Financial Tools for Start-ups

FinancialPlanningToolsforFoodCo-opsNFCAAnnualMee8ng,2017www.foodcoopini8a8ve.coopStuartReid,Execu8veDirector507-581-0170|[email protected]

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PreliminaryMarketStudy

Sources&Uses

9

BillGessnerCreatoroftheS&UTemplate

Sources&UsesTemplate

Start-Up Natural Food Co-op: Date: Mar 7 2016 Notes:

Quick Start Sources & Uses Budget:Drafted and Updated by Bill Gessner, CDS Consulting Co-op, 612-823-4509, [email protected]

Most cells are generated by formulas. Fill in cells in yellow to see your new totals.

All costs are ballpark estimates, based on knowledge of prior projects and market rates. Costs will increase over time.

Key Assumptions: This scenario assumes a lease, not a purchase

retail square feet 4000 retail is typically 62 - 68% of total spacetotal square feet 6000

Assump8ons:StoreSize



Projected Sales $2,000,000 $500

$500/retail sq. ft is an initial projection prior to a market analysis, to be adjusted following a professional market/site/location analysis





Assump8ons

Key Assumptions: This scenario assumes a lease, not a purchase retail square feet 4000 retail is typically 62 - 68% of total space total square feet 6000



Lease Rate/sq ft, triple net $12.00 Leased site at triple net. Rates vary greatly. Research those in your community

Real Estate Taxes $2.00 triple net expense can vary greatly Building Insurance $0.75 Common Area Maintenance (CAM) $1.00

Off Street Parking 24

6/1000 sq ft of retail space for customers, local minimum requirements vary. Employees park elsewhere. An alternate ratio is 4-11 spaces/1000 sq ft of total space

Membership share cost $200 Try changing this to see what effect it has on your bank debt and other "Sources" below.

Assuming # members by opening: 1000 End of: Stage 1 = 300 members, Stage 2A = 450 members Stage 2B = 600 members, Stage 3A = 800 members Opening or within 2 months after Opening = 1000 members

Uses:TheBig3

Uses:Acquisition n/a This scenario assumes a lease, not a purchaseLeasehold Improvements $600,000 $100

typical range = $100 - 115/total sqft but it can be + or -

Equipment $570,000 $95typical range = $90- 110/total sqft but it can be + or -

Inventory $160,000 $40 typical range = $35 - 45/retail sqft

MoreUses

Fees $159,600includes consultants, architect/engineer, store design, legal, financing, environmental, misc.Fees are initially estimated at 12% of the above

Project Management $30,000Varies greatly, but budget for it. Some allowance is also in fee budget

Overhead/Admin prior to Opening $15,000

Basic expenses incurred in years prior to opening

Start-up Promotion $12,500Allows for promotion before opening day. Equivalent to 3 months of Year 1 advertising 2.5% of Year 1 sales divided by 4

EvenMoreUses

Start-up Staffing $125,667

Initially estimated as 1/12 of Year 1 labor (25% of sales) + salary/benefits/taxes for G.M. for 1 yr before Opening ($70K plus 20%)

Holding/Site Costs $20,000lease deposit, if required, plus option/rent/taxes/ins/CAM/utilities before opening

Interest during project $17,500initially estimated at $1,000,000 of debt at blended interest of 7% for 6 months at 50% avg. draw

Post Opening Professional Support $20,000

set aside for consulting support to develop operating systems and provide support in Year 1

NCGA Membership deposit $2,000Co-ops opening at a scale to join NCGA should plan their deposit as part of pre-opening expenses.

Summingitallup

Working Capital, allowance $200,000 10%Initial estimate to provide adequate cash flow to cover initial operating losses. Range is 6 - 10% of

subtotal Uses $1,932,267

Overrun Allowance $289,840Initially calculated at 15% of subtotal. Lowered to no lower than 10% as estimated costs become Assumes overrun allowance is 50% leasehold improvements and 50% equipment.

Total Uses $2,222,107 #### /sq ft. $375

Sources:Owners’Contribu8on

Sources:

Cash from benefits, donations $20,000 Net Proceeds, unless expenses are shown in Uses (line 33 or 34) Grants $30,000

Member Equity $200,000 1000 members at an average of $200/member. Member share requirement might range from $200 - $300/member

Member equity would need to be fully raised within 2-3 months of opening.

4000 sq ft of retail has potential for 2500 - 3000 members by Year 5.

Preferred Shares $500,000 100 members at an average of $5,000. Minimum = $1,000. Seek appropriate legal & consultant advice

Member Loans $500,000 125 loans at an average size of $4,000. Min. size loan is $2,000. Seek appropriate legal & consultant advice.

Length of loan term: 4, 5, 6, 7, 8, 9 and 10 years, possibly longer. Blended interest rate of 3.5 - 4.0%

Equity Fund

Miscellaneous $0 Other types of equity investors. Does not include donations of time or in-kind contributions.

subtotal Owner's Contribution $1,250,000 56.25% Owner's Contribution should be 50% of the total Sources (or higher)

OwnerEquityandLoans

Preferred Shares $500,000

100 members at an average of $5,000. Minimum = $1,000. Seek appropriate legal & consultant advice

Member Loans $500,000

125 loans at an average size of $4,000. Min. size loan is $2,000. Seek appropriate legal & consultant advice.

Length of loan term: 4, 5, 6, 7, 8, 9 and 10 years, possibly longer. Blended interest rate of 3.5 - 4.0%

OtherSources

Equity Fund

Miscellaneous $0Other types of equity investors. Does not include donations of time or in-kind contributions.

subtotal Owner's Contribution$1,250,000 56.25%Owner's Contribution should be 50% of the total Sources (or higher)

ExternalSources

Landlord Contribution $120,000

Possible credit of up to 25% of leasehold improvements provided by the landlord (i.e. tenant improvement allowance, range equals $15 - 25/sq ft, but not always. Could be 0.

Vendor Credit $24,000 15% a % of inventory covered by extended terms with vendors (not just opening order terms)

Terms need to be established with vendors over time. There is no guarantee of initial terms. Initial terms might be COD.

Free Fill $16,000 10% % of initial inventory provided by manufacturers, accessed by working with distributor

City/Community $150,000

low interest, long term loan accessed through local sources (city, neighborhoods, foundations) (3%, 10-15yrs) (not easy to find, not always available, if available, possibly lots of red tape and hoops to jump thru)

Gap $0

Co-op Loan Funds $200,000 Co-op Loan funds, CFNE, NCDF, LEAF are possilbe sources. ~7% for 5-10 yrs.

subtotal External/Subordinated $510,000 22.95%

Owner's Contribution plus External/Subordinated should be 75% or higher

Bank Debt $462,107 20.80% Bank Debt (Senior Debt)(First Position) should be 25% of total or less. ~6-7% for 7 yrs. Bank financing can be difficult to obtain.

Total Sources $2,222,107 100.00%

City&CommunityFunds

City/Community $150,000

low interest, long term loan accessed through local sources (city, neighborhoods, foundations) (3%, 10-15yrs) (not easy to find, not always available, if available, possibly lots of red tape and hoops to jump thru)

CommercialLenders

Co-op Loan Funds $200,000Co-op Loan funds, CFNE, NCDF, LEAF are possilbe sources. ~7% for 5-10 yrs.

subtotal External/Subordinated$510,000 22.95%Owner's Contribution plus External/Subordinated should be 75% or higher

Bank Debt $462,107 20.80%Bank Debt (Senior Debt)(First Position) should be 25% of total or less. ~6-7% for 7 yrs. Bank financing can be

Total Sources $2,222,107 100.00%

Sources&UsesCashFlow

CashandUseofOwners’Capital

UsingS&UCashFlow

Sources & Uses Cash Flow Stage 1 Stage 2A Stage 2B Stage 3 ABy Stage Organizing Feasibility/ Planning ImplementationDraft: February 25, 2014 Organizing Feasibility Planning Preconstruction

6-12+ months 3-6 months 3-6 months 3-6 months

Cash Flow for the Period 63,150 14,000 8,500 930,000 Beginning Cash 0 63,150 77,150 85,650 Ending Cash 63,150 77,150 85,650 1,015,650

Total Member Equity, Accumulated 60,000 90,000 120,000 160,000 Unused Member Equity 60,000 77,150 85,650 15,650 Used Member Equity, Accumulated 0 12,850 34,350 144,350

Total Preferred Shares & Member Loans Collected - - - 1,000,000 Unused Preferred Shares & Member Loans 1,000,000 Used Preferred Shares &Member Loans 0

DecisionPoint:GoForward?

FinalGo/Nogo

UseofOwners’Investments

DecisionPoint:GoForward?

FinalStages

Sources & Uses Cash Flow Stage 3B Stage 3C Stage 3D TotalBy Stage Implementation Implementation ImplementationDraft: February 25, 2014 Construction/Renovation Preparation for Opening Sustaining

3-6 months 1 month (forever) 19-37+months0

Cash Flow for the Period (532,000) (358,297) (125,353) - Beginning Cash 1,015,650 483,650 125,353 - Ending Cash 483,650 125,353 0 -

Total Member Equity, Accumulated 180,000 185,000 200,000 200,000 Unused Member Equity 0 0 0 0Used Member Equity, Accumulated 180,000 185,000 200,000 200,000

Total Preferred Shares & Member Loans Collected 1,000,000 1,000,000 1,000,000 1,000,000 Unused Preferred Shares & Member Loans 0 0 0 0Used Preferred Shares &Member Loans 1,000,000 1,000,000 1,000,000 1,000,000

OPEN!

ProFormaFinancialBudgets

30

WhyYouShouldNotDrahProFormas

Dorchester Community Co-op Sources &

3/3/2016 0:00 Uses Beginning YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8 YEAR 9 YEAR 10$3-$5

million$5-$6.5 million

BALANCE SHEET 29 stores 9 stores

ASSETSCURRENT ASSETSCash 224,491 224,491 139,610 130,970 123,811 136,962 183,570 209,574 286,814 344,131 406,195 445,482Prepaid Items 0 0 0 0 0 0 0 0 0 0 0Inventories 168,000 168,000 168,000 173,040 178,231 183,578 189,085 194,758 200,601 206,619 212,817 219,202Accounts Receivable 0 0 0 0 0 0 0 0 0 0 0TOTAL CURRENT ASSETS 392,491 392,491 307,610 304,010 302,042 320,540 372,656 404,332 487,415 550,750 619,013 664,684

FIXED ASSETSLand 0Building contingency 0 0 0 0 0 0 0 0 0 0 0Building 0 0 0 0 0 0 0 0 0 0 0Equipment 516,500 516,500 516,500 531,500 546,500 561,500 591,500 606,500 621,500 636,500 651,500 666,500Leasehold Improvements 687,500 687,500 687,500 687,500 702,500 702,500 717,500 717,500 717,500 732,500 732,500 747,500Accumulated Depreciation 0 (119,619) (241,381) (366,286) (493,333) (625,667) (760,143) (896,762) (962,738) (1,030,857) (1,099,976)Gross FIXED ASSETS 1,204,000 1,204,000 1,084,381 977,619 882,714 770,667 683,333 563,857 442,238 406,262 353,143 314,024

OTHER ASSETSInvestments 0 0 0 0 0 0 0 0 0 0 0Deposits 0 0 0 0 0 0 0 0 0 0 0Organization Development Costs 421,355 421,355 421,355 421,355 421,355 421,355 421,355 421,355 421,355 421,355 421,355 421,355Depreciation/Amortization 0 (28,090) (45,023) (61,956) (78,889) (95,822) (112,755) (129,688) (146,621) (163,554) (180,487)TOTAL OTHER ASSETS 421,355 421,355 393,265 376,332 359,399 342,466 325,533 308,600 291,667 274,734 257,801 240,868

TOTAL ASSETS 2,017,846 2,017,846 1,785,255 1,657,961 1,544,155 1,433,672 1,381,522 1,276,789 1,221,320 1,231,746 1,229,956 1,219,576

LIABILITIESCURRENT LIABILITIESAccounts Payable 111,566 134,079 154,191 169,610 183,744 192,931 199,461 209,435 219,906 230,902Accrued Payroll and Payroll Taxes 0 11,221 12,548 14,431 15,874 17,263 18,126 19,032 19,754 20,742 21,779Sales Tax Payables 0 2,532 3,090 3,553 3,908 4,299 4,514 4,740 4,977 5,226 5,487Income tax Payable 0 0 0 0 0 0 0 0 0 0 0Loan Payable Current Portion 17,126 18,012 18,949 19,941 20,990 22,100 23,275 24,519 25,835 27,227 28,703TOTAL CURRENT LIABILITIES 0 17,126 143,331 168,666 192,115 210,383 227,406 238,846 247,752 260,000 273,101 286,870

LONG TERM LIABILITIESCity/Community Loan 100,000 95,892 91,701 87,425 83,063 78,613 74,073 69,442 64,717 59,897 54,979 49,962Vendor Credit 0 0 0 0 0 0 0 0 0 0 0 0Bank Debt 487,647 474,628 460,806 446,131 430,551 414,010 396,449 377,805 358,011 336,997 314,686 290,998Member Loans 0 0 0 0 0 0 0 0 0 0 0 0TOTAL LONG TERM LIABILITIES 587,647 570,520 552,506 533,556 513,614 492,624 470,523 447,247 422,728 396,893 369,665 340,961

TOTAL LIABILITIES 587,647 587,646 695,837 702,222 705,730 703,006 697,929 686,093 670,480 656,893 642,766 627,831

EQUITYMember Equity 80,000 80,000 108,800 137,600 166,400 195,200 224,000 240,000 256,000 264,000 272,000 280,000Worker Equity 0 0 2,500 6,250 10,000 10,625 11,250 11,875 12,125 12,375 12,625 12,875Preferred Shares through DPO 500,000 500,000 500,000 500,000 500,000 500,000 500,000 475,000 450,000 400,000 325,000 225,000Preferred Shares Dividends 0 0 0 0 0 0 (15,000) (29,250) (42,750) (54,750) (64,500)Retained Earnings 850,200 850,200 478,118 311,889 162,025 24,841 (51,657) (121,179) (138,036) (58,773) 32,316 138,369TOTAL EQUITY 1,430,200 1,430,200 1,089,418 955,739 838,425 730,666 683,593 590,696 550,839 574,852 587,191 591,744

TOTAL LIABILITIES & EQUITY 2,017,847 2,017,846 1,785,255 1,657,961 1,544,155 1,433,672 1,381,522 1,276,789 1,221,320 1,231,746 1,229,956 1,219,576INCOME STATEMENT ??????? 1 (0) 0 0 0 0 0 0 0 0 0 0

INCOMERETAIL SQ/FT 4,200 4,200 4,200 4,200 4,200 4,200 4,200 4,200 4,200 4,200GROSS SALES SQ/FT 579 706 812 893 983 1,032 1,083 1,138 1,194 1,254

GROSS SALES $2,431,141 $2,965,993 $3,410,891 $3,751,981 $4,127,179 $4,333,538 $4,550,214 $4,777,725 $5,016,611 $5,267,442% SALES GROWTH 22.00% 15.00% 10.00% 10.00% 5.00% 5.00% 5.00% 5.00% 5.00%

COST OF GOODS SOLD 1,628,865 1,957,555 2,251,188 2,476,307 2,682,666 2,816,799 2,912,137 3,057,744 3,210,631 3,371,163• AS % OF GROSS SALES 67.00% 66.00% 66.00% 66.00% 65.00% 65.00% 64.00% 64.00% 64.00% 64.00% 61.79% 61.89%

GROSS MARGIN 802,277 1,008,437 1,159,703 1,275,673 1,444,513 1,516,738 1,638,077 1,719,981 1,805,980 1,896,279• AS % OF GROSS SALES 33.00% 34.00% 34.00% 34.00% 35.00% 35.00% 36.00% 36.00% 36.00% 36.00% 38.21% 38.11%

EXPENSESPersonnel CostsPayroll & Salary Expense 437,605 489,389 562,797 619,077 673,246 706,908 742,254 770,408 808,929 849,375Payroll Taxes & Benefits 145,868 163,130 187,599 206,359 224,415 235,636 247,418 256,803 269,643 283,125Total Personnel Costs 583,474 652,518 750,396 825,436 897,661 942,544 989,672 1,027,211 1,078,571 1,132,500• AS % OF GROSS SALES 24.00% 22.00% 22.00% 22.00% 21.75% 21.75% 21.75% 21.50% 21.50% 21.50% 24.02% 23.90%

Occupancy ExpensesRent 96,000 96,000 102,000 102,000 105,000 105,000 108,000 108,000 111,000 111,000Real and Property Taxes, Insurance & CAM 0 0 0 0 0 0 0 0 0 0Repairs & Maintenance 9,725 10,016 10,317 10,626 10,945 11,273 11,612 11,960 12,319 12,688Insurance 9,725 10,016 10,317 10,626 10,945 11,273 11,612 11,960 12,319 12,688Utilities 30,000 31,500 33,075 34,729 36,465 38,288 40,203 42,213 44,324 46,540Licenses & Permits 3,500 3,605 3,713 3,825 3,939 4,057 4,179 4,305 4,434 4,567Building Services 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524Depreciation/Amortization 147,709 138,695 141,838 143,981 149,266 151,409 153,552 82,909 85,052 86,052Total Occupancy Expenses 301,659 294,983 306,564 311,250 322,189 327,098 335,128 267,496 275,781 280,059• AS % OF GROSS SALES 12.41% 9.95% 8.99% 8.30% 7.81% 7.55% 7.37% 5.60% 5.50% 5.32% 5.40% 4.58%Occupancy Expenses less Depreciation/Amortization 6.33% 5.27% 4.83% 4.46% 4.19% 4.05% 3.99% 3.86% 3.80% 3.68% 3.93% 2.96%Depreciation/Amortization 6.08% 4.68% 4.16% 3.84% 3.62% 3.49% 3.37% 1.74% 1.70% 1.63% 1.47% 1.62%Operating ExpensesStore Supplies 55,308 38,558 44,342 48,776 53,653 56,336 59,153 62,110 65,216 68,477Credit Card Fees 33,550 40,931 47,070 51,777 56,955 59,803 62,793 65,933 69,229 72,691Telephone/Internet 2,003 2,444 2,811 3,092 3,401 3,571 3,749 3,937 4,134 4,340Small Equipment purchases 3,890 4,746 5,457 6,003 6,603 6,934 7,280 7,644 8,027 8,428Trash/Baler 1,459 1,780 2,047 2,251 2,476 2,600 2,730 2,867 3,010 3,160Bad Debt, Cash Over (Short), Bank Charges 243 297 341 375 413 433 455 478 502 527Vehicle Expense 0 0 0 0 0 0 0 0 0 0Miscellaneous 4,862 7,415 8,527 9,380 10,318 10,834 11,376 11,944 12,542 13,169Total Operating Expenses 101,315 96,169 110,595 121,654 133,820 140,511 147,536 154,913 162,659 170,792• AS % OF GROSS SALES 4.17% 3.24% 3.24% 3.24% 3.24% 3.24% 3.24% 3.24% 3.24% 3.24% 3.41% 3.39%

Administrative ExpensesOffice Supplies/Postage 11,852 9,639 11,085 12,194 13,413 14,084 14,788 15,528 16,304 17,119Dues & Subscriptions 3,355 4,093 4,707 5,178 5,696 5,980 6,279 6,593 6,923 7,269Legal, Accounting, Consulting Fees 46,775 20,465 23,535 25,889 28,478 29,901 31,396 32,966 34,615 36,345Travel Expenses 2,516 3,070 3,530 3,883 4,272 4,485 4,709 4,945 5,192 5,452Total Administrative Expenses 64,498 37,268 42,858 47,144 51,858 54,451 57,173 60,032 63,034 66,185• AS % OF GROSS SALES 2.65% 1.26% 1.26% 1.26% 1.26% 1.26% 1.26% 1.26% 1.26% 1.26% 1.29% 1.08%

Governance/Member ExpenseBoard of Directors 5,105 6,229 6,566 7,223 7,223 8,342 8,759 9,197 9,657 10,140Newsletter Expense 2,431 2,966 3,411 3,752 4,127 4,334 4,550 4,778 5,017 5,267Member Services 851 1,038 1,194 1,313 1,445 1,517 1,593 1,672 1,756 1,844Total Governance/Member Expense 8,387 10,233 11,171 12,288 12,794 14,192 14,902 15,647 16,429 17,251• AS % OF GROSS SALES 0.35% 0.35% 0.33% 0.33% 0.31% 0.33% 0.33% 0.33% 0.33% 0.33% 0.38% 0.33%

Promotion ExpenseAdvertising 48,623 39,151 42,295 46,525 51,177 53,736 54,603 57,333 58,193 61,102Merchandising & Promotion 9,725 11,864 13,644 15,008 16,509 17,334 18,201 19,111 20,066 21,070Contributions/Donations 1,500 2,500 3,000 5,500 8,000 10,500 13,000 15,500 18,000 20,500Total Promotional Expenses 59,847 53,515 58,939 67,032 75,686 81,570 85,803 91,944 96,259 102,672• AS % OF GROSS SALES 2.46% 1.80% 1.73% 1.79% 1.83% 1.88% 1.89% 1.92% 1.92% 1.95% 1.71% 1.81%

TOTAL OPERATING EXPENSES 0 0 1,119,181 1,144,686 1,280,522 1,384,804 1,494,007 1,560,367 1,630,214 1,617,243 1,692,733 1,769,459• AS % OF GROSS SALES 46.04% 38.59% 37.54% 36.91% 36.20% 36.01% 35.83% 33.85% 33.74% 33.59% 36.90% 35.91%

INCOME FROM OPERATIONS 0 0 (316,904) (136,248) (120,819) (109,131) (49,495) (43,628) 7,863 102,738 113,247 126,820• AS % OF GROSS SALES (13.04%) (4.59%) (3.54%) (2.91%) (1.20%) (1.01%) 0.17% 2.15% 2.26% 2.41%

Other Revenue (Expenses)Interest Income 0 0 0 0 0 0 0 0 0 0Interest Expense 0 0 0 0 0 0 0 0 0 0Rent for 500 sq. ft. 0 0 0 0 0 0 0 0 0 0 0Other Non-operating (expense) (24,311) 0 0 0 0 0 0 0 0 0Total Other Revenues (Expenses) (24,311) 0 0 0 0 0 0 0 0 0• AS % OF GROSS SALES (1.00%) 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Interest expenseCity/Community Loan 1,962 1,880 1,796 1,709 1,621 1,531 1,440 1,346 1,250 1,154Member Loans 0 0 0 0 0 0 0 0 0 0Vendor Credit 0 0 0 0 0 0 0 0 0 0Bank Debt 28,905 28,102 27,249 26,345 25,383 24,363 23,280 22,130 20,909 19,613Total Interest Expense 0 30,866 29,981 29,044 28,053 27,003 25,893 24,719 23,475 22,158 20,766• AS % OF GROSS SALES 1.27% 1.01% 0.85% 0.75% 0.65% 0.60% 0.54% 0.49% 0.44% 0.39%

PROFIT/(LOSS) BEFORE PATRONAGE & TAXES (372,082) (166,230) (149,863) (137,184) (76,498) (69,522) (16,857) 79,263 91,088 106,054• AS % OF GROSS SALES (15.30%) (5.60%) (4.39%) (3.66%) (1.85%) (1.60%) (0.37%) 1.66% 1.82% 2.01%

Patronage Rebate expense• AS % OF GROSS SALES 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

PROFIT/(LOSS) BEFORE TAXES 0 0 (372,082) (166,230) (149,863) (137,184) (76,498) (69,522) (16,857) 79,263 91,088 106,054• AS % OF GROSS SALES (15.30%) (5.60%) (4.39%) (3.66%) (1.85%) (1.60%) (0.37%) 1.66% 1.82% 2.01%

Income Taxes 0 0 0 0 0 0 0 0 0 0 0• AS % OF GROSS SALES 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% -0.10% -0.19%

PROFIT/(LOSS) 0 0 (372,082) (166,230) (149,863) (137,184) (76,498) (69,522) (16,857) 79,263 91,088 106,054• AS % OF GROSS SALES (15.30%) (5.60%) (4.39%) (3.66%) (1.85%) (1.60%) (0.37%) 1.66% 1.82% 2.01% 1.03% 1.67%STATEMENT OF CASH FLOW

Profit (loss) (372,082) (166,230) (149,863) (137,184) (76,498) (69,522) (16,857) 79,263 91,088 106,054Depreciation (Gross Accumulated Depreciation) 147,709 138,695 141,838 143,981 149,266 151,409 153,552 82,909 85,052 86,052Interest Expense Add back 30,866 29,981 29,044 28,053 27,003 25,893 24,719 23,475 22,158 20,766Subtotal (193,506) 2,447 21,019 34,850 99,771 107,781 161,415 185,648 198,299 212,872

Changes In Working CapitalPrepaid Items 0 0 0 0 0 0 0 0 0 0Inventories 0 (5,040) (5,191) (5,347) (5,507) (5,673) (5,843) (6,018) (6,199) (6,385)Accounts Receivable 0 0 0 0 0 0 0 0 0 0Accounts Payable 111,566 22,513 20,112 15,419 14,134 9,187 6,530 9,973 10,472 10,995Accrued Payroll and Payroll Taxes 11,221 1,328 1,882 1,443 1,389 863 906 722 988 1,037Sales Tax Payables 2,532 557 463 355 391 215 226 237 249 261BLANK 0 0 0 0 0 0 0 0 0 0Income tax Payable 0 0 0 0 0 0 0 0 0 0BLANK 0 0 0 0 0 0 0 0 0 0TOTAL 125,319 19,358 17,266 11,871 10,407 4,593 1,819 4,914 5,510 5,909CASH FLOWS FROM OPERATIONS (68,187) 21,805 38,285 46,721 110,178 112,373 163,234 190,561 203,809 218,781

INVESTMENTSInvestments 0 0 0 0 0 0 0 0 0 0BLANK 0 0 0 0 0 0 0 0 0 0Deposits 0 0 0 0 0 0 0 0 0 0Organization Development Costs 0 0 0 0 0 0 0 0 0 0Land 0 0 0 0 0 0 0 0 0 0Building contingency 0 0 0 0 0 0 0 0 0 0Building 0 0 0 0 0 0 0 0 0 0Equipment 0 (15,000) (15,000) (15,000) (30,000) (15,000) (15,000) (15,000) (15,000) (15,000)Leasehold Improvements 0 0 (15,000) 0 (15,000) 0 0 (15,000) 0 (15,000)CASH FLOW FROM INVESTMENTS 0 (15,000) (30,000) (15,000) (45,000) (15,000) (15,000) (30,000) (15,000) (30,000)

CASH FLOWS FROM EQUITY ACTIVITIES:Member Equity 28,800 28,800 28,800 28,800 28,800 16,000 16,000 8,000 8,000 8,000Worker Equity 2,500 3,750 3,750 625 625 625 250 250 250 250Preferred Shares through DPO 0 0 0 0 0 (25,000) (25,000) (50,000) (75,000) (100,000)Preferred Shares Dividends 0 0 0 0 0 (15,000) (14,250) (13,500) (12,000) (9,750)CASH FLOWS FROM EQUITY ACTIVITIES: 31,300 32,550 32,550 29,425 29,425 (23,375) (23,000) (55,250) (78,750) (101,500)

CASH FLOW BEFORE DEBT SERVICE (36,887) 39,355 40,835 61,146 94,603 73,998 125,234 105,311 110,059 87,281

DEBT SERVICE (Principal & Interest)City/Community Loan (6,071) (6,071) (6,071) (6,071) (6,071) (6,071) (6,071) (6,071) (6,071) (6,071)Vendor Credit 0 0 0 0 0 0 0 0 0 0Bank Debt (41,924) (41,924) (41,924) (41,924) (41,924) (41,924) (41,924) (41,924) (41,924) (41,924)Member Loans 0 0 0 0 0 0 0 0 0 0TOTAL LONG TERM LIABILITIES (47,994) (47,994) (47,994) (47,994) (47,994) (47,994) (47,994) (47,994) (47,994) (47,994)

TOTAL CASH FLOW (84,881) (8,640) (7,159) 13,151 46,609 26,004 77,240 57,317 62,064 39,287BEGINNING CASH 224,491 139,610 130,970 123,811 136,962 183,570 209,574 286,814 344,131 406,195ENDING CASH 139,610 130,970 123,811 136,962 183,570 209,574 286,814 344,131 406,195 445,482test 0 (0) 0 0 0 0 0 0 0 0

RATIOSDEBT/EQUITY 0.41 0.64 0.73 0.84 0.96 1.02 1.16 1.22 1.14 1.09 1.06DEBT/EQUITY+MEMBER LOANS 0.41 0.64 0.73 0.84 0.96 1.02 1.16 1.22 1.14 1.09 1.06CURRENT RATIO 2.15 1.80 1.57 1.52 1.64 1.69 1.97 2.12 2.27 2.32DEBT COVERAGE (3.96) 0.05 0.43 0.71 2.03 2.19 3.28 3.76 4.02 4.30DEBT COVERAGE w/o MEMBER LOANS (3.96) 0.05 0.43 0.71 2.03 2.19 3.28 3.76 4.02 4.30RETURN ON EQUITY -29.53% -16.26% -16.71% -17.49% -10.82% -10.91% -2.95% 14.08% 15.68% 17.99%INVENTORY TURNOVERS 10 11 13 14 14 15 15 15 15 16PROFIT MARGIN ON SALES -15.30% -5.60% -4.39% -3.66% -1.85% -1.60% -0.37% 1.66% 1.82% 2.01%RATE OF RETURN ON ASSETS -19.57% -9.66% -9.36% -9.21% -5.43% -5.23% -1.35% 6.46% 7.40% 8.66%SALES PER SQ. FT. $579 $706 $812 $893 $983 $1,032 $1,083 $1,138 $1,194 $1,254OWNERSHIP (EQUITY/ASSETS) 61.02% 57.65% 54.30% 50.96% 49.48% 46.26% 45.10% 46.67% 47.74% 48.52%WORKING CAPITAL $'S $375,365 $164,279 $135,344 $109,927 $110,158 $145,250 $165,486 $239,663 $290,750 $345,912 $377,814

COMMON SIZE INCOME STATEMENT

INCOMEGROSS SALES 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%Cost of Goods 67.00% 66.00% 66.00% 66.00% 65.00% 65.00% 64.00% 64.00% 64.00% 64.00% 61.79% 61.89%GROSS MARGIN 33.00% 34.00% 34.00% 34.00% 35.00% 35.00% 36.00% 36.00% 36.00% 36.00% 38.21% 38.11%

EXPENSESPersonnel CostsPayroll & Salary Expense 18.00% 16.50% 16.50% 16.50% 16.31% 16.31% 16.31% 16.13% 16.13% 16.13%Payroll Taxes & Benefits 6.00% 5.50% 5.50% 5.50% 5.44% 5.44% 5.44% 5.38% 5.38% 5.38%Total Personnel Costs 24.00% 22.00% 22.00% 22.00% 21.75% 21.75% 21.75% 21.50% 21.50% 21.50% 24.02% 23.90%

Occupancy ExpensesRent 3.95% 3.24% 2.99% 2.72% 2.54% 2.42% 2.37% 2.26% 2.21% 2.11%Real and Property Taxes, Insurance & CAM 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%Repairs & Maintenance 0.40% 0.34% 0.30% 0.28% 0.27% 0.26% 0.26% 0.25% 0.25% 0.24%Insurance 0.40% 0.34% 0.30% 0.28% 0.27% 0.26% 0.26% 0.25% 0.25% 0.24%Utilities 1.23% 1.06% 0.97% 0.93% 0.88% 0.88% 0.88% 0.88% 0.88% 0.88%Licenses & Permits 0.14% 0.12% 0.11% 0.10% 0.10% 0.09% 0.09% 0.09% 0.09% 0.09%Building Services 0.21% 0.17% 0.16% 0.15% 0.14% 0.13% 0.13% 0.13% 0.13% 0.12%Depreciation/Amortization 6.08% 4.68% 4.16% 3.84% 3.62% 3.49% 3.37% 1.74% 1.70% 1.63% 1.47% 1.62%Total Occupancy Expenses 12.41% 9.95% 8.99% 8.30% 7.81% 7.55% 7.37% 5.60% 5.50% 5.32% 5.40% 4.58%

Operating ExpensesStore Supplies 2.28% 1.30% 1.30% 1.30% 1.30% 1.30% 1.30% 1.30% 1.30% 1.30%Credit Card Fees 1.38% 1.38% 1.38% 1.38% 1.38% 1.38% 1.38% 1.38% 1.38% 1.38%Telephone 0.08% 0.08% 0.08% 0.08% 0.08% 0.08% 0.08% 0.08% 0.08% 0.08%Small Equipment purchases 0.16% 0.16% 0.16% 0.16% 0.16% 0.16% 0.16% 0.16% 0.16% 0.16%Trash/Baler 0.06% 0.06% 0.06% 0.06% 0.06% 0.06% 0.06% 0.06% 0.06% 0.06%Bad Debt, Cash Over (Short), Bank Charges 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01%Vehicle Expense 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%Miscellaneous 0.20% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25% 0.25%Total Operating Expenses 4.17% 3.24% 3.24% 3.24% 3.24% 3.24% 3.24% 3.24% 3.24% 3.24% 3.41% 3.39%

Administrative ExpensesOffice Supplies/Postage 0.49% 0.33% 0.33% 0.33% 0.33% 0.33% 0.33% 0.33% 0.33% 0.33%Dues & Subscriptions 0.14% 0.14% 0.14% 0.14% 0.14% 0.14% 0.14% 0.14% 0.14% 0.14%Legal, Accounting, Consulting Fees 1.92% 0.69% 0.69% 0.69% 0.69% 0.69% 0.69% 0.69% 0.69% 0.69%Travel Expenses 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10%Total Administrative Expenses 2.65% 1.26% 1.26% 1.26% 1.26% 1.26% 1.26% 1.26% 1.26% 1.26% 1.29% 1.08%

Governance/Member ExpenseBoard of Directors 0.21% 0.21% 0.19% 0.19% 0.18% 0.19% 0.19% 0.19% 0.19% 0.19%Newsletter Expense 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10%Member Services 0.04% 0.04% 0.04% 0.04% 0.04% 0.04% 0.04% 0.04% 0.04% 0.04%Total Governance/Member Expense 0.35% 0.35% 0.33% 0.33% 0.31% 0.33% 0.33% 0.33% 0.33% 0.33% 0.38% 0.33%

Promotion ExpenseAdvertising 2.00% 1.32% 1.24% 1.24% 1.24% 1.24% 1.20% 1.20% 1.16% 1.16%Merchandising & Promotion 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40% 0.40%Contributions/Donations 0.06% 0.08% 0.09% 0.15% 0.19% 0.24% 0.29% 0.32% 0.36% 0.39%Total Promotional Expenses 2.46% 1.80% 1.73% 1.79% 1.83% 1.88% 1.89% 1.92% 1.92% 1.95% 1.71% 1.81%

TOTAL OPERATING EXPENSES 46.04% 38.59% 37.54% 36.91% 36.20% 36.01% 35.83% 33.85% 33.74% 33.59% 36.90% 35.91%

INCOME FROM OPERATIONS -13.04% -4.59% -3.54% -2.91% -1.20% -1.01% 0.17% 2.15% 2.26% 2.41%

Other Revenue (Expenses)Interest Income 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%Interest Expense 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%Other non-operating Income 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%Other Non-operating (expense) -1.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%Total Other Revenues (Expenses) -1.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% -0.30% -0.53%

Interest expenseCity/Community Loan 0.08% 0.06% 0.05% 0.05% 0.04% 0.04% 0.03% 0.03% 0.02% 0.02%Member Loans 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%Gap Financing 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%Bank Debt 1.19% 0.95% 0.80% 0.70% 0.62% 0.56% 0.51% 0.46% 0.42% 0.37%Total Interest Expense 1.27% 1.01% 0.85% 0.75% 0.65% 0.60% 0.54% 0.49% 0.44% 0.39% -0.58% -0.96%

PROFIT/(LOSS) BEFORE PATRONAGE & TAXES -15.30% -5.60% -4.39% -3.66% -1.85% -1.60% -0.37% 1.66% 1.82% 2.01%

Patronage Rebate expense 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% -0.07% 0.00%

PROFIT/(LOSS) BEFORE TAXES -15.30% -5.60% -4.39% -3.66% -1.85% -1.60% -0.37% 1.66% 1.82% 2.01%

Income Taxes 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% -0.10% -0.19%

PROFIT/LOSS -15.30% -5.60% -4.39% -3.66% -1.85% -1.60% -0.37% 1.66% 1.82% 2.01% 1.03% 1.67%

inflation 0.03

TAXES CALCULATIONProfit (loss) (372,082) (166,230) (149,863) (137,184) (76,498) (69,522) (16,857) 79,263 91,088 106,054Profit (loss) netted with previous period (372,082) (538,311) (688,175) (825,359) (901,857) (971,379) (988,236) (908,973) (817,884) (711,831)TAXES 0 0 0 0 0 0 0 0 0 0

WAGES% OF SALES 24.00% 22.00% 22.00% 22.00% 21.75% 21.75% 21.75% 21.50% 21.50% 21.50%WAGES AS A % OF GROSS SALES 583,474 652,518 750,396 825,436 897,661 942,544 989,672 1,027,211 1,078,571 1,132,500Wages % 75.00% 75.00% 75.00% 75.00% 75.00% 75.00% 75.00% 75.00% 75.00% 75.00%Payroll Taxes & Benefits % 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00%Wages 437,605 489,389 562,797 619,077 673,246 706,908 742,254 770,408 808,929 849,375Benefits 145,868 163,130 187,599 206,359 224,415 235,636 247,418 256,803 269,643 283,125

Comparisons

Oneofseventabsfromanactualproforma

FinancialProjec8ons

n  Salesprojec8ons

n  ProFormaopera8ngbudgetn  BalanceSheetn  IncomeStatementorProfit&Lossn  Cashflown  Ra8oAnalysesn  Debtservice

BalanceSheet3/3/2016 0:00

Sources & Uses Beginning YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8 YEAR 9 YEAR 10

BALANCE SHEET

ASSETSCURRENT ASSETSCash 224,491 224,491 139,610 130,970 123,811 136,962 183,570 209,574 286,814 344,131 406,195 445,482Prepaid Items 0 0 0 0 0 0 0 0 0 0 0Inventories 168,000 168,000 168,000 173,040 178,231 183,578 189,085 194,758 200,601 206,619 212,817 219,202Accounts Receivable 0 0 0 0 0 0 0 0 0 0 0TOTAL CURRENT ASSETS 392,491 392,491 307,610 304,010 302,042 320,540 372,656 404,332 487,415 550,750 619,013 664,684

FIXED ASSETSLand 0Building contingency 0 0 0 0 0 0 0 0 0 0 0Building 0 0 0 0 0 0 0 0 0 0 0Equipment 516,500 516,500 516,500 531,500 546,500 561,500 591,500 606,500 621,500 636,500 651,500 666,500Leasehold Improvements 687,500 687,500 687,500 687,500 702,500 702,500 717,500 717,500 717,500 732,500 732,500 747,500Accumulated Depreciation 0 (119,619) (241,381) (366,286) (493,333) (625,667) (760,143) (896,762) (962,738) (1,030,857) (1,099,976)Gross FIXED ASSETS 1,204,000 1,204,000 1,084,381 977,619 882,714 770,667 683,333 563,857 442,238 406,262 353,143 314,024

OTHER ASSETSInvestments 0 0 0 0 0 0 0 0 0 0 0Deposits 0 0 0 0 0 0 0 0 0 0 0Organization Development Costs 421,355 421,355 421,355 421,355 421,355 421,355 421,355 421,355 421,355 421,355 421,355 421,355Depreciation/Amortization 0 (28,090) (45,023) (61,956) (78,889) (95,822) (112,755) (129,688) (146,621) (163,554) (180,487)TOTAL OTHER ASSETS 421,355 421,355 393,265 376,332 359,399 342,466 325,533 308,600 291,667 274,734 257,801 240,868

TOTAL ASSETS 2,017,846 2,017,846 1,785,255 1,657,961 1,544,155 1,433,672 1,381,522 1,276,789 1,221,320 1,231,746 1,229,956 1,219,576

LIABILITIESCURRENT LIABILITIESAccounts Payable 111,566 134,079 154,191 169,610 183,744 192,931 199,461 209,435 219,906 230,902Accrued Payroll and Payroll Taxes 0 11,221 12,548 14,431 15,874 17,263 18,126 19,032 19,754 20,742 21,779Sales Tax Payables 0 2,532 3,090 3,553 3,908 4,299 4,514 4,740 4,977 5,226 5,487Income tax Payable 0 0 0 0 0 0 0 0 0 0 0Loan Payable Current Portion 17,126 18,012 18,949 19,941 20,990 22,100 23,275 24,519 25,835 27,227 28,703TOTAL CURRENT LIABILITIES 0 17,126 143,331 168,666 192,115 210,383 227,406 238,846 247,752 260,000 273,101 286,870

LONG TERM LIABILITIESCity/Community Loan 100,000 95,892 91,701 87,425 83,063 78,613 74,073 69,442 64,717 59,897 54,979 49,962Vendor Credit 0 0 0 0 0 0 0 0 0 0 0 0Bank Debt 487,647 474,628 460,806 446,131 430,551 414,010 396,449 377,805 358,011 336,997 314,686 290,998Member Loans 0 0 0 0 0 0 0 0 0 0 0 0TOTAL LONG TERM LIABILITIES 587,647 570,520 552,506 533,556 513,614 492,624 470,523 447,247 422,728 396,893 369,665 340,961

TOTAL LIABILITIES 587,647 587,646 695,837 702,222 705,730 703,006 697,929 686,093 670,480 656,893 642,766 627,831

EQUITYMember Equity 80,000 80,000 108,800 137,600 166,400 195,200 224,000 240,000 256,000 264,000 272,000 280,000Worker Equity 0 0 2,500 6,250 10,000 10,625 11,250 11,875 12,125 12,375 12,625 12,875Preferred Shares through DPO 500,000 500,000 500,000 500,000 500,000 500,000 500,000 475,000 450,000 400,000 325,000 225,000Preferred Shares Dividends 0 0 0 0 0 0 (15,000) (29,250) (42,750) (54,750) (64,500)Retained Earnings 850,200 850,200 478,118 311,889 162,025 24,841 (51,657) (121,179) (138,036) (58,773) 32,316 138,369TOTAL EQUITY 1,430,200 1,430,200 1,089,418 955,739 838,425 730,666 683,593 590,696 550,839 574,852 587,191 591,744

TOTAL LIABILITIES & EQUITY 2,017,847 2,017,846 1,785,255 1,657,961 1,544,155 1,433,672 1,381,522 1,276,789 1,221,320 1,231,746 1,229,956 1,219,576

CurrentAssets

3/3/2016 0:00Sources &

Uses Beginning YEAR 1 YEAR 2 YEAR 3 YEAR 4BALANCE SHEET

ASSETSCURRENT ASSETSCash 224,491 224,491 139,610 130,970 123,811 136,962Prepaid Items 0 0 0 0 0Inventories 168,000 168,000 168,000 173,040 178,231 183,578Accounts Receivable 0 0 0 0 0TOTAL CURRENT ASSETS 392,491 392,491 307,610 304,010 302,042 320,540

FixedAssets

FIXED ASSETSLand 0Building contingency 0 0 0 0 0Building 0 0 0 0 0Equipment 516,500 516,500 516,500 531,500 546,500 561,500Leasehold Improvements 687,500 687,500 687,500 687,500 702,500 702,500Accumulated Depreciation 0 (119,619) (241,381) (366,286) (493,333)Gross FIXED ASSETS 1,204,000 1,204,000 1,084,381 977,619 882,714 770,667

3/3/2016 0:00Sources &

Uses Beginning YEAR 1 YEAR 2 YEAR 3 YEAR 4

OtherAssets&TotalAssets

OTHER ASSETSInvestments 0 0 0 0 0Deposits 0 0 0 0 0Organization Development Costs 421,355 421,355 421,355 421,355 421,355 421,355Depreciation/Amortization 0 (28,090) (45,023) (61,956) (78,889)TOTAL OTHER ASSETS 421,355 421,355 393,265 376,332 359,399 342,466

TOTAL ASSETS 2,017,846 2,017,846 1,785,255 1,657,961 1,544,155 1,433,672

CurrentLiabili8es

LIABILITIESCURRENT LIABILITIESAccounts Payable 111,566 134,079 154,191 169,610Accrued Payroll and Payroll Taxes 0 11,221 12,548 14,431 15,874Sales Tax Payables 0 2,532 3,090 3,553 3,908Income tax Payable 0 0 0 0 0Loan Payable Current Portion 17,126 18,012 18,949 19,941 20,990TOTAL CURRENT LIABILITIES 0 17,126 143,331 168,666 192,115 210,383

Long-Term&TotalLiabili8es

3/3/2016 0:00Sources &

Uses Beginning YEAR 1 YEAR 2 YEAR 3 YEAR 4LONG TERM LIABILITIESCity/Community Loan 100,000 95,892 91,701 87,425 83,063 78,613Vendor Credit 0 0 0 0 0 0Bank Debt 487,647 474,628 460,806 446,131 430,551 414,010Member Loans 0 0 0 0 0 0TOTAL LONG TERM LIABILITIES 587,647 570,520 552,506 533,556 513,614 492,624

TOTAL LIABILITIES 587,647 587,646 695,837 702,222 705,730 703,006

Equity

EQUITYMember Equity 80,000 80,000 108,800 137,600 166,400 195,200Worker Equity 0 0 2,500 6,250 10,000 10,625Preferred Shares through DPO 500,000 500,000 500,000 500,000 500,000 500,000Preferred Shares Dividends 0 0 0 0 0Retained Earnings 850,200 850,200 478,118 311,889 162,025 24,841TOTAL EQUITY 1,430,200 1,430,200 1,089,418 955,739 838,425 730,666

TOTAL LIABILITIES & EQUITY 2,017,847 2,017,846 1,785,255 1,657,961 1,544,155 1,433,672

3/3/2016 0:00Sources &


AnalyzingtheBalanceSheet

IncomeStatements(orProfit&Loss/P&L)

INCOME STATEMENT 1 (0) 0 0 0 0 0 0 0 0 0 0

INCOMERETAIL SQ/FT 4,200 4,200 4,200 4,200 4,200 4,200 4,200 4,200 4,200 4,200GROSS SALES SQ/FT 579 706 812 893 983 1,032 1,083 1,138 1,194 1,254

GROSS SALES $2,431,141 $2,965,993 $3,410,891 $3,751,981 $4,127,179 $4,333,538 $4,550,214 $4,777,725 $5,016,611 $5,267,442% SALES GROWTH 22.00% 15.00% 10.00% 10.00% 5.00% 5.00% 5.00% 5.00% 5.00%

COST OF GOODS SOLD 1,628,865 1,957,555 2,251,188 2,476,307 2,682,666 2,816,799 2,912,137 3,057,744 3,210,631 3,371,163• AS % OF GROSS SALES 67.00% 66.00% 66.00% 66.00% 65.00% 65.00% 64.00% 64.00% 64.00% 64.00%

GROSS MARGIN 802,277 1,008,437 1,159,703 1,275,673 1,444,513 1,516,738 1,638,077 1,719,981 1,805,980 1,896,279• AS % OF GROSS SALES 33.00% 34.00% 34.00% 34.00% 35.00% 35.00% 36.00% 36.00% 36.00% 36.00%

EXPENSESPersonnel CostsPayroll & Salary Expense 437,605 489,389 562,797 619,077 673,246 706,908 742,254 770,408 808,929 849,375Payroll Taxes & Benefits 145,868 163,130 187,599 206,359 224,415 235,636 247,418 256,803 269,643 283,125Total Personnel Costs 583,474 652,518 750,396 825,436 897,661 942,544 989,672 1,027,211 1,078,571 1,132,500• AS % OF GROSS SALES 24.00% 22.00% 22.00% 22.00% 21.75% 21.75% 21.75% 21.50% 21.50% 21.50%

Occupancy ExpensesRent 96,000 96,000 102,000 102,000 105,000 105,000 108,000 108,000 111,000 111,000Real and Property Taxes, Insurance & CAM 0 0 0 0 0 0 0 0 0 0Repairs & Maintenance 9,725 10,016 10,317 10,626 10,945 11,273 11,612 11,960 12,319 12,688Insurance 9,725 10,016 10,317 10,626 10,945 11,273 11,612 11,960 12,319 12,688Utilities 30,000 31,500 33,075 34,729 36,465 38,288 40,203 42,213 44,324 46,540Licenses & Permits 3,500 3,605 3,713 3,825 3,939 4,057 4,179 4,305 4,434 4,567Building Services 5,000 5,150 5,305 5,464 5,628 5,796 5,970 6,149 6,334 6,524Depreciation/Amortization 147,709 138,695 141,838 143,981 149,266 151,409 153,552 82,909 85,052 86,052Total Occupancy Expenses 301,659 294,983 306,564 311,250 322,189 327,098 335,128 267,496 275,781 280,059• AS % OF GROSS SALES 12.41% 9.95% 8.99% 8.30% 7.81% 7.55% 7.37% 5.60% 5.50% 5.32%Occupancy Expenses less Depreciation/Amortization 6.33% 5.27% 4.83% 4.46% 4.19% 4.05% 3.99% 3.86% 3.80% 3.68%Depreciation/Amortization 6.08% 4.68% 4.16% 3.84% 3.62% 3.49% 3.37% 1.74% 1.70% 1.63%Operating ExpensesStore Supplies 55,308 38,558 44,342 48,776 53,653 56,336 59,153 62,110 65,216 68,477Credit Card Fees 33,550 40,931 47,070 51,777 56,955 59,803 62,793 65,933 69,229 72,691Telephone/Internet 2,003 2,444 2,811 3,092 3,401 3,571 3,749 3,937 4,134 4,340Small Equipment purchases 3,890 4,746 5,457 6,003 6,603 6,934 7,280 7,644 8,027 8,428Trash/Baler 1,459 1,780 2,047 2,251 2,476 2,600 2,730 2,867 3,010 3,160Bad Debt, Cash Over (Short), Bank Charges 243 297 341 375 413 433 455 478 502 527Vehicle Expense 0 0 0 0 0 0 0 0 0 0Miscellaneous 4,862 7,415 8,527 9,380 10,318 10,834 11,376 11,944 12,542 13,169Total Operating Expenses 101,315 96,169 110,595 121,654 133,820 140,511 147,536 154,913 162,659 170,792• AS % OF GROSS SALES 4.17% 3.24% 3.24% 3.24% 3.24% 3.24% 3.24% 3.24% 3.24% 3.24%

Administrative ExpensesOffice Supplies/Postage 11,852 9,639 11,085 12,194 13,413 14,084 14,788 15,528 16,304 17,119Dues & Subscriptions 3,355 4,093 4,707 5,178 5,696 5,980 6,279 6,593 6,923 7,269Legal, Accounting, Consulting Fees 46,775 20,465 23,535 25,889 28,478 29,901 31,396 32,966 34,615 36,345Travel Expenses 2,516 3,070 3,530 3,883 4,272 4,485 4,709 4,945 5,192 5,452Total Administrative Expenses 64,498 37,268 42,858 47,144 51,858 54,451 57,173 60,032 63,034 66,185• AS % OF GROSS SALES 2.65% 1.26% 1.26% 1.26% 1.26% 1.26% 1.26% 1.26% 1.26% 1.26%

Governance/Member ExpenseBoard of Directors 5,105 6,229 6,566 7,223 7,223 8,342 8,759 9,197 9,657 10,140Newsletter Expense 2,431 2,966 3,411 3,752 4,127 4,334 4,550 4,778 5,017 5,267Member Services 851 1,038 1,194 1,313 1,445 1,517 1,593 1,672 1,756 1,844Total Governance/Member Expense 8,387 10,233 11,171 12,288 12,794 14,192 14,902 15,647 16,429 17,251• AS % OF GROSS SALES 0.35% 0.35% 0.33% 0.33% 0.31% 0.33% 0.33% 0.33% 0.33% 0.33%

Promotion ExpenseAdvertising 48,623 39,151 42,295 46,525 51,177 53,736 54,603 57,333 58,193 61,102Merchandising & Promotion 9,725 11,864 13,644 15,008 16,509 17,334 18,201 19,111 20,066 21,070Contributions/Donations 1,500 2,500 3,000 5,500 8,000 10,500 13,000 15,500 18,000 20,500Total Promotional Expenses 59,847 53,515 58,939 67,032 75,686 81,570 85,803 91,944 96,259 102,672• AS % OF GROSS SALES 2.46% 1.80% 1.73% 1.79% 1.83% 1.88% 1.89% 1.92% 1.92% 1.95%

TOTAL OPERATING EXPENSES 0 0 1,119,181 1,144,686 1,280,522 1,384,804 1,494,007 1,560,367 1,630,214 1,617,243 1,692,733 1,769,459• AS % OF GROSS SALES 46.04% 38.59% 37.54% 36.91% 36.20% 36.01% 35.83% 33.85% 33.74% 33.59%

INCOME FROM OPERATIONS 0 0 (316,904) (136,248) (120,819) (109,131) (49,495) (43,628) 7,863 102,738 113,247 126,820• AS % OF GROSS SALES (13.04%) (4.59%) (3.54%) (2.91%) (1.20%) (1.01%) 0.17% 2.15% 2.26% 2.41%

Other Revenue (Expenses)Interest Income 0 0 0 0 0 0 0 0 0 0Interest Expense 0 0 0 0 0 0 0 0 0 0Rent for 500 sq. ft. 0 0 0 0 0 0 0 0 0 0Other Non-operating (expense) (24,311) 0 0 0 0 0 0 0 0 0Total Other Revenues (Expenses) (24,311) 0 0 0 0 0 0 0 0 0• AS % OF GROSS SALES (1.00%) 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Interest expenseCity/Community Loan 1,962 1,880 1,796 1,709 1,621 1,531 1,440 1,346 1,250 1,154Member Loans 0 0 0 0 0 0 0 0 0 0Vendor Credit 0 0 0 0 0 0 0 0 0 0Bank Debt 28,905 28,102 27,249 26,345 25,383 24,363 23,280 22,130 20,909 19,613Total Interest Expense 0 30,866 29,981 29,044 28,053 27,003 25,893 24,719 23,475 22,158 20,766• AS % OF GROSS SALES 1.27% 1.01% 0.85% 0.75% 0.65% 0.60% 0.54% 0.49% 0.44% 0.39%

PROFIT/(LOSS) BEFORE PATRONAGE & TAXES (372,082) (166,230) (149,863) (137,184) (76,498) (69,522) (16,857) 79,263 91,088 106,054• AS % OF GROSS SALES (15.30%) (5.60%) (4.39%) (3.66%) (1.85%) (1.60%) (0.37%) 1.66% 1.82% 2.01%

Patronage Rebate expense• AS % OF GROSS SALES 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

PROFIT/(LOSS) BEFORE TAXES 0 0 (372,082) (166,230) (149,863) (137,184) (76,498) (69,522) (16,857) 79,263 91,088 106,054• AS % OF GROSS SALES (15.30%) (5.60%) (4.39%) (3.66%) (1.85%) (1.60%) (0.37%) 1.66% 1.82% 2.01%

Income Taxes 0 0 0 0 0 0 0 0 0 0 0• AS % OF GROSS SALES 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

PROFIT/(LOSS) 0 0 (372,082) (166,230) (149,863) (137,184) (76,498) (69,522) (16,857) 79,263 91,088 106,054• AS % OF GROSS SALES (15.30%) (5.60%) (4.39%) (3.66%) (1.85%) (1.60%) (0.37%) 1.66% 1.82% 2.01%

IncomeStatementComponents

n Income

n Expenses

n  IncomefromOpera8ons

n  OtherRevenue/Expenses

n  Interestexpense

n  ProfitorLossbeforePatronage&Taxes

n  Patronageexpense

n  Taxes

n Profit/Loss

Income

INCOMERETAIL SQ/FT 4,200 4,200 4,200 4,200GROSS SALES SQ/FT 579 706 812 893

GROSS SALES $2,431,141 $2,965,993 $3,410,891 $3,751,981% SALES GROWTH 22.00% 15.00% 10.00%

COST OF GOODS SOLD 1,628,865 1,957,555 2,251,188 2,476,307• AS % OF GROSS SALES 67.00% 66.00% 66.00% 66.00%

GROSS MARGIN 802,277 1,008,437 1,159,703 1,275,673• AS % OF GROSS SALES 33.00% 34.00% 34.00% 34.00%

3/3/2016 0:00Sources &


ExpensesPersonnel&Occupancy

Personnel CostsPayroll & Salary Expense 437,605 489,389 562,797 619,077Payroll Taxes & Benefits 145,868 163,130 187,599 206,359Total Personnel Costs 583,474 652,518 750,396 825,436• AS % OF GROSS SALES 24.00% 22.00% 22.00% 22.00%

Occupancy ExpensesRent 96,000 96,000 102,000 102,000Real and Property Taxes, Insurance & CAM 0 0 0 0Repairs & Maintenance 9,725 10,016 10,317 10,626Insurance 9,725 10,016 10,317 10,626Utilities 30,000 31,500 33,075 34,729Licenses & Permits 3,500 3,605 3,713 3,825Building Services 5,000 5,150 5,305 5,464Depreciation/Amortization 147,709 138,695 141,838 143,981Total Occupancy Expenses 301,659 294,983 306,564 311,250• AS % OF GROSS SALES 12.41% 9.95% 8.99% 8.30%Occupancy Expenses less Depreciation/Amortization 6.33% 5.27% 4.83% 4.46%Depreciation/Amortization 6.08% 4.68% 4.16% 3.84%

3/3/2016 0:00 YEAR 1 YEAR 2 YEAR 3 YEAR 4

Opera8ngExpenses

Operating ExpensesStore Supplies 55,308 38,558 44,342 48,776Credit Card Fees 33,550 40,931 47,070 51,777Telephone/Internet 2,003 2,444 2,811 3,092Small Equipment purchases 3,890 4,746 5,457 6,003Trash/Baler 1,459 1,780 2,047 2,251Bad Debt, Cash Over (Short), Bank Charges 243 297 341 375Vehicle Expense 0 0 0 0Miscellaneous 4,862 7,415 8,527 9,380Total Operating Expenses 101,315 96,169 110,595 121,654• AS % OF GROSS SALES 4.17% 3.24% 3.24% 3.24%


Administra8ve&GovernanceExpenses

Administrative ExpensesOffice Supplies/Postage 11,852 9,639 11,085 12,194Dues & Subscriptions 3,355 4,093 4,707 5,178Legal, Accounting, Consulting Fees 46,775 20,465 23,535 25,889Travel Expenses 2,516 3,070 3,530 3,883Total Administrative Expenses 64,498 37,268 42,858 47,144• AS % OF GROSS SALES 2.65% 1.26% 1.26% 1.26%

Governance/Member ExpenseBoard of Directors 5,105 6,229 6,566 7,223Newsletter Expense 2,431 2,966 3,411 3,752Member Services 851 1,038 1,194 1,313Total Governance/Member Expense 8,387 10,233 11,171 12,288• AS % OF GROSS SALES 0.35% 0.35% 0.33% 0.33%


Promo8onExpenses

Promotion ExpenseAdvertising 48,623 39,151 42,295 46,525Merchandising & Promotion 9,725 11,864 13,644 15,008Contributions/Donations 1,500 2,500 3,000 5,500Total Promotional Expenses 59,847 53,515 58,939 67,032• AS % OF GROSS SALES 2.46% 1.80% 1.73% 1.79%


TotalOpera8ngExpenses&Income

TOTAL OPERATING EXPENSES 1,119,181 1,144,686 1,280,522 1,384,804• AS % OF GROSS SALES 46.04% 38.59% 37.54% 36.91%

INCOME FROM OPERATIONS (316,904) (136,248) (120,819) (109,131)• AS % OF GROSS SALES (13.04%) (4.59%) (3.54%) (2.91%)


OtherRevenue&Interest

Other Revenue (Expenses)Interest Income 0 0 0 0Interest Expense 0 0 0 0Rent for 500 sq. ft. 0 0 0 0Other Non-operating (expense) (24,311) 0 0 0Total Other Revenues (Expenses) (24,311) 0 0 0• AS % OF GROSS SALES (1.00%) 0.00% 0.00% 0.00%

Interest expenseCity/Community Loan 1,962 1,880 1,796 1,709Member Loans 0 0 0 0Vendor Credit 0 0 0 0Bank Debt 28,905 28,102 27,249 26,345Total Interest Expense 30,866 29,981 29,044 28,053• AS % OF GROSS SALES 1.27% 1.01% 0.85% 0.75%


BokomLine

PROFIT/(LOSS) BEFORE PATRONAGE & TAXES (372,082) (166,230) (149,863) (137,184)• AS % OF GROSS SALES (15.30%) (5.60%) (4.39%) (3.66%)

Patronage Rebate expense• AS % OF GROSS SALES 0.00% 0.00% 0.00% 0.00%

PROFIT/(LOSS) BEFORE TAXES (372,082) (166,230) (149,863) (137,184)• AS % OF GROSS SALES (15.30%) (5.60%) (4.39%) (3.66%)

Income Taxes 0 0 0 0• AS % OF GROSS SALES 0.00% 0.00% 0.00% 0.00%

PROFIT/(LOSS) (372,082) (166,230) (149,863) (137,184)• AS % OF GROSS SALES (15.30%) (5.60%) (4.39%) (3.66%)


CashFlow

51

STATEMENT OF CASH FLOW

Profit (loss) (372,082) (166,230) (149,863) (137,184) (76,498) (69,522) (16,857) 79,263 91,088 106,054Depreciation (Gross Accumulated Depreciation) 147,709 138,695 141,838 143,981 149,266 151,409 153,552 82,909 85,052 86,052Interest Expense Add back 30,866 29,981 29,044 28,053 27,003 25,893 24,719 23,475 22,158 20,766Subtotal (193,506) 2,447 21,019 34,850 99,771 107,781 161,415 185,648 198,299 212,872

Changes In Working CapitalPrepaid Items 0 0 0 0 0 0 0 0 0 0Inventories 0 (5,040) (5,191) (5,347) (5,507) (5,673) (5,843) (6,018) (6,199) (6,385)Accounts Receivable 0 0 0 0 0 0 0 0 0 0Accounts Payable 111,566 22,513 20,112 15,419 14,134 9,187 6,530 9,973 10,472 10,995Accrued Payroll and Payroll Taxes 11,221 1,328 1,882 1,443 1,389 863 906 722 988 1,037Sales Tax Payables 2,532 557 463 355 391 215 226 237 249 261BLANK 0 0 0 0 0 0 0 0 0 0Income tax Payable 0 0 0 0 0 0 0 0 0 0BLANK 0 0 0 0 0 0 0 0 0 0TOTAL 125,319 19,358 17,266 11,871 10,407 4,593 1,819 4,914 5,510 5,909CASH FLOWS FROM OPERATIONS (68,187) 21,805 38,285 46,721 110,178 112,373 163,234 190,561 203,809 218,781

INVESTMENTSInvestments 0 0 0 0 0 0 0 0 0 0BLANK 0 0 0 0 0 0 0 0 0 0Deposits 0 0 0 0 0 0 0 0 0 0Organization Development Costs 0 0 0 0 0 0 0 0 0 0Land 0 0 0 0 0 0 0 0 0 0Building contingency 0 0 0 0 0 0 0 0 0 0Building 0 0 0 0 0 0 0 0 0 0Equipment 0 (15,000) (15,000) (15,000) (30,000) (15,000) (15,000) (15,000) (15,000) (15,000)Leasehold Improvements 0 0 (15,000) 0 (15,000) 0 0 (15,000) 0 (15,000)CASH FLOW FROM INVESTMENTS 0 (15,000) (30,000) (15,000) (45,000) (15,000) (15,000) (30,000) (15,000) (30,000)

CASH FLOWS FROM EQUITY ACTIVITIES:Member Equity 28,800 28,800 28,800 28,800 28,800 16,000 16,000 8,000 8,000 8,000Worker Equity 2,500 3,750 3,750 625 625 625 250 250 250 250Preferred Shares through DPO 0 0 0 0 0 (25,000) (25,000) (50,000) (75,000) (100,000)Preferred Shares Dividends 0 0 0 0 0 (15,000) (14,250) (13,500) (12,000) (9,750)CASH FLOWS FROM EQUITY ACTIVITIES: 31,300 32,550 32,550 29,425 29,425 (23,375) (23,000) (55,250) (78,750) (101,500)

CASH FLOW BEFORE DEBT SERVICE (36,887) 39,355 40,835 61,146 94,603 73,998 125,234 105,311 110,059 87,281

DEBT SERVICE (Principal & Interest)City/Community Loan (6,071) (6,071) (6,071) (6,071) (6,071) (6,071) (6,071) (6,071) (6,071) (6,071)Vendor Credit 0 0 0 0 0 0 0 0 0 0Bank Debt (41,924) (41,924) (41,924) (41,924) (41,924) (41,924) (41,924) (41,924) (41,924) (41,924)Member Loans 0 0 0 0 0 0 0 0 0 0TOTAL LONG TERM LIABILITIES (47,994) (47,994) (47,994) (47,994) (47,994) (47,994) (47,994) (47,994) (47,994) (47,994)

TOTAL CASH FLOW (84,881) (8,640) (7,159) 13,151 46,609 26,004 77,240 57,317 62,064 39,287BEGINNING CASH 224,491 139,610 130,970 123,811 136,962 183,570 209,574 286,814 344,131 406,195ENDING CASH 139,610 130,970 123,811 136,962 183,570 209,574 286,814 344,131 406,195 445,482

CashFlow

STATEMENT OF CASH FLOW

Profit (loss) (372,082) (166,230) (149,863) (137,184)Depreciation (Gross Accumulated Depreciation) 147,709 138,695 141,838 143,981Interest Expense Add back 30,866 29,981 29,044 28,053Subtotal (193,506) 2,447 21,019 34,850

3/3/2016 0:00 Uses Beginning YEAR 1 YEAR 2 YEAR 3 YEAR 4

CashFlow:ChangesinWorkingCapital

3/3/2016 0:00 Uses Beginning YEAR 1 YEAR 2 YEAR 3 YEAR 4Changes In Working CapitalPrepaid Items 0 0 0 0Inventories 0 (5,040) (5,191) (5,347)Accounts Receivable 0 0 0 0Accounts Payable 111,566 22,513 20,112 15,419Accrued Payroll and Payroll Taxes 11,221 1,328 1,882 1,443Sales Tax Payables 2,532 557 463 355

0 0 0 0Income tax Payable 0 0 0 0

0 0 0 0TOTAL 125,319 19,358 17,266 11,871CASH FLOWS FROM OPERATIONS (68,187) 21,805 38,285 46,721

CashFlowfromInvestments


INVESTMENTSInvestments 0 0 0 0BLANK 0 0 0 0Deposits 0 0 0 0Organization Development Costs 0 0 0 0Land 0 0 0 0Building contingency 0 0 0 0Building 0 0 0 0Equipment 0 (15,000) (15,000) (15,000)Leasehold Improvements 0 0 (15,000) 0CASH FLOW FROM INVESTMENTS 0 (15,000) (30,000) (15,000)

CashFlowsfromEquityAc8vity


CASH FLOWS FROM EQUITY ACTIVITIES:Member Equity 28,800 28,800 28,800 28,800Worker Equity 2,500 3,750 3,750 625Preferred Shares through DPO 0 0 0 0Preferred Shares Dividends 0 0 0 0CASH FLOWS FROM EQUITY ACTIVITIES: 31,300 32,550 32,550 29,425

CASH FLOWS FROM EQUITY ACTIVITIES:Member Equity 28,800 28,800 28,800 28,800 28,800 16,000 16,000Worker Equity 2,500 3,750 3,750 625 625 625 250Preferred Shares through DPO 0 0 0 0 0 (25,000) (25,000)Preferred Shares Dividends 0 0 0 0 0 (15,000) (14,250)CASH FLOWS FROM EQUITY ACTIVITIES: 31,300 32,550 32,550 29,425 29,425 (23,375) (23,000)

YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7

CashFlowfromDebtService


CASH FLOW BEFORE DEBT SERVICE (36,887) 39,355 40,835 61,146

DEBT SERVICE (Principal & Interest)City/Community Loan (6,071) (6,071) (6,071) (6,071)Vendor Credit 0 0 0 0Bank Debt (41,924) (41,924) (41,924) (41,924)Member Loans 0 0 0 0TOTAL LONG TERM LIABILITIES (47,994) (47,994) (47,994) (47,994)

TotalCashFlow

TOTAL CASH FLOW (84,881) (8,640) (7,159) 13,151 46,609 26,004 77,240BEGINNING CASH 224,491 139,610 130,970 123,811 136,962 183,570 209,574ENDING CASH 139,610 130,970 123,811 136,962 183,570 209,574 286,814

3/3/2016 0:00 YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7

CashFlowvs.Profit

TOTAL CASH FLOW (84,881) (8,640) (7,159) 13,151 46,609 26,004 77,240BEGINNING CASH 224,491 139,610 130,970 123,811 136,962 183,570 209,574ENDING CASH 139,610 130,970 123,811 136,962 183,570 209,574 286,814

3/3/2016 0:00 YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7

PROFIT/(LOSS) (372,082) (166,230) (149,863) (137,184) (76,498) (69,522) (16,857)• AS % OF GROSS SALES (15.30%) (5.60%) (4.39%) (3.66%) (1.85%) (1.60%) (0.37%)

Ra8oAnalysis


RATIOSDEBT/EQUITY 0.64 0.73 0.84 0.96DEBT/EQUITY+MEMBER LOANS 0.64 0.73 0.84 0.96CURRENT RATIO 2.15 1.80 1.57 1.52DEBT COVERAGE (3.96) 0.05 0.43 0.71DEBT COVERAGE w/o MEMBER LOANS (3.96) 0.05 0.43 0.71RETURN ON EQUITY -29.53% -16.26% -16.71% -17.49%INVENTORY TURNOVERS 10 11 13 14PROFIT MARGIN ON SALES -15.30% -5.60% -4.39% -3.66%RATE OF RETURN ON ASSETS -19.57% -9.66% -9.36% -9.21%SALES PER SQ. FT. $579 $706 $812 $893OWNERSHIP (EQUITY/ASSETS) 61.02% 57.65% 54.30% 50.96%WORKING CAPITAL $'S $164,279 $135,344 $109,927 $110,158

DebtSchedule

TOTAL LOANS Beginning YEAR 1 YEAR 2 YEAR 3 YEAR 4Interest Expense 0 30,866 29,981 29,044 28,053Average Line Of Credit 0 0 0 0 0Long term portion 570,520 552,506 533,556 513,614 492,624Current portion 17,126 18,012 18,949 19,941 20,990Total Loans 587,646 570,518 552,505 533,555 513,614Closing Costs 0 0 0 0 0Initial Term Loans Amount 587,647 587,647 587,647 587,647 587,647Average Term Payments 0 47,994 47,994 47,994 47,994Average Term Principal Paid 1 17,128 18,013 18,950 19,941

Bank DebtAMOUNT 487,647 487,647 487,647 487,647 487,647RATE 6.00% 6.00% 6.00% 6.00% 6.00%MONTHS 240 240 240 240 240PRINCIPAL BALANCE 487,646 474,627 460,805 446,130 430,551CURRENT MONTH NO. 0 12 24 36 48MONTH NUMBER + 12 12 24 36 48 60LONG TERM PORTION 474,628 460,806 446,131 430,551 414,010CURRENT PORTION 13,018 13,821 14,674 15,579 16,541MONTHLY PAYMENTS 3,494 3,494 3,494 3,494 3,494TOTAL PAYMENTS 0 41,924 41,924 41,924 41,924PRINCIPAL PAID 1 13,019 13,822 14,675 15,579INTEREST PAID 0 28,905 28,102 27,249 26,345

AccesstoCapital

n Ownerequity

n Fundraising&grants

n Ownerloans

n Preferredshares

n  Economicdevelopmentfunds

n  Coopera8veloanfunds

n  Commerciallenders

ContractwithaSpecialist

n  Areyou…n  Fullyconversantwithfinancialbudgetsandrepor8ng?n  Abletosetupandmanagecomplexspreadsheets?n  Familiarwithfoodco-opopera8onsandfinancialperformance?n  Abletoaccesshistoricalfinancialdataandadaptittofityourco-op’splans?n  Willingtotakeresponsibilityfortheaccuracyofyourprojec8ons?

n  No?Notsure?

n HireaprofessionalconsultantwithspecializedexperHse.

Addi8onalResources

n  Sources&UsesBudgetTemplate:hkp://www.foodcoopini8a8ve.coop/sites/default/files/Sources%20%26%20Uses%20template%2C%20start-ups%2C%20March%207%202016%20bg.xls

n  DevelopingaBudgetforaFoodCoopera8ve(recordedworkshop):hkps://youtu.be/I0tLXTuheMo?list=PLA2749DE9E2C56641

n WhySomeCo-opsFail(Coopera8veGrocerar8cle):hkp://www.grocer.coop/ar8cles/why-some-co-ops-fail

n WhatisaFeasibilityStudy,Anyway?(Webinar):hkps://youtu.be/wYLwKKAqKio

www.fci.coop

Financial Tools for Start-ups

Business

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