[Company Name]
[Name], [Name] & [Name]
[Address]
[City, State ZIP]
XXX-XXX-XXXX T XXX-XXX-XXXX T
XXX-XXX-XXXX F
[Email] e-mail
BUSINESS PLAN
© Copyright 2012 Docstoc Inc. 1
Confidentiality Agreement
The undersigned reader acknowledges that the information provided by [Company Name] in this
business plan is confidential; therefore, reader agrees not to disclose it without the express written
permission of [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 [Company
Name]
Upon request, this document is to be immediately returned to [Company Name]
___________________
Signature
___________________
Name (typed or printed)
___________________
Date
This is a business plan. It does not imply an offering of securities.
© Copyright 2012 Docstoc Inc. 2
Table of Contents
1.0 Executive Summary .................................................................................................................... 1
Chart: Highlights .......................................................................................................................... 2
1.1 Objectives.................................................................................................................................... 2
1.2 Mission .......................................................................................................................................... 2
1.3 Keys to Success ........................................................................................................................ 3
2.0 Company Summary ..................................................................................................................... 3
2.1 Company Ownership ............................................................................................................... 3
2.2 Start-up Summary ................................................................................................................... 3
Table: Start-up.............................................................................................................................. 4
Chart: Start-up ............................................................................................................................. 4
3.0 Services ............................................................................................................................................ 5
4.0 Market Analysis Summary ........................................................................................................ 5
4.1 Market Segmentation ............................................................................................................. 5
Table: Market Analysis ............................................................................................................... 6
Chart: Market Analysis (Pie) .................................................................................................... 6
4.2 Target Market Segment Strategy ...................................................................................... 7
4.3 Service Business Analysis ..................................................................................................... 7
4.3.1 Competition and Buying Patterns .............................................................................. 7
5.0 Strategy and Implementation Summary ............................................................................ 7
5.1 SWOT Analysis .......................................................................................................................... 7
5.1.1 Strengths ............................................................................................................................. 7
5.1.2 Weaknesses ........................................................................................................................ 7
5.1.3 Opportunities ..................................................................................................................... 8
5.1.4 Threats ................................................................................................................................. 8
5.2 Competitive Edge ..................................................................................................................... 8
5.3 Marketing Strategy .................................................................................................................. 8
5.4 Sales Strategy ........................................................................................................................... 8
5.4.1 Sales Forecast.................................................................................................................... 8
Table: Sales Forecast ............................................................................................................. 9
Chart: Sales Monthly ............................................................................................................ 10
Chart: Sales by Year ............................................................................................................. 10
5.5 Milestones.................................................................................................................................. 11
Table: Milestones ....................................................................................................................... 11
Chart: Milestones ....................................................................................................................... 11
6.0 Management Summary ............................................................................................................ 11
6.1 Personnel Plan ......................................................................................................................... 12
Table: Personnel ......................................................................................................................... 12
7.0 Financial Plan ............................................................................................................................... 12
7.1 Start-up Funding .................................................................................................................... 12
Table: Start-up Funding .......................................................................................................... 13
7.2 Important Assumptions ....................................................................................................... 14
7.3 Break-even Analysis .............................................................................................................. 15
Table: Break-even Analysis.................................................................................................... 15
Chart: Break-even Analysis ................................................................................................... 15
BUSINESS PLAN Page 1
Table of Contents
7.4 Projected Profit and Loss ..................................................................................................... 16
Table: Profit and Loss ............................................................................................................... 16
Chart: Profit Monthly ................................................................................................................ 17
Chart: Profit Yearly .................................................................................................................... 17
Chart: Gross Margin Monthly................................................................................................. 18
Chart: Gross Margin Yearly .................................................................................................... 18
7.5 Projected Cash Flow .............................................................................................................. 19
Table: Cash Flow ........................................................................................................................ 19
Chart: Cash .................................................................................................................................. 20
7.6 Projected Balance Sheet ...................................................................................................... 21
Table: Balance Sheet ................................................................................................................ 21
7.7 Business Ratios ....................................................................................................................... 21
Table: Ratios ................................................................................................................................ 22
Table: Sales Forecast ......................................................................................................................... 2
Table: Personnel ................................................................................................................................... 3
Table: Profit and Loss ......................................................................................................................... 4
Table: Cash Flow .................................................................................................................................. 5
Table: Balance Sheet .......................................................................................................................... 6
BUSINESS PLAN Page 2
[Company Name]
1.0 Executive Summary
[Company Name] is a start-up company that will provide legal representation to homeowners who are
in default on their owner occupied mortgages. [Company Name] plans to utilize grant funding to
subsidize the legal fees involved in staying foreclosure. By nature, America is a litigious society, and
while everyone has the same legal rights, attorneys are generally required for someone to
enforce/assert their rights. The current real estate debacle has changed many rules pertaining to the
foreclosure process, in favor of the homeowner. [Company Name] will utilize its legal expertise to
helps these homeowners keep there homes.
These legal strategies will be offered to homeowners at a reasonable rate. Those that are unable to
pay will still receive the same service. This is where grant funding will intervene. [Company Name] will
use an initial grant of $600,000 to cover the legal costs for this service. First time homebuyers will also
be on the agenda of [Company Name]. Outside investors will team up with [Company Name] to assist
the First Time homebuyer or those who have been displaced through foreclosure, to receive a new
mortgage.
BUSINESS PLAN Page 1
[Company Name]
Chart: Highlights
1.1 Objectives
The objectives for the first three years of operation include:
1. To create a service-based organization whose primary goal is to exceed 150 successful cases
2. To serve the Nevada, Southern California, Arizona and Utah communities with foreclosure legal
representation without demanding a fee
3. To increase and continue to receive donations every year
1.2 Mission
[Company Name] offers high-quality foreclosure prevention services to residential customers. Our aim
is to provide our customers with fair mortgage rates at reasonable prices, after the legal process has
been resolved. We will become friends and mentors to our customers as well as quality service
providers. We exist to attract and maintain pre-foreclosure, first time homebuyers or previously
displaced homeowners. When we adhere to these maxims, everything else will fall into place. Our
services will exceed the expectations of our customers.
BUSINESS PLAN Page 2
[Company Name]
1.3 Keys to Success
Keys to success for the company will include:
1. Maintaining a reputable and untarnished reputation in the community
2. Quality legal advice and performance
3. Reasonable interest rate pricing on the new mortgages
2.0 Company Summary
[Company Name] is a new company that provides a high level of expertise. We will provide
superior legal service to homeowners. Our responsibility as foreclosure prevention professionals is to
determine what a customer's financial abilities are, not just to obtain a new rate to make a profit. We
have access to specific legal, real estate, and financial knowledge, allowing us to arrange the most
beneficial solution... whatever the homeowner's needs may be.
2.1 Company Ownership
The company, [Company Name] is a c-corporation that is co-owned by [Name] a real estate
professional, [Name] an attorney and [Name] a financial consultant and loan modification specialist.
2.2 Start-up Summary
The start-up costs are outlined in the following chart. Start-up costs derive from office, equipment,
computer station complete with software, office advertising and services, and expenses associated
with opening our location. The start-up costs will be financed by grant funding. The assumptions are
shown in the following table and chart.
BUSINESS PLAN Page 3
[Company Name]
Table: Start-up
Start-up
Requirements
Start-up Expenses
Legal $0
Stationery etc. $0
Insurance $0
Rent $7,200
Computer $12,000
Other $13,000
Total Start-up Expenses $32,200
Start-up Assets
Cash Required $514,500
Other Current Assets $0
Long-term Assets $0
Total Assets $514,500
Total Requirements $546,700
Chart: Start-up
BUSINESS PLAN Page 4
[Company Name]
3.0 Services
Our personal goal is to break through the barriers that impede homeownership through foreclose for
those who just wish to realize the American Dream. We provide potential and current homeowners the
opportunity to negotiate the best mortgage loan for their current needs.
We also will match first time homebuyers and post foreclosure 'victims' to investors who purchase
homes from foreclosure bank REO departments. Once an affordable rate is determined and a set
purchase price agreed upon the home is resold sold to our client. Based on what the investor was able
to pay, the client would be offered a price that is 50% of the fair market value, for example, thus
instant equity is transferred to the buyer.
4.0 Market Analysis Summary
[Company Name] will provide foreclosure legal services to people who do not qualify for other types
of mortgage rate reduction or re-modification because 1) they do not fit the economic profile, 2) the
other organizations did not have the time, resources, or do not specialize in this particular legal
technique.
Our other segment will be 1st home buyers who are looking to purchase an owner occupied residence.
In addition, those who have lost their homes through hardship, i.e. foreclosure or short sale would be
our prime targets.
4.1 Market Segmentation
[Company Name]'s market can be segmented into two different segments:
People who do not qualify for other mortgage programs from the government, for economic reasons,
but qualify for us: Pre-Foreclosure
People who have been foreclosed and lost their home or those who desire to purchase a new home
for the first time: Post-Foreclosure and 1st Time Homebuyers
BUSINESS PLAN Page 5
[Company Name]
Table: Market Analysis
Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential Growth CAGR
Customers
Pre-Foreclosure 5% 520,900 546,945 574,292 603,007 633,157 5.00%
Post-Foreclosure 5% 1,500,000 1,575,000 1,653,750 1,736,438 1,823,260 5.00%
1st Time 10% 400,000 440,000 484,000 532,400 585,640 10.00%
Homebuyers
Total 5.88% 2,420,900 2,561,945 2,712,042 2,871,845 3,042,057 5.88%
Chart: Market Analysis (Pie)
BUSINESS PLAN Page 6
[Company Name]
4.2 Target Market Segment Strategy
[Company Name] will target the different segments through its developed relationships. As a realtor,
[Name] has consistent access to notice of default (NOD) or pre-foreclosure homeowner lists. By
developing a relationship with these homeowners, [Company Name] will obtain new clients when they
are unable to be served by their current lender.
[Company Name] will also target new clients by developing awareness of the company through the
various advertising medium, postcards and radios ads for example. As long as these avenues are
explored thoroughly and potential clients become increasingly aware of [Company Name]s’ unique
services, then it will not be difficult to continuously get new clients.
4.3 Service Business Analysis
As mentioned above the unique nature of the actual service along with grant subsidies allows
[Company Name] to be the leading advocate in this market. The alternative firms in this market are
loan modification companies. These companies only work with the current lender to assist
homeowners. Thus, the results are often unsuccessful or the service is never rendered because the
homeowner cannot afford the initial fees.
4.3.1 Competition and Buying Patterns
There are no direct competitors to [Company Name] The service it provides is unprecedented in the
general foreclosure prevention market, and the inability to pay the legal fees is a non-factor. Most of
the potential clients will not be in a position to choose between loan modification companies and
[Company Name] because continued financial hardship and possible foreclosure are at risk. The 1st
time homebuyer program will have competitors, but the company firmly believes it will deliver the best
possible terms on the most consistent basis.
5.0 Strategy and Implementation Summary
[Company Name] will focus on the pre-foreclosure needs in the Southern California, Nevada, Arizona
and Utah regions. For the purchase program the target customer will be first-time home buyers or
those who have had existing refinancing failures.
5.1 SWOT Analysis
The following SWOT analysis captures the key strengths and weaknesses within the company, and
describes the opportunities and threats facing [Company Name]
5.1.1 Strengths
Strong relationships with investors that offer credit arrangements, flexibility, and response to the
built-in equity requirement
Excellent and stable staff, offering personalized customer service
Good referral relationships with complementary financial advisors, local realtors, and banks
5.1.2 Weaknesses
Access to additional operating capital and grant funds
BUSINESS PLAN Page 7
[Company Name]
5.1.3 Opportunities
A growing market with most of our target market still not knowing we exist
Strategic alliances offering sources for referrals and joint marketing activities to extend our reach
Increasing opportunities beyond the "100-mile" target area through Internet and radio advertising
5.1.4 Threats
Homeowners still climbing the "mortgage experience curve" and thus, may be reluctant to
seek/accept help
5.2 Competitive Edge
[Company Name] will sustain its competitive edge by allowing less fortunate homeowners to receive
the full service without paying the initial fee up-front. Additionally, the company will guide them
through the entire process while making sure their home is safe. The company will actually take title of
the property for the homeowner. No other agency or advocacy has a foreclosure prevention program
so well geared to home retention.
5.3 Marketing Strategy
Traditional marketing techniques for foreclosure assistance are becoming ineffective, due to the horror
stories and eventual outcomes of many homeowners; loss of ownership. Building trusting relationships
with the community is a crucial first step in reducing anxiety in the foreclosure prevention and 1st time
home-buying processes. [Company Name] will build relationships that will lead to referrals and
business success.
5.4 Sales Strategy
The sales forecast summary is included in the appendix. The annual sales projections are included here
in Table 5.4.1
5.4.1 Sales Forecast
As the following table shows, the company plans to deliver sales of approximately $735,000 from just
over 100 clients, in the first year, ~$1.0MM from 160 clients in the second year, and around $1.5MM
from 230 clients in the third year of plan implementation.
BUSINESS PLAN Page 8
[Company Name]
Table: Sales Forecast
Sales Forecast
Year 1 Year 2 Year 3
Unit Sales
Pre-Foreclosure Clients 75 100 150
Post-Foreclosure Clients 17 30 40
1st Time Homebuyers 17 30 40
Total Unit Sales 108 160 230
Unit Prices Year 1 Year 2 Year 3
Pre-Foreclosure Clients $7,500.00 $7,500.00 $7,500.00
Post-Foreclosure Clients $5,225.88 $5,225.88 $5,225.88
1st Time Homebuyers $5,225.88 $5,225.88 $5,225.88
Sales
Pre-Foreclosure Clients $562,500 $750,000 $1,125,000
Post-Foreclosure Clients $87,098 $156,776 $209,035
1st Time Homebuyers $87,098 $156,776 $209,035
Total Sales $736,696 $1,063,553 $1,543,070
Direct Unit Costs Year 1 Year 2 Year 3
Pre-Foreclosure Clients $0.00 $0.00 $0.00
Post-Foreclosure Clients $0.00 $0.00 $0.00
1st Time Homebuyers $0.00 $0.00 $0.00
Direct Cost of Sales
Pre-Foreclosure Clients $0 $0 $0
Post-Foreclosure Clients $0 $0 $0
1st Time Homebuyers $0 $0 $0
Subtotal Direct Cost of Sales $0 $0 $0
BUSINESS PLAN Page 9
[Company Name]
Chart: Sales Monthly
Chart: Sales by Year
BUSINESS PLAN Page 10
[Company Name]
5.5 Milestones
Our detailed milestones are shown in the following table and chart. The related budgets are included
with the expenses shown in the projected Profit and Loss statement, which is in the financial analysis
that comes in Chapter 7 of this plan.
Table: Milestones
Milestones
Milestone Start Date End Date Budget Manager Department
Receive Grant Funding 12/1/2010 12/1/2010 $600,000
Begin Marketing Plan 12/1/2010 11/1/2011 ($15,000)
First 20 Clients 12/1/2010 3/1/2011 ($150,000)
First 50 Clients 12/1/2010 5/1/2011 ($225,000)
Totals $210,000
Chart: Milestones
6.0 Management Summary
The initial management team depends on the founders themselves, with little back-up. As we initiate
start-up, we will take on additional help; an office assistant and a paralegal.
BUSINESS PLAN Page 11
[Company Name]
6.1 Personnel Plan
The detailed monthly personnel plan for the next three years is included in the chart below. The annual
personnel estimates are included here also. Note: in order to assist in the gradual increase in
operating capital in year 1, employees will initially be paid out of the grant funding.
Table: Personnel
Personnel Plan
Year 1 Year 2 Year 3
Paralegal $23,333 $40,000 $40,000
Office Assistant $14,583 $25,000 $25,000
Total People 2 2 2
Total Payroll $37,917 $65,000 $65,000
7.0 Financial Plan
Our financial plan is based on conservative estimates and assumptions. We will need to plan on an
initial grant investment to make the financials work.
7.1 Start-up Funding
[Company Name] start-up costs are detailed below, in the Start-up Table. The following table shows
how these start-up costs will be funded; by grant capital.
BUSINESS PLAN Page 12
[Company Name]
BUSINESS PLAN Page 13
[Company Name]
Table: Start-up Funding
Start-up Funding
Start-up Expenses to Fund $32,200
Start-up Assets to Fund $514,500
Total Funding Required $546,700
Assets
Non-cash Assets from Start-up $0
Cash Requirements from Start-up $514,500
Additional Cash Raised $53,300
Cash Balance on Starting Date $567,800
Total Assets $567,800
Liabilities and Capital
Liabilities
Current Borrowing $0
Long-term Liabilities $0
Other Current Liabilities (interest-free) $0
Total Liabilities $0
Capital
Planned Investment
Owner $0
Investor $600,000
Additional Investment Requirement $0
Total Planned Investment $600,000
Loss at Start-up (Start-up Expenses) ($32,200)
Total Capital $567,800
Total Capital and Liabilities $567,800
Total Funding $600,000
7.2 Important Assumptions
We are assuming steady growth from good management, barring any unforeseen local, or national
disasters such as the economic recovery reversal
We are also assuming adequate grant funding to sustain us during start-up
BUSINESS PLAN Page 14
[Company Name]
7.3 Break-even Analysis
The Break-even Analysis is based on the average of the first-year figures for total sales and by
operating expenses. These conservative assumptions make for a more accurate estimate of real risk.
Table: Break-even Analysis
Break-even Analysis
Monthly Units Break-even 1
Monthly Revenue Break-even $6,109
Assumptions:
Average Per-Unit Revenue $6,821.26
Average Per-Unit Variable Cost $0.00
Estimated Monthly Fixed Cost $6,109
Chart: Break-even Analysis
BUSINESS PLAN Page 15
[Company Name]
7.4 Projected Profit and Loss
As the Profit and Loss table shows, the company expects to continue its sustained growth in
profitability over the next three years of operations.
Table: Profit and Loss
Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $736,696 $1,063,553 $1,543,070
Direct Cost of Sales $0 $0 $0
Other Costs of Sales $0 $0 $0
Total Cost of Sales $0 $0 $0
Gross Margin $736,696 $1,063,553 $1,543,070
Gross Margin % 100.00% 100.00% 100.00%
Expenses
Payroll $37,917 $65,000 $65,000
Marketing/Promotion $15,000 $15,000 $15,000
Depreciation $0 $0 $0
Rent $4,700 $4,700 $4,700
Utilities $0 $3,000 $3,000
Insurance $0 $0 $0
Payroll Taxes $5,688 $9,750 $9,750
Other $10,000 $10,000 $10,000
Total Operating Expenses $73,304 $107,450 $107,450
Profit Before Interest and Taxes $663,392 $956,103 $1,435,620
EBITDA $663,392 $956,103 $1,435,620
Interest Expense $0 $0 $0
Taxes Incurred $199,018 $286,831 $430,686
Net Profit $464,374 $669,272 $1,004,934
Net Profit/Sales 63.03% 62.93% 65.13%
BUSINESS PLAN Page 16
[Company Name]
Chart: Profit Monthly
Chart: Profit Yearly
BUSINESS PLAN Page 17
[Company Name]
Chart: Gross Margin Monthly
Chart: Gross Margin Yearly
BUSINESS PLAN Page 18
[Company Name]
7.5 Projected Cash Flow
The cash flow projection shows that provisions for ongoing expenses are adequate to meet the needs
of the company as the business generates sufficient cash flow to support operations.
Table: Cash Flow
Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $736,696 $1,063,553 $1,543,070
Subtotal Cash from Operations $736,696 $1,063,553 $1,543,070
Additional Cash Received
Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0
New Long-term Liabilities $0 $0 $0
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 $736,696 $1,063,553 $1,543,070
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $272,322 $394,281 $538,136
Subtotal Spent on Operations $272,322 $394,281 $538,136
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $0 $0 $0
Purchase Other Current Assets $236,583 $750,000 $1,125,000
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $508,905 $1,144,281 $1,663,136
Net Cash Flow $227,791 ($80,728) ($120,066)
Cash Balance $795,591 $714,863 $594,797
BUSINESS PLAN Page 19
[Company Name]
Chart: Cash
BUSINESS PLAN Page 20
[Company Name]
7.6 Projected Balance Sheet
The following table presents the Balance Sheet for [Company Name]
Table: Balance Sheet
Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $795,591 $714,863 $594,797
Other Current Assets $236,583 $986,583 $2,111,583
Total Current Assets $1,032,174 $1,701,446 $2,706,381
Long-term Assets
Long-term Assets $0 $0 $0
Accumulated Depreciation $0 $0 $0
Total Long-term Assets $0 $0 $0
Total Assets $1,032,174 $1,701,446 $2,706,381
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
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 $600,000 $600,000 $600,000
Retained Earnings ($32,200) $432,174 $1,101,446
Earnings $464,374 $669,272 $1,004,934
Total Capital $1,032,174 $1,701,446 $2,706,381
Total Liabilities and Capital $1,032,174 $1,701,446 $2,706,381
Net Worth $1,032,174 $1,701,446 $2,706,381
7.7 Business Ratios
The following table shows the projected business ratios. We expect to maintain healthy ratios for
profitability, risk, and return. The industry comparisons are for NAICS 541199, all other legal services.
BUSINESS PLAN Page 21
[Company Name]
Table: Ratios
Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth n/a. 44.37% 45.09% 13.07%
Percent of Total Assets
Other Current Assets 22.92% 57.98% 78.02% 53.58%
Total Current Assets 100.00% 100.00% 100.00% 70.11%
Long-term Assets 0.00% 0.00% 0.00% 29.89%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 0.00% 0.00% 0.00% 37.94%
Long-term Liabilities 0.00% 0.00% 0.00% 54.53%
Total Liabilities 0.00% 0.00% 0.00% 92.47%
Net Worth 100.00% 100.00% 100.00% 7.53%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 100.00% 100.00% 100.00% 59.56%
Selling, General & Administrative Expenses 36.97% 37.07% 34.87% 28.35%
Advertising Expenses 2.04% 1.41% 0.97% 1.21%
Profit Before Interest and Taxes 90.05% 89.90% 93.04% 8.19%
Main Ratios
Current 0.00 0.00 0.00 1.24
Quick 0.00 0.00 0.00 1.18
Total Debt to Total Assets 0.00% 0.00% 0.00% 92.47%
Pre-tax Return on Net Worth 64.27% 56.19% 53.05% 696.33%
Pre-tax Return on Assets 64.27% 56.19% 53.05% 52.41%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin 63.03% 62.93% 65.13% n/a
Return on Equity 44.99% 39.34% 37.13% n/a
Activity Ratios
Accounts Payable Turnover 8.98 12.17 12.17 n/a
Total Asset Turnover 0.71 0.63 0.57 n/a
Debt Ratios
Debt to Net Worth 0.00 0.00 0.00 n/a
Current Liabilities to Liabilities 0.00 0.00 0.00 n/a
Liquidity Ratios
Net Working Capital $1,032,174 $1,701,446 $2,706,381 n/a
Interest Coverage 0.00 0.00 0.00 n/a
Additional Ratios
Assets to Sales 1.40 1.60 1.75 n/a
Current Debt/Total Assets 0% 0% 0% n/a
Acid Test 0.00 0.00 0.00 n/a
Sales/Net Worth 0.71 0.63 0.57 n/a
Dividend Payout 0.00 0.00 0.00 n/a
BUSINESS PLAN Page 22
Appendix
Table: Sales Forecast
Sales Forecast
Year 1 Year 2 Year 3
Unit Sales
Pre-Foreclosure Clients 75 100 150
Post-Foreclosure Clients 17 30 40
1st Time Homebuyers 17 30 40
Total Unit Sales 108 160 230
Unit Prices Year 1 Year 2 Year 3
Pre-Foreclosure Clients $7,500.00 $7,500.00 $7,500.00
Post-Foreclosure Clients $5,225.88 $5,225.88 $5,225.88
1st Time Homebuyers $5,225.88 $5,225.88 $5,225.88
Sales
Pre-Foreclosure Clients $562,500 $750,000 $1,125,000
Post-Foreclosure Clients $87,098 $156,776 $209,035
1st Time Homebuyers $87,098 $156,776 $209,035
Total Sales $736,696 $1,063,553 $1,543,070
Direct Unit Costs Year 1 Year 2 Year 3
Pre-Foreclosure Clients $0.00 $0.00 $0.00
Post-Foreclosure Clients $0.00 $0.00 $0.00
1st Time Homebuyers $0.00 $0.00 $0.00
Direct Cost of Sales
Pre-Foreclosure Clients $0 $0 $0
Post-Foreclosure Clients $0 $0 $0
1st Time Homebuyers $0 $0 $0
Subtotal Direct Cost of Sales $0 $0 $0
BUSINESS PLAN
Appendix
Table: Personnel
Personnel Plan
Year 1 Year 2 Year 3
Paralegal $23,333 $40,000 $40,000
Office Assistant $14,583 $25,000 $25,000
Total People 2 2 2
Total Payroll $37,917 $65,000 $65,000
BUSINESS PLAN
Appendix
Table: Profit and Loss
Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $736,696 $1,063,553 $1,543,070
Direct Cost of Sales $0 $0 $0
Other Costs of Sales $0 $0 $0
Total Cost of Sales $0 $0 $0
Gross Margin $736,696 $1,063,553 $1,543,070
Gross Margin % 100.00% 100.00% 100.00%
Expenses
Payroll $37,917 $65,000 $65,000
Marketing/Promotion $15,000 $15,000 $15,000
Depreciation $0 $0 $0
Rent $4,700 $4,700 $4,700
Utilities $0 $3,000 $3,000
Insurance $0 $0 $0
Payroll Taxes $5,688 $9,750 $9,750
Other $10,000 $10,000 $10,000
Total Operating Expenses $73,304 $107,450 $107,450
Profit Before Interest and Taxes $663,392 $956,103 $1,435,620
EBITDA $663,392 $956,103 $1,435,620
Interest Expense $0 $0 $0
Taxes Incurred $199,018 $286,831 $430,686
Net Profit $464,374 $669,272 $1,004,934
Net Profit/Sales 63.03% 62.93% 65.13%
BUSINESS PLAN
Appendix
Table: Cash Flow
Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $736,696 $1,063,553 $1,543,070
Subtotal Cash from Operations $736,696 $1,063,553 $1,543,070
Additional Cash Received
Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0
New Long-term Liabilities $0 $0 $0
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 $736,696 $1,063,553 $1,543,070
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $272,322 $394,281 $538,136
Subtotal Spent on Operations $272,322 $394,281 $538,136
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $0 $0 $0
Purchase Other Current Assets $236,583 $750,000 $1,125,000
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $508,905 $1,144,281 $1,663,136
Net Cash Flow $227,791 ($80,728) ($120,066)
Cash Balance $795,591 $714,863 $594,797
BUSINESS PLAN
Appendix
Table: Balance Sheet
Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $795,591 $714,863 $594,797
Other Current Assets $236,583 $986,583 $2,111,583
Total Current Assets $1,032,174 $1,701,446 $2,706,381
Long-term Assets
Long-term Assets $0 $0 $0
Accumulated Depreciation $0 $0 $0
Total Long-term Assets $0 $0 $0
Total Assets $1,032,174 $1,701,446 $2,706,381
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
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 $600,000 $600,000 $600,000
Retained Earnings ($32,200) $432,174 $1,101,446
Earnings $464,374 $669,272 $1,004,934
Total Capital $1,032,174 $1,701,446 $2,706,381
Total Liabilities and Capital $1,032,174 $1,701,446 $2,706,381
Net Worth $1,032,174 $1,701,446 $2,706,381
BUSINESS PLAN