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BUSINESS PLAN

[YOUR NAME]
[YOUR TITLE]

Phone: [YOUR PHONE NUMBER]


Email: [[email protected]]
[YOUR WEBSITE ADDRESS] Page 1
[MONTH] [YEAR] // Confidential Information
Confidentiality Agreement

The undersigned reader acknowledges that the information provided by [YOUR COMPANY NAME] in this
business plan is confidential; therefore, reader agrees not to disclose it without the express written permission of
[YOUR COMPANY NAME].

It is acknowledged by reader that information to be furnished in this business plan is in all respects confidential in
nature, other than information which is in the public domain through other means and that any disclosure or use of
same by reader may cause serious harm or damage to [YOUR COMPANY NAME].

Upon request, this document is to be immediately returned to [YOUR COMPANY NAME].

___________________
Signature

___________________
Name (typed or printed)

___________________
Date

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

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[MONTH] [YEAR] // Confidential Information
Contents
1.0 Executive Summary.......................................................................................................................... 3
1.1 Objectives...................................................................................................................................... 5
1.2 Mission.......................................................................................................................................... 5
1.3 Keys to Success............................................................................................................................ 5
2.0 Company Summary/Company Ownership.........................................................................................6
2.1 Start-Up Summary......................................................................................................................... 6
3.0 Products and Services....................................................................................................................... 6
4.0 Market Analysis Summary (data provided by the American Cancer Society)...............................6
4.1 Competition and Buying Patterns..................................................................................................7
5.0 Web Plan Summary.......................................................................................................................... 7
6.0 SWOT Analysis............................................................................................................................. 7
6.1 Competitive Edge.......................................................................................................................... 8
6.2 Marketing Strategy........................................................................................................................ 8
6.3 Sales Strategy............................................................................................................................... 9
6.4 Sales Forecast............................................................................................................................... 9
6.5 Milestones................................................................................................................................... 11
7.0 Management Summary................................................................................................................... 11
7.1 Personnel Plan............................................................................................................................ 11
8.0 Financial Plan.................................................................................................................................. 11
8.2 Break-even Analysis.................................................................................................................... 12
8.3 Projected Profit and Loss............................................................................................................. 12
8.4 Projected Operating Cash Flow...................................................................................................15
8.5 Projected Balance Sheet............................................................................................................. 16
Table: Sales Forecast............................................................................................................................. 1
Table: Personnel..................................................................................................................................... 2
Table: Profit and Loss............................................................................................................................. 3
Table: Cash Flow.................................................................................................................................... 4
Table: Balance Sheet.............................................................................................................................. 5

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1.0 Executive Summary

[YOUR COMPANY NAME]


Owner:  INSERT NAME
INSERT ADDRESS
Phone: 
Email: 

Introduction
[YOUR COMPANY NAME] is seeking $127,000 funding in order to fund the start-up of a ‘green’ hair salon
that focuses on hair replacement/hair extensions services targeting cancer patients and survivors in a high-
end salon setting. The business will also offer traditional salon services and will offer some educational
opportunities for stylists.

Location

The business will be located in [CITY, STATE].

The Organization
The business will be organized as a Minnesota LLC and will be owned 100% by INSERT NAME. INSERT
NAME will be the full-time owner/operator of the salon.

Services
The salon focuses on hair replacement/hair extensions services targeting cancer patients and survivors in a
high-end salon setting. In addition, the firm will offer laser hair growth services at $65 a session, estitician
services, and retail sales of salon products.

The Market
There are 1,530,000 new cases of cancer are expected to be found in the U.S. in 2010, of which 740,000 will
be female. The 5-year relative survival rate for all cancers diagnosed between 1999-2005 is 68%, up from
50% in 1975-1977. There are currently 11,000,000 cancer survivors in the U.S., of which 5,320,261 are
women. The high-end services and location of the salon in a high-income area will provide a stable
demographic to support the business. All of this points to a large and growing market of potential customers
of [YOUR COMPANY NAME].

Financial Considerations
[YOUR COMPANY NAME] is projecting $638,840 in annual sales and a $65,813 net profit in year 1,
and is seeking $127,000 in funding to be used as follows. The working capital will be
partially used to acquire inventory.

Start-up
Start-up Expenses
Legal & Accounting $2,000
Salon Build-Out $7,500
Laser Hair Growth Machine $7,000
Furniture (includes shelving, chairs, and receptionist desk) $5,000
Mirrors $3,000
Rent Deposits $2,500
Initial Marketing Expense $10,000
Wigs and Mannequins $1,500
Working Capital (2.5 months of operating expenses) $88,500
Total Start-Up Costs $127,000

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The major focus for funding is as follows:
 
1. Hire employees; the firm will look to hire veterans, minorities, and the unemployed; as sales and cash
flow improve.

Chart: Projected Financial Performance

Highlights

$900,000

$800,000

$700,000

$600,000 Sales

$500,000 Gross Margin

$400,000 Net Profit

$300,000

$200,000

$100,000

$0
Year 1 Year 2 Year 3

The firm is projecting a net profit of $65,813 in year 1 and a net profit of $135,670 in year 2.

1.1 Objectives

1. Begin dialogue with cancer health care providers to identify patients who can benefit from the firm's hair
replacement services.
  
2. Create a new company website for a services description, education/awareness, with contact information
and online appointment scheduling.

3. Build a ‘green’ salon with organic products; yet retaining an upscale environment.

1.2 Mission

The mission of [YOUR COMPANY NAME] is to provide high quality hair replacement/hair extensions services
targeting cancer patients and survivors in a high-end salon setting.

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[MONTH] [YEAR] // Confidential Information
1.3 Keys to Success

1. INSERT NAME’s management experience and personal attention to client needs


 
2. Commitment to employee training and professional development for stylists and barbers in order to expand
hair replacement services to more cancer patients.

3. INSERT NAME’s desire to help cancer patients, including offering discounted services to those in need.

2.0 Company Summary/Company Ownership

[YOUR COMPANY NAME] is a start-up up-scale and ‘green’ hair salon that will specialize in hair
extension and replacement services for cancer patients. In addition, the firm will offer laser hair growth
services at $65 a session, estitician services, and retail sales of salon products. The salon will be located in
[CITY, STATE]. The business will be organized as a [STATE] LLC, with INSERT NAME as the President.
INSERT NAME is the President and 100% owner.

2.1 Start-Up Summary

[YOUR COMPANY NAME] is projecting $450,000 in annual sales and a $4,706 net profit in year 1,
and is seeking $127,000 in funding to be used as follows. The working capital will be
partially used to acquire inventory.

Start-up
Start-up Expenses
Legal & Accounting $2,000
Salon Build-Out $7,500
Laser Hair Growth Machine $7,000
Furniture (includes shelving, chairs, and receptionist desk) $5,000
Mirrors $3,000
Rent Deposits $2,500
Initial Marketing Expense $10,000
Wigs and Mannequins $1,500
Working Capital (2.5 months of operating expenses) $88,500
Total Start-Up Costs $127,000

3.0 Products and Services

The primary services offered by [YOUR COMPANY NAME] are hair extensions and hair reconditioning. The
owner is highly skilled in the technique of Thermal Reconditioning, which is a Japanese straightening
treatment that uses heat to restructure the bonds in your hair so the hair lies straight, giving you glossy,
smooth, shiny straight hair that requires hardly any blow drying. Thermal Reconditioning has been practiced
in the United States for just over six years. This treatment has been featured in just about every fashion
magazine in America including: In Style, Allure, Vogue, Marie Claire, Jane, Woman's Day, Cosmopolitan,
Self, Oprah, Lucky, Glamour, and Elle. The business also offers traditional hair salon services,
including haircuts, up-dos, and hair coloring. The firm can also offer formal training to stylists twice a month as
an additional revenue source. In addition, the firm will offer laser hair growth services at $65 a session,
estitician services, and retail sales of salon products.

The standard price for a hair extension case is $1,500.

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[MONTH] [YEAR] // Confidential Information
4.0 Market Analysis Summary (data provided by the American Cancer Society)
 1,530,000 new cases of cancer are expected to be found in the U.S. in 2010, of which 740,000 will be
female.
 The 5-year relative survival rate for all cancers diagnosed between 1999-2005 is 68%, up from 50%
in 1975-1977.
 There are currently 11,000,000 cancer survivors in the U.S., of which 5,320,261 are women.
 According to the Pantene Beautiful Lengths Web site, a recent study revealed that nearly 60 percent
of women consider hair loss the most dreaded side effect they face when undergoing chemotherapy.
 Real-hair wigs can cost as much as $1,200 and are often only partially covered by health insurance.
 Dakota County, MN has a population of approximately 386,599 and a median household income of
$73,209. With 55.5% of the population in the 25-64 age range and 52.65% of the adult population
being female, the target population of women is 112,967 (data from the U.S. Census Bureau 2009
estimates)

4.1 Competition and Buying Patterns

There are many small salons, resort salons, and a few larger salons who offer general cosmetology services. 
Hair extensions touch a specific client and the firm’s hair replacement services will actively seek women and
childhood cancer patients.

Several competing salons that offer extensions and wigs include the following:

INSERT COMPETITION

The firm believes that the most attractive growth strategies involve marketing based upon the firm’s upscale
and green image, mining the existing customer base for referrals, and by contacting any visitors to the
company’s website

5.0 Web Plan Summary

A website will be developed. It will allow prospective customers to view examples of the firm’s service,
including photos of the dramatic improvement in the attractiveness in the patient’s hair. In addition, the firm
will make a stronger effort at collecting customer’s email for periodic email blasts. The website will also allow
for online scheduling of appointments.

6.0 SWOT Analysis

SWOT (Strengths, Weaknesses, Opportunities, Threats) Analysis


STRENGTHS HOW STRENGTHS WILL BE LEVERAGED

Ability to change hair services quickly based The firm will move quickly to take advantage of changing
upon changing consumer demand customer preferences

Only high-end salon in this particular suburb The firm will quickly attract financial comfortable clients

WEAKNESSES HOW WEAKNESSES WILL BE MINIMIZED


Lack of Capital to Fund Business Start-Up The firm is seeking funding

OPPORTUNITIES HOW TO CAPITALIZE


The number of cancer patients in the U.S. has The firm has a large pool of potential customers.

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[MONTH] [YEAR] // Confidential Information
risen due to the increased survivability rates of
cancer treatment

Many small, poorly managed hair salons have The firm can quickly build sales with customers who have
gone out of business during the recession; lack lost their salon contacts and market to targeted customer
of high-end salon in high-income Dakota demographic
County

THREATS HOW COMPANY WILL MINIMIZE THREATS


A less expensive competition (i.e. economies The firm maintains a higher standard of quality by having
of scale enjoyed by a multi-unit salon operator) an owner/operator who will monitor all client relationships
can win market share by undercutting prices if with a focus of customer satisfaction and with the goal of
they target the hair replacement/hair extension developing a more personal relationship between the stylist
market and the client

6.1 Competitive Edge

The firm’s competitive edge will be created by its proximity to multiple cancer treatment facilities in the Twin
Cities area, high-end and comfortable salon facilities, eco-friendly “green” and organic product philosophy and
management experience brought by INSERT NAME; which will allow for a strong brand image that will attract
new customers and build referral pipelines. In addition, the salon will be the only high-end salon currently
operating in the subject suburb.

6.2 Marketing Strategy

The firm will utilize the following marketing methods:


 
 Customer referrals

 Visitors to the website

 Email blasts/email newsletters targeting site visitors and current/previous customers

 Signage at the location

 Newspaper advertisement

 Local promotions and networking

 New web site that will exclusively target hair replacement services

 Doctor’s office brochures

6.3 Sales Strategy

All employees are paid based on performance (40 – 52% commission) providing incentive for customer
service and relationship-building. Customer referrals and e-marketing will drive both local and national
customers to the salon.

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[MONTH] [YEAR] // Confidential Information
12
6.4 Sales Forecast

10 Month
11
The firm projects to achieve $638,840 in sales during year 1, $767,166 in year 2, and $899,741 in year 3.

9 Month
Table: Sales Forecast

8 Month
Month
Sales Forecast
Year 1 Year 2 Year 3

Month
Sales

7
Salon Services by Stylists and Barbers $450,000 $550,000 $650,000

Month
Salon Services by Estitician $84,000 $96,600 $111,090
Laser Hair Growth Services by Owner/Manager Month 6 $60,840 $69,966 $80,461
Retail Product Sales by Stylists and Barbers $44,000 $50,600 $58,190
5

Total Sales $638,840 $767,166 $899,741


Month
4

Direct Cost of Sales Year 1 Year 2 Year 3


Month

Salon Services by Stylists & Barbers $0 $0 $0


3

Salon Services by Estiticians $42,000 $48,300 $55,545


Month

Laser Hair Growth Services $36,504 $41,980 $48,277


2

Retail Product Sales $23,040 $26,496 $30,470


MonthMonth

Subtotal Direct Cost of Sales $101,544 $116,776 $134,292


1

Sales Monthly

$60,000

$50,000 Salon Services by Stylists and Barbers

$40,000 Salon Services by Estitician

$30,000 Laser Hair Growth Services by Owner/Manager

$20,000 Retail Product Sales by Stylists and Barbers


$10,000

$0

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Sales by Year

$800,000
Salon Services by Stylists and Barbers

$600,000 Salon Services by Estitician

Laser Hair Growth Services by Owner/Manager


$400,000
Retail Product Sales by Stylists and Barbers

$200,000

$0
Year 1 Year 2 Year 3

6.5 Milestones

Table: Milestones

Milestones

Milestone Start Date End Date


Receive Funding Sources 2/28/11 5/1/11
Hire Employees 4/15/11 5/8/11
Prep Location/Pre-Open Ads 5/1/11 5/15/11
Grand Opening 5/16/11
Totals

7.0 Management Summary

INSERT NAME is a former educator (5 years in public school systems) and retail manager (9 years at all
levels of management). He has specialized knowledge in the fitting and care of wigs. He is also skilled in
creating and analyzing business financial statements and managing the cash flow of an operating business.

7.1 Personnel Plan

The firm estimates a first year payroll expense of $326,064. The stylists and barber will be independent
contractors.

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[MONTH] [YEAR] // Confidential Information
Table: Personnel

Personnel Plan
Year 1 Year 2 Year 3
Full-Time Sylists (Seven in Year 1) 1099 $224,004 $230,724 $237,646
Full-Time Barber (One in Year 1) 1099 $32,004 $32,964 $33,953
Full-Time Receptionist (One in Year 1) W-2 $20,796 $21,420 $22,063
Part-Time Receptionist (One in Year 1) W-2 $13,260 $13,658 $14,068
Owner/Manager $36,000 $37,080 $38,192

Total Payroll $326,064 $335,846 $345,921

8.0 Financial Plan

This Business Plan is used by the management as a road map to its success.  It is an indispensable tool for
the ongoing performance and improvement of the Company, and it will be referred to often as management
plots its business course.  The Company provided the assumptions for all financial projections which are
detailed in the tables and charts throughout this plan.

8.1 Start-Up Funding

[YOUR COMPANY NAME] is projecting $638,840 in annual sales and a $65,813 net profit in year 1,
and is seeking $127,000 in funding to be used as follows. The working capital will be
partially used to acquire inventory.

Start-up
Start-up Expenses
Legal & Accounting $2,000
Salon Build-Out $7,500
Laser Hair Growth Machine $7,000
Furniture (includes shelving, chairs, and receptionist desk) $5,000
Mirrors $3,000
Rent Deposits $2,500
Initial Marketing Expense $10,000
Wigs and Mannequins $1,500
Working Capital (2.5 months of operating expenses) $88,500
Total Start-Up Costs $127,000

8.2 Break-even Analysis

The firm needs to produce $43,921 in monthly sales in order to break-even.

Table: Break-even Analysis

Break-even Analysis

Monthly Revenue Break-even $43,921

Estimated Monthly Fixed Cost $36,940

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Break-even Analysis
$30,000

$20,000

$10,000

$0

($10,000)

($20,000)

($30,000)

$0 $14,000 $28,000 $42,000 $56,000 $70,000


$7,000 $21,000 $35,000 $49,000 $63,000 $77,000

8.3 Projected Profit and Loss

The following Projected Profit and Loss Table and charts illustrate the firm’s sales, operating expenses, and
profitability over the next three years.  It illustrates the effects on profitability of increased expenses such as
asset acquisition, personnel, and marketing as the Company expands.  It also illustrates the delayed revenue
(sales) growth that occurs months after the capital expenditures of start-up and expansion.  A monthly
projection for the first twelve months of sales, direct cost of sales, operating expenses, gross profits, tax
consequences, and net profits after taxes is found in the appendix. 

The firm is projecting a $638,840 sales figure in year 1 and a $65,813 net profit.

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Table: Profit and Loss
Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $638,840 $767,166 $899,741
Direct Cost of Sales $101,544 $116,776 $134,292
Other Costs of Sales $0 $0 $0
Total Cost of Sales $101,544 $116,776 $134,292

Gross Margin $537,296 $650,390 $765,449


Gross Margin % 84.10% 84.78% 85.07%

Expenses
Payroll $326,064 $335,846 $345,921
Marketing/Promotion $15,000 $15,450 $15,914
Depreciation $0 $0 $0
Rent $24,000 $24,720 $25,462
Utilities $6,000 $6,180 $6,365
Insurance with Workers Comp $8,004 $8,244 $8,491
Payroll Taxes $48,910 $50,377 $51,888
Phone/Fax $1,500 $1,545 $1,591
Legal & Accounting $3,000 $3,090 $4,026
Office Expense $1,800 $1,854 $1,910
Repair/Maintenance $2,400 $2,472 $2,546
Travel $3,600 $3,708 $3,819
Auto/Truck Expense $3,000 $3,090 $3,183

Total Operating Expenses $443,278 $456,576 $471,117

Profit Before Interest and Taxes $94,018 $193,814 $294,332


EBITDA $94,018 $193,814 $294,332
Interest Expense $0 $0 $0
Taxes Incurred $28,206 $58,144 $88,300

Net Profit $65,813 $135,670 $206,032


Net Profit/Sales 10.30% 17.68% 22.90%

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Profit Monthly

$10,000

$8,000

$6,000

$4,000

$2,000

$0

Month 1 Month 3 Month 5 Month 7 Month 9 Month 11


Month 2 Month 4 Month 6 Month 8 Month 10 Month 12

Profit Yearly

$210,000

$180,000

$150,000

$120,000
$90,000

$60,000

$30,000

$0
Year 1 Year 2 Year 3

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Gross Margin Monthly

$50,000

$40,000

$30,000

$20,000

$10,000

$0
Month 1 Month 3 Month 5 Month 7 Month 9 Month 11
Month 2 Month 4 Month 6 Month 8 Month 10 Month 12

Gross Margin Yearly

$720,000

$600,000

$480,000

$360,000

$240,000

$120,000

$0
Year 1 Year 2 Year 3

8.4 Projected Operating Cash Flow

[YOUR COMPANY NAME] has applied for $127,000 in funding sources. The Company forecast that it will receive
the funding between the first and second quarter of 2011. As all sales will be paid by cash, check, or credit card;
there will be no delayed collection of receipts and most inventory or supplies will be paid up front as well. The
cash flow statement below projects the operating cash flow only.

Table: Operating Cash Flow


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Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received

Cash from Operations


Cash Sales $638,840 $767,166 $899,741
Subtotal Cash from Operations $638,840 $767,166 $899,741

Additional Cash Received


Sales of Other Current Assets $0 $0 $0
Sales of Long-term Assets $0 $0 $0
New Investment Received $0 $0 $0
Subtotal Cash Received $638,840 $767,166 $899,741

Expenditures Year 1 Year 2 Year 3

Expenditures from Operations


Cash Spending $573,027 $631,496 $693,709
Bill Payments $0 $0 $0
Subtotal Spent on Operations $573,027 $631,496 $693,709

Additional Cash Spent


Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $573,027 $631,496 $693,709

Net Cash Flow $65,813 $135,670 $206,032


Cash Balance $65,813 $201,483 $407,515

Cash
$70,000

$60,000

$50,000
Net Cash Flow
$40,000
Cash Balance
$30,000

$20,000

$10,000

$0
Month 1 Month 3 Month 5 Month 7 Month 9 Month 11
Month 2 Month 4 Month 6 Month 8 Month 10 Month 12

8.5 Projected Balance Sheet

The Balance Sheet Table (below) shows the Pro-Forma Balance Sheet projections.  In the appendix, the first
twelve months are shown individually.

Based on these financial projections, [YOUR COMPANY NAME] expects to build a business with a solid
balance sheet for years to come. The balance sheet assumes that all earnings are retained in the business
and projects that cash will grow to $407,515 by year 3.

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Table: Balance Sheet

Pro Forma Balance Sheet


Year 1 Year 2 Year 3
Assets

Current Assets
Cash $65,813 $201,483 $407,515
Other Current Assets $0 $0 $0
Total Current Assets $65,813 $201,483 $407,515

Long-term Assets
Long-term Assets $0 $0 $0
Accumulated Depreciation $0 $0 $0
Total Long-term Assets $0 $0 $0
Total Assets $65,813 $201,483 $407,515

Liabilities and Capital Year 1 Year 2 Year 3

Current Liabilities
Accounts Payable $0 $0 $0
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $0 $0 $0

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

Paid-in Capital $120,000 $120,000 $120,000


Retained Earnings ($120,000) ($54,187) $81,483
Earnings $65,813 $135,670 $206,032
Total Capital $65,813 $201,483 $407,515
Total Liabilities and Capital $65,813 $201,483 $407,515

Net Worth $65,813 $201,483 $407,515

8.6 Business Ratios

The table below presents the projected business ratios from the beauty salons services as a reference with
sales from $500,000-$999,999. The firm is projecting sales growth of 20.09% in year 2 and 17.28% in year 3.

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Table: Ratios

Ratio Analysis
Year 1 Year 2 Year 3
Sales Growth n.a. 20.09% 17.28%

Percent of Sales
Sales 100.00% 100.00% 100.00%
Gross Margin 84.10% 84.78% 85.07%
Selling, General & Administrative 73.80% 67.09% 62.18%
Expenses
Advertising Expenses 2.35% 2.01% 1.77%
Profit Before Interest and Taxes 14.72% 25.26% 32.71%

Main Ratios
Current 0.00 0.00 0.00
Quick 0.00 0.00 0.00
Total Debt to Total Assets 0.00% 0.00% 0.00%
Pre-tax Return on Net Worth 142.86% 96.19% 72.23%
Pre-tax Return on Assets 142.86% 96.19% 72.23%

Additional Ratios Year 1 Year 2 Year 3


Net Profit Margin 10.30% 17.68% 22.90%
Return on Equity 100.00% 67.34% 50.56%

Activity Ratios
Accounts Payable Turnover 0.00 0.00 0.00
Payment Days 0 0 0
Total Asset Turnover 9.71 3.81 2.21

Debt Ratios
Debt to Net Worth 0.00 0.00 0.00
Current Liab. to Liab. 0.00 0.00 0.00

Liquidity Ratios
Net Working Capital $65,813 $201,483 $407,515
Interest Coverage 0.00 0.00 0.00

Additional Ratios
Assets to Sales 0.10 0.26 0.45
Current Debt/Total Assets 0% 0% 0%
Acid Test 0.00 0.00 0.00
Sales/Net Worth 9.71 3.81 2.21
Dividend Payout 0.00 0.00 0.00

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Appendix

Table: Sales Forecast


Sales Forecast
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month Month Month
10 11 12
Sales
Salon Services by Stylists $33,750 $33,750 $33,750 $37,500 $37,500 $37,500 $37,500 $37,500 $37,500 $41,250 $41,250 $41,250
and Barbers
Salon Services by Estitician $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000
Laser Hair Growth Services $780 $1,560 $2,340 $3,120 $3,900 $4,680 $5,460 $6,240 $7,020 $7,800 $8,580 $9,360
by Owner/Manager
Retail Product Sales by $0 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000 $4,000
Stylists and Barbers
Total Sales $41,530 $46,310 $47,090 $51,620 $52,400 $53,180 $53,960 $54,740 $55,520 $60,050 $60,830 $61,610

Direct Cost of Sales Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month Month Month
10 11 12
Salon Services by Stylists & $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Barbers
Salon Services by $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500
Estiticians
Laser Hair Growth Services $468 $936 $1,404 $1,872 $2,340 $2,808 $3,276 $3,744 $4,212 $4,680 $5,148 $5,616
Retail Product Sales $1,920 $1,920 $1,920 $1,920 $1,920 $1,920 $1,920 $1,920 $1,920 $1,920 $1,920 $1,920
Subtotal Direct Cost of $5,888 $6,356 $6,824 $7,292 $7,760 $8,228 $8,696 $9,164 $9,632 $10,100 $10,568 $11,036
Sales

Page 1
Appendix

Table: Personnel
Personnel Plan
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month Month Month
10 11 12
Full-Time Sylists (Seven in Year 1) $18,667 $18,667 $18,667 $18,667 $18,667 $18,667 $18,667 $18,667 $18,667 $18,667 $18,667 $18,667
1099
Full-Time Barber (One in Year 1) $2,667 $2,667 $2,667 $2,667 $2,667 $2,667 $2,667 $2,667 $2,667 $2,667 $2,667 $2,667
1099
Full-Time Receptionist (One in Year $1,733 $1,733 $1,733 $1,733 $1,733 $1,733 $1,733 $1,733 $1,733 $1,733 $1,733 $1,733
1) W-2
Part-Time Receptionist (One in Year $1,105 $1,105 $1,105 $1,105 $1,105 $1,105 $1,105 $1,105 $1,105 $1,105 $1,105 $1,105
1) W-2
Owner/Manager $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Total People 0 0 0 0 0 0 0 0 0 0 0 0

Total Payroll $27,172 $27,172 $27,172 $27,172 $27,172 $27,172 $27,172 $27,172 $27,172 $27,172 $27,172 $27,172

Page 2
Appendix

Table: Profit and Loss


Pro Forma Profit and
Loss
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month Month Month
10 11 12
Sales $41,530 $46,310 $47,090 $51,620 $52,400 $53,180 $53,960 $54,740 $55,520 $60,050 $60,830 $61,610
Direct Cost of Sales $5,888 $6,356 $6,824 $7,292 $7,760 $8,228 $8,696 $9,164 $9,632 $10,100 $10,568 $11,036
Other Costs of Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Cost of Sales $5,888 $6,356 $6,824 $7,292 $7,760 $8,228 $8,696 $9,164 $9,632 $10,100 $10,568 $11,036

Gross Margin $35,642 $39,954 $40,266 $44,328 $44,640 $44,952 $45,264 $45,576 $45,888 $49,950 $50,262 $50,574
Gross Margin % 85.82% 86.28% 85.51% 85.87% 85.19% 84.53% 83.88% 83.26% 82.65% 83.18% 82.63% 82.09%

Expenses
Payroll $27,172 $27,172 $27,172 $27,172 $27,172 $27,172 $27,172 $27,172 $27,172 $27,172 $27,172 $27,172
Marketing/Promotion $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250
Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Rent $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000
Utilities $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500
Insurance with $667 $667 $667 $667 $667 $667 $667 $667 $667 $667 $667 $667
Workers Comp
Payroll Taxes $4,076 $4,076 $4,076 $4,076 $4,076 $4,076 $4,076 $4,076 $4,076 $4,076 $4,076 $4,076
Phone/Fax $125 $125 $125 $125 $125 $125 $125 $125 $125 $125 $125 $125
Legal & Accounting $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250
Office Expense $150 $150 $150 $150 $150 $150 $150 $150 $150 $150 $150 $150
Repair/Maintenance $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200
Travel $300 $300 $300 $300 $300 $300 $300 $300 $300 $300 $300 $300
Auto/Truck Expense $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250 $250

Total Operating $36,940 $36,940 $36,940 $36,940 $36,940 $36,940 $36,940 $36,940 $36,940 $36,940 $36,940 $36,940
Expenses

Profit Before Interest ($1,298) $3,014 $3,326 $7,388 $7,700 $8,012 $8,324 $8,636 $8,948 $13,010 $13,322 $13,634
and Taxes
EBITDA ($1,298) $3,014 $3,326 $7,388 $7,700 $8,012 $8,324 $8,636 $8,948 $13,010 $13,322 $13,634
Interest Expense $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Taxes Incurred ($389) $904 $998 $2,216 $2,310 $2,404 $2,497 $2,591 $2,684 $3,903 $3,997 $4,090

Page 3
Appendix

Net Profit ($908) $2,110 $2,328 $5,172 $5,390 $5,609 $5,827 $6,045 $6,264 $9,107 $9,326 $9,544
Net Profit/Sales -2.19% 4.56% 4.94% 10.02% 10.29% 10.55% 10.80% 11.04% 11.28% 15.17% 15.33% 15.49%

Table: Cash Flow


Pro Forma Cash Flow
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month Month Month
10 11 12
Cash Received

Cash from Operations


Cash Sales $41,530 $46,310 $47,090 $51,620 $52,400 $53,180 $53,960 $54,740 $55,520 $60,050 $60,830 $61,610
Subtotal Cash from $41,530 $46,310 $47,090 $51,620 $52,400 $53,180 $53,960 $54,740 $55,520 $60,050 $60,830 $61,610
Operations

Additional Cash Received


Sales of Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales of Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Investment Received $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash Received $41,530 $46,310 $47,090 $51,620 $52,400 $53,180 $53,960 $54,740 $55,520 $60,050 $60,830 $61,610

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

Expenditures from Operations


Cash Spending $42,438 $44,200 $44,762 $46,448 $47,010 $47,571 $48,133 $48,695 $49,256 $50,943 $51,504 $52,066
Bill Payments $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Spent on Operations $42,438 $44,200 $44,762 $46,448 $47,010 $47,571 $48,133 $48,695 $49,256 $50,943 $51,504 $52,066

Additional Cash Spent


Long-term Liabilities Principal $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Repayment
Purchase Other Current $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Assets
Purchase Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Dividends $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash Spent $42,438 $44,200 $44,762 $46,448 $47,010 $47,571 $48,133 $48,695 $49,256 $50,943 $51,504 $52,066

Net Cash Flow ($908) $2,110 $2,328 $5,172 $5,390 $5,609 $5,827 $6,045 $6,264 $9,107 $9,326 $9,544
Cash Balance ($908) $1,201 $3,530 $8,702 $14,092 $19,700 $25,527 $31,573 $37,836 $46,943 $56,269 $65,813

Page 4
Appendix

Table: Balance Sheet

The $127,000 funding request has been rounded down to $120,000 in the statement below, assuming that negotiations result in a smaller funding amount.

Pro Forma
Balance Sheet
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Assets

Current Assets
Cash ($908) $1,201 $3,530 $8,702 $14,092 $19,700 $25,527 $31,573 $37,836 $46,943 $56,269 $65,813
Other Current $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Assets
Total Current ($908) $1,201 $3,530 $8,702 $14,092 $19,700 $25,527 $31,573 $37,836 $46,943 $56,269 $65,813
Assets

Long-term
Assets
Long-term $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Assets
Accumulated $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Depreciation
Total Long-term $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Assets
Total Assets ($908) $1,201 $3,530 $8,702 $14,092 $19,700 $25,527 $31,573 $37,836 $46,943 $56,269 $65,813

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

Current
Liabilities
Accounts $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Payable
Current $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Borrowing
Other Current $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Liabilities

Page 5
Appendix

Subtotal Current $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Liabilities

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

Paid-in Capital $120,000 $120,000 $120,000 $120,000 $120,000 $120,000 $120,000 $120,000 $120,000 $120,000 $120,000 $120,000
Retained ($120,000 ($120,000 ($120,000 ($120,000 ($120,000 ($120,000 ($120,000 ($120,000 ($120,000 ($120,000 ($120,000 ($120,000)
Earnings ) ) ) ) ) ) ) ) ) ) )
Earnings ($908) $1,201 $3,530 $8,702 $14,092 $19,700 $25,527 $31,573 $37,836 $46,943 $56,269 $65,813
Total Capital ($908) $1,201 $3,530 $8,702 $14,092 $19,700 $25,527 $31,573 $37,836 $46,943 $56,269 $65,813
Total Liabilities ($908) $1,201 $3,530 $8,702 $14,092 $19,700 $25,527 $31,573 $37,836 $46,943 $56,269 $65,813
and Capital

Net Worth ($908) $1,201 $3,530 $8,702 $14,092 $19,700 $25,527 $31,573 $37,836 $46,943 $56,269 $65,813

Page 6

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