Business Plan

Around the
Clock
Diego Amato, Stefano Canavera, Matteo Calati, Ivano Pietro Cambria, 24H Shops in
Ilaria Ciarloni
Lugano
 Business Plan Around the Clock 2011

Index

1. Business Description
1.1 Description of the idea
1.2 Social Structure
1.3 Emergent features of vending machine
1.4 Products
1.5 Positioning
1.6 Location (design, places)

2. The Market
2.1 Consumer profile
2.2 Competitors
2.3 Retailers
2.4 Vending areas

3. Development Status
3.1 Market Research
3.2 Cost of Development
3.3 Labor
3.4 Expenses & Capital Requirements
3.5 Advertising and promotions

4. Management
4.1 CEO
4.2 Financial Manager / Accountants
4.3 Sales Manager
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4.4 Contact with Mother Company

4.5 Dealing with Legal Issues

5. Financial Analysis
 Business Plan Around the Clock 2011

1. Business Description
1.1 Description of the idea

Our idea is to create 2 shops in Lugano opened 24h a day, for the sale of several articles,
through vending machines. This kind of market is growing, due to social reasons because
of the frantic rhythms of human life but also for economic reasons because the willingness
to pay for food and beverage consumption is significantly reduced.
Our business will position itself in a market segment yet to be exploited because our shop
in addition to food and beverage, they will sell also several articles of immediate use, such
as first aid kit, hot food and an entertainment panel where the customers can surf the net
and recharge the phone while he’s eating and drinking. What we propose is to create a
store that meets the practical needs of people, a place that never closes. Where there is
always what you want, where you enjoy it if you're with your friends but also a place where
no one bothers you if you want a moment alone.

1.2 Social Structure:

Our firm will have legal office in our house. Actually this kind of job do not need any
structured office.

Our society team is composed as follow:

Diego Amato: Born in Puertorico in 1987, living in Lugano, Bachelor at Università Cattolica
Del Sacro Cuore in Economics. Training in lawyer studio in Milano and in Cairns
(Queensland, Australia) too. He’s attending a Master in Management at USI.

Stefano Canavera: Born in Cuneo in 1987, living in Lugano, Bachelor at Università

Cattolica Del Sacro Cuore in Economics. At present he’s attending Master in Management
at USI.
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Matteo Calati: Born in Holland in 1988, living in Lugano, Bachelor at USI in Economics.
Experiences in consulting. Attending a Master in Management at USI.

Ivano Pietro Cambria: Born in 1984, living in Lugano, Bachelor in Economics and several
managerial experiences in Milan, at the moment he’s attending Master in Management at
USI.
 Business Plan Around the Clock 2011

Ilaria Ciarloni: Born in 1987, living in Lugano. Bachelor at Università Cattolica Del Sacro
Cuore in Economics. Management training experiences in Oxford. Currently attending
Master in Management at USI.

1.3 Emergent features of vending machine

Is estimated that people who use regularly machine of automatic distribution in Swiss, are
more than three million and half - with peaks of four million during period of high
consumption growth- , with an average of customers within 18 and 50 years old.

We analyzed that in Lugano almost 28% of the reference sample, use vending machine
almost every day with the addition of a further fee of 21.8% accessing this type of
consumption of beverages and snacks, at least once or twice a week.

Consumption of food are rapidly changing, both to the changing taste of people and for the
current crisis, that pushing many families to reconsider their spending patterns, oriented on
more content than expansion. Is significant that 25% of respondents have reformulated
their own expenses for food, but less than 7% of users of vending machine has reduced
the usage.

We can say that, while this indicate that between the so-called “frequent users” of
machines there are high level of loyalty so the request is quite rigid with respect to prices
changing and other external changing factors, is also true that operators of vending have
to face a changing market and a multiplicity of different customers.

We develop a series of question, in order to understand better customers trends and how
do they perceive the market of the vending machine:
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We submitted this questions to a significant sample of population shared in age

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categories. These are the results:

1. Have you ever used Vending Machine?

Yes 91%
No 8%

2. If is yes, how often do you buy from the vending machine?

 Business Plan Around the Clock 2011

Almost every day 12%

At least once a week 24.5%
Two – three times a week 21.8%
Three – four times a week 19.4%
Ones a month 9.1%
Occasionally, but more than 10 times 5.6%
Occasionally, but less than 10 times 7.6%

3. What do you appreciate of the service?

The convenience of the service 31.3%
The speed of the service 19.7%
Vending machine are almost everywhere 26.5%
Products are cheaper 16.4%
They offer a broad choice of products 6.1%

4. What do you expect from Vending Machine?

That vending machine give the change 40.7%
Vending machine accept banknotes and give the change 15.6%
A larger choice of products 10.3%
I want more vending machine in the area 13.2%
I want vending machine selling other product (not only hot drinks and snacks)
20.2%

5. How often are you going to use Vending machine again?

More often 6.2%
Like nowadays 82.7%
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Less often 9.6%

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Never again 1.5%

1.4 The products:

A vending machine shop is a 24 hours open area where you can find different selling
machine offering many kind of products, from the cold drink, to the hot food and other
several product.
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Our Shop includes the following machine:

 DRINK: The machine offer a variety of hot drinks, coffee, tea, chocolates, milk, cafè
mocha.
 FOOD & DRINK: Clients always want sweet and salty snacks, as well cold drink.
Thanks to the features of the machine that can refrigerate up to 2°C, it can have
different installation in order to offer different products and a wide range of food. Not
only snacks and chips, but also sandwiches and yogurt and other dairy products.
Concerning to the drink, we will offer can of drinks, juice and water.
 HOT FOOD: With this automatic machine our customers can select a real hot dish
with a small amount of money. We offer different kind of hot food like Lasagne al
ragù di carne, cannelloni ricotta e verdure, penne al pomodoro, melanzane alla
parmigiana, petto di pollo e piselli e cordon bleu con piselli e carote. The customer
has to wait a few minutes and his dish is ready.
 PARMA24: For many products and for many emergencies, this machine can be
very important and convenience for our customers and might substitute the
necessity of a pharmacy that might not be open during the night. With 7 shelves of
products and 7 selection per shelf, we can offer the main important products: First
Aid Products, diagnostic products, contraception, horal hygiene, body and beauty
products and babyhood products.
 ENTERTAINMENT PANNEL: This panel has two different section: a change area,
where you can change your banknotes in coins; and a 32’’ monitor touch screen
connected to a PC and a ADSL network. The customers can surf the net, check e-
mail and listen music on YouTube while he’s eating or drinking. This panel offer
also the possibility to top-up the mobile phone through an application, where you
can select your mobile operator, insert your number and the amount of credit that
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you want to top up. Our shop offer also a free Wi-Fi zone, where anybody can
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access with their laptop or mobile phone.

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1.5 Positioning

Our business idea, while introducing a series of innovations that help differentiate it in the
market, has several competitors, such as super markets, pharmacies, fast food and other
vending machines already in the city. What is in our favor is that the business hours are
limited mainly from 9AM to 7PM. After this time, providing a suitable quality of service
could attract customers from different age and where it’s possible to satisfy different needs
at cheaper prices. Our customers will be in a range from 16 to 50, mainly workers and
students.
Analyzing each competitor, by offering different product at any time, others vending
machine in the city will be our first competitor but this category usually offer only soft drinks
and snacks, but with our completeness of the service we offer, consumers will prefer us
over competitors.
All others competitors will be only indirectly correlated to us because obviously we can’t
compete with the wide range of product offered by supermarkets and also with bars and
restaurant where customers are trying to satisfy not only primary need but also social
activities. But thanks to our characteristic of being open 24 hours a day, we will meet the
various needs of our customers.

1.6 Locations

1.6.1 Area location

Our 2 store will be located in Lugano, one in Corso Elvezia and the other in via della
Posta.

The shop in Corso Elvezi is placed in a commercial services area, it will serve residents,
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students and workers during the day. The location is strategically important because it’s
closed to the University and furthermore, Corso Elvezia is a street with a high frequency of
traffic.

The shop in Via Della Posta is placed in a tourist area vocation, close to the lake resort,
Parco Ciani and city centre. This shop will attract not only the residents but tourist, visitors
too. This place is very important because it could provide considerable prestige to our
company and also this area is the heart of the night life in Lugano, but at the same time
 Business Plan Around the Clock 2011

there are not bars and restaurant open at night. For the layout of our 24h shops, we can’t
make many customizations because the square footage of the room is mostly occupied by
the vending machines. The shops will be without the entrance door in order to stimulate
curiosity in customers.

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The two shops are 1 km far each other and they will have close fields, but they not
overlap.

1.6.2 internal location

Our shop will be based on two fundamental colors, black and white. Vending machines
provided from the Laservideo S.r.l. are black varnished, for this reason we would like to
 Business Plan Around the Clock 2011

keep the “theme” creating an elegant and relaxing area, and make a checkerboard floor
black and white as well.

We will provide table, stools and bins for recycling. We will install also security cameras in
order to prevent vandalism.

2 The Market

In Switzerland the market of vending machine has an interesting potential growing. Above
the 30% of our sample use vending machine every day and because of the changing of
food consumption and of economic recession many users can be reoriented to the vending
machine market. Our initiative has a complete new market with no competitors at present.
We estimate a huge potential market that will offer the opportunity to a safe business.
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2.1 Consumer Profile

Vending machine are useful, cheaper and rapid, for this reason a growing number of
consumers are using this service, looking for a comfort to cope with a sense of hunger or
thirst, or simply pass the time.
 Business Plan Around the Clock 2011

A preliminary investigation has identify users and non-users of vending machine, to

compare and find the personal data, geographic and social differences, and as well
analyze why people do not buy at the vending machines.

The real criteria among users and nonusers, is the age.

Automatic distribution is emerging as an youth-oriented sector; probably because of the

technological aspect that has, or simply because of the different approach with the
traditional consumption of food.

Among nonusers, 50.9% are people between 45 and 64 years old, and the lowest number
of nonusers it is found in the class of 18 and 29 years old.

composition of non-users of vending machine by age.

Is therefore a difference in the behavior and character, and even the generation that
separates the under 45 to the over 45.

The main reason to not buying at the vending machine are the difficulty to find the
machines in the area but sometimes is a real conscious decision (they prefer to buy that
products through other channels). Another important reason is the fact that they don’t are
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enough interested in the product offered: this might be an important data for us, in order to
increase the users in the area, selling “not obvious” products.
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Special reason for not using the automatic distribution by age.

Others non-users say that they don’t use vending machine simply because they never had
the real opportunity to use it; so our objective is also to find the right place and the right
combination of products in order to attract consumers and make our vending machine
reliable and attractive.

Frequency of use and place of use:

In order to decide where to place our vending machine, we should identify an identikit of
our best customer:

 1 out of 4 consumer use vending machine at least ones a day.

 15.4% of consumer, choose the product of the machine with regularity.
 Overall we can say that the 41% of our consumers are loyal. The rest of them are
occasionally buyers.
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The regular consumer is a man between 18 and 30 years old, with a low- medium income.
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Analyzing the places where to locate the vending machines, we have to consider other
different data: the highest sales are in workplaces, areas of study (library and university)
and waiting areas.

2.2 Competitors
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We have to analyze Ticino’s area in order to have a clear prospect of the competitors.

Firstly we have to say that we don’t have a real direct competitors, in fact in Lugano don’t
exist 24hours shops with vending machine offering several products like ours.

We analyze the indirect competitors, that can offer a similar or partial offer overlapping our
reference market.

Supermarket: The city of Lugano offer a several numbers of supermarket like Migros,
Coop and Manor situated all around the area. They offer a wide variety of products with
higher prices than ours items in the machines. They open at 9am and close at 7pm
(except in Thursday when they close at 9pm), so people that need to buy something after
that hour, can buy products at our vending machines. Here we have competition just on
some products like snack but the target is completely different.

Vending machines: We realize that the existing vending machines are present only inside
building (private or public) so people cannot have a direct contact with them, and moreover
that machines are limited to a strict range of products (coffee and snacks); for this reason
customers are not completely satisfy. The reference market of this area is limited to the
office people inside the building and not cover the ready meal offer. The concurrence is
only on some of our products. Therefore this target is an opportunity for us too. They are
already use to vending machine and will get in our offer items as ready meal fast food and
a better structured social meeting point.

Pharmacy: There are several pharmacy around Lugano, but they have different business
hours and might be difficult for a person to reach that shops during the night. Of course our
machine can’t compete with that broad variety of products and medicine, but it can be an
alternative for a limited needs (first aid kit, patches, cream and baby products).
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Bars and fast food: These are the most challenging competitors to face with because
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they offer not only food and beverage, but overall a meeting place where socialize and
spend free time. Offering sits and table and staff, they attract people. However our service
is oriented to people who does not have time to waste and money as well, and especially
for those who can’t find an open bar during the night.
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2.3 Suppliers

For the first period we will rely on the society that provide us the vending machines, in fact
they offer also assistance in the choice of the products in the machines and they will
connect us with the suppliers. In the future we might change our suppliers, after have a
more solid consciousness about what consumers want, and what are the best seller
products.

By the way we already indentify some potential suppliers:

Acquapoint srl – Lissone; Barry Callebout spa – Assago; Coca cola hbc – Milano; Gmoka
srl – Andalo Valtellino; Mars spa – milano; Nestlè italia – Milano; Perfetti van melle spa –
Milano; Prontofoods spa Brescia; Riso scotti snack srl – Pavia; Most of them has a swiss
branch too.

3. Development Status

3.1 Market Research

Lugano is a city with 58,658 (downtown) population (over 145,000 inhabitants in the
agglomeration), extends between Monte Bre and Monte San Salvatore, about 32 km2 of
surface at a height of 273 mt. on the north side of Lugano Lake.

Population density is above 1.851 habitant per km2 and this are our estimation:

Because of our regular consumer is a man between 18 and 30 years old, with a low-
medium income and our potential population available in a range of 500 mt from our
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“shop” will be above 900 people, we estimate an average of about 90 items sold per day,
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in order to reach our breakeven point calculation.

We estimate to have a potential customers for 260 people per day just for residential
people and we suggest to duplicate this number including the full agglomeration, work
commuters and tourists. A further analysis will be made in order to develop the business
after the first year of activity.
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3.2 Regulations

Self - service

Needs Appropriate measures

Keep the perishable foodstuffs in cool (at a control the temperature with a thermometer
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temperature less than 5°C)

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S1 – S6
keep hot food at a temperature of at least
65 ° C
S1 – S6
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System S1: cooking and service

Operator buys ingredients cooked / raw, made a dish using a recipe specifies, by
manipulating the individual components, proceed to cook them and serve immediately.

System S2: cooking, hot storage

Operator buys ingredients cooked / raw, made a dish using a recipe specifies, by
manipulating the individual components, proceed to cook them and serve after an hot
maintenance.

System S3: cooking / cooling - heating / service

Operator buys ingredients cooked / raw, made a dish using a recipe specifies, by
manipulating the individual components, cool and serve after heating.

System S4: cooking / cooling / freezing / defrosting / heating / service

Operator buys ingredients cooked / raw, made a dish using a recipe specifies, by
manipulating the individual components, cool, freeze and defrost, heats and serve.

System S5: Preparation and cold serving

Operator buys ingredients cooked / raw, made a dish using a recipe specifies, by
manipulating the individual components, and serve.

System S6: cooking frozen food

Operator buys frozen ingredients and cook it. then proceeds according to one of the
previously described system
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 Business Plan Around the Clock 2011

3.3 Cost of Investments

Our investment is based in two main areas: the vending machine and the plants of the
places. We have 6 vending machines with different items + a video entertainment and a
changing machine for each site. The cost of this part is 48.000 CHF.

As far as the plants is concerned, we need to adapt electrical and water plants, the
furniture location, internal and external lights and security cameras. These items will cost
35.000 CHF.

Than our total investment is 65.500 CHF per each point, for a total amount of 131.000
CHF.

                 
  Investments in vending machine          
  Full investment       14,00   96.000,00  
  Year investment           96.000,00  
                 
  Investments   ChF   N°   96.000,00  
                 
  Snack   8.000   2   16.000,00  
  Drinks   9.000   2   18.000,00  
  Water   7.000   2   14.000,00  
  Coffee   5.000   2   10.000,00  
  food .- ready meals   10.000   2   20.000,00  
  First aids pharmacy   4.000   2   8.000,00  
  Video+ changin coins machine 5.000   2   10.000,00  
              -  
                 
                 
                 
  Full investment           35.000,00  
  Year investment           35.000,00  
                 
  Other investments       N°   35.000,00  
                 
  Electical & water plant   5.000   2   10.000,00  
  Fornitures & walls   8.500   2   17.000,00  
  Internal & external lights   2.500   2   5.000,00  
  Security cameras   1.500   2   3.000,00  
      -   2   -  
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3.4 Labor
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Laservideo S.r.l. , the society that provide us the vending machines, offer also technical
assistance that has to be done two times a year.

The ratio between operators and working hours it’s 1 operators = 8 working hours per day
and costs 50,000 CHF per year, so 0.3 operators = 2/3 hours per day and costs 15,000
CHF.

These costs referring to unskilled operators because the work that the vending machine
required are control, reorganization, management and solution of the problems: the
operator has to fill the missing products in the machine, withdraw the money and check if
there are some problem.

3.5 Capital Requirements

The full business need a full investment of 131.000 CHF financed with 30% of own capital
(45.850 CHF). We estimate to have founding source for 34.000 from suppliers and the rest
form the bank market with a cost of 6% per year.

3.6 Advertising and promotions

The allocated budget for new service promotion is 15.000 CHF.

As the vendor machines are a totally new market proposition in Lugano, the object of
promotion strategy are two: create awareness and encourage the first purchases.

Awareness creation:

The first marketing effort consist in reaching the potential customers, informing them
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about the new service.

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As the budget doesn't allow a massive advertising campaign, and the service might be
considered quite innovative, our aim is to reach those who can become the early adopters
of our product.

Flyers:
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It's low cost media, as the distribution will be made by ourselves. The internal solution
allow an estimated saving of 50 CHF per person each day.

The distribution will be made in selected places as:

 Educational institutes: as universities, high schools, libraries. Students are typically

low-budget consumers, then potentially interested in low-cost products sold at
vendor machines. Flyers will be distributed by us during entrance/exit periods and
they will be left inside the common areas of university.

 Public transport stations and stops: we will distribute flyers at stops around point of
sales during peak hours of morning and evening; these places are attended by
students and workers, that might be interested in purchasing at vendor machines
when it happens to work until late. Other flyers will be left at bus stops after 19.00,
to be found by night workers or by whom is going out for the evening.

 Clubs and lounge bars: those opened after . If traditional bars might think about
vendor machines as competitors, clubs and lounge bars won't, as they are opened
at evening and usually they sell different products. A barter agreement, placing their
flyers at our vendor machines, is the better and cheaper solution for both.

Daily Unitary Total Total

Flyers Days
q.ty cost q.ty amount
Educational inst. (left) 200 0,050 CHF 20 4.000 200 CHF
Educational inst. (distributed) 200 0,050 CHF 20 4.000 200 CHF
Public transport (left) 200 0,050 CHF 30 6.000 300 CHF
Public transport (distributed) 200 0,050 CHF 20 4.000 200 CHF
Clubs and lunge bars: 490 weekly 100 0,050 CHF 30 3.000 150 CHF
Total 21.000 1.050 CHF
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Radio:

A radio advertising campaign is the most indicated way to reach potential customers as
radio is the only media that can be reach them during their working activity (as night
workers or taxi drivers) or spare time (students or workers during their daily trip to courses
or offices). As it's a local service, it will be appropriate to invest in a local radio company.
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For two months, one local radio will broadcast our spot 6 times per day. Usually this set
includes also an additional random promotion made by the Dj: this is the typical minimum
acceptable set for an effective radio campaign, in order to have a good reminder effect.

We will consider also an amount of 1.000 CHF for the production of a 20” radio spot.

Radio campaign Q.ty

Daily spot 6
Days of campaing 60
Cost of single spot transmission 30,00 CHF
Broadcasting cost 10.800 CHF
Spot production 1.000 CHF
Radio campaign cost 11.800 CHF

Newspaper campaign:

As for the radio campaign strategy, invest a little amount of the budget in local newspaper
could be a great opportunity to create awareness in the local market. The purchase of a
little space (49mm * 18mm) for a short period in a local newspaper will be cheaper and
more appropriate then investing in a national newspaper, which would reach more but
probably not interested customers. The production of advertisement will be made
internally, as it's a marginal investment in our opinion.

Newspaper campaign Q.ty

40mm x 18mm space
Days of campaing 20
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Daily cost 100,00 CHF

Total cost 2.000 CHF
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First use:
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The main problem is that, as vendor machines doesn't exist yet in Lugano, the target
market probably won't realized immediately, even if reached by advertising campaign,
which are the benefits of purchasing at vendor machines.

For this reason we decided to distribute 100 cards with a pre-paid amount of 5 CHF each.
The total amount 500 CHF should be considered as follows; anyway, due to our margin on
product sales, that we can estimate of a medium percentage 50% , we will invoice to the
budget only 250 CHF , as cost of sold products.

Promotion and advertising campaign budget

Budget Amount
Flyers 915,00 CHF
Radio campaign 11.800,00 CHF
Newspaper campaign 2.000,00 CHF
Free cards 250,00 CHF
Total 14.965 CHF

4. Management Team

To form the best Management Team possible, we tried to match all the skills and
competences of the components of the team with the role that they would have to hold
during the beginning, development and finalization of this ambitious project that we will try
to accomplish together.
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The organization in a Team is a fundamental, and the correct division of task and labor will
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be fundamental for us. We think we have a good blended team with different but
complementary competences: in fact, we are all getting our Master degree and so the
capabilities might be similar (useful in order not have too many disagreements), but each
of us has a particular field in which he will be able to excel and to bring high satisfaction
and profits to the team (or, at least, we hope so!).
 Business Plan Around the Clock 2011

Moreover, a good mix of nationalities (three Italians, one Dutch and one Portorican guy)
might be very useful in order to have a more “open-minded” mentality that will allow us to
have more different point of views for the same issue and, hence, a broader vision of the
problem and a consequent increased easiness in solving it.

Our team is composed by 5 people that will go hard at this project and commit their time to
have the best outcomes possible; we are not so much as number, but we think that this
will be an advantage for us: in fact, not being too much people will favor a good and
efficient communication and a better organization. Furthermore, the fields of competence
will be easier to divide and we also will have the time to try to solve other members’
problems: this means, an increased coordination within the various areas will be possible.

4.1 CEO

We are proud to have had the luck and honor to have Ilaria Ciarloni as our CEO: her
experience in coordination, organization and division of labor will be fundamental for our
Team to accomplish our work in the best way possible. Moreover, the great interest that
she has in this sector will for sure help her to have great results as Chief Executive Officer
in our team, thanks to her great enthusiasm. Finally, the experience and wisdom of her
father will be a very important strategic tool that we will be able to exploit during the
project.

4.2 Financial Manager

Diego Amato is already working magnificently on the accounting/financial field: his

attention to details, accuracy, and desire of perfection are our winning tools: as he works in
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the financial area of the Team, his qualities are crucial; he will take care of all the problems
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and issues in the most efficient way possible, never missing out particulars or details that
will lead to a disaster for our firm. Hence, we have complete trust in his work and we wish
him an excellent job with us.

4.3 Sales Manager

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We thought that Matteo Calati would have been the best choice in this case: we hope that
his dual nationality and open-minded mentality will help us to develop new innovative
ideas in order to exploit the market in the best way. In fact, he will deal and take care of
the purchase and (above all) the spread of the product on the whole territory: it will be
important to have our ‘machines’ in fundamental strategic points, in order to satisfy in the
best way people that might be hungry in that moment; moreover, he will take care of the
advertising, trying to let the higher number of people know that this new, innovative, idea is
now in town!

4.4 Dealing with legal issues

As this is a very interesting but also touchy and sensitive market, we thought that legal
problems (above all concerning conservation of food) might have risen, and, hence, we
thought to put two people for this mansion: Stefano Canavera and Ivano Cambria. They
both have a good basis of legal regulations and this will allow us to avoid significant legal
problems in the future; instead, they might be able to help us to find new opportunities and
chances in the Swiss (Ticino) market by comprehending and interpreting all the legal
issues excellently.

5 Economical & Financial Analysis

5.1 Revenues

We estimate that the business will reach his normal capacity in the third year of business
with a revenue of about 165.000 ChF per year.
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Profit & Loss 2011 2012 2013 2014 2015

           
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Revenues food 86.400,00 95.040,00 103.680,00 103.680,00 103.680,00
Revenues drinks 41.400,00 46.080,00 50.760,00 50.760,00 50.760,00
Recenues other 8.640,00 9.720,00 10.800,00 10.800,00 10.800,00
Net Revenues 136.440,00 150.840,00 165.240,00 165.240,00 165.240,00
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5.2 Contribution

We have a very high contribution margin. The media mix on our business plan is about
around 55% for an amount of 91.000 CHF the third year.

Contribution margin 75.758,14 82.298,92 91.668,19 91.392,03 91.392,03

  55,52% 54,56% 55,48% 55,31% 55,31%

5.3 Other costs

We have an initial cost of 36.000 CHF due to a larger publicity cost, reducing during the
period of about 10.000 CHf.

Pubblicity 15.000,00 7.000,00 5.000,00 5.000,00 5.000,00

Policy costs 15.000,00 7.000,00 5.000,00 5.000,00 5.000,00

           

Energy 2.555,00 2.555,00 2.555,00 2.555,00 2.555,00

Rent 883,02 883,02 883,02 883,02 883,02

Manutention 1.120,00 1.120,00 1.120,00 1.120,00 1.120,00

Cleaning 9.000,00 9.000,00 9.000,00 9.000,00 9.000,00

Insurances 2.520,00 2.520,00 2.520,00 2.520,00 2.520,00

Total Fix production
costs 16.078,02 16.078,02 16.078,02 16.078,02 16.078,02
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Overheads expenses 5.500,00 5.500,00 5.500,00 5.500,00 5.500,00

  - - - - -

Total overheads costs 5.500,00 5.500,00 5.500,00 5.500,00 5.500,00

           

TOTAL FIXED COSTS 36.578,02 28.578,02 26.578,02 26.578,02 26.578,02

 Business Plan Around the Clock 2011

5.4 Amortization & depreciations

We will have just amortization calculated on 5 year of life. We do not have credit as our
customer pay cash so we do not forecast any depreciation. Tha amortization cost is
26.200 ChF per year.

5.5 Financial costs

Bank Interests 552,00 467,00 - 143,00 - 402,00 - 660,00

Debt (credits) vs banks 18.392,72 - 2.810,32 - 54.544,09 - 106.104,50 - 157.832,60

We will have a little cost due to a financial current loan in the first year but from the second
year we will have cash disponibility and financial revenues.

5.6 Net earning

We manage to reach a positive result since the first year. When the business will be
steady the net income after taxation will be around 25.000 CHF per year.

Net income – E 8.078,28 17.585,04 25.371,56 25.360,41 25.528,11

Balance sheet – financial area

5.7 Uses of capital

Operative cash need: we estimate to have a need 100 CHF in the 2 changing machines.

Customer credits: we do not have any customer credits, as they pay cash.
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Stock: We estimate to have a vending machine stock of 100 items per vending machine
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with a cost of about 500 CHF ant a back stock of 7 day-revenue for 3.000 CHF.

Investment: the investment is 131.000 CHF reducing of 26.200 CHF due to amortization
each year. The 5th year the net investment will expire.

Our need of capital the end of each year in Bp will be the follow:

Total usues of capital   109.471,03 82.080,82 56.156,99 29.956,99 3.756,99

 Business Plan Around the Clock 2011

5.7 Funding sources

Suppliers: The suppliers will be paid at 60 days on the amount of purchases this mean a
fund source of 14000 CHF. (the first year, due to investment this amount is greater).

Own capital: we put 45.800 CHF ( 35% of investment) as own capital in the society.

We will re-invest in the business all the yearly revenues increasing our own capital tha will
increase till 147.000 CHF the last year.

The missing part of the need of capital is asked to the bank market. We need it just the
first year, than we have a positive cash.

- -
Bank Debts (credits)   18.392,72 - 2.810,32 - 54.544,09 106.104,50 157.832,60

5.8 Breakeven point

The breakeven point is placed at 114.000Chf revenues the first year decreasing at about
95.000 Chf at the thirs year.

                   
  Around the Clock          
  Break-even point calculation          
                   
        2011 2012 2013 2014 2015  
                   
Revenue
  s     136.440 150.840 165.240 165.240 165.240  
                   
  Variable costs   60.682 68.541 73.572 73.848 73.848  
  Fixed costs   37.130 29.045 26.435 26.176 25.918  
  non cash costs   26.200 26.200 26.200 26.200 26.200  
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  K= cv/f     0,44 0,45 0,45 0,45 0,45  
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Breakeven
  point   114.057 101.255 94.879 94.698 94.231  
Shut down
  point   66.871 53.235 47.651 47.327 46.861  
                   
  Contribution   75.758 82.299 91.668 91.392 91.392  
  % contribution   55,52% 54,56% 55,48% 55,31% 55,31%  
                   
                   
 Business Plan Around the Clock 2011

The internal rate of return is based on the unlevered cash flow that is 59,06%. The
payback period is estimated at 2 years (2013).

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