................................................................................... 16
6.1 Website Marketing Strategy............................................................................................... 16
6.2 Development Requirements ............................................................................................... 16
7.0 Management Summary ............................................................................................................ 17
7.1 Personnel Plan ......................................................................................................................... 17
Table: Personnel ......................................................................................................................... 17
8.0 Financial Plan ............................................................................................................................... 18
8.1 General Assumptions ............................................................................................................ 18
Table: General Assumptions .................................................................................................. 18
8.2 Break-even Analysis .............................................................................................................. 19
8.2 Break-even Analysis .............................................................................................................. 19
Chart: Break-even Analysis ................................................................................................... 19
Table: Break-even Analysis.................................................................................................... 19
8.3 Projected Profit and Loss ..................................................................................................... 20
Page 1
Table of Contents
8.3 Projected Profit and Loss ..................................................................................................... 20
Chart: Profit Monthly ................................................................................................................ 20
Chart: Profit Yearly .................................................................................................................... 20
Chart: Gross Margin Monthly................................................................................................. 21
Chart: Gross Margin Yearly .................................................................................................... 21
Table: Profit and Loss ............................................................................................................... 22
8.4 Projected Cash Flow .............................................................................................................. 23
Table: Cash Flow ........................................................................................................................ 23
Chart: Cash .................................................................................................................................. 24
8.5 Projected Balance Sheet ...................................................................................................... 25
Table: Balance Sheet ................................................................................................................ 25
8.6 Business Ratios ....................................................................................................................... 25
Table: Ratios ................................................................................................................................ 26
Table: Sales Forecast ......................................................................................................................... 1
Table: Personnel ................................................................................................................................... 2
Table: Personnel ................................................................................................................................... 2
Table: General Assumptions ............................................................................................................ 3
Table: General Assumptions ............................................................................................................ 3
Table: Profit and Loss ......................................................................................................................... 4
Table: Profit and Loss ......................................................................................................................... 4
Table: Cash Flow .................................................................................................................................. 5
Table: Cash Flow .................................................................................................................................. 5
Table: Balance Sheet .......................................................................................................................... 6
Table: Balance Sheet .......................................................................................................................... 6
Page 2
Tall Drink of Water
1.0 Executive Summary
Tonya McClendon has developed a new* elevated pet feeder component, designed
several elevated feeder models around the component and built several prototypes. She plans
to invest a minimum of $22,000 through a combination of personal savings and loans and is
seeking additional funding to protect her feeder component and design ideas and to bring the
products to market. She plans to incorporate Tall Drink of Water as a New York-based
subchapter S holding corporation to shield her from personal liability and double taxation.
Ms. McClendon intends to establish her product as a brand leader in the $34 billion pet products
industry, which is experiencing steady growth, but it is fragmented with no clear brand leaders
producing elevated feeders.
Ms. McClendon has managerial, operational and technical experience in business, including
financial services, management consulting, food service, architecture and landscape
architecture, and Olympic planning. She has a strong customer service and sales foundation
and is comfortable working in environments ranging from small family businesses to Fortune
500 corporations. She has a broad range of skills and experience to draw from to launch the
company from start-up to stellar.
Based on her research, she is confident that a start-up pet products business that designs and
sells innovative, contemporary elevated pet feeders to design professionals, pet care
professionals, government agencies and individual consumers will be successful in the United
States, where more than half of all American households have at least one pet dog or cat.
Sales forecasts for the first three years are modest based on the performance of competing and
complementary products. First year sales are projected to total $143,800 and to increase at a
rate of 10% over the following two years, reaching $248,748 by the end of Year 3. Sales are
expected to improve dramatically once the brand is established.
* Based on preliminary patent searches on the U.S. Patent and Trademark Office website.
Page 1
Tall Drink of Water
Chart: Highlights
1.1 Objectives

To be a leader in the pet feeder product market with a measurable share of the market by
the end of the second year of operation, based on the design and development of:

o Innovative, functional and beautiful elevated pet feeders
o Accessories and complementary pet products
o Products that are environmentally and socially responsible
To increase sales by at least 10% for the first three years of operation.

To reach sales of $250,000 by the third year of operation.
1.2 Mission
Tall Drink of Water designs, develops, and markets innovative, functional and beautiful elevated
pet feeders and related pet products using methods and materials that are socially and
environmentally responsible. It provides a rewarding and respectful work environment with
competitive compensation and benefits.
1.3 Keys to Success
Tall Drink of Water, will:







Design and develop innovative, functional, reliable and beautiful products
Provide a competitive guarantee for our products
Provide exceptional customer service
Participate in design and pet industry communities
Support pet associations that rescue, train and promote the humane treatment of animals
Use profits for new product development
Promote pet safety and health
Page 2
Tall Drink of Water
2.0 Company Summary
Tall Drink of Water is a New York-based start-up company that is developing elevated pet
feeder technology and designs that are unique in the pet products market in both form and
function. Its elevated pet feeder products will be marketed to design professionals, pet care
professionals, government agencies and individual consumers.
2.1 Company Ownership
Tall Drink of Water is privately owned by Tonya McClendon and will file for S-Corporation
status.
2.2 Start-up Summary
Start-up expenses for the company total $31,200 and will be distributed as follows:




52% – Product research and development: design fees, patent fees and prototyping.
19% – Corporate brand development: website design, marketing materials and advertising.
10% – Administrative costs: legal fees, licensing and other general administrative costs.
19% – Home office: interior improvements, office equipment, software and miscellaneous
purchases.
We will also need a small amount for start-up inventory ($1,000), and a $40,000 cash reserve
on opening to cover operating costs for the first few months.
Start-up costs will be financed using a combination of owner investment and a 2-year Small
Business Administration (SBA) loan.
Page 3
Tall Drink of Water
Table: Start-up Funding
Start-up Funding
Start-up Expenses to Fund
Start-up Assets to Fund
Total Funding Required
$31,200
$41,000
$72,200
Assets
Non-cash Assets from Start-up
Cash Requirements from Start-up
Additional Cash Raised
Cash Balance on Starting Date
Total Assets
$1,000
$40,000
$0
$40,000
$41,000
Liabilities and Capital
Liabilities
Current Borrowing
Long-term Liabilities
Accounts Payable (Outstanding Bills)
Other Current Liabilities (interest-free)
Total Liabilities
$50,000
$0
$0
$0
$50,000
Capital
Planned Investment
Tonya McLendon
Other
Additional Investment Requirement
Total Planned Investment
Loss at Start-up (Start-up Expenses)
Total Capital
$22,200
$0
$0
$22,200
($31,200)
($9,000)
Total Capital and Liabilities
$41,000
Total Funding
$72,200
Page 4
Tall Drink of Water
Chart: Start-up
Table: Start-up
Start-up
Requirements
Start-up Expenses
Product Design
Prototyping
Patent Fees
Website Design
Marketing Materials: Brochures, Banners, Signs, Trade Show Materials
Advertising
Fees: Legal, Licensing, Insurance
Stationery
Home Office Interior Improvements
Home Office Equipment
Software
Miscellaneous purchases
Rent
Expensed Equipment
Total Start-up Expenses
$5,000
$6,300
$5,000
$1,000
$4,000
$1,000
$2,700
$300
$1,000
$1,000
$500
$500
$1,700
$1,200
$31,200
Start-up Assets
Cash Required
Start-up Inventory
Other Current Assets
Long-term Assets
Total Assets
$40,000
$1,000
$0
$0
$41,000
Total Requirements
$72,200
Page 5
Tall Drink of Water
3.0 Products
Tall Drink of Water designs, develops and markets innovative, functional, luxury elevated pet
feeders to design professionals, pet care professionals, government agencies and individual pet
owners.
The products are divided into two categories, basic models and deluxe models. The basic
models are off-the-shelf solutions that have the following features:



Four standard heights: small (3"), medium (9"), large (15") and extra large (21").
Three standard colors: clear, pearl (frosted) and smoke.
One material: acrylic.
Basic models have one feeding platform that includes a water dish and food dish and a base.
The small basic model is intended for small dogs and cats, while the medium through extra
large sizes are intended for larger dogs. While these products cannot be customized, they can
be personalized with pets' names, pet's photos or breed likeness.
Deluxe models can be fully customized - the options are limited only by the buyer's (and their
design professional's) imagination. Some examples of customized options include sizes tailored
for individual pets rather than based on average sizes like the basic model. Owners can add
multiple platform heights to one unit or multiple water and food dishes in one unit. If purchased
through a design professional, the materials, colors and design choices are limitless.
Over the next five years, the company plans to expand the pet feeder line, introduce
incremental improvements to existing products and introduce complementary products, based
on customer feedback.
All products will be manufactured by vendors using just-in-time (JIT) methods, unless
experience determines that it is more efficient to maintain an inventory of basic models.
4.0 Market Analysis Summary
According an April 2004 American Pet Products Manufacturers Association, Inc. (APPMA) news
release, pet owners are projected to spend "$2.2 billion for other [pet] services" in 2004. That's
a small portion of the more than $34 billion they will spend on all classes of pet care and
product spending in 2004. The same APPMA news release reports that consumer spending on
pet products has doubled from $17 billion to a projected $34 billion since 1994 when the APPMA
first began tracking pet industry statistics.
One market research company, Mindbranch, states that "inadequate marketing has resulted in
annual sales returns well below the level this market should deliver," which indicates that
growth in this market could be much stronger if marketing efforts were more sophisticated than
they are in the current fragmented market.
Page 6
Tall Drink of Water
Based on our industry research, we think we have opportunities to attract customers from the
following market groups:




Design professionals
Pet care professionals
Government agencies
Individual consumers
The first three groups were selected because they offer growth outside of the "usual" pet
products consumer; their favorable opinion of the product may help establish product
reliability, brand credibility and influence individual consumer purchases.
4.1 Market Segmentation
The four target market segments selected for this product are design professionals, pet care
professionals, government agencies and individual consumers. Each segment is described below
and illustrated in following market analysis pie chart.
Design Professionals
Interior designers, architects, and landscape architects, were selected as a target market for
this product because the deluxe models are intended to be customized to meet pets' and
owners' needs. Designers who have clients with pets will have access to a solution that is
integral to their designs, not an afterthought. The 2000 U.S. Census Occupations report shows
1,926,689 people in architecture and engineering fields, but for the purposes of this plan, we
used the numbers reported by professional organizations rather than Census data, because it is
more specific and representative of the populations we would have access to:
 Interior designers (American Society of Interior Designers): 20,000
 Architects (American Institute of Architects): 70,000
 Landscape architects (American Society of Landscape Architects): 14,200
Pet Care Professionals
Veterinarians, breeders, kennels and pet day care centers also need access to a customized
solution that works best for their clients. Veterinarians recognize the health benefits of elevated
feeders for pet digestive health, as well as for the the joint, muscle and skeletal health of older
pets. They also recognize the benefits and pet preference for flowing rather than stagnant
water and can offer these products to clients to address those health needs. Breeders, kennels
and pet day care centers all may have multiple pet facilities. Some of these facilities cater to
high-end clients who want assurance that their existing or future pets are well cared for. Our
customized multiple pet units can meet the pet care professionals' needs for feeding and
watering pets and the pet owners' need to know that their pets are receiving high-quality care.
We used data from the American Veterinary Medical Association and the 2000 U.S. Census for
market data for this segment:


Veterinarians (American Veterinary Medical Association): 69,000
Pet care except veterinary services (2000 US Census): 28,320.
Page 7
Tall Drink of Water
Government Agencies
Police departments and fire departments use dogs as service animals. They may benefit from a
customized, multiple-pet solution. Parks and recreation departments that build and maintain
dog runs or dog parks may also benefit from a customized solution. In our research, we have
found that New York City area dog runs often have one water dish used by hundreds of dogs
throughout the day. We can offer another way for parks and recreation departments to address
the need to offer hydration for pets in these locations: multiple height, water-dish-only units.
Market data for this segment was obtained from the 2002 US Government Census report that
shows parks and recreation and fire protection departments as special district governments
totaling 1,314 and 5,743 respectively, while state and local police agencies in 2000 totalled
17,784. Further research may indicate that this market should be further segmented to focus
on New York City agencies to start.
Individual Consumers
The largest number of potential buyers for these products are individual consumers. Industry
experts estimate that more than 55% of U.S. households own at least one pet cat or dog; many
own multiple pets. The 2000 Census reported a total population of 281,421,960; 55% of that
number represents our potential individual consumer market, 154,782,078.
We project that the individual consumer segment will grow at a rate of 10% per year, while the
commercial market segment, design professionals, pet care professionals and government
agencies, is forecasted to grow at a rate of 5% annually.
Table: Market Analysis
Market Analysis
Potential Customers
Individual consumers (1000's)
Government agencies
Design professionals
Pet care professionals
Total
Year 1
Year 2
Year 3
Year 4
Year 5
154,782
24,841
104,200
28,320
312,143
170,260
26,083
109,410
29,736
335,489
187,286
27,387
114,881
31,223
360,777
206,014
28,756
120,625
32,784
388,179
226,616
30,194
126,656
34,423
417,889
Growth
10%
5%
5%
5%
7.57%
CAGR
10.00%
5.00%
5.00%
5.00%
7.57%
Page 8
Tall Drink of Water
Chart: Market Analysis (Pie)
4.2 Target Market Segment Strategy
The initial market focus will be on the commercial market segments: design professionals, pet
care professionals and government agencies. Design professionals were selected because they
can recommend customized product solutions to existing pet owners as an added value to their
new or remodeled home. Pet care professionals can inform, assure and influence pet owners
regarding the health benefits of the products for their pets. Government agencies can offer the
product as value added to attract visitors to dog runs and dog parks by demonstrating an
interest in the health and well-being to pets that visit them. Other government agencies, police
and fire departments that use service dogs can benefit from improved feeding and watering for
the larger breed dogs typically employed for this kind of service. Together, these market
segments were selected to establish product reliability, brand credibility and brand recognition.
Once the products are established in the commercial market segments, the company will
introduce them to individual consumers who think of their pets as family, and are style and
status conscious.
To support this strategy, we will attend industry trade shows and enter design competitions.
This strategy will allow us to form partnerships with people and organizations that can help the
company establish the highest level of product performance and customer service.
4.3 Industry Analysis
In an April 2003 news release, the American Pet Products Manufacturers Association (APPMA)
forecasted that pet owners would spend $31 billion for the care, feeding, spoiling and
pampering of their pets. According to their April 2004 news release, actual spending on pet
products in 2003 was $32.4 billion, $1.4 billion more than projected. Industry researchers
estimate that the industry will grow between 5% and 15% annually through 2008.
Page 9
Tall Drink of Water
Industry experts also report that the pet products industry is competitive and highly
fragmented with no clear brand leadership, and under utilized marketing opportunities. There
are opportunities for successful entry to it that we intend to use to our advantage.
4.3.1 Competition and Buying Patterns
We have many competitors in the pet products industry. Direct competitors are designers and
manufacturers of elevated pet feeders and complementary products such as pet fountains. In
our research, we identified one direct competitor that is publicly traded, OurPet's
Company. Other competitors include, but are not limited to, private companies:



Doskocil Manufacturing Company (LeBistro feeders and waterers)
Veterinary Ventures, Inc. (Drinkwell fountains)
A Charmed Life (Elevated feeders)
Indirect competitors for pet-related purchases include, but are not limited to, large public pet
products corporations:



Nestle Purina PetCare
PETsMART
PETCO
Large bricks and clicks retailers:



Wal-Mart
K-Mart
Target
Online and catalog retailers:




Drs. Foster & Smith
Watson's Pet Company
TrendyPet.com
Orvis
Current consumer buying habits for elevated pet feeders are driven primarily by the products'
functionality, elevating pets' food and water dishes to a level that is healthier for them or
providing flowing water, which pets not only prefer, but is also healthier for them, encouraging
hydration and reducing microorganism growth that occurs in stagnant water.
Some consumers, dissatisfied by current market offerings for elevated pet feeders are building
their own elevated feeders or asking friends or relatives to build them to suit their unique
space, aesthetic tastes or pet needs. Others, like me, are starting companies of their own to
offer products to address consumers needs for functional products that also suit the owners'
needs for products that fit their lifestyles.
5.0 Strategy and Implementation Summary
Tall Drink of Water's strategy is to provide high-quality, functional and beautiful products that
are environmentally and socially responsible. We want our products to be the standard by
which similar products will be measured.
Page 10
Tall Drink of Water
Strategic Assumptions:




Our individual customers think of their pets as family and care about the health and wellbeing of their family pets.
Many of our end-users have high quality and style expectations.
Products adopted by the commercial market, design and pet care professionals and
government agencies, will lead to brand establishment, acceptance and recognition
Individual consumers will more readily use products used by government facilities and pet
care professionals.
Profits will be used for new product development and incremental improvements for existing
products, and to expand our marketing and sales efforts to foreign markets.
5.1 Competitive Edge
Our patented designs and technology will be our competitive edge. There are many elevated
pet feeders in the market, but ours will be the first* to market with an integrated,
elevated fountain and contemporary designs. With patent protection of the elevated feeder with
an integrated fountain, we can potentially capture a large share of the market for that class of
products. As patent holders of the technology, we could also license it to other manufacturers
to increase revenue and have the branding benefit of being "the original" elevated feeder and
integrated fountain product.
Another competitive advantage is that our products provide an off-the-shelf solution for owners
of large breed dogs like Mastiffs, Newfoundlands and Great Danes that are, on average, about
five inches taller than the existing large model elevated feeders on the market. Our products
also address the needs of pet owners who live in small, urban apartments and appreciate
contemporary design.
* Based on preliminary patent searches on the US Patent and Trademark Office web site.
5.2 Marketing Strategy
In the first year of operation, our marketing strategy will be focused on design professionals,
pet care professionals and government agencies. Marketing efforts will include trade show
participation, design contest entries, and advertising in industry and lifestyle magazines.
In subsequent years, we will expand our marketing efforts to include individual consumers who
may be reached through advertising in lifestyle magazines and on cable television, sponsoring
dog shows and competitions, and participation in regional pet events.
5.3 Sales Strategy
The company intends to focus its initial sales efforts on commercial clients, design
professionals, pet care professionals and government agencies, to establish product
reliability and brand recognition for the company without incurring exorbitant advertising costs.
This strategy will generate fewer sales, but sales of higher priced items. The owner will identify
and work with these prospects directly. Because of the potential complexity of these orders,
delivery times will vary, but the consumer will be provided with an estimated delivery time and
regular progress updates by e-mail or fax.
Page 11
Tall Drink of Water
Sales to individual consumers will be completed through the company's website, by phone or
fax, through catalogues and third party websites. The owner will work with manufacturers to
determine the appropriate delivery schedule for these items, but anticipates being able to offer
consumers 5 – 10 business day delivery terms. FedEx will be the preferred shipping vendor.
The company does not have immediate plans to offer products for sale in retail stores, but this
decision will be re-evaluated based on consumer feedback and demand.
Order processing, manufacturing, delivery and shipping will be managed using electronic data
interchange (EDI) methods to minimize order processing times, facilitate order tracking and
optimize customer and vendor information management.
Products will be manufactured by an independent plastics moulder with whom we have
contracted. After the prototypes, they will manufacture the standard feeders in batches of
2,000, and coordinate with us to ship directly to consumers to reduce delivery time. Custom
orders will require more lead- and manufacturing time, and will be coordinated with their
custom-solutions department.
To ensure that we are meeting (and hopefully exceeding) customers' expectations, consumers
will be asked to complete a satisfaction survey regarding the level of service received from the
beginning of the sales process to delivery and installation (where applicable), including followup and future service needs.
5.3.1 Sales Forecast
The sales forecast table shows a worst case scenario of forecasted sales for the first three years
of operation. During the first year, our focus will be on sales to commercial consumers, design
and pet care professionals and government agencies to establish product reliability and brand
credibility. Sales may fluctuate seasonally for design and pet care professionals, and based on
budgetary cycles for government agencies.
In the second and third years, we will expand our sales strategy to include individual
consumers. The basic, off-the-shelf models, developed for high- and moderate-income
consumers will be sold on the company's website, by phone and fax, through catalogs and third
party websites. Individual consumer sales may also fluctuate seasonally, but we are estimating
flat monthly sales for all market segments with annual sales growth of 10% for 2006 and 2007
based on an average of the low and high end industry expert sales forecasts.
This time table is flexible and can be accelerated based on demand.
Based on current economic indicators, we set the direct cost of sales to increase at a rate of 5%
for the first three years of operation. This too is flexible and can be adjusted based on changes
in the economy. Cost of sales below includes manufacturing and delivery costs.
Page 12
Tall Drink of Water
Table: Sales Forecast
Sales Forecast
Year 1
Year 2
Year 3
$0
$0
$0
$0
$40,800
$45,000
$58,000
$143,800
$5,000
$10,000
$20,000
$30,000
$44,880
$49,500
$63,800
$223,180
$5,750
$11,500
$23,000
$34,500
$49,368
$54,450
$70,180
$248,748
Year 1
$0
$0
$0
$0
$17,000
$11,400
$11,200
$39,600
Year 2
$2,050
$4,100
$8,200
$12,300
$17,325
$11,970
$11,200
$67,145
Year 3
$2,358
$4,715
$9,430
$14,145
$18,191
$12,569
$11,200
$72,607
Sales
Basic small feeder
Basic medium feeder
Basic large feeder
Basic extra large feeder
Custom low-end feeder
Custom medium feeder
Custom high-end feeder
Total Sales
Direct Cost of Sales
Basic small feeder
Basic medium feeder
Basic large feeder
Basic extra large feeder
Custom low-end feeder
Custom medium feeder
Custom high-end feeder
Subtotal Direct Cost of Sales
Page 13
Tall Drink of Water
Chart: Sales Monthly
Chart: Sales by Year
Page 14
Tall Drink of Water
5.4 Milestones
The accompanying table lists milestones for our start up goals and budgets for each. Tonya
McClendon will be the manager in charge of each milestone, consultants will be used for many
functions. The milestone schedule shows our emphasis on planning for design, development
and market introduction.
Additional milestone tables will be created for future marketing and sales planning.
Table: Milestones
Milestones
Milestone
Utility patent drawings
Design patent drawings
Business licenses
Prototype development
Incorporation
Branding
Website design
Print advertising campaign
development
Trade show entry applications
Design competition application
Totals
Start Date
10/1/2004
10/1/2004
11/1/2004
11/15/2004
10/1/2004
1/15/2005
2/20/2005
3/15/2005
End Date
11/1/2004
11/1/2004
12/15/2004
12/15/2004
1/1/2005
2/15/2005
4/15/2005
4/15/2005
Budget
$2,500
$2,500
$250
$6,300
$250
$4,000
$1,000
$1,000
Manager
TLM
TLM
TLM
TLM
TLM
TLM
TLM
TLM
Department
Consultant
Consultant
Admin
Consultant
Admin
Consultant
Consultant
Consultant
10/1/2004
10/1/2004
5/15/2005
5/15/2005
$750
$750
$19,300
TLM
TLM
Marketing
Marketing
Chart: Milestones
Page 15
Tall Drink of Water
6.0 Web Plan Summary
Tall Drink of Water's website will be the virtual storefront for consumers interested in:








Company information
Contacting the company
Buying products
Product and services information
Product demonstrations
Locating design professionals
Customer testimonials
Pet health and wellness information
Tall Drink of Water plans a well-designed and sophisticated website. The key to the website
strategy will be combining great design on the front end, with a powerful back end capable of
managing customer information, monitoring customer orders and delivery status; as well as
managing vendor information.
Initially, the website will provide information and direct commercial customers to phone and
mail purchasing options. In years two and three we will add e-commerce capabilities to serve
our individual consumers.
6.1 Website Marketing Strategy
Marketing an Internet retail business depends on brand recognition and the consumer's ability
to find the business easily. Our strategy includes:




Positioning the website as a featured link on major search engines and on complementary
sites
Including the website address on corporate press releases and marketing materials
Including the website address on all products
Word-of-mouth.
6.2 Development Requirements
Tall Drink of Water's website will be developed and maintained by consultants with the ability to
measure, analyze and report site activity as well as make recommendations for improvements.
website usability testing will be conducted throughout the design process to ensure that the
site is both useful and usable to consumers.
The site will be hosted by an Internet Service Provider (ISP) that is reliable, has the ability to
grow with our business and that supports electronic data interchange (EDI). It will be
imperative for our website to function as consumers expect to reinforce the brand's credibility
and reliability.
Page 16
Tall Drink of Water
7.0 Management Summary
Tonya McClendon will be the principal owner and operator of Tall Drink of Water Ms. McClendon
has managerial, operational and technical experience in financial services, management
consulting, food service, architecture and landscape architecture, and Olympic planning. She
has a strong customer service and sales foundation and is comfortable working in environments
ranging from small family businesses to Fortune 500 corporations. She has a Bachelor of Arts in
Psychology, is studying to become a Certified Usability Analyst (CUA) and is working toward an
MBA in Global Management.
Ms. McClendon has a passion for pets, architecture, interior and industrial design. She is looking
forward to offering beautiful products of exceptional quality to pets and the people who love
them.
7.1 Personnel Plan
Tall Drink of Water will initially have one full-time employee, the owner, Tonya McClendon. In
the first seven months, Tonya will be responsible for all aspects of the business, from design, to
coordinating with the contracted manufacturer, to taking orders and performing customer
service. As part of our initial marketing campaign, Tonya will spend a great deal of time in the
first few months demonstrating the feeders at pet care trade shows and liaising with
government officials and design professionals.
Once sales begin to climb, we will hire a second person to take over inventory and office
management. This person will coordinate orders and deliveries, pay bills, and provide back-up
customer service coverage. In the second and third years we plan to hire a part-time sales
representative to expand our commercial sales nationally.
The personnel plan will be evaluated regularly and, as growth requires it, a detailed personnel
plan will be developed based on business needs with guidance from the Occupational Outlook
Handbook and staffing agencies.
Our website, marketing and trade show activities are being undertaken under the advice of
independently contracted consultants familiar with the pet-care industry.
Table: Personnel
Personnel Plan
Year 1
Year 2
Year 3
TL McClendon
Part-time Sales Rep
Inventory/Office Mgmt.
Total People
$28,800
$0
$10,425
2
$32,000
$10,000
$28,000
3
$37,000
$13,000
$30,000
3
Total Payroll
$39,225
$70,000
$80,000
Page 17
Tall Drink of Water
8.0 Financial Plan
We expect sales growth will be slow to moderate, and that cash flows will be steady with annual
sales projected to equal $143,800, $223,180 and $248,748 for the years 2005 – 2007.
Once the company reaches a sufficient level of profitability and accumulates a cash reserve, it
plans to invest 50% of profits in research and development of new products, existing product
and operational improvements, and to expand marketing and sales efforts to foreign markets.
38% of profits will be invested in low risk financial instruments. 10% of profits will be used for
employee bonuses. 1% of profits will be used to support non-profit organizations that support
the health and welfare of women in the United States. The remaining 1% will be used to
support non-profit organizations that promote the health and welfare of pets in the United
States. These expenses will be itemized in the later years of the business plans.
In the event that the company does not earn a profit, additional funds will be sought to finance
research and development (R&D) activities. 100% of funding obtained during break-even or
loss periods will be used for R&D, while the investment in financial instruments, employee
bonuses and charitable giving activities will be foregone.
8.1 General Assumptions
The general assumptions for this plan are shown in the following table.
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%
10.00%
30.00%
0
2
10.00%
10.00%
30.00%
0
3
10.00%
10.00%
30.00%
0
Page 18
Tall Drink of Water
8.2 Break-even Analysis
The following break-even analysis table and chart show that with average estimated monthly
fixed cost of $7,325 and a 28% variable cost, the company needs to generate approximately
$10,000 in sales to break even.
Chart: Break-even Analysis
Table: Break-even Analysis
Break-even Analysis
Monthly Revenue Break-even
$9,438
Assumptions:
Average Percent Variable Cost
Estimated Monthly Fixed Cost
28%
$6,839
Page 19
Tall Drink of Water
8.3 Projected Profit and Loss
We will operate at a profit beginning in the first year based on our worst case sales forecasts.
Though we project that we will operate at a loss for the first six months, we will make up for
the losses in the second half of 2005 to break even for the year. We also anticipate earning a
profit in subsequent years. These projections are conservatively based on solid market research
and initial responses from local pet care professionals.
Chart: Profit Monthly
Chart: Profit Yearly
Page 20
Tall Drink of Water
Chart: Gross Margin Monthly
Chart: Gross Margin Yearly
Page 21
Tall Drink of Water
Table: Profit and Loss
Pro Forma Profit and Loss
Year 1
Year 2
Year 3
Sales
Direct Cost of Sales
Other Costs of Goods
Total Cost of Sales
$143,800
$39,600
$0
$39,600
$223,180
$67,145
$0
$67,145
$248,748
$72,607
$0
$72,607
Gross Margin
Gross Margin %
$104,200
72.46%
$156,035
69.91%
$176,141
70.81%
Payroll
Sales and Marketing and Other Expenses
Depreciation
Rent
Utilities
Insurance
Payroll Taxes
Web site management
Business travel
Miscellaneous
$39,225
$5,000
$0
$20,400
$2,400
$238
$0
$6,400
$6,000
$2,400
$70,000
$5,000
$0
$20,400
$2,400
$238
$0
$12,000
$8,000
$3,000
$80,000
$5,000
$0
$20,400
$2,400
$238
$0
$15,000
$10,000
$5,000
Total Operating Expenses
$82,063
$121,038
$138,038
Profit Before Interest and Taxes
EBITDA
Interest Expense
Taxes Incurred
$22,137
$22,137
$4,461
$5,303
$34,997
$34,997
$3,506
$9,447
$38,103
$38,103
$2,510
$10,678
Net Profit
Net Profit/Sales
$12,374
8.60%
$22,044
9.88%
$24,915
10.02%
Expenses
Page 22
Tall Drink of Water
8.4 Projected Cash Flow
The cash flow table shows that cash flow for our worst case sales scenario (i.e., slow sales for
the first three years) provides steady cash balance increases. Once the loan is fully repaid, the
cash balance should provide a cushion for future expenses.
The cash flow chart shows monthly projections for 2005.
Table: Cash Flow
Pro Forma Cash Flow
Year 1
Year 2
Year 3
$35,950
$46,790
$82,740
$55,795
$133,679
$189,474
$62,187
$175,704
$237,891
$0
$0
$0
$0
$0
$0
$75,000
$157,740
$0
$0
$0
$0
$0
$0
$0
$189,474
$0
$0
$0
$0
$0
$0
$0
$237,891
Year 1
Year 2
Year 3
$39,225
$78,089
$117,314
$70,000
$146,513
$216,513
$80,000
$139,057
$219,057
$0
$9,960
$0
$0
$0
$0
$0
$127,274
$0
$9,960
$0
$0
$0
$0
$0
$226,473
$0
$9,960
$0
$0
$0
$0
$0
$229,017
$30,466
$70,466
($36,999)
$33,467
$8,874
$42,341
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 23
Tall Drink of Water
Chart: Cash
Page 24
Tall Drink of Water
8.5 Projected Balance Sheet
Our projected balance sheet is shown in the following table. Monthly projections are shown in
the appendix. The Balance Sheet, even with these conservative forecasts, shows a steadily
increasing net worth.
Table: Balance Sheet
Pro Forma Balance Sheet
Year 1
Year 2
Year 3
$70,466
$61,060
$13,310
$0
$144,836
$33,467
$94,766
$13,019
$0
$141,252
$42,341
$105,623
$8,978
$0
$156,942
$0
$0
$0
$144,836
$0
$0
$0
$141,252
$0
$0
$0
$156,942
Year 1
Year 2
Year 3
Accounts Payable
Current Borrowing
Other Current Liabilities
Subtotal Current Liabilities
$26,422
$40,040
$0
$66,462
$10,754
$30,080
$0
$40,834
$11,490
$20,120
$0
$31,610
Long-term Liabilities
Total Liabilities
$0
$66,462
$0
$40,834
$0
$31,610
$97,200
($31,200)
$12,374
$78,374
$144,836
$97,200
($18,826)
$22,044
$100,417
$141,252
$97,200
$3,217
$24,915
$125,332
$156,942
$78,374
$100,417
$125,332
Assets
Current Assets
Cash
Accounts Receivable
Inventory
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
Paid-in Capital
Retained Earnings
Earnings
Total Capital
Total Liabilities and Capital
Net Worth
8.6 Business Ratios
The following table outlines some of the more important ratios from the Pet Supplies industry.
The final column, Industry Profile, details specific ratios based on the industry as it is classified
by the Standard Industry Classification (SIC) code, 5999.1103.
Our asset ratios differ from the industry standard for two reasons:
1. Because we are operating initially as a home office with outsourced manufacturing, we do
not require any long-term assets at this stage.
2. Because our first sales approaches are to other professionals and the government, rather
than to individual consumers, we have a higher percentage of assets as accounts receivable.
Page 25
Tall Drink of Water
Table: Ratios
Ratio Analysis
Year 1
Year 2
Year 3
Industry Profile
n.a.
55.20%
11.46%
1.08%
Accounts Receivable
Inventory
Other Current Assets
Total Current Assets
Long-term Assets
Total Assets
42.16%
9.19%
0.00%
100.00%
0.00%
100.00%
67.09%
9.22%
0.00%
100.00%
0.00%
100.00%
67.30%
5.72%
0.00%
100.00%
0.00%
100.00%
22.01%
18.65%
36.34%
77.00%
23.00%
100.00%
Current Liabilities
Long-term Liabilities
Total Liabilities
Net Worth
45.89%
0.00%
45.89%
54.11%
28.91%
0.00%
28.91%
71.09%
20.14%
0.00%
20.14%
79.86%
27.21%
18.98%
46.19%
53.81%
100.00%
72.46%
49.91%
0.00%
15.39%
100.00%
69.91%
49.23%
0.00%
15.68%
100.00%
70.81%
49.60%
0.00%
15.32%
100.00%
38.34%
15.66%
1.52%
3.70%
2.18
1.98
45.89%
22.55%
12.20%
3.46
3.14
28.91%
31.36%
22.29%
4.96
4.68
20.14%
28.40%
22.68%
1.83
1.01
58.09%
3.95%
9.42%
Additional Ratios
Year 1
Year 2
Year 3
Net Profit Margin
Return on Equity
8.60%
15.79%
9.88%
21.95%
10.02%
19.88%
n.a
n.a
1.77
50
8.74
3.96
27
0.99
1.77
170
5.10
12.17
52
1.58
1.77
196
6.60
12.17
29
1.58
n.a
n.a
n.a
n.a
n.a
n.a
0.85
1.00
0.41
1.00
0.25
1.00
n.a
n.a
$78,374
4.96
$100,417
9.98
$125,332
15.18
n.a
n.a
1.01
46%
1.06
1.83
0.00
0.63
29%
0.82
2.22
0.00
0.63
20%
1.34
1.98
0.00
n.a
n.a
n.a
n.a
n.a
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
Activity Ratios
Accounts Receivable Turnover
Collection Days
Inventory Turnover
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
Dividend Payout
Page 26
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
$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
$1,200
$0
$0
$1,200
$0
$0
$0
$0
$1,200
$2,500
$4,000
$7,700
$0
$0
$0
$0
$2,400
$2,500
$8,000
$12,900
$0
$0
$0
$0
$1,200
$7,500
$4,000
$12,700
$0
$0
$0
$0
$4,800
$2,500
$4,000
$11,300
$0
$0
$0
$0
$8,400
$5,000
$2,000
$15,400
$0
$0
$0
$0
$9,600
$10,000
$16,000
$35,600
$0
$0
$0
$0
$12,000
$15,000
$20,000
$47,000
Sales
Basic small feeder
Basic medium feeder
Basic large feeder
Basic extra large feeder
Custom low-end feeder
Custom medium feeder
Custom high-end feeder
Total Sales
Direct Cost of Sales
0%
0%
0%
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
Basic small feeder
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Basic medium feeder
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Basic large feeder
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Basic extra large feeder
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Custom low-end feeder
$0
$0
$0
$0
$500
$500
$1,000
$500
$2,000
$3,500
$4,000
$5,000
Custom medium feeder
$0
$0
$0
$0
$0
$600
$1,200
$1,800
$600
$1,200
$2,400
$3,600
Custom high-end feeder
$0
$0
$0
$0
$0
$700
$1,400
$700
$700
$1,400
$2,800
$3,500
Subtotal Direct Cost of Sales
$0
$0
$0
$0
$500
$1,800
$3,600
$3,000
$3,300
$6,100
$9,200
$12,100
Page 1
Appendix
Table: Personnel
Personnel Plan
TL McClendon
Part-time Sales Rep
Inventory/Office Mgmt.
Total People
Total Payroll
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
$2,400
$0
$0
1
$2,400
$0
$0
1
$2,400
$0
$0
1
$2,400
$0
$0
1
$2,400
$0
$0
1
$2,400
$0
$0
1
$2,400
$0
$0
1
$2,400
$0
$2,085
2
$2,400
$0
$2,085
2
$2,400
$0
$2,085
2
$2,400
$0
$2,085
2
$2,400
$0
$2,085
2
$2,400
$2,400
$2,400
$2,400
$2,400
$2,400
$2,400
$4,485
$4,485
$4,485
$4,485
$4,485
Page 2
Appendix
Table: General Assumptions
General Assumptions
Month 1
Month 2
Month 3
Month 4
Month 5
Month 6
Month 7
Month 8
Month 9
Month 10
Month 11
1
2
3
4
5
6
7
8
9
10
11
12
Current Interest Rate
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
Long-term Interest Rate
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
10.00%
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%
0
0
0
0
0
0
0
0
0
0
0
0
Plan Month
Other
Month 12
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
$0
$0
$0
$0
$1,200
$7,700
$12,900
$12,700
$11,300
$15,400
$35,600
$47,000
Direct Cost of Sales
$0
$0
$0
$0
$500
$1,800
$3,600
$3,000
$3,300
$6,100
$9,200
$12,100
Other Costs of Goods
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Total Cost of Sales
$0
$0
$0
$0
$500
$1,800
$3,600
$3,000
$3,300
$6,100
$9,200
$12,100
Gross Margin
Gross Margin %
$0
$0
$0
$0
$700
$5,900
$9,300
$9,700
$8,000
$9,300
$26,400
$34,900
0.00%
0.00%
0.00%
0.00%
58.33%
76.62%
72.09%
76.38%
70.80%
60.39%
74.16%
74.26%
$2,400
$2,400
$2,400
$2,400
$2,400
$2,400
$2,400
$4,485
$4,485
$4,485
$4,485
$4,485
$417
$417
$417
$417
$417
$417
$417
$417
$417
$417
$417
$417
Expenses
Payroll
Sales and Marketing and Other
Expenses
Depreciation
Rent
Utilities
Insurance
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$1,700
$1,700
$1,700
$1,700
$1,700
$1,700
$1,700
$1,700
$1,700
$1,700
$1,700
$1,700
$200
$200
$200
$200
$200
$200
$200
$200
$200
$200
$200
$200
$20
$20
$20
$20
$20
$20
$20
$20
$20
$20
$20
$20
Payroll Taxes
Web site management
15%
$0
$0
$0
$0
$0
$0
$0
$0
$0
$800
$0
$800
$0
$800
$0
$800
$0
$800
$0
$800
$0
$800
$0
$800
Business travel
Miscellaneous
15%
$500
$200
$500
$200
$500
$200
$500
$200
$500
$200
$500
$200
$500
$200
$500
$200
$500
$200
$500
$200
$500
$200
$500
$200
$5,437
$5,437
$5,437
$5,437
$6,237
$6,237
$6,237
$8,322
$8,322
$8,322
$8,322
$8,322
Profit Before Interest and Taxes
($5,437)
($5,437)
($5,437)
($5,437)
($5,537)
($337)
$3,064
$1,379
($322)
$979
$18,079
$26,579
EBITDA
($5,437)
($5,437)
($5,437)
($5,437)
($5,537)
($337)
$3,064
$1,379
($322)
$979
$18,079
$26,579
$410
$403
$396
$389
$382
$375
$368
$361
$354
$348
$341
$334
($1,754)
($1,752)
($1,750)
($1,748)
($1,776)
($214)
$809
$305
($203)
$189
$5,321
$7,873
($4,092)
($4,088)
($4,083)
($4,078)
($4,143)
($498)
$1,887
$712
($473)
$442
$12,417
$18,371
0.00%
0.00%
0.00%
0.00%
-345.25%
-6.47%
14.63%
5.61%
-4.19%
2.87%
34.88%
39.09%
Total Operating Expenses
Interest Expense
Taxes Incurred
Net Profit
Net Profit/Sales
Page 4
Appendix
Table: Cash Flow
Pro Forma 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
Cash Sales
$0
$0
$0
$0
$300
$1,925
$3,225
$3,175
$2,825
$3,850
$8,900
$11,750
Cash from Receivables
$0
$0
$0
$0
$0
$30
$1,063
$5,905
$9,670
$9,490
$8,578
$12,055
Subtotal Cash from Operations
$0
$0
$0
$0
$300
$1,955
$4,288
$9,080
$12,495
$13,340
$17,478
$23,805
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
New Other Liabilities (interest-free)
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
New Long-term Liabilities
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Sales of Other Current Assets
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Sales of Long-term Assets
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
New Investment Received
$0
$0
$0
$0
$50,000
$0
$0
$0
$25,000
$0
$0
$0
Subtotal Cash Received
$0
$0
$0
$0
$50,300
$1,955
$4,288
$9,080
$37,495
$13,340
$17,478
$23,805
Month 1
Month 2
Month 3
Month 4
Month 5
Month 6
Month 7
Month 8
Month 9
Month 10
Month 11
Month 12
$2,400
$2,400
$2,400
$2,400
$2,400
$2,400
$2,400
$4,485
$4,485
$4,485
$4,485
$4,485
$56
$1,692
$1,687
$1,683
$1,803
$5,495
$7,032
$7,996
$7,486
$7,201
$13,674
$22,283
$2,456
$4,092
$4,087
$4,083
$4,203
$7,895
$9,432
$12,481
$11,971
$11,686
$18,159
$26,768
Cash Received
Cash from Operations
Additional Cash Received
Sales Tax, VAT, HST/GST Received
New Current Borrowing
Expenditures
0.00%
Expenditures from Operations
Cash Spending
Bill Payments
Subtotal Spent on Operations
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$830
$830
$830
$830
$830
$830
$830
$830
$830
$830
$830
$830
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
$3,286
$4,922
$4,917
$4,913
$5,033
$8,725
$10,262
$13,311
$12,801
$12,516
$18,989
$27,598
Net Cash Flow
($3,286)
($4,922)
($4,917)
($4,913)
$45,267
($6,770)
($5,975)
($4,231)
$24,694
$824
($1,512)
($3,793)
Cash Balance
$36,714
$31,791
$26,874
$21,961
$67,228
$60,458
$54,484
$50,252
$74,947
$75,770
$74,259
$70,466
Principal Repayment of Current Borrowing
Subtotal Cash Spent
Page 5
Appendix
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
$40,000
$0
$1,000
$0
$41,000
$36,714
$0
$1,000
$0
$37,714
$31,791
$0
$1,000
$0
$32,791
$26,874
$0
$1,000
$0
$27,874
$21,961
$0
$1,000
$0
$22,961
$67,228
$900
$3,500
$0
$71,628
$60,458
$6,645
$4,700
$0
$71,803
$54,484
$15,258
$4,100
$0
$73,841
$50,252
$18,878
$4,100
$0
$73,230
$74,947
$17,683
$3,800
$0
$96,429
$75,770
$19,743
$6,710
$0
$102,223
$74,259
$37,865
$10,120
$0
$122,244
$70,466
$61,060
$13,310
$0
$144,836
$0
$0
$0
$41,000
$0
$0
$0
$37,714
$0
$0
$0
$32,791
$0
$0
$0
$27,874
$0
$0
$0
$22,961
$0
$0
$0
$71,628
$0
$0
$0
$71,803
$0
$0
$0
$73,841
$0
$0
$0
$73,230
$0
$0
$0
$96,429
$0
$0
$0
$102,223
$0
$0
$0
$122,244
$0
$0
$0
$144,836
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
Inventory
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
$0
$50,000
$0
$50,000
$1,636
$49,170
$0
$50,806
$1,631
$48,340
$0
$49,971
$1,627
$47,510
$0
$49,137
$1,622
$46,680
$0
$48,302
$5,262
$45,850
$0
$51,112
$6,765
$45,020
$0
$51,785
$7,746
$44,190
$0
$51,936
$7,253
$43,360
$0
$50,613
$6,755
$42,530
$0
$49,285
$12,937
$41,700
$0
$54,637
$21,372
$40,870
$0
$62,242
$26,422
$40,040
$0
$66,462
Long-term Liabilities
Total Liabilities
$0
$50,000
$0
$50,806
$0
$49,971
$0
$49,137
$0
$48,302
$0
$51,112
$0
$51,785
$0
$51,936
$0
$50,613
$0
$49,285
$0
$54,637
$0
$62,242
$0
$66,462
$22,200
($31,200)
$0
($9,000)
$41,000
$22,200
($31,200)
($4,092)
($13,092)
$37,714
$22,200
($31,200)
($8,180)
($17,180)
$32,791
$22,200
($31,200)
($12,263)
($21,263)
$27,874
$22,200
($31,200)
($16,340)
($25,340)
$22,961
$72,200
($31,200)
($20,483)
$20,517
$71,628
$72,200
($31,200)
($20,982)
$20,018
$71,803
$72,200
($31,200)
($19,095)
$21,905
$73,841
$72,200
($31,200)
($18,383)
$22,617
$73,230
$97,200
($31,200)
($18,856)
$47,144
$96,429
$97,200
($31,200)
($18,414)
$47,586
$102,223
$97,200
($31,200)
($5,998)
$60,002
$122,244
$97,200
($31,200)
$12,374
$78,374
$144,836
($9,000)
($13,092)
($17,180)
($21,263)
($25,340)
$20,517
$20,018
$21,905
$22,617
$47,144
$47,586
$60,002
$78,374
Paid-in Capital
Retained Earnings
Earnings
Total Capital
Total Liabilities and Capital
Net Worth
Page 6