Blue Waffle Technology_clive

7/31/2019 Blue Waffle Technology_clive

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Business Plan

for

Blue Waffle Technology CC

Nigeria & South Africa

www awoofshop com


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www awoofshop com

Confidentiality Agreement

The undersigned reader acknowledges that the information provided by Blue Waffle Technology inthis business plan is confidential; therefore, reader agrees not to disclose it without the expresswritten permission of Blue Waffle Technology.

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 andthat any disclosure or use of same by reader, may cause serious harm or damage to Blue WaffleTechnology.

Upon request, this document is to be immediately returned to Blue Waffle Technology.

___________________

Signature

___________________

Name (typed or printed)

___________________


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Table of Contents

1.0 Executive Summary......................................................................................................................................1Chart: Highlights..............................................................................................................................2

1.1 Objectives............................................................................................................................................31.2 Mission ................................................................................................................................................41.3 Keys to Success ..................................................................................................................................5

2.0 Company Summary ......................................................................................................................................62.1 Company Ownership ..........................................................................................................................72.2 Start-up Summary...............................................................................................................................8

Table: Start-up.................................................................................................................................9

Chart: Start-up...............................................................................................................................103.0 Products ......................................................................................................................................................114.0 Market Analysis Summary ..........................................................................................................................16

4.1 Market Segmentation........................................................................................................................17Table: Market Analysis ..................................................................................................................18Chart: Market Analysis (Pie)..........................................................................................................19

4.2 Target Market Segment Strategy......................................................................................................204.3 Industry Analysis ...............................................................................................................................21

4.3.1 Competition and Buying Patterns.........................................................................................22

5.0 Web Plan Summary....................................................................................................................................235.1 Website Marketing Strategy..............................................................................................................245.2 Development Requirements .............................................................................................................25

6.0 Strategy and Implementation Summary .....................................................................................................266.1 SWOT Analysis .................................................................................................................................27

6.1.1 Strengths ..............................................................................................................................286.1.2 Weaknesses.........................................................................................................................296.1.3 Opportunities ........................................................................................................................306.1.4 Threats..................................................................................................................................31

6.2 Competitive Edge..............................................................................................................................326.3 Marketing Strategy ............................................................................................................................336.4 Sales Strategy ...................................................................................................................................34

6.4.1 Sales Forecast......................................................................................................................35


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Table of Contents8.6 Projected Balance Sheet ...................................................................................................................58

Table: Balance Sheet ....................................................................................................................598.7 Business Ratios.................................................................................................................................60

Table: Ratios .................................................................................................................................61Table: Sales Forecast .........................................................................................................................................1Table: Personnel .................................................................................................................................................2Table: Profit and Loss .........................................................................................................................................3Table: Cash Flow ................................................................................................................................................4Table: Balance Sheet..........................................................................................................................................5


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Blue Waffle Technology 11/06/2009

1.0 Executive Summary


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1.1 Objectives

The objects of Blue Waffle Technology are:

1. To become the major distributor of P.C. and hand-held equipment covers in Africa.

2. To exploit the exclusive agreement we have with the manufacturer of the accessories we areselling.

3. To develop a wholesale network in South and West Africa.

4. To turnover 5,000 Units in the first year.


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1.2 Mission

Blue Waffle Mission is to:

Provide effective artistic protection for electronic items throughout Africa.

Operate and grow at a significant rate through sound economic decisions.


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1.3 Keys to Success

The Keys to success in Blue Waffle Business is:

1. Offer items not available elsewhere

2. Maintain current items with suitable artwork and designs, taking account of sporting events,news items. fashion etc.

3. Good customer relations and recommendations, delivering excellent service, on time, withquick replacement guarantee.


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2.0 Company Summary

Blue Waffle Technology is a importer/distributor of computer accessories throughout Africa. Thecompany has minimal operating costs having at present two partners. Most of the companiesbusiness is operated via Web Site but contact with wholesalers/retailers will also be pursued inthe future.

The companies base in Nigeria but is already active in Kenya, South Africa and other Africanstates.

The products imported are exclusive to Blue Waffle in the African continent and similar qualityitems are not available for any other supplier. The products are made in Singapore.


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2.1 Company Ownership

The two owners of the company will form a legal partnership on beginning of this plan. One ofthe partners, Chike Igwebe is already active in the industry. The second partner BernardEkwunife will be joining the effort as soon as practicable.

Both owners are Nigerian nationals.


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2.2 Start-up Summary

The company will have minimal startup costs, the main costs will be the preparation of anagreement between the partners, company formation, traveling and stationary. The remainder ofthe costs will be the purchase of the initial stock.

The purpose of the plan is to secure the 10,000$ needed to secure the opening stockand advertising. after this stage profits will be returned to the company to pay for future stockpurchase.


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Table: Start-up

Start-up

Requirements

Start-up Expenses

Legal $150

Stationery etc. $150

Company Formation $250

Rent $0

Computer $2,000Other $200

Total Start-up Expenses $2,750

Start-up Assets

Cash Required $4,000

Other Current Assets $0

Long-term Assets $0

Total Assets $4,000

Total Requirements $6,750


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3.0 Products

The Blue Waffle Technology product range is a collection of computer covers. These are printedin attractive designs and protect the device from dust, moisture and impact damage, thecovers also make the equipment more attractive. The covers are produced for the followingitems:

Playstation


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Apple Computers


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Laptops

XBox


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4.0 Market Analysis Summary

The MArket for our products will be mainly the African states, beginning with Nigeria, Kenyaand South Africa, later extending to other African countries.

Although figures are sketchy, the following figures come from the CIA factbook.

Country Population Estimated LaptopOwnership

Nigeria 150,000,000 2,000,000

Kenya 39,000,000 1,500,000

South Africa 50,000,000 2,500,000

Total Initial Market 6,000,000

The above figures do not include ownership of games consoles and Ipods etc.

Growth in ownership of laptop computers is estimated at 20% per year.

At present laptop covers are relativly unknow in these countries, we have the exclusive rightsto sell a well known brand in African countries.

We intend to aquire .5% of the laptop market in our first year by online agressive marketingusing search engine optimisation and some internet medium such as adwords.

A further possibility is to send a few samples to Education Institutions where laptop ownershipwill be high, once the covers are seen as fashionable then this should attract further sales.


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4.1 Market Segmentation

The initial sales drive will be aimed at the following segments:-

Higher end education establishments

Computer Accesory Shops and Dealers

On line sales via web site


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Table: Market Analysis

Market Analysis

Year 1 Year 2 Year 3 Year 4 Year 5

Potential Customers Growth CAGR

Nigeria 20% 10,000 12,000 14,400 17,280 20,736 20.00%

Kenya 20% 7,500 9,000 10,800 12,960 15,552 20.00%

South Africa 25% 12,500 15,625 19,531 24,414 30,518 25.00%

Total 22.16% 30,000 36,625 44,731 54,654 66,806 22.16%


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4.2 Target Market Segment Strategy

Higher end educational establishments, where a significant number of students have laptopswill be marketed directly by distributing a few sample covers. Once these have seen by otherlaptop users, the protection and fashion statement will increase the popularity and addsignificant sales.

Computer distributors and accessory shops. We will be offering generous quantity discounts to

distribution companies and providing some in store display such as bubble packs and someadvertising.

Internet Sales. This will be the majot focus of the sales campaign, we are already selling asmall quantity of covers via the internet site, at present this is limited volume due to theinvestment required to hold sufficient stock. Once we have financing then we will exploitseveral mediums to increase sales, such as Adwods campaigns, SEO optimisation, improvedspecific sales site.


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4.3 Industry Analysis

The computer accessories Industry is well developed in the Western World, whilst in Africa thetrend of purchasing add ons for computers and mobile phones is yet to be fully established. Thsiis due in part to the difficulty in purchasing worldwide from African countries, also the limitedamount of retail outlets accessable to users of electronic equipment.

The conditions in African countries lend themselves to our products perfectly.

The sometimes dusty conditions in transport are conducive to protecting any largeelectronic investment.

The low cost of our accessories are affordable improvements to existing hardware. Our accessories can be purchased on the net, inside African Countries.


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4.3.1 Competition and Buying Patterns

At present there is little or no significant competition in our business sector, our test salesindicate there is a need for our products initially in the large connurbations later in the moreremote cities.

The competative advantages of Blue Waffle Technology:-

The exclusive agreement we have with a major manufacturer in Singapore.

Virtually untapped market with a prospective 6,000,000 users.

Fashionable item that can be produced in any design very quickly.


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5.0 Web Plan Summary

Blue Waffle has already developed a web presence with e-commerce to its business model.The Blue Waffle website, www.awoofshop.com and www.awoofshop.co.za will be a secondarychannel of business serving as virtual business card and portfolio for the company, as well asits online "home."

The website will showcase the products on offer available for purchase, and provide design andtrend information appropriate to the computer accesories market. Additional tips andinspirational ideas will focus on gifts and gift giving. To further show off its expertise, The BlueWaffle website will provide a resources area, offering articles, research, product informationand website links of interest to its customers.

The key to the website strategy will be combining a well designed front-end, with a back-endcapable of capturing "hits" and customer data for use in future marketing endeavors.


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5.1 Website Marketing Strategy

Market strategy in an Internet retail business depends on recognition of expertise by theconsumer. For Blue Waffle, it will start with our existing customer base, informing them of ourInternet presence and encouraging their word-of-mouth recommendations to others. Furtherawareness will be heightened by utilizing search engine marketing, banner advertising, and

affiliates.


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5.2 Development Requirements

Costs that The Blue Waffle will expect to incur with development of its website include:

Development Costs

New site design and SEO optimisation - $500. Site Implementation - Free. Blue Waffle will utilise the programming services of Chike

Igwegbe, he has extensive experience in Web development.

Ongoing Costs

Website name registration - $70 per year.

Site Hosting - $30 or less per month. Search Engine Registration - $100 per year.

Site Design Changes - Changes in the site, such as photography costs, are consideredto be part of Marketing and Advertising.


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6.0 Strategy and Implementation Summary

Blue Waffle Technology will pursue a differentiation strategy by offering a specific line offashionable, practical covers for laptops, games consoles and mobile phones to the selectedcustomer segments in the geographical area of Nigeria, Kenya and South Africa.


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6.1 SWOT Analysis

Blue Waffle Technology have a valuable inventory of strengths that will help it succeded Thesestrengths include: A nnowledgable entrepreneur in the same young grouping as the majority ofBW target customers, knowledge of the medium, no Competitors in the region, Understandingof the culture and easy product returns/guarantees policy. These strengths are valuable but itis also important to recognise weaknesses Blue Waffle must address. These weaknesses include:limited Capital availability and the dependence on quickly changing fashion item.

Blue Waffles strengths will help it capitalise on emerging oppertunities. These opportunitiesinclude, but not limited to, a growing young population of laptop users, Increasingly fashionconcous target group, a me too mentality on our type of products and local market knowledge.Threats that we face are limited to the threats facing any business in terms of emergingcompetitors.


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6.1.1 Strengths

Knowledgable entrepreneur in the same young grouping as the majority of BW targetcustomers.

Knowledge of the medium, particularly the internet and search engine optimisation

No Competitors in the region. Understanding of the culture and selling from a local source with short delivery times.

Easy product returns/guarantees policy due to localisation.


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6.1.2 Weaknesses

Limited Capital will result in restricted growth.

Dependence on quickly changing fashion item.


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6.1.3 Opportunities

Growing young population of laptop users.

Increasingly fashion concous target group.

Me too mentality on our type of products, many laptop users are in contact with other laptopusers.

Local knowledge of market, distribution and population.


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6.1.4 Threats

Emerging local competitoras, if BW can move fast than competitors will find it more difficult tomove into the market.


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6.2 Competitive Edge

Blue Waffle Technology are already researching the market and making sales in person and onthe web site, this has given us a unique understanding of the market we are entering over thelast few months.


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6.3 Marketing Strategy

The following sections illuminate the procing, promotion and distribution strategies for BlueWaffle Technologies.


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6.4 Sales Strategy

Key to the sales strategy is the distribution amongst african laptop owners of a high qualityproduct with practical and lifestyle advantages.

We will focus much of our effort with our existing web site, modifying the layout to exclusivelysell our products, also to interact with our customers and distributors. We envisage a sitewhere we run design competitions with new skins being suggested by customers, with themes

from Footbal to Country Acheivements, Popular Music and virtually anything that is current.

Our company is alread identifying distribution networks within our initial target countries.


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6.4.1 Sales Forecast

Sales projections reflect reasonable success from BW marketing efforts explained earlier. It isassumed that these efforts will result in the unit sales shown in the documentation. We expectthat 60% or sales will come via the internet whilst the remainder will be concluded byditribution networks.


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Table: Sales ForecastSales Forecast

Year 1 Year 2 Year 3

Unit Sales

Laptop Skins 2,525 3,500 4,500

Phone Skins 968 1,200 1,450

Games Console Skins 532 750 1,000

Own Brand PC's 0 25 75

Total Unit Sales 4,025 5,475 7,025

Unit Prices Year 1 Year 2 Year 3Laptop Skins $20.00 $20.00 $20.00

Phone Skins $18.00 $18.00 $18.00

Games Console Skins $40.00 $40.00 $40.00

Own Brand PC's $0.00 $0.00 $0.00

Sales

Laptop Skins $50,500 $70,000 $90,000

Phone Skins $17,424 $21,600 $26,100

Games Console Skins $21,280 $30,000 $40,000

Own Brand PC's $0 $0 $0

Total Sales $89,204 $121,600 $156,100

Direct Unit Costs Year 1 Year 2 Year 3

Laptop Skins $8.00 $8.00 $8.00

Phone Skins $7.20 $7.20 $7.20

Games Console Skins $16.00 $16.00 $16.00

Own Brand PC's $0.00 $0.00 $0.00

Direct Cost of Sales

Laptop Skins $20,200 $28,000 $36,000

Phone Skins $6,970 $8,640 $10,440

Games Console Skins $8,512 $12,000 $16,000

Own Brand PC's $0 $0 $0Subtotal Direct Cost of Sales $35,682 $48,640 $62,440


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7.0 Management Summary

The management of Blue Waffle is made up of the Chike Igwegbe and one other member whostill needs to be added. This plan calls for the owner to concentrate efforts firstly on sales. Themany administrative functions of Blue Waffle would become the primary focus of the otherteam member.


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7.1 Personnel Plan

Blue Waffle' sales targets can only be reached if the owner's time is freed up to spend virtually100% of his time selling to new customers and managing the accounts he has already sold to.

Is is intended that two people will joint the company withing the fist six months of operation.These people will be marketeers and resonsibe for thew sales effort. The salary costs will be inthe region of $200 per month each.

We also expect to hire a representative in South Africa, this person will be responsible fordistribution in S.A. and take care of local business for BWT.

An admin assistant will be taken on in Month 4, initially part time later becoming full time


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Table: PersonnelPersonnel Plan


Directors $8,400 $10,200 $11,500

Country Representative $2,000 $2,100 $2,200

Sales & Marketing $3,800 $4,000 $4,200

Admin Assistants $1,150 $1,400 $1,600

Total People 5 5 5

Total Payroll $15,350 $17,700 $19,500


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8.0 Financial Plan

It is assumed that the owner's private resources will be sufficient to finance any monthly cash-flow shortage. However, it would be advisable to establish a bank relationship as soon aspossible. Sales could very well increase at a much sharper rate than assumed in theseconservative projections. Sharper sales will result in a greater need for funds in support of

inventory and receivables. An over-draft line of credit of $10,000-15,000 would be an excellentcushion to fall back on.


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8.1 Start-up Funding

Blue Waffle Technologies start-up costs are detailed above, in the Start-up Table. The followingtable shows how these start-up costs will be funded by owner and investor capital or Bank loan.


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Table: Start-up FundingStart-up Funding

Start-up Expenses to Fund $2,750

Start-up Assets to Fund $4,000

Total Funding Required $6,750

Assets

Non-cash Assets from Start-up $0

Cash Requirements from Start-up $4,000

Additional Cash Raised $3,250

Cash Balance on Starting Date $7,250Total Assets $7,250

Liabilities and Capital

Liabilities

Current Borrowing $10,000

Long-term Liabilities $0

Other Current Liabilities (interest-free) $0

Total Liabilities $10,000

Capital

Planned Investment

Owner $0

Investor $0

Additional Investment Requirement $0

Total Planned Investment $0

Loss at Start-up (Start-up Expenses) ($2,750)

Total Capital ($2,750)

Total Capital and Liabilities $7,250

Total Funding $10,000


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8.2 Important Assumptions


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8.3 Break-even Analysis

A break-even analysis table has been completed on the basis of average costs/prices. Withfixed costs of $2,500, ~$43 in average sales, and $20 in an average variable costs, we need$4,682 per month in sales to break even.


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Table: Break-even AnalysisBreak-even Analysis

Monthly Units Break-even 123

Monthly Revenue Break-even $2,716

Assumptions:

Average Per-Unit Revenue $22.16

Average Per-Unit Variable Cost $8.86

Estimated Monthly Fixed Cost $1,629


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8.4 Projected Profit and Loss

There are many factors to include when determining a projected profit and loss statement,these are included in the following table.


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Table: Profit and LossPro Forma Profit and Loss


Sales $89,204 $121,600 $156,100

Direct Cost of Sales $35,682 $48,640 $62,440

Other Costs of Sales $0 $0 $0

Total Cost of Sales $35,682 $48,640 $62,440

Gross Margin $53,522 $72,960 $93,660

Gross Margin % 60.00% 60.00% 60.00%

Expenses

Payroll $15,350 $17,700 $19,500

Marketing/Promotion $1,900 $2,200 $2,500

Depreciation $0 $0 $0

Rent $0 $0 $0

Utilities $0 $0 $0

Insurance $0 $0 $0

Payroll Taxes $2,303 $2,655 $2,925

Other $0 $0 $0

Total Operating Expenses $19,553 $22,555 $24,925

Profit Before Interest and Taxes $33,970 $50,405 $68,735

EBITDA $33,970 $50,405 $68,735

Interest Expense $1,500 $1,500 $1,500

Taxes Incurred $3,247 $4,891 $6,723

Other Income

Other Income (1) $0 $0 $0

Other Income (2) $0 $0 $0

Total Other Income $0 $0 $0

Other Expense

Other Expense (1) $0 $0 $0

Other Expense (2) $0 $0 $0

Total Other Expense $0 $0 $0


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8.5 Projected Cash Flow

Our projected cash flow is outlined in the following chart and table.


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Table: Cash Flow

Pro Forma Cash Flow


Cash Received

Cash from Operations

Cash Sales $89,204 $121,600 $156,100

Subtotal Cash from Operations $89,204 $121,600 $156,100

Additional Cash Received

Sales Tax, VAT, HST/GST Received $0 $0 $0

New Current Borrowing $0 $0 $0

New Other Liabilities (interest-free) $0 $0 $0

New Long-term Liabilities $0 $0 $0

Sales of Other Current Assets $0 $0 $0

Sales of Long-term Assets $0 $0 $0

New Investment Received $0 $0 $0

Subtotal Cash Received $89,204 $121,600 $156,100

Expenditures Year 1 Year 2 Year 3

Expenditures from Operations

Cash Spending $59,981 $77,586 $95,589Subtotal Spent on Operations $59,981 $77,586 $95,589

Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out $0 $0 $0

Principal Repayment of Current Borrowing $0 $0 $0

Other Liabilities Principal Repayment $0 $0 $0

Long-term Liabilities Principal Repayment $0 $0 $0

Purchase Other Current Assets $0 $0 $0

Purchase Long-term Assets $0 $0 $0

Dividends $0 $0 $0

Subtotal Cash Spent $59,981 $77,586 $95,589

Net Cash Flow $29,223 $44,015 $60,512

Cash Balance $36,473 $80,487 $140,999


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8.6 Projected Balance Sheet

The table below outlines the projected balance sheet.


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Table: Balance Sheet

Pro Forma Balance Sheet


Assets

Current Assets

Cash $36,473 $80,487 $140,999

Other Current Assets $0 $0 $0

Total Current Assets $36,473 $80,487 $140,999

Long-term Assets

Long-term Assets $0 $0 $0

Accumulated Depreciation $0 $0 $0

Total Long-term Assets $0 $0 $0

Total Assets $36,473 $80,487 $140,999

Liabilities and Capital Year 1 Year 2 Year 3

Current Liabilities

Current Borrowing $10,000 $10,000 $10,000

Other Current Liabilities $0 $0 $0

Subtotal Current Liabilities $10,000 $10,000 $10,000

Long-term Liabilities $0 $0 $0

Total Liabilities $10,000 $10,000 $10,000

Paid-in Capital $0 $0 $0

Retained Earnings ($2,750) $26,473 $70,487

Earnings $29,223 $44,015 $60,512

Total Capital $26,473 $70,487 $130,999

Total Liabilities and Capital $36,473 $80,487 $140,999

Net Worth $26,473 $70,487 $130,999


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8.7 Business Ratios


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Table: Ratios

Ratio Analysis

Year 1 Year 2 Year 3 Industry Profile

Sales Growth 0.00% 36.32% 28.37% -0.84%

Percent of Total Assets

Other Current Assets 0.00% 0.00% 0.00% 30.64%

Total Current Assets 100.00% 100.00% 100.00% 88.46%

Long-term Assets 0.00% 0.00% 0.00% 11.54%

Total Assets 100.00% 100.00% 100.00% 100.00%

Current Liabilities 27.42% 12.42% 7.09% 43.21%

Long-term Liabilities 0.00% 0.00% 0.00% 21.84%

Total Liabilities 27.42% 12.42% 7.09% 65.05%

Net Worth 72.58% 87.58% 92.91% 34.95%

Percent of Sales

Sales 100.00% 100.00% 100.00% 100.00%

Gross Margin 60.00% 60.00% 60.00% 38.34%

Selling, General & Administrative Expenses 27.24% 23.80% 21.24% 16.49%Advertising Expenses 2.13% 1.81% 1.60% 1.24%

Profit Before Interest and Taxes 38.08% 41.45% 44.03% 7.37%

Main Ratios

Current 3.65 8.05 14.10 1.83

Quick 3.65 8.05 14.10 1.19

Total Debt to Total Assets 27.42% 12.42% 7.09% 65.05%

Pre-tax Return on Net Worth 122.65% 69.38% 51.32% 65.51%

Pre-tax Return on Assets 89.02% 60.76% 47.68% 22.89%

Additional Ratios Year 1 Year 2 Year 3

Net Profit Margin 32.76% 36.20% 38.76% n.a

Return on Equity 110.39% 62.44% 46.19% n.a

Activity Ratios

Accounts Payable Turnover 6.66 12.17 12.17 n.a

Total Asset Turnover 2.45 1.51 1.11 n.a

Appendix


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Appendix

Page 1

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

Unit Sales

Laptop Skins 60 75 90 120 140 180 220 240 280 320 380 420

Phone Skins 25 35 40 50 65 70 85 98 110 120 130 140

Games Console Skins 0 0 12 25 25 50 55 55 65 75 80 90Own Brand PC's 0 0 0 0 0 0 0 0 0 0 0 0

Total Unit Sales 85 110 142 195 230 300 360 393 455 515 590 650

Unit Prices Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12

Laptop Skins $20.00 $20.00 $20.00 $20.00 $20.00 $20.00 $20.00 $20.00 $20.00 $20.00 $20.00 $20.00

Phone Skins $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00

Games Console Skins $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 $40.00 $40.00

Own Brand PC's $0.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00 $350.00

Sales

Laptop Skins $1,200 $1,500 $1,800 $2,400 $2,800 $3,600 $4,400 $4,800 $5,600 $6,400 $7,600 $8,400

Phone Skins $450 $630 $720 $900 $1,170 $1,260 $1,530 $1,764 $1,980 $2,160 $2,340 $2,520

Games Console Skins $0 $0 $480 $1,000 $1,000 $2,000 $2,200 $2,200 $2,600 $3,000 $3,200 $3,600

Own Brand PC's $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Total Sales $1,650 $2,130 $3,000 $4,300 $4,970 $6,860 $8,130 $8,764 $10,180 $11,560 $13,140 $14,520

Direct Unit Costs Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12

Laptop Skins 40.00% $8.00 $8.00 $8.00 $8.00 $8.00 $8.00 $8.00 $8.00 $8.00 $8.00 $8.00 $8.00

Phone Skins 40.00% $7.20 $7.20 $7.20 $7.20 $7.20 $7.20 $7.20 $7.20 $7.20 $7.20 $7.20 $7.20

Games Console Skins 40.00% $16.00 $16.00 $16.00 $16.00 $16.00 $16.00 $16.00 $16.00 $16.00 $16.00 $16.00 $16.00

Own Brand PC's 50.00% $175.00 $175.00 $175.00 $175.00 $175.00 $175.00 $175.00 $175.00 $175.00 $175.00 $175.00 $175.00

Direct Cost of Sales

Laptop Skins $480 $600 $720 $960 $1,120 $1,440 $1,760 $1,920 $2,240 $2,560 $3,040 $3,360

Phone Skins $180 $252 $288 $360 $468 $504 $612 $706 $792 $864 $936 $1,008

Games Console Skins $0 $0 $192 $400 $400 $800 $880 $880 $1,040 $1,200 $1,280 $1,440

Own Brand PC's $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Subtotal Direct Cost of Sales $660 $852 $1,200 $1,720 $1,988 $2,744 $3,252 $3,506 $4,072 $4,624 $5,256 $5,808

Appendix


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Appendix

Page 2

Table: Personnel

Personnel Plan


Directors $700 $700 $700 $700 $700 $700 $700 $700 $700 $700 $700 $700

Country Representative $0 $0 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200

Sales & Marketing $0 $0 $200 $400 $400 $400 $400 $400 $400 $400 $400 $400

Admin Assistants $0 $0 $0 $100 $100 $100 $100 $150 $150 $150 $150 $150Total People 1 1 3 3 4 4 5 5 5 5 5 5

Total Payroll $700 $700 $1,100 $1,400 $1,400 $1,400 $1,400 $1,450 $1,450 $1,450 $1,450 $1,450

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Appendix

Page 3

Table: Profit and Loss

Pro Forma Profit and Loss


Sales $1,650 $2,130 $3,000 $4,300 $4,970 $6,860 $8,130 $8,764 $10,180 $11,560 $13,140 $14,520

Direct Cost of Sales $660 $852 $1,200 $1,720 $1,988 $2,744 $3,252 $3,506 $4,072 $4,624 $5,256 $5,808

Other Costs of Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Cost of Sales $660 $852 $1,200 $1,720 $1,988 $2,744 $3,252 $3,506 $4,072 $4,624 $5,256 $5,808

Gross Margin $990 $1,278 $1,800 $2,580 $2,982 $4,116 $4,878 $5,258 $6,108 $6,936 $7,884 $8,712

Gross Margin % 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00% 60.00%

Expenses

Payroll $700 $700 $1,100 $1,400 $1,400 $1,400 $1,400 $1,450 $1,450 $1,450 $1,450 $1,450

Marketing/Promotion $300 $150 $150 $150 $150 $100 $100 $100 $200 $200 $200 $100

Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Rent $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Utilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Insurance $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Payroll Taxes 15% $105 $105 $165 $210 $210 $210 $210 $218 $218 $218 $218 $218

Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Operating Expenses $1,105 $955 $1,415 $1,760 $1,760 $1,710 $1,710 $1,768 $1,868 $1,868 $1,868 $1,768

Profit Before Interest and Taxes ($115) $323 $385 $820 $1,222 $2,406 $3,168 $3,491 $4,241 $5,069 $6,017 $6,945

EBITDA ($115) $323 $385 $820 $1,222 $2,406 $3,168 $3,491 $4,241 $5,069 $6,017 $6,945

Interest Expense $125 $125 $125 $125 $125 $125 $125 $125 $125 $125 $125 $125

Taxes Incurred ($24) $20 $26 $70 $110 $228 $304 $337 $412 $494 $589 $682

Other Income

Other Income (1) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Other Income (2) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Other Income $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Other Expense

Other Expense (1) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0Other Expense (2) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Other Expense $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Net Other Income $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Net Profit ($216) $178 $234 $626 $987 $2,053 $2,739 $3,029 $3,704 $4,449 $5,302 $6,138

Net Profit/Sales -13.09% 8.37% 7.80% 14.55% 19.87% 29.93% 33.69% 34.57% 36.38% 38.49% 40.35% 42.27%

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Appendix

Page 4

Table: Cash Flow

Pro Forma Cash Flow


Cash Received

Cash from Operations

Cash Sales $1,650 $2,130 $3,000 $4,300 $4,970 $6,860 $8,130 $8,764 $10,180 $11,560 $13,140 $14,520Subtotal Cash from Operations $1,650 $2,130 $3,000 $4,300 $4,970 $6,860 $8,130 $8,764 $10,180 $11,560 $13,140 $14,520

Additional Cash Received

Sales Tax, VAT, HST/GST Received 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

New Current Borrowing $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 $0 $0 $0 $0 $0 $0 $0 $0

Subtotal Cash Received $1,650 $2,130 $3,000 $4,300 $4,970 $6,860 $8,130 $8,764 $10,180 $11,560 $13,140 $14,520

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

Expenditures from Operations

Cash Spending $1,866 $1,952 $2,766 $3,675 $3,983 $4,807 $5,391 $5,735 $6,476 $7,111 $7,838 $8,382

Subtotal Spent on Operations $1,866 $1,952 $2,766 $3,675 $3,983 $4,807 $5,391 $5,735 $6,476 $7,111 $7,838 $8,382

Additional Cash Spent

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

Subtotal Cash Spent $1,866 $1,952 $2,766 $3,675 $3,983 $4,807 $5,391 $5,735 $6,476 $7,111 $7,838 $8,382

Net Cash Flow ($216) $178 $234 $626 $987 $2,053 $2,739 $3,029 $3,704 $4,449 $5,302 $6,138Cash Balance $7,034 $7,212 $7,446 $8,072 $9,059 $11,112 $13,851 $16,880 $20,584 $25,033 $30,335 $36,473

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Appendix

Table: Balance Sheet

Pro Forma Balance Sheet


Assets Starting Balances

Current Assets

Cash $7,250 $7,034 $7,212 $7,446 $8,072 $9,059 $11,112 $13,851 $16,880 $20,584 $25,033 $30,335 $36,473Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Current Assets $7,250 $7,034 $7,212 $7,446 $8,072 $9,059 $11,112 $13,851 $16,880 $20,584 $25,033 $30,335 $36,473

Long-term Assets

Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Accumulated Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Assets $7,250 $7,034 $7,212 $7,446 $8,072 $9,059 $11,112 $13,851 $16,880 $20,584 $25,033 $30,335 $36,473

Liabilities and Capital Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12

Current Liabilities

Current Borrowing $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000

Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Subtotal Current Liabilities $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000

Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Liabilities $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000

Paid-in Capital $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Retained Earnings ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750) ($2,750)

Earnings $0 ($216) ($38) $196 $822 $1,809 $3,862 $6,601 $9,630 $13,334 $17,783 $23,085 $29,223

Total Capital ($2,750) ($2,966) ($2,788) ($2,554) ($1,928) ($941) $1,112 $3,851 $6,880 $10,584 $15,033 $20,335 $26,473

Total Liabilities and Capital $7,250 $7,034 $7,212 $7,446 $8,072 $9,059 $11,112 $13,851 $16,880 $20,584 $25,033 $30,335 $36,473

Net Worth ($2,750) ($2,966) ($2,788) ($2,554) ($1,928) ($941) $1,112 $3,851 $6,880 $10,584 $15,033 $20,335 $26,473

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