Carpet Cleaning Service: Carpet Chem Corporation
Carpet Cleaning Service
BUSINESS PLAN
CARPET CHEM CORPORATION
585 Linberg
Salt Lake City, Utah 84116
Carpet Chem Corporation began as a familyowned and operated business venture. The owners identified a need for a quality carpet and upholstery cleaning system, and their son developed the formula for success. Today, the business has been franchised 21 times in 16 different states. Carpet Chem Corporation attributes its steady growth and financial achievements to a quality product line, through market research and an effective price strategy.
- extecutwive summary
- company information
- market analysis
- market strategy and implementation
- management summary
- financial plan and information
EXECUTIVE SUMMARY
Carpet Chem Corporation (CCC) formulates, manufactures, and re-labels special high quality carpet and upholstery cleaning solutions for use by its network of franchises and customers nation-wide. We sell these products to these franchises, and provide them with specific support services, including marketing and technical support. Our products are developed, packaged, and sold out of our headquarters located in Salt Lake City, Utah.
Objectives
- To give CCC the market presence needed to support marketing and sales goals.
- To continue to provide quality products and support to our franchises.
- To develop consistent quality standards for our products and provide a guarantee to all those purchasing our products.
- To continue research and development efforts to produce the best products on the market.
- To grow sales to $25,000 monthly by the end of 1996, and $100,000 monthly by the end of 2000.
Mission
Carpet Chem Corporation is a support company dedicated to developing and selling the highest quality, and most productive, carpet solutions at competitive prices. We combined this with the best method of cleaning carpets known as The Carpet Chem Advanced Drycleaning System. We intend to make enough profit to generate a fair return for our investors, and to finance continued growth and development in a quality product. We also maintain a friendly, fair, and creative work environment, which respects diversity, new ideas, hard work, and unity.
Keys to Success
The keys to success in this business are:
- Marketing: by dealing with channel problems and barriers to entry, or solving problems with major advertising and promoting budgets.
- Product quality.
- Management: products delivered on time, costs controlled, marketing budgets managed. There is a temptation to fixate to growth, at the expense of profits.
COMPANY INFORMATION
Carpet Chem supports franchises, hospitals, hotels, schools, carpet cleaning companies and janitorial cleaning companies with proven methods of carpet cleaning and upholstery cleaning designed to help them provide quality service to their customers and facilities. Its customers are intelligent business people who want a practical and high quality method of cleaning carpets to accomplish their needs and/or their customer's needs, with as little expenditure of time and money as possible. The company was incorporated in Utah in 1993, after twenty-two years of previous operation under different names.
Company Ownership
Carpet Chem Corporation is a privately held Utah corporation. Samantha Berns is the majority owner. Dave and Alex Berns are the other owners.
Company History
Carpet Chem Corporation (CCC) was incorporated on December 16, 1993 by Samantha, Dave, and Alex Berns. The corporation was formed by liquidating the assets of Builders Basics Cleaning (BBC), a predecessor of CCC. BBC operated two franchise programs, Carpet Chem Cleaning Corp. and Builders Basics Commercial Cleaning. Both franchise programs started between 1990 and 1992. Previous to this, Samantha and Dave had ownership in nine other commercial cleaning companies. Samantha and Dave started their own janitorial company in 1972 because they identified a need for a quality cleaning company in a building where Dave was employed. After they started their business, they found that there was money to be made in the commercial cleaning industry. From 1972 until 1990, they operated commercial cleaning companies in several states with great success. During this time, one of the services that they offered was carpet cleaning. Many methods were tried, but none of them satisfied the owners or the customers. Finally, after much research, development, and trial and error, Alex Berns, their son, developed a carpet cleaning system that effectively satisfied their high standards for quality. This system cleans the entire fiber of the carpet without getting any moisture below the primary backing, dries quickly, and leaves no residue. This system was so incredible that they decided to franchise it nationwide. Today, this system is known as the Carpet Chem Total DryCleaning System.
CCC provides high-quality solutions, equipment, and supplies, along with a complete support program for its franchisees. In July of 1995, Samantha and Dave recognized the success of the Carpet Chem System, as they reviewed the increasing list of satisfied customers. They introduced a new idea that will open up the Carpet Chem System to everyone, releasing it from franchise restrictions. Now, hospitals, hotels, schools, carpet cleaning companies, janitorial cleaning companies, and entrepreneurs can enjoy the benefits of a franchise without paying for one.
The new program was researched using a survey during the beginning of September 1995. Recently, it has been marketed locally, and in the surrounding states of Utah, with great interest and success.
Currently, there are 21 Carpet Chem franchises in 16 different states. As of November 1st, one hotel and one school district in Salt Lake City are using the new program, and many more clients have expressed interest in the program.
The following table illustrates past performance over the last three years, including sales, gross margin, net revenue, and cash flow. The plan also includes financial statements for the last three years.
Past Financial Performance
|
1993 |
1994 |
1995 |
| Sales |
$0 |
$103,490 |
$186,085 |
| Gross Margin |
$0 |
$69,814 |
$115,671 |
| Gross % (calculated) |
0.00% |
67.46% |
62.16% |
| Operating expenses |
$0 |
$76,973 |
$119,888 |
| Collection period (days) |
0 |
47 |
45 |
| Inventory turnover |
0 |
126 |
66 |
| Balance Sheet |
– |
– |
1995 |
| Short-term Assets |
– |
– |
– |
| Cash |
– |
– |
$11,694 |
| Accounts receivable |
– |
– |
$7,679 |
| Inventory |
– |
– |
$6,583 |
| Other Short-term Assets |
– |
– |
$2,596 |
| Total Short-term Assets |
– |
– |
$28,552 |
| Long-term Assets |
– |
– |
– |
| Capital Assets |
– |
– |
$42,854 |
| Accumulated Depreciation |
– |
– |
$9,732 |
| Total Long-Term Assets |
– |
– |
$33,122 |
| Total Assets |
– |
– |
$61,674 |
| Debt and Equity |
– |
– |
– |
| Accounts Payable |
– |
– |
$14,664 |
| Short-term Notes |
– |
– |
$0 |
| Other ST Liabilities |
– |
– |
$0 |
| Subtotal Short-term Liabilities |
– |
– |
$14,664 |
| Long-term Liabilities |
– |
– |
$45,218 |
| Total Liabilities |
– |
– |
$59,882 |
| Paid in Capital |
– |
– |
$12,969 |
| Retained Earnings |
– |
– |
($6,960) |
| Earnings |
$0 |
($7,159) |
($4,217) |
| Total Equity |
– |
– |
$1,792 |
| Total Debt and Equity |
– |
– |
$61,674 |
| Other Inputs |
– |
– |
1995 |
| Payment Days |
– |
– |
45 |
| Sales on credit |
– |
– |
$150,000 |
| Receivables turnover |
– |
– |
19.53 |
Company Products
The Carpet Chem products go through a series of testing and development to insure quality and to make sure they are safe for stain-resistant carpets. CCC performs tests similar to those used by Smithson flooring systems.
Company Locations and Facilities
Headquarters are located in office space of approximately 900 square feet and warehouse space of approximately 1200 square feet at 5 85 Linberg, Salt Lake City, Utah 84116.
We have first rights of refusal for both office and warehouse space of equal size on each side of our current location for easy expansion. We already have all of the furniture and shelving needed to expand to twice our current size.
MARKET ANALYSIS
We have researched the national market and found the following results:
- 96.4% of people would like to have their carpets dry within less than 1 hour of cleaning.
- 98.2% of people want a cleaning solution that removes stains during cleaning, eliminating prespraying.
- 94.5% of people want a toll-free number to answer technical questions about cleaning and spotting.
- 3.6% of people nationwide are currently acquainted with Carpet Chem.
- 58.2% of people want to see a free demonstration of Carpet Chem.
- 85.5% of people spend $0 - $500 on carpet cleaning in a month.
- 14.5% of people spend $500 - $1000 in a month,
- 0% spend over $1000 in a month.
- 78.2% of people currently use a wet carpet cleaning system.
- 9.1% of people currently use a dry carpet cleaning system.
- 10.9% of people currently use both wet and dry types of carpet cleaning systems.
- 52.7% of people would pay $ 100-$ 150 to learn how to be fully trained and certified on how to use Carpet Chem System.
- 3.6% of people would pay $ 150-$200 to become educated about the Carpet Chem System.
According to our market research, conducted in 5 different areas of the United States with 25 different companies, there is a need for our services and products.
Main Competitors
Our main competitors are other supply houses that are specific to the carpet cleaning industry.
Market Analysis
The chart below compares the percentage of each of our target markets. We are currently targeting carpet cleaning companies and janitorial cleaning companies because they have the most experience with cleaning carpets. We have had little success with hospitals, hotels, or schools.
| Analysis of Potential Market |
| Potential Customers |
Customers |
Growth rate |
| Carpet Cleaning Companies |
170 |
0% |
| Janitorial Cleaning Companies |
120 |
13% |
| New Business Owners-Service Industry |
150 |
4% |
| Hospitals |
32 |
−11% |
| Hotels |
105 |
11% |
| Schools |
250 |
14% |
| Other |
– |
0% |
| Total |
827 |
N\A |
MARKET STRATEGY IMPLEMENTATION
Marketing Strategy
We will attend trade shows and send advertisements to cleaning companies, offering them the same supplies, support, and solutions that we provide to our franchises.
Pricing strategy
We have decided to offer prices a bit lower than the average to acquire new customers.
Sales Strategy
| Yearly |
Total Sales |
| 1996 |
270,000 |
| 1997 |
410,000 |
| 1998 |
620,000 |
| Sales Forecast |
| Sales |
1996 |
1997 |
1998 |
| Supply Sales |
$176,621 |
$300,000 |
$500,000 |
| Seminar Training |
$2,725 |
$5,000 |
$10,000 |
| Video Training |
$2,098 |
$3,000 |
$3,500 |
| Carpet Cleaning Revenue |
$47,548 |
$58,000 |
$65,000 |
| Franchise Royalties |
$23,683 |
$20,000 |
$20,000 |
| Misc. Income |
$1,197 |
$1,100 |
$2,000 |
| Other |
$12,672 |
$15,100 |
$16,600 |
| Total Sales |
$266,544 |
$402,200 |
$617,100 |
| Cost of sales |
|
|
|
| Supply Sales |
$94,290 |
$140,000 |
$200,000 |
| Seminar Training |
$606 |
$500 |
$1,000 |
| Video Training |
$80 |
$125 |
$200 |
| Carpet Cleaning Revenue |
$7,344 |
$8,700 |
$9,750 |
| Franchise Royalties |
$0 |
$0 |
$0 |
| Misc. Income |
$0 |
$0 |
$0 |
| Other |
$0 |
$0 |
$0 |
| Total Cost of Sales |
$102,320 |
$149,325 |
$210,950 |
MANAGEMENT SUMMARY
Alex Jenkins, President of CCC, has several years experience in management. His objective is to provide a comfortable work environment.
Organizational Structure
Dave and Samantha Berns consult with Alex on many decisions. Alex then organizes them, delegates them, and carries on the day-to-day operations.
Personnel Plan
|
1996 |
1997 |
1998 |
| Payroll |
$56,981 |
$69,000 |
$75,000 |
FINANCIAL PLAN AND INFORMATION
We plan to market our idea nationwide while maintaining our carpet cleaning revenue and franchises.
Important Assumptions
General Assumptions
1996 1997 1998 |
| Short Term Interest Rate |
12.00% |
12.00% |
12.00% |
| Long Term Interest Rate |
14.00% |
14.00% |
14.00% |
| Collection days |
45 |
40 |
37 |
| Payment days |
40 |
30 |
30 |
| Inventory Turnover |
7.00 |
6.00 |
5.00 |
| Tax Rate Percent |
0.00% |
0.00% |
0.00% |
| Expenses in cash% |
7.25% |
7.00% |
7.00% |
| Sales on credit |
52.83% |
70.00% |
75.00% |
| Personnel Burden % |
10.28% |
11.00% |
11.25% |
Projected Profit and Loss
1996 1997 1998 |
| Sales |
$266,544 |
$402,200 |
$617,100 |
| Cost of Sales |
$102,320 |
$149,325 |
$210,950 |
| Other |
$0 |
$0 |
$0 |
| Total Cost of Sales |
$102,320 |
$149,325 |
$210,950 |
| Gross margin |
$164,224 |
$252,875 |
$406,150 |
| Gross margin percent |
61.61% |
62.87% |
65.82% |
| Operating expenses: |
|
|
|
| Advertising/Promotion |
$19,800 |
$20,000 |
$25,000 |
| Auto Expense |
$3,310 |
$8,000 |
$12,000 |
| Bank Service Charges |
$520 |
$650 |
$750 |
| Printing Expense |
$366 |
$500 |
$1,000 |
| Legal Fees/Licenses $ Other Fees |
$262 |
$200 |
$500 |
| Miscellaneous |
$956 |
$1,500 |
$2,500 |
| Entertainment |
$242 |
$0 |
$0 |
| Payroll Expense |
$56,981 |
$69,000 |
$75,000 |
| Office Expense |
$3,767 |
$4,000 |
$5,000 |
| Postage |
$5,426 |
$6,000 |
$10,000 |
| Professional Fees |
$444 |
$750 |
$1,000 |
| Taxes - Property and Other |
$277 |
$300 |
$350 |
| Utilities |
$2,350 |
$2,500 |
$3,000 |
| Insurance |
$2,773 |
$3,500 |
$5,000 |
| Rent |
$6,350 |
$6,500 |
$7,200 |
| Depreciation |
$4,524 |
$3,500 |
$4,000 |
| Telephone |
$4,444 |
$4,700 |
$5,000 |
| Pagers |
$616 |
$750 |
$800 |
| Travel |
$1,789 |
$3,000 |
$5,000 |
| Total Operating Expenses |
$115,197 |
$135,350 |
$163,100 |
| Profit Before Interest\Taxes |
$49,027 |
$117,525 |
$243,050 |
| Interest Expense ST |
$0 |
$0 |
$0 |
| Interest Expense LT |
$7,614 |
$7,731 |
$7,731 |
| Taxes Incurred |
$0 |
$0 |
$0 |
| Net Profit |
$41,413 |
$109,794 |
$235,319 |
| Net Profit/Sales |
15.54% |
27.30% |
38.13% |
| Projected Cash Flow |
|
1996 |
1997 |
1998 |
| Net Profit: |
$41,413 |
$109,794 |
$235,319 |
| Plus: |
– |
– |
– |
| Depreciation |
$4,524 |
$3,500 |
$4,000 |
| Change in Accts Payable |
$2,846 |
($1,590) |
$14,513 |
| Current Borrowing |
$0 |
$0 |
$0 |
| Increase (decrease) Other Liabilities |
$0 |
$0 |
$0 |
| Long-term Borrowing |
$10,000 |
$0 |
$0 |
| Capital input |
$0 |
$0 |
$0 |
| Subtotal |
$58,783 |
$111,704 |
$253,833 |
| Less: |
|
|
|
| Change in Accts Rec |
$16,725 |
$596 |
$19,000 |
| Change in Inventory |
$7,943 |
$20,723 |
$13,882 |
| Change in Other ST Assets |
$0 |
$0 |
$0 |
| Capital Expenditure |
$0 |
$0 |
$0 |
| Dividends |
$0 |
$0 |
$0 |
| Subtotal |
$24,668 |
$21,319 |
$32,882 |
| Net Cash Flow |
$34,115 |
$90,385 |
$220,951 |
| Cash balance |
$45,809 |
$136,195 |
$357,145 |
Projected Balance Sheet
1996 1997 1998 |
| Short-term Assets |
|
|
|
| Cash |
$45,809 |
$136,195 |
$357,145 |
| Accounts receivable |
$24,404 |
$25,000 |
$44,000 |
| Inventory |
$14,526 |
$35,249 |
$49,131 |
| Other Short-term Assets |
$2,596 |
$2,5% |
$2,596 |
| Total Short-term Assets |
$87,335 |
$199,040 |
$452,872 |
| Long-term Assets |
– |
– |
– |
| Capital Assets |
$42,854 |
$42,854 |
$42,854 |
| Accumulated Depreciation |
$14,256 |
$17,756 |
$21,756 |
| Total Long-Term Assets |
$28,598 |
$25,098 |
$21,098 |
| Total Assets |
$115,933 |
$224,138 |
$473,970 |
| Debtand Equity |
|
|
|
|
1996 |
1997 |
1998 |
| Accounts Payable |
$17,510 |
$15,920 |
$30,433 |
| Short-term Notes |
$0 |
$0 |
$0 |
| Other ST Liabilities |
$0 |
$0 |
$0 |
| Subtotal Short-term Liab. |
$17,510 |
$15,920 |
$30,433 |
| Long-term Liabilities |
$55,218 |
$55,218 |
$55,218 |
| Total Liabilities |
$72,728 |
$71,138 |
$85,651 |
| Paid in Capital |
$12,969 |
$12,969 |
$12,969 |
| Retained Earnings |
($11,177) |
$30,236 |
$140,031 |
| Earnings |
$41,413 |
$109,794 |
$235,319 |
| Total Equity |
$43,205 |
$153,000 |
$388,319 |
| Total Debt and Equity |
$115,933 |
$224,138 |
$473,970 |
| Net Worth |
$43,205 |
$153,000 |
$388,319 |
| Projected Business Ratios |
| Profitability Ratios |
1996 |
1997 |
1998 |
| Gross margin |
61.61% |
62.87% |
65.82% |
| Net profit margin |
15.54% |
27.30% |
38.13% |
| Return on Assets |
35.72% |
48.99% |
49.65% |
| Return on Equity |
95.85% |
71.76% |
60.60% |
| Activity Ratios |
|
|
|
| AR Turnover |
5.68 |
11.26 |
10.52 |
| Collection days |
42 |
32 |
27 |
| Inventory Turnover |
9.69 |
6.00 |
5.00 |
| Accts payable turnover |
8.50 |
12.60 |
9.14 |
| Total asset turnover |
2.30 |
1.79 |
1.30 |
| Debt Ratios |
1996 |
1997 |
1998 |
| Debt to Net Worth |
1.68 |
0.46 |
0.22 |
| Short-term Debt to Liab. |
0.24 |
0.22 |
0.36 |
| Liquidity ratios |
|
|
|
| Current Ratio |
4.99 |
12.50 |
14.88 |
| Quick Ratio |
4.16 |
10.29 |
13.27 |
| Net Working Capital |
$69,825 |
$183,120 |
$422,439 |
| Interest Coverage |
6.44 |
15.20 |
31.44 |
| Additional ratios |
1996 |
1997 |
1998 |
| Assets to sales |
0.43 |
0.56 |
0.77 |
| Debt/Assets |
63% |
32% |
18% |
| Current debt/Total Assets |
15% |
7% |
6% |
| Acid Test |
2.76 |
8.72 |
11.82 |
| Asset Turnover |
2.30 |
1.79 |
1.30 |
| Sales/Net Worth |
6.17 |
2.63 |
1.59 |
| Projected Balance Sheet |
|
Jan-96 |
Feb-96 |
Mar-96 |
Apr-96 |
May-96 |
Jun-96 |
Jul-96 |
| Short-term Assets |
|
|
|
|
|
|
|
| Cash |
$7,233 |
$4,126 |
$2,265 |
$6,169 |
$7,861 |
$14,855 |
$19,056 |
| Accounts receivable |
$11,488 |
$13,592 |
$15,818 |
$14,787 |
$17,016 |
$16,339 |
$17,772 |
| Inventory |
$7,070 |
$10,431 |
$11,751 |
$12,585 |
$13,222 |
$13,451 |
$13,521 |
| Other S-term Assets |
$2,596 |
$2,596 |
$2,596 |
$2,596 |
$2,596 |
$2,596 |
$2,596 |
| Total S-term Assets |
$28,388 |
$30,746 |
$32,430 |
$36,136 |
$40,695 |
$47,241 |
$52,945 |
| Long-term Assets |
|
|
|
|
|
|
|
| Capital Assets $42,854 |
$42,854 |
$42,854 |
$42,854 |
$42,854 |
$42,854 |
$42,854 |
$42,854 |
| Accum Depreciation |
$10,109 |
$10,486 |
$10,863 |
$11,240 |
$11,617 |
$11,994 |
$12,371 |
| Total Long-term Assets |
$32,745 |
$32,368 |
$31,991 |
$31,614 |
$31,237 |
$30,860 |
$30,483 |
| Total Assets |
$61,133 |
$63,114 |
$64,421 |
$67,750 |
$71,932 |
$78,101 |
$83,428 |
| Debt and Equity |
|
|
|
|
|
|
|
| Accounts Payable |
$18,171 |
$19,000 |
$19,522 |
$19,584 |
$18,584 |
$17,521 |
$16,529 |
| Short-term Notes |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Other ST Liabilities |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Subtotal Short-term Liabilities |
$18,171 |
$19,000 |
$19,522 |
$19,584 |
$18,584 |
$17,521 |
$16,529 |
| Long-term Liabilities |
$45,218 |
$55,218 |
$55,218 |
$55,218 |
$55,218 |
$55,218 |
$55,218 |
| Aug-96 |
Sep-96 |
Oct-96 |
Nov-96 |
Dec-96 |
1996 |
1997 |
1998 |
| $28,451 |
$31,769 |
$39,847 |
$42,754 |
$45,809 |
$45,809 |
$136,195 |
$357,145 |
| $15,822 |
$18,578 |
$18,196 |
$21,274 |
$24,404 |
$24,404 |
$25,000 |
$44,000 |
| $13,259 |
$14,526 |
$14,500 |
$14,500 |
$14,526 |
$14,526 |
$35,249 |
$49,131 |
| $2,596 |
$2,596 |
$2,596 |
$2,596 |
$2,596 |
$2,596 |
$2,596 |
$2,596 |
| $60,127 |
$67,469 |
$75,139 |
$81,124 |
$87,335 |
$87,335 |
$199,040 |
$452,872 |
| $42,854 |
$42,854 |
$42,854 |
$42,854 |
$42,854 |
$42,854 |
$42,854 |
$42,854 |
| $12,748 |
$12,13,125 |
$13,125 |
$13,502 |
$13,879 |
$14,256 |
$17,756 |
$21,756 |
| $30,106 |
$29,729 |
$29,352 |
$28,975 |
$28,598 |
$28,598 |
$25,098 |
$21,098 |
| $90,233 |
$97,198 |
$104,491 |
$110,099 |
$115,933 |
$115,933 |
$224,138 |
$473,970 |
| $16,524 |
$15,754 |
$17,333 |
$16,746 |
$17,510 |
$17,510 |
$15,920 |
$30,433 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| $16,524 |
$15,754 |
$17,333 |
$16,746 |
$17,510 |
$17,510 |
$15,920 |
$30,433 |
| $55,218 |
$55,218 |
$55,218 |
$55,218 |
$55,218 |
$55,218 |
$55,218 |
$55,218 |
|
Jan-96 |
Feb-96 |
Mar-96 |
Apr-96 |
May-96 |
Jun-96 |
Jul-96 |
| Total Liabilities |
$63,389 |
$74,218 |
$74,740 |
$74,802 |
$73,802 |
$72,739 |
$71,747 |
| Paid in Capital |
$12,969 |
$12,969 |
$12,969 |
$12,969 |
$12,969 |
$12,969 |
$12,969 |
| Retained Earnings |
($11,177) |
($11,177) |
($11,177) |
($11,177) |
($11,177) |
($11,177) |
($11,177) |
| Earnings |
($4,049) |
($12,897) |
($12,111) |
($8,844) |
($3,663) |
$3,569 |
$9,889 |
| Total Equity |
($2,256) |
($11,104) |
($10,319) |
($7,052) |
($1,870) |
$5,362 |
$11,681 |
| Total Debt &Equity |
$61,133 |
$63,114 |
$64,421 |
$67,750 |
$71,932 |
$78,101 |
$83,428 |
| Net Worth |
($2,256) |
($11,104) |
($10,319) |
($7,052) |
($1,870) |
$5,362 |
$11,681 |
| Projected Cash Flow |
|
Jan-96 |
Feb-96 |
Mar-96 |
Apr-96 |
May-96 |
Jun-96 |
Jul-96 |
| Net Profit: |
($4,049) |
($8,848) |
$786 |
$3,267 |
$5,182 |
$7,232 |
$6,320 |
| Plus: |
|
|
|
|
|
|
|
| Depreciation |
$377 |
$377 |
$377 |
$377 |
$377 |
$377 |
$377 |
| Change in Accts Payable |
$3,507 |
$829 |
$522 |
$62 |
($1,000) |
($1,063) |
($992) |
| Current Borrowing (repayment) |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Increase (decrease) Other Liabilities |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Long-term Borrowing (repayment) |
$0 |
$10,000 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Capital input |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Subtotal |
($165) |
$2,358 |
$1,685 |
$3,706 |
$4,559 |
$6,546 |
$5,705 |
| Less: |
|
|
|
|
|
|
|
| Change in Accounts Receivable |
$3,809 |
$2,104 |
$2,226 |
($1,032) |
$2,230 |
($677) |
$1,433 |
| Change in Inventory |
$487 |
$3,361 |
$1,320 |
$834 |
$637 |
$229 |
$70 |
| Change in Other ST Assets |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Capital Expenditure |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Dividends |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Subtotal |
$4,296 |
$5,465 |
$3,546 |
($198) |
$2,867 |
($448) |
$1,503 |
| Net Cash Flow |
($4,461) |
($3,107) |
($1,861) |
$3,904 |
$1,692 |
$6,994 |
$4,202 |
| Cash Balance |
$7,233 |
$4,126 |
$2,265 |
$6,169 |
$7,861 |
$14,855 |
$19,056 |
| General Assumptions |
|
|
|
|
|
|
|
| Short Term Interest Rate |
12.00% |
12.00% |
12.00% |
12.00% |
12.00% |
12.00% |
12.00% |
| Long Term Interest Rate |
14.00% |
14.00% |
14.00% |
14.00% |
14.00% |
14.00% |
14.00% |
| Collection Days |
45 |
45 |
45 |
45 |
45 |
45 |
45 |
| Payment Days |
40 |
40 |
40 |
40 |
40 |
40 |
40 |
| Inventory Tumovier |
6.00 |
7.00 |
7.00 |
7.00 |
7.00 |
7.00 |
7.00 |
| Tax Rate Percent |
0.00% |
0.00% |
0.00% |
0.00% |
0.00% |
0.00% |
0.00% |
| Expenses in Cash?% |
8.00% |
8.00% |
8.00% |
7.00% |
7.00% |
7.00% |
7.00% |
| Sales on Credit |
55.00% |
64.00% |
64.00% |
44.00% |
55.00% |
41.00% |
51.00% |
| Personnel Burden% |
10.15% |
10.15% |
10.15% |
10.15% |
10.15% |
10.35% |
10.35% |
| Personnel Plan |
|
|
|
|
|
|
|
| Payroll |
$1,766 |
$4,943 |
$4,943 |
$4,943 |
$4,943 |
$4,943 |
$5,000 |
| Aug-96 |
Sep-96 |
Oct-96 |
Nov-96 |
Dec-96 |
1996 |
1997 |
1998 |
| $71,742 |
$70,972 |
$72,551 |
$71,964 |
$72,728 |
$72,728 |
$71,138 |
$85,651 |
| $12,969 |
$12,969 |
$12,969 |
$12,969 |
$12,969 |
$12,969 |
$12,969 |
$12,969 |
| ($11,177) |
($11,177) |
($11,177) |
($11,177) |
($11,177) |
($11,177) |
$30,236 |
$140,031 |
| $16,699 |
$24,434 |
$30,148 |
$36,343 |
$41,413 |
$41,413 |
$109,794 |
$235,319 |
| $18,491 |
$26,226 |
$31,941 |
$38,136 |
$43,205 |
$43,205 |
$153,000 |
$388,319 |
| $90,233 |
$97,198 |
$104,491 |
$110,099 |
$115,933 |
$115,933 |
$224,138 |
$473,970 |
| $18,491 |
$26,226 |
$31,941 |
$38,136 |
$43,205 |
$43,205 |
$153,000 |
$388,319 |
| Aug-96 |
Sep-96 |
Oct-96 |
Nov-96 |
Dec-96 |
1996 |
1997 |
1998 |
| $6,810 |
$7,735 |
$5,715 |
$6,195 |
$5,070 |
$41,413 |
$109,794 |
$235,319 |
| $377 |
$377 |
$377 |
$377 |
$377 |
$4,524 |
$3,500 |
$4,000 |
| ($5) |
($770) |
$1,579 |
($587) |
$764 |
$2,846 |
($1,590) |
$14,513 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$10,000 |
$0 |
$0 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| $7,182 |
$7,342 |
$7,670 |
$5,985 |
$6,211 |
$58,783 |
$111,704 |
$253,833 |
| ($1,950) |
$2,757 |
($382) |
$3,078 |
$3,130 |
$16,725 |
$596 |
$19,000 |
| ($262) |
$1,267 |
($26) |
$0 |
$26 |
$7,943 |
$20,723 |
$13,882 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| ($2,212) |
$4,024 |
($408) |
$3,078 |
$3,156 |
$24,668 |
$21,319 |
$32,882 |
| $9,394 |
$3,318 |
$8,079 |
$2,907 |
$3,055 |
$34,115 |
$90,385 |
$220,951 |
| $28,451 |
$31,769 |
$39,847 |
$42,754 |
$45,809 |
$45,809 |
$136,195 |
$357,145 |
| 12.00% |
12.00% |
12.00% |
12.00% |
12.00% |
12.00% |
12.00% |
12.00% |
| 14.00% |
14.00% |
14.00% |
14.00% |
14.00% |
14.00% |
14.00% |
14.00% |
| 45 |
45 |
45 |
45 |
45 |
45 |
40 |
37 |
| 40 |
40 |
40 |
40 |
40 |
40 |
30 |
30 |
| 7.00 |
7.00 |
7.00 |
7.00 |
7.00 |
7.00 |
6.00 |
5.00 |
| 0.00% |
0.00% |
0.00% |
0.00% |
0.00% |
0.00% |
0.00% |
0.00% |
| 7.00% |
7.00% |
7.00% |
7.00% |
7.00% |
7.25% |
7.00% |
7.00% |
| 38.00% |
51.00% |
44.00% |
61.00% |
66.00% |
52.83% |
70.00% |
75.00% |
| 10.35% |
10.35% |
10.35% |
10.35% |
10.50% |
10.28% |
11.00% |
11.25% |
| $5,100 |
$5,100 |
$5,100 |
$5,100 |
$5,100 |
$56,981 |
$69,000 |
$75,000 |
| Projected Profit and Loss |
|
Jan-96 |
Feb-96 |
Mar-96 |
Apr-96 |
May-96 |
Jun-96 |
Jul-96 |
| Sales |
$13,479 |
$14,355 |
$16,706 |
$21,456 |
$22,356 |
$24,856 |
$24,856 |
| Cost of Sales |
$6,535 |
$6,085 |
$6,855 |
$8,435 |
$8,570 |
$9,020 |
$8,975 |
| Other |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Total Cost of Sales |
$6,535 |
$6,085 |
$6,855 |
$8,435 |
$8,570 |
$9,020 |
$8,975 |
| Gross Margin |
$6,944 |
$8,270 |
$9,851 |
$13,021 |
$13,786 |
$15,836 |
$15,881 |
| Gross Margin % |
51.52% |
57.61% |
58.97% |
60.69% |
61.67% |
63.71% |
63.89% |
| Operating expenses: |
|
|
|
|
|
|
|
| Advertising/Promotion |
$3,824 |
$8,000 |
$126 |
$500 |
$500 |
$500 |
$700 |
| Auto Expense |
$185 |
$100 |
$175 |
$250 |
$250 |
$250 |
$300 |
| Bank Service Charges |
$0 |
$40 |
$40 |
$40 |
$40 |
$40 |
$40 |
| Printing Expense |
$356 |
$0 |
$10 |
$0 |
$0 |
$0 |
$0 |
| Legal Fees/Licenses and Other Fees |
$212 |
$50 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Miscellaneous |
$56 |
$50 |
$50 |
$50 |
$50 |
$50 |
$100 |
| Entertainment |
$142 |
$100 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Payroll Expense |
$1,766 |
$4,943 |
$4,943 |
$4,943 |
$4,943 |
$4,943 |
$5,000 |
| Office Expense |
$517 |
$300 |
$250 |
$300 |
$300 |
$300 |
$300 |
| Postage |
$526 |
$800 |
$300 |
$800 |
$200 |
$200 |
$800 |
| Professional Fees |
$194 |
$100 |
$50 |
$0 |
$0 |
$0 |
$0 |
| Taxes - Property and Other |
$13 |
$264 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Utilities |
$225 |
$225 |
$225 |
$225 |
$175 |
$175 |
$175 |
| Insurance |
$473 |
$200 |
$200 |
$200 |
$200 |
$200 |
$200 |
| Rent |
$525 |
$525 |
$525 |
$525 |
$525 |
$525 |
$525 |
| Depreciation |
$377 |
$377 |
$377 |
$377 |
$377 |
$377 |
$377 |
| Telephone |
$469 |
$350 |
$350 |
$350 |
$350 |
$350 |
$350 |
| Pagers |
$66 |
$50 |
$50 |
$50 |
$50 |
$50 |
$50 |
| Travel |
$539 |
$0 |
$750 |
$500 |
$0 |
$0 |
$0 |
| Total Operating Expenses |
$10,465 |
$16,474 |
$8,421 |
$9,110 |
$7,960 |
$7,960 |
$8,917 |
| Profit Before Interest and Taxes |
($3,521) |
($8,204) |
$1,430 |
$3,911 |
$5,826 |
$7,876 |
$6,964 |
| Interest Expense ST |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Interest Expense LT |
$528 |
$644 |
$644 |
$644 |
$644 |
$644 |
$644 |
| Taxes Incurred |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Net Profit |
($4,049) |
($8,848) |
$786 |
$3,267 |
$5,182 |
$7,232 |
$6,320 |
| Net Profit/Sales |
−30.04% |
−61.64% |
4.70% |
15.23% |
23.18% |
29.09% |
25.43% |
| Sales Forecast |
|
|
|
|
|
|
|
| Supply Sales |
$7,871 |
$9,000 |
$10,250 |
$14,000 |
$14,000 |
$16,500 |
$16,500 |
| Seminar Training |
$625 |
$600 |
$0 |
$500 |
$0 |
$0 |
$500 |
| Video Training |
$99 |
$99 |
$300 |
$300 |
$200 |
$200 |
$200 |
| Carpet Cleaning Revenue |
$1,548 |
$1,500 |
$3,000 |
$3,500 |
$5,000 |
$5,000 |
$4,500 |
| Franchise Royalties |
$2,183 |
$2,000 |
$2,000 |
$2,000 |
$2,000 |
$2,000 |
$2,000 |
| Misc. Income |
$97 |
$100 |
$100 |
$100 |
$100 |
$100 |
$100 |
| Other |
$1,056 |
$1,056 |
$1,056 |
$1,056 |
$1,056 |
$1,056 |
$1,056 |
| Total Sales |
$13,479 |
$14,355 |
$16,706 |
$21,456 |
$22,356 |
$24,856 |
$24,856 |
| Aug-96 |
Sep-96 |
Oct-96 |
Nov-96 |
Dec-96 |
1996 |
1997 |
1998 |
| $24,956 |
$27,131 |
$25,631 |
$25,631 |
$25,131 |
$266,544 |
$402,200 |
$617,100 |
| $9,000 |
$9,900 |
$9,670 |
$9,675 |
$9,600 |
$102,320 |
$149,325 |
$210,950 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| $9,000 |
$9,900 |
$9,670 |
$9,675 |
$9,600 |
$102,320 |
$149,325 |
$210,950 |
| $15,956 |
$17,231 |
$15,961 |
$15,956 |
$15,531 |
$164,224 |
$252,875 |
$406,150 |
| 63.94% |
63.51% |
62.27% |
62.25% |
61.80% |
61.61% |
62.87% |
65.82% |
| $750 |
$1,000 |
$1,200 |
$1,200 |
$1,500 |
$19,800 |
$20,000 |
$25,000 |
| $300 |
$350 |
$350 |
$350 |
$450 |
$3,310 |
$8,000 |
$12,000 |
| $50 |
$50 |
$50 |
$65 |
$65 |
$520 |
$650 |
$750 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$366 |
$500 |
$1,000 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$262 |
$200 |
$500 |
| $100 |
$100 |
$100 |
$100 |
$150 |
$956 |
$1,500 |
$2,500 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$242 |
$0 |
$0 |
| $5,100 |
$5,100 |
$5,100 |
$5,100 |
$5,100 |
$56,981 |
$69,000 |
$75,000 |
| $300 |
$300 |
$300 |
$300 |
$300 |
$3,767 |
$4,000 |
$5,000 |
| $200 |
$250 |
$800 |
$250 |
$300 |
$5,426 |
$6,000 |
$10,000 |
| $0 |
$0 |
$0 |
$0 |
$100 |
$444 |
$750 |
$1,000 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$277 |
$300 |
$350 |
| $175 |
$175 |
$175 |
$200 |
$200 |
$2,350 |
$2,500 |
$3,000 |
| $200 |
$200 |
$200 |
$200 |
$300 |
$2,773 |
$3,500 |
$5,000 |
| $525 |
$525 |
$525 |
$55 |
O$550 |
$6,350 |
$6,500 |
$7,200 |
| $377 |
$377 |
$377 |
$377 |
$377 |
$4,524 |
$3,500 |
$4,000 |
| $375 |
$375 |
$375 |
$375 |
$375 |
$4,444 |
$4,700 |
$5,000 |
| $50 |
$50 |
$50 |
$50 |
$50 |
$616 |
$750 |
$800 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$1,789 |
$3,000 |
$5,000 |
| $8,502 |
$8,852 |
$9,602 |
$9,117 |
$9,817 |
$115,197 |
$135,350 |
$163,100 |
| $7,454 |
$8,379 |
$6,359 |
$6,839 |
$5,714 |
$49,027 |
$117,525 |
$243,050 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| $644 |
$644 |
$644 |
$644 |
$644 |
$7,614 |
$7,731 |
$7,731 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| $6,810 |
$7,735 |
$5,715 |
$6,195 |
$5,070 |
$41,413 |
$109,794 |
$235,319 |
| 27.29% |
28.51% |
22.30% |
24.17% |
20.17% |
15.54% |
27.30% |
38.13% |
| $16,500 |
$18,000 |
$18,000 |
$18,000 |
$18,000 |
$176,621 |
$300,000 |
$500,000 |
| $0 |
$0 |
$500 |
$0 |
$0 |
$2,725 |
$5,000 |
$10,000 |
| $300 |
$100 |
$100 |
$100 |
$100 |
$2,098 |
$3,000 |
$3,500 |
| $5,000 |
$6,000 |
$4,000 |
$4,500 |
$4,000 |
$47,548 |
$58,000 |
$65,000 |
| $2,000 |
$1,875 |
$1,875 |
$1,875 |
$1,875 |
$23,683 |
$20,000 |
$20,000 |
| $100 |
$100 |
$100 |
$100 |
$100 |
$1,197 |
$1,100 |
$2,000 |
| $1,056 |
$1,056 |
$1,056 |
$1,056 |
$1,056 |
$12,672 |
$15,100 |
$16,600 |
| $24,956 |
$27,131 |
$25,631 |
$25,631 |
$25,131 |
$266,544 |
$402,200 |
$617,000 |
| Cost of Sales |
Jan-96 |
Feb-96 |
Mar-96 |
Apr-96 |
May-96 |
Jun-96 |
Jul-96 |
| Supply Sales |
$5,810 |
$5,735 |
$6,355 |
$7,840 |
$7,800 |
$8,250 |
$8,250 |
| Seminar Training |
$406 |
$50 |
$0 |
$50 |
$0 |
$0 |
$50 |
| Video Training |
$0 |
$0 |
$0 |
$20 |
$20 |
$20 |
$0 |
| Carpet Cleaning Revenue |
$319 |
$300 |
$500 |
$525 |
$750 |
$750 |
$675 |
| Franchise Royalties |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Misc. Income |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Other |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| Total Cost of Sales |
$6,535 |
$6,085 |
$6,855 |
$8,435 |
$8,570 |
$9,020 |
$8,975 |
| Aug-96 |
Sep-96 |
Oct-96 |
Nov-96 |
Dec-96 |
1996 |
1997 |
1998 |
| $8,250 |
$9,000 |
$9,000 |
$9,000 |
$9,000 |
$94,290 |
$140,000 |
$200,000 |
| $0 |
$0 |
$50 |
$0 |
$0 |
$606 |
$500 |
$1,000 |
| $0 |
$0 |
$20 |
$0 |
$0 |
$80 |
$125 |
$200 |
| $750 |
$900 |
$600 |
$675 |
$600 |
$7,344 |
$8,700 |
$9,750 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| $0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
$0 |
| $9,000 |
$9,900 |
$9,670 |
$9,675 |
$9,600 |
$102,320 |
$149,325 |
$210,950 |
Cite this article
Pick a style below, and copy the text for your bibliography.
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Grease life prediction for sealed ball bearings
Magazine article from: Tribology Transactions; 4/1/2001; ; 700+ words
; ...and lithium soap greases were generated...were derived from grease life data generated...the number of grease life tests is...Lithium soap greases are widely used...common use of these greases for sealed ball bearings, grease life equations...
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Grease collection-Nothing but a Nuisance?: grease collection and disposal are a necessary evil for restaurant owners, providing cost-saving benefits as well as environmental protection.
Magazine article from: PM Engineer; 6/1/2003; ; 700+ words
; A grease pit, as far as a restaurant owner is concerned...Unfortunately, like a lot of things in life, grease collection and disposal are a necessary evil. The expense of not having grease interceptors is dramatic. I cannot calculate...
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Grease: don't let the details slip through your fingers
Magazine article from: Canadian Forest Industries; 3/1/1998; ; 700+ words
; ...used; regular and complex greases. Regular grease: In regular grease, the...properties has made lithium soap greases a popular choice for multi...industrial and automotive grease applications. However, lithium greases are somewhat more costly...
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Grease is still the word: prevent downtime and costly repairs by choosing and using the right grease.
Magazine article from: Commercial Carrier Journal; 9/1/2003; ; 700+ words
; ...several different kinds of grease, has its benefits...advantages to using different greases in different vehicle...For example, a tacky grease that won't easily wash...components, require a grease with superior anti...and aluminum-based greases, with an anti-wear...
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Synthetic greases take on the tough jobs.
Magazine article from: Plant Engineering; 1/26/1984; ; 700+ words
; ...converting to a synthetic grease. Synthetic greases contain none of the...available with synthetic greases. One motor manufacturing...tested a synthetic grease in several motors...using the synthetic grease. Synthetic greases are particularly helpful...
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Grease bandits strike as biofuel demand rises.(USA)
Newspaper article from: The Christian Science Monitor; 5/6/2008; ; 700+ words
; ...truck sidled up to a local Burger King's grease bin last month. The driver plunged a...300-gallon tub of used French-fry grease and slurped it into his tank. Mr. Rosenzweig...legal codes to convince them that, yes, grease theft is a crime. He should know. As...
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Grease is the word of a new industry.
Newspaper article from: Knight Ridder/Tribune News Service; 3/30/2004; ; 700+ words
; ...of hash browns and ponder, if you will, the grease log. In the sewer trade, the grease log terrorizes. It grows, forming white and...Water Services Department. Hardened cooking grease, sometimes filling three or four feet of a section...
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Grease interceptor location options: the location and type of grease interceptor used in a commercial kitchen depend on federal and local requirements, as well as the concerns of kitchen consultants, architects and owners.
Magazine article from: PM Engineer; 6/1/2004; ; 700+ words
; ...handling establishment is the location of a grease interceptor. Before discussing interceptor...better understand the issues related to grease, as well as the problems resulting from...ILLUSTRATION OMITTED] Fats, oils and grease (FOG) are becoming an increasingly talked...
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Grease: What it is; how it works
Magazine article from: Electrical Apparatus; 4/1/2002; ; 700+ words
; ...The earliest widely used commercial greases contained a calcium base (sometimes called lime grease). Older calcium greases were "hydrated," containing a small...free water needed to maintain proper grease consistency. The material was quite...
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Automatic grease-removal devices: whether electrical or mechanical, these units minimize maintenance requirements at new or existing facilities.
Magazine article from: PM Engineer; 8/1/2006; ; 700+ words
; The control of FOG (fats, oil and grease) has long been a requirement of many industrial...ILLUSTRATION OMITTED] Sanitary Sewer Overflows and Grease Control Millions of pounds of grease are generated yearly by food processing plants...
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Bear Grease
Book article from: Fashion, Costume, and Culture: Clothing, Headwear, Body Decorations, and Footwear through the Ages
Bear Grease Indians across North America smeared bear grease, or bear fat, and other oils on their hair to make it...Huron, and Sauk tribes of the Northeast smoothed bear grease onto their hair daily. The Plains Indians also shined...
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grease
Book article from: The Oxford Pocket Dictionary of Current English
grease • n. / grēs / oily...oily substance used as a lubricant: axle grease. ∎ oil or fat used...x113;z / [ tr. ] smear or lubricate with grease: [as adj. ] ( greased ) place on a greased...
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SIC 2992 Lubricating Oils and Greases
Encyclopedia entry from: Encyclopedia of American Industries
...lubricating oils and greases from purchased mineral...lubricating oils and greases are classified in SIC...Petroleum Lubricating Oil and Grease Manufacturing) Industry...be used. The trend in grease manufacturing in the...dollar sales, while greases amounted to less than...
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Grease Line Presentation
Book article from: Fly Fishing: The Lifetime Sport
Grease Line Presentation The grease line presentation furnishes a broadside drift of the fly making...position it ’ s fished the same as the wet fly swing. This grease line presentation was established long ago in Europe as an Atlantic...
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grease gun
Book article from: The Oxford Pocket Dictionary of Current English
grease gun • n. a device for pumping grease under pressure to a particular point.
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