Page 61 - Business Plans that Work A Guide for Small Business

52 • Business Plans that Work

companies in the $12 million to $50 million range, as well as his two engineering
degrees from Brown and Caltech infuse much needed experience and energy to
the company’s founders at this critical growth stage.

Financial Snapshot: Five-Year Income Statement
Year 1 Year 2 Year 3 Year 4 Year 5
Revenue
Total Number of
owned Stores 8 8 8 8 8
Total Number of
franchises 0 5 15 35 60
Owned Store
Contribution $2,033,177 $2,971,381 $4,089,183 $5,225,870 $6,125,353
Franchise
Contribution $0 $206,905 $485,348 $1,100,699 $1,767,146
Total Revenue $2,033,177 $3,178,286 $4,574,531 $6,326,569 $7,891,599
Total COGS* $872,835 $1,309,072 $1,296,739 $1,585,962 $1,747,125
Gross Profit $1,160,342 $1,869,213 $3,277,792 $4,740,607 $6,144,474
Gross Profit % 57% 59% 72% 75% 78%
Expenses
Owned Store
SG&A** $1,358,133 $1,371,987 $1,469,757 $1,558,780 $1,624,546
Corporate SG&A $328,314 $344,730 $664,870 $728,201 $976,651
Taxes and Interest
Expenses $70,876 $143,164 $521,722 $1,027,290 $1,432,920
Total Expenses $1,757,323 $1,859,881 $2,656,350 $3,314,272 $4,034,117
Net Ordinary
Income −$596,981 $95,333 $621,466 $1,426,336 $2,110,357
Net Profit Margin −29% 0% 14% 23% 26%
* COGS = cost of goods sold
** SG&A = selling, general and administrative expenses

This abbreviated
income statement gives a
sense of the five-year plan
and potential for Lazybones.
However, the executive
summary seems to be miss-
ing a discussion of how the
team plans to finance the
$600,000 loss in year 1. Will
this come from current
cash flow or do they need
outside investment?