bridal shop

8/3/2019 Bridal Shop

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FANTASY BRIDAL BOUTIQUES

Executive Summary

Moms, Maids, and More is a wedding attire shop like no other. While most retail bridal shopsfocus on selling wedding gowns, our focus is everything else. We will cater to the mothers of thebride and groom, bridesmaids. In addition, we will provide an array of accessories for all thefemale members of the bridal party.

Moms, Maids, and More is registered as a single-member, incorporated in Bhubaneswar state,and the sole owner is Florence Sahoo. The purpose this business plan is to secure start-upfinancing. We project that the company will reach the break-even point in its fourth month of

operations.

The projections outlined within this business plan indicate sufficient funds for repayment of therequested loan.

1.1 Objectives

Moms, Maids, and More has the following objectives:

0

5000000

10000000

15000000

20000000

25000000

30000000

35000000

year 1 year 2 year 3

sales

gross profit

net profit


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1. To be the primary one-stop-shop for the female members of a bridal party once the bridehas purchased her gown (i.e. mother of the bride, mother of the groom, bridesmaids,relatives, footwear, and accessories).

2. To have vigorous sales in the first twelve months of operations.3. In Year 3, to have sales more than double first year level and net income of at least 10%

of sales.

1.2 Mission

Moms, Maids, and More is a boutique that provides attire and accessories for female bridalattendants. We believe in providing superior customer service and creating a shoppingexperience that is relaxed and pleasurable. We also believe in providing a working environmentfor our employees that is professional and fun, and that empowers our employees to betrustworthy and valuable resources to our customers.

1.3 Keys to Success

To be successful in this business, Moms, Maids, and More must:

1. Generate and preserve a reputation of being the one-stop-shop for bridalpurchases beyond the wedding gown.

2. Establish a strong referral network among others in the bridal industry.3. Provide better customer service.4. Maintain a fresh mix of inventory.Company Summary

Moms, Maids, and More is a new retail boutique that will be a unique supplement to theexisting bridal shops in the best area. While most bridal shops focus on providing thebride with her wedding dress, the focus of Moms, Maids, and More is everything besidesthe wedding dress. Our core products include mother-of-the-bride and mother-of-the-groom attire, bridesmaids' attire, bridal footwear, and bridal accessories, such asheadpieces, and jewelry. Our goal is to be the one-stop-shop for items beyond thewedding dress, and to provide a fulfilling shopping experience for our customers.

2.1 Company Ownership

Moms, Maids, and More is a privately held company. It is registered in Bhubaneswar as asingle-member with Florence Sahoo as the owner.


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2.2 Start-up Summary

Total start-up cost estimates are shown in the following table and charts. The mostsignificant components of the start up costs are inventory (30%), cash-on-hand (23%),and expensed equipment and leasehold improvements (19%).

The start-up costs will be financed through a combination of owner investment and long-term loans.

START-UP REQUIREMENTS

Start-up Expenses

Legal 48000

Stationery 38400

Other Supplies 55200

Consultants 72000

Insurance 48000

Rent 422400

Leasehold Improvements(Expensed)

480,000

Expensed Equipment 384000

Other 192000

Total Start-up Expenses 1740000

0

500000

1000000

1500000

2000000

2500000

3000000

3500000

expenses assets investment loans

AxisT

itle

Axis Title

Chart Title


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Start-up Assets

Cash Required 1051200

Start-up Inventory 1360800

Other Current Assets 48000

Long-term Assets 40800

Total Assets 2868000

Total Requirements 4608000

Start-up Funding

Start-up Expenses to Fund 1740000

Start-up Assets to Fund 2868000

Total Funding Required 4608000

Assets

Non-cash Assets from Start-up

1816800

Cash Requirements fromStart-up

1051200

Additional Cash Raised 0

Cash Balance on StartingDate

1051200

Total Assets 2868000

Liabilities and Capital

Liabilities

Current Borrowing 0

Long-term Liabilities 3120000

Accounts Payable(Outstanding Bills)

48000

Other Current Liabilities(interest-free)

0

Total Liabilities 3168000

CapitalPlanned Investment

Florence Sahoo 1440000

Other 0

Additional InvestmentRequirement

0


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Total Planned Investment 1440000

Loss at Start-up (Start-upExpenses)

(1740000)

Total Capital (300000)

Total Capital and Liabilities 2868000Total Funding 4608000

Products

Moms, Maids, and More will carry mother-of-the-bride, mother-of-the-groom, bridesmaid. Inaddition, we will carry bridal footwear and bridal accessories such as and jewelry. We will aimto provide products in a wide variety of styles and price-ranges that are of good quality and fromreputable designers.

The dresses will be sold primarily on a made-to-order basis. We will keep a sample dress of eachstyle in the store for customers to try on, and once they decide on a style, we will then order it intheir size and in the color of their choosing. If, however, a customer is pleased with the floorsample, they will have the option to purchase that item.

When a dress is being made-to-order, a fifty percent, non-refundable deposit will berequired. Once the dress arrives, the deposit will be applied toward the balance. Full paymentwill be due before the customer can take the dress from the store. Shoes and jewelry willprimarily be sold off the floor.

Most designers set "minimums," which means that they require the purchase of a certain number

of sample dresses in any given season. Some designers require that all samples be purchased atonce, while other designers allow the purchase of samples to be staggered throughout theseason. The buying pattern for Moms, Maids, and More will be a function of designerrequirements as well as customer demand for new products.

Market Analysis Summary

What is unique about Moms, Maids, and More is that it places a spotlight on the weddingpurchases that are typically overshadowed by the purchase of the wedding dress. Wedding dress,on average, comprise about 6.1% of the total wedding expenditures, while the mothers' attire,attendants' attire, and accessories collectively make up another 7.8% of the total weddingexpenditures. Moms, Maids, and More is focusing on the 7.8% that is usually an afterthought formost bridal shops.

Moms, Maids, and More is a store like no other. It creates a shopping environment in whichmothers, bridesmaids, and flower girls, as well as the bride, are catered to.


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4.1 Market Segmentation

There are three major market segments that will be served by Moms, Maids, and More: mother-

of-the-bride/mother-of-the-groom; attendants, which includes bridesmaids and brides. It isimportant to keep in mind that most customers who are shopping for bridal attire are in it for theexperience just as much as the are in it to walk away with a purchase. That means that catering totheir desire for "fun" and "pampering" will be just as critical as providing them with desirablemerchandise.

For almost every bride in King County, there will be at least two mothers who will need to beoutfitted for the big day. For many mothers, especially the mother-of-the-bride, the weddingof her child is second only in significance to her own wedding. As a result, the style of the gowntends to take precedence over price. These customers will want a unique shopping experiencethat will acknowledge their significance in the upcoming wedding.

The most common number of bridesmaids, including the maid-of-honor, is four. Becausebridesmaids are typically expected to pay for their own attire, they tend to be fairly cost-conscious. If they believe that they will be able to use the dress more than once, then pricebecomes less of an issue. The bride usually has the final say in which dress will be chosen, whichcreates an interesting dynamic. On the one hand, the bride's tastes need to be accommodated, andon the other hand, the bridesmaids need to feel comfortable with the amount they are spending.Bridesmaid parties often shop as a group so that they can decide on a dress together. For groupsof three or more, appointments will be recommended to ensure that proper attention and dressingroom space is provided.

The bridesmaids' attire, the bride usually makes the decision about the style of the dress, but theparent of the flower girl usually pays for it.

In addition to helping outfit the bridal party, Moms, Maids, and More will aim to accommodatebrides who are still in need of the other critical pieces to go with her gown, such as shoes andjewelry. While some brides purchase the "other items" at the time that they purchase their dress,most brides choose to shop around for the accessories.

4.2 Target Market Segment Strategy

The focus of Moms, Maids, and More is "everything but the wedding dress." There are nearly 20

bridal shops in this area that focus primarily on selling wedding dress. However, for every bride,there are, on average, at least five other females who need to be outfitted, and the bride herselfwill also require additional accessories.

Because most bridal shops focus on selling wedding dress, there is minimal effort dedicated tothe other necessary items. Moms, Maids, and More gives the "other items" their ownsignificance. Without the bridal gown as a distraction, the "other items" will no longer be an


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afterthought. Mothers and bridal attendants can have their own unique shopping experience, andbrides can have a fresh environment in which to shop for their accessories.

4.3 Industry Analysis

There are thousands of bridal shops nation-wide. Most of them are locally-owned, single-unitoperations, however, there are increasing numbers of chains entering the marketplace. Theprimary focus of all bridal shops is the wedding dresses. Some shops will also carry a limitedselection of mothers' dresses, attendants' attire, and accessories, but their main goal is to sellwedding dresses. As a result, the market currently lacks a place to find a good selection of theother necessary items.

4.3.1 Competition and Buying Patterns

There are currently about 20 bridal shops in this region. However, the primary focus of all ofthose shops is wedding dresses, so they have a very limited selection of mothers' attire,

attendants' attire, bridal footwear, and other bridal accessories.

Establishing a reputation for having a good selection and providing superior customer servicewill be key. Statistics show that brides will visit, on average, a total of six stores beforepurchasing their wedding gown. The "shop around before you buy" mentality may apply to theother members of the bridal party, as well, so it will be critical to provide a unique selection ofitems in a memorable environment. It will also be important to have a wide selection of items, sothat the customers feel fulfilled with what they've seen at our store and won't feel the need toshop around.

As previously mentioned, bridesmaids tend to be more cost-conscious, so competitive pricing

will be key for that segment. We will offer a wide variety of styles at different price points -again, working to assure the members of the bridal party that they are being presented with acomprehensive selection, thus reducing the need to shop around.

Strategy and Implementation Summary

Moms, Maids, and More has the distinct advantage of being the only store of its kind in itsmarket.

our wide-range of clothing styles, designers, and accessories the attention we pay to all the female members of the wedding party our wonderful location in a destination shopping area

Our marketing strategy begins with standard print and online listings in wedding media, andcontinues through networks of wedding consultants. Our location, next to complementary shopsand an upscale mall, will generate additional foot traffic.

Our sales strategy is designed to "close the deal" - from the moment a potential customer walksin the door, she will know that her place in the wedding, and her needs, are important to us. We


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will create an atmosphere that makes shopping for the "other items" as significant as theexperience of shopping for the wedding dress. In other stores, mothers, bridesmaids, and otherwedding party members are often an afterthought. At Moms, Maids, and More, they will begiven as much prominence and attention as the bride receives when dress shopping.

5.1 Competitive Edge

The predominant competitive edge of Moms, Maids, and More is that it is the only store of itskind in Bhubaneswar. Most bridal shops focus on the wedding dress itself and focus in a fewother product-lines, such as mothers' attire or bridesmaids' attire. When shops focus primarily onthe bride's dresses, there tends to be a lack of selection and lack of attention devoted to the otherproduct lines. At a traditional bridal shop, the bride is the primary focus, and everything else issecondary.

Moms, Maids, and More offers an entirely different shopping experience. At our shop, the focusis everything besides the wedding dress. This means that our customers will be offered a wide

selection of their desired attire, and their needs will be our primary focus. We will have the mostcomprehensive selection of mothers' attire, attendants' attire, and bridal accessories.

Another competitive advantage is our location. We are located in the heart of the city whichis geographically convenient to customers. In addition, our shop is located on the corner of amain intersection with great street visibility and free parking. We are located in a complex thatincludes jewelry stores all of which are complementary businesses.

5.2 Marketing Strategy

Moms, Maids, and More will use the following mediums for its marketing efforts:

1. Local Wedding Publications - This includes magazines that are used to promotewedding shows and local wedding resource books.

2. Bridal Consultants - By building relationships with local bridal consultants, we willhave a direct referral source.

3. TheKnot.com - This is a web site specifically geared toward people who are preparingfor a wedding. Visitors to this site can do state-specific searches for shops and services intheir area. By listing ourselves on this site, we will be specifically targeting our market.

4. Web Links - Most designers offer a "store locator" on their web pages. Therefore, whenavailable, we will be listed on the web sites of the designers whose lines we carry, with alink to our web site.

5. Yellow Pages - We will be listed under the "bridal" section of the yellow pages, so thiswill serve as a standard resource for customers to find us.5.3 Sales Strategy

1. Customers need to be acknowledged and attended to right away. Everyone who walksthrough the door is preparing for a big event. They are probably not in our shop to browseor make a casual purchase, so they need to be taken seriously immediately.


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2. Our expertise will help customers stay focused. The process of choosing bridal attire canbe overwhelming, because it is such a significant purchase, and because there are somany variables (e.g. colors, event setting, coordinating with the other participants, etc.).

Therefore, it will be critical to navigate the customer through the process efficiently. Bycontrolling the process, the outcome (the sale) is more attainable.

3. In addition to selling goods, we are selling a shopping experience. Because each womanmakes wedding purchases only a few times in her life, the process of shopping for bridalattire is quite memorable, and is often a bonding experience for moms, girl friends, andthe bride. If the experience is a positive one, word of mouth will grow exponentially.

4. Sales goals will be set for our employees, and achievement of those goals will berewarded monetarily.

5.3.1 Sales Forecast

The following illustrates the forecasted sales for Moms, Maids, and More.

One percent is a sensible estimate for the first year of operations. There are currently about 20shops in our city that carry some or all of the items offered at Moms, Maids, andMore. Assuming that the customer base was divided evenly among these shops, each shop would

have about a two-and-a-half percent market share. However, because this will be the first year ofoperations for Moms, Maids, and More, that "even share" of the market is not expected rightaway. It is expected that by year two, the market share will increase to two percent, and by yearthree, the market share will exceed three percent. This will happen as Moms, Maids, and Morebecomes known as the place to shop for mothers' attire, attendants' attire, and other bridalaccessories.

To break the sales forecast down even further, the goal of of sales in year one is equivalent toselling to 160 wedding parties during the year, or to three wedding parties per week.

The table is constructed in such a way that it counts a sale when cash is received. When dresses

are ordered, a minimum 50% deposit is required. When a customer receives the item theyordered, the remaining 50% is due. For projection purposes, it is assumed that the dresses willarrive two to three months after they are ordered. So, for example, if a customer orders a Rs.9600dress in January, Rs. 4800 goes into January's sales, and Rs. 4800 goes into April's sales. Forshoes and accessories, we are assuming that the items will be in stock, therefore, thoseprojections reflect the gross amount of the sale on the day of purchase.


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Costs of sales assumes that for clothing, the wholesale cost will average about 46.5% of the retailprice, and for accessories, the wholesale cost will average about 30% of the retail price. For theclothing items, there is a two-month lag in cost of sales because the inventory takes two to threemonths to arrive from the day it is ordered, and the store does not pay for custom-ordered itemsuntil they are shipped.

SALES FORECAST

Year 1 Year 2 Year 3

Sales

Mothers' Attire 5304000 9282000 16243488

Bridesmaids' Attire 4866624 7056624 10232064

Flower Girl Dresses 415200 539760 701712

Shoes 782400 1056240 1425936

Other Accessories 765600 995280 1293888

Total Sales 12133824 18929904 29897040

Direct Cost of SalesYear 1 Year 2 Year 3

Clothing 4756608 7610544 12176832

Shoes and Other Accessories 503280 654288 850560

Subtotal Direct Cost of Sales 5259888 8264784 13027392

5.4 Milestones

The accompanying table lists the critical milestones for Moms, Maids, and More from now untilthe store is ready to open for business. Florence Sahoo will be in charge of each of thecompletion of each of these items.


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MILESTONES

Milestone Start Date End Date Budget Manager Department

Business Plan 6/30/2003 9/30/2003 0Florence

SahooAdministrative

Licensing and Permits 7/1/2003 8/31/2003 0Florence

SahooAdministrative

Site Selection and LeaseNegotiations

7/7/2003 10/15/2003 0Florence

SahooAdministrative

Secure Start-UpFinancing

7/28/2003 10/15/2003 0Florence

SahooAdministrative

Secure Line of Credit 7/28/2003 10/15/2003 0Florence

SahooAdministrative

Buying Show 9/10/2003 9/13/2003 0Florence

SahooAdministrative

Web Site Construction 10/8/2003 11/15/2003 0Florence

SahooAdministrative

Accounting Plan 11/15/2003 1/15/2004 0Florence

SahooAdministrative

Leasehold Improvements 1/2/2004 2/28/2004 0Florence

SahooAdministrative

Personnel Plan 1/15/2004 2/15/2004 0 Florence Administrative


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Sahoo

Totals 0

Web Plan Summary

The Moms, Maids, and More website will be an expanded business card for the store. Visitorswill be able to receive information about the designers we carry as well as basic storeinformation, such as location and store hours.

The site will also be a resource for bridesmaids who are unable to physically come in to ordertheir attire. Through a secure log in, they will be able to provide the necessary information toplace their order. This is an added convenience that most bridal shops do not offer.

6.1 Website Marketing Strategy

The website will be an additional resource for customers who want to learn more about ourstore. Visitors to our site will fall into two primary categories:

1. People who have not yet been to the shop and want to learn more about it.2. Bridesmaids who are ready to order their attire.

Category 1 visitors will be coming to the site to learn more about the store and what we have tooffer. Highlights for these visitors will be the store description, links to our designers' sites, amap to the store, contact information, and store hours.

Category 2 visitors will be bridesmaids who are unable to come into the store to be measured

and/or pay their deposit. It is quite common for bridesmaids to be out-of-town and unable tophysically come in to complete their purchase. While our customers will be able to completesales by phone and fax, they will appreciate the added convenience of being able to completetheir purchases online. Once the bridesmaid gown has been selected for a bridal party, a securelogin will be created for each of the bridesmaids so that they can complete the necessary orderinformation on line.

6.2 Development Requirements

Initially, the Moms, Maids, and More website will be developed with few technical resources. Asimple hosting provider will host the site and provide the technical back end. We will work with

a contracted web page designer to develop a simple, yet classy, site.

The most technically complex portion of the site will be the bridesmaid ordering portion. Forthis, a secure site must be created so that credit card information can be transmitted safely. Inaddition, it will need to be designed in such a way that store employees will be able to set up thenecessary profiles for bridesmaids to log in


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Management Summary

Moms, Maids, and More will be managed by the owner, Florence Sahoo (complete resume isenclosed). Florence is a CPA who spent four years in public accounting. Her efforts wereprimarily focused on auditing the financial statements of closely-held businesses in the greater

Seattle area. Through this work, she developed an understanding of various business cycles,internal controls, cash flow, inventory management, ratio analysis, variance analysis, smallbusiness dynamics, and basic tax principles. While working in publicaccounting, Florence supervised numerous projects and teams of various sizes. She frequentlyrepresented the firm at public speaking engagements, and she established a recruiting programfor the firm.

For the past two years, Florence has performed extensive research on the bridal industry. Hermentors include a bridal boutique owner; a wedding consultant who has been planning weddingsfor nearly 20 years; and a coordinator of a local wedding show. In addition to performingextensive research on the bridal industry, Florence also worked in a local bridal shop to learn the

day-to-day operations. While working as a salesperson at the bridal shop, Florence was one ofthe top sellers, often out-performing sales associates who had been there longer and workedmore hours than her.

Florence Sahoo enthusiasm, perceptiveness, and organization skills will be the keys toorchestrating the efforts of the sales team and making Moms, Maids, and More a successfulbusiness.

SUMMARY OF QUALIFICATIONS

Certified Public Accountant (CPA), licensed Lifetime of experience with small businesses Excellent organizational and communication skills

7.1 Personnel Plan

Moms, Maids, and More will have a sales force that includes the owner and three part-timeemployees. The store will have two sales associates in the store on weekdays, and threeassociates in the store on weekends. Sales associates will be paid an hourly wage of [Proprietaryand Confidential Information removed]. In years two and three, the sales associates' hours willincrease to accommodate the planned increase in sales; thus, the wages in years two and threeincrease significantly.

The owner, Florence Sahoo, will not be paid a salary, but will take distributions from thecompany profits while maintaining a positive cash balance. The financials in this plan do not yetinclude the owner's draw.


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PERSONNEL PLAN


Florence

SahooOwner

0 0 0

Part TimeSalesAssociate1

806400 864000 888000


334080 720000 864000


334080 384000 408000

TotalPeople

4 4 4

TotalPayroll

1474560 1968000 2160000

Financial Plan

Moms, Maids, and More expects to be profitable by the end of its second year of operations. Toget the business up and running, we will need to obtain financing. The initial market share willbe modest; however, significant growth in market share is expected due to the unique niche thatthe shop is targeting. The market share is expected to grow at a more modest rate after year three.

8.1 Important Assumptions

The following assumptions are key to understanding the profit and loss projections.

We do not sell anything on credit - all items must be paid in full before they are takenfrom the store.

We are estimating that 80% of the purchases will be made with credit cards. The creditcard fees are calculated as 80% of the sales, times 1.8 percent (the fee rate).


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Cost of sales for the clothing items has a two month delay. This is because most clothingitems will be custom ordered and, as a result, Moms, Maids, and More will not have topay for them until they arrive about two months after they are ordered.

GENERAL ASSUMPTIONS


Plan Month 1 2 3

Current Interest Rate 6.25% 6.25% 6.25%

Long-term Interest Rate 6.25% 6.25% 6.25%

Tax Rate 30.00% 30.00% 30.00%

Other 0 0 0

8.2 Break-even Analysis

For the break-even analysis, the following assumptions were used:

1. Fixed costs per month are estimated as total first year operating expenses divided by 12.2. For each item sold, there is a variable price equal to about 43% of the retail price of the

item.

BREAK-EVEN

ANALYSIS

Monthly RevenueBreak-even

1029360

Assumptions:

Average PercentVariable Cost

43%

Estimated MonthlyFixed Cost

583152

8.3 Projected Profit and Loss

We expect losses in the first year, because it will take time for the store to build momentum andgenerate traffic. However, once sales increase, the results are positive because many of the otherexpenses will remain fixed. In fact, we expect that sample inventory costs will actually go downin years to come. Some designers will provide sample inventory at deep discounts and/or provide


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the samples free of charge once good credit terms are established. As a result, the annualexpenditures for sample inventory should decrease.

PRO FORMA PROFIT AND LOSS


Sales 12133824 18929904 29897040

Direct Cost of Sales 5259888 8264784 13027392

Credit Card Fees 174720 151440 239184

Total Cost of Sales 5434608 8416224 13266576

Gross Margin 6699216 10513632 16630464

Gross Margin % 55.21% 55.54% 55.63%

Expenses

Payroll 1474560 1968000 2160000

Sales and Marketing andOther Expenses

571200 576000 576000

Depreciation 103680 103680 103680

Rent including triple nets 2534400 2628000 3211200

Utilities 432000 456000 480000

Insurance 201600 220800 244800

Payroll Taxes 221184 295200 324000

Supplies 172800 192000 206400

Repairs and Maintenance 115200 124800 134400

Professional Fees 14400 168000 192000

Taxes and Licenses 52800 52800 52800

New Sample Inventory 960000 720000 672000

Total Operating Expenses 6997824 7505280 8357280

Profit Before Interest andTaxes

(298608) 3008352 8273184

EBITDA (194928) 3112032 8376864

Interest Expense 173856 136464 97440Taxes Incurred 0 861600 2452704

Net Profit (472416) 2010336 5723040

Net Profit/Sales -3.89% 10.62% 19.14%


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8.4 Projected Cash Flow

The cash flow of Moms, Maids, and More is somewhat unique. For items that are sold off thefloor, the cash flow and revenue recognition is traditional, in that full payment is received at thetime of the sale, and the customer takes possession of the item at that time. This is how most of

the shoe sales will take place, as well as some of the other accessory purchases.

However, most of the other items in the store have a different flow. Let's use a dress as anexample. The customer will try on a sample in the store, and when she decides to purchase theitem, she will most likely have to order it in the size and color of her choosing. For this processto begin, the customer must provide a deposit of at least 50% of the total price of the item (note:while some customers may choose to pay the full amount at the time the order is placed, theseillustrations assume that everyone will choose the 50% option). The remaining balance willbe due within thirty days of when the item arrives in our store.

This timing issue has also been taken into consideration for the costs of goods sold. The store

will be billed for items when the items are shipped, thus cash outflow for the cost of the item willclosely match the cash inflow of the customer paying the balance on the item.

PRO FORMA CASH FLOW


Cash Received

Cash from OperationsCash Sales 12133824 18929904 29897040

Subtotal Cash fromOperations 12133824 18929904

29897040

Additional Cash Received

Sales Tax, VAT, HST/GSTReceived

0 0 0

New Current Borrowing 0 0 0

New Other Liabilities(interest-free)

0 0 0

New Long-term Liabilities 0 0 0Sales of Other Current Assets 0 0 0

Sales of Long-term Assets 0 0 0

New Investment Received 0 0 0

Subtotal Cash Received 12133824 18929904 29897040

Expenditures Year 1 Year 2 Year 3


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Expenditures fromOperations

Cash Spending 1474560 1968000 1260000

Bill Payments 9334896 14511072 21619728

Subtotal Spent on Operations 10809456 16479072 23779728

Additional Cash Spent

Sales Tax, VAT, HST/GSTPaid Out

0 0 0

Principal Repayment ofCurrent Borrowing

0 0 0

Other Liabilities PrincipalRepayment

0 0 0

Long-term LiabilitiesPrincipal Repayment

624960 624000 624000

Purchase Other CurrentAssets 0 0 0

Purchase Long-term Assets 0 0 0

Dividends 0 0 0

Subtotal Cash Spent 11434416 17103072 24403728

Net Cash Flow 699408 1826784 5493312

Cash Balance 1750608 3577392 9070704

8.5 Projected Balance Sheet

Moms, Maids, and More maintains a strong current ratio throughout. While the net worth of thebusiness is negative in year one, it makes steady gains and becomes positive in year two. By theend of year three, retained earnings is also close to being positive.

PRO FORMA BALANCE SHEET


AssetsCurrent Assets

Cash 1750608 3577392 9070704

Inventory 330144 518784 817728

Other Current Assets 48000 48000 48000

Total Current Assets 2128752 4144176 9936432

Long-term Assets


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Long-term Assets 408000 408000 408000

Accumulated Depreciation 10080 207360 311040

Total Long-term Assets 304320 200640 96960

Total Assets 2433072 4344816 10033392

Liabilities and Capital Year 1 Year 2 Year 3Current Liabilities

Accounts Payable 710496 1235856 1825440

Current Borrowing 0 0 0

Other Current Liabilities 0 0 0

Subtotal Current Liabilities 710496 1235856 1825440

Long-term Liabilities 2495040 1871040 1247040

Total Liabilities 3205536 3106896 3072480

Paid-in Capital 1440000 1440000 1440000

Retained Earnings (1740000) (2212416) (202080)Earnings (472416) 2010336 923040

Total Capital (772416) 1237920 6960960

Total Liabilities and Capital 2433072 4344816 10033392

Net Worth (772416) 1237920 6960960

8.6 Business Ratios

The following table breaks down some of the key financial ratios. Where available, industryaverages for Bridal Shops - SIC code 5621.0102, are shown for comparison.

RATIO ANALYSIS

Year 1 Year 2 Year 3Industry

Profile

Sales Growth 0.00% 56.01% 57.94% -0.02%

Percent of Total Assets

Inventory 13.57% 11.94% 8.15% 50.91%

Other Current Assets 1.97% 1.10% 0.48% 24.44%

Total Current Assets 87.49% 95.38% 99.03% 85.49%

Long-term Assets 12.51% 4.62% 0.97% 14.51%

Total Assets 100.00% 100.00% 100.00% 100.00%

Current Liabilities 29.20% 28.44% 18.19% 29.49%

Long-term Liabilities 102.55% 43.06% 12.43% 11.18%

Total Liabilities 131.75% 71.51% 30.62% 40.67%

Net Worth -31.75% 28.49% 69.38% 59.33%


20/29

Percent of Sales

Sales 100.00% 100.00% 100.00% 100.00%

Gross Margin 55.21% 55.54% 55.63% 40.07%

Selling, General &Administrative Expenses

59.10% 44.92% 36.48% 21.95%

Advertising Expenses 0.00% 0.00% 0.00% 2.92%

Profit Before Interest andTaxes

-2.46% 15.89% 27.67% 2.90%

Main Ratios

Current 3.00 3.35 5.44 2.64

Quick 2.53 2.93 5.00 0.74

Total Debt to Total Assets 131.75% 71.51% 30.62% 5.31%

Pre-tax Return on Net Worth 61.16% 232.00% 117.45% 47.92%

Pre-tax Return on Assets -19.42% 66.10% 81.49% 10.20%

Additional Ratios Year 1 Year 2 Year 3

Net Profit Margin -3.89% 10.62% 19.14% n.a

Return on Equity 0.00% 162.40% 82.22% n.a

Activity Ratios

Inventory Turnover 6.78 19.47 19.49 n.a

Accounts Payable Turnover 14.07 12.17 12.17 n.a

Payment Days 27 24 25 n.a

Total Asset Turnover 4.99 4.36 2.98 n.a

Debt Ratios

Debt to Net Worth 0.00 2.51 0.44 n.a

Current Liab. to Liab. 0.22 0.40 0.59 n.a

Liquidity Ratios

Net Working Capital 1418304 2908320 8111040 n.a

Interest Coverage -1.72 22.05 84.91 n.a

Additional Ratios

Assets to Sales 0.20 0.23 0.34 n.a

Current Debt/Total Assets 29% 28% 18% n.a

Acid Test 2.53 2.93 5.00 n.a

Sales/Net Worth 0.00 15.29 4.29 n.a

Dividend Payout 0.00 0.00 0.00 n.a


21/29

Appendix

SALES FORECAST

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month11

Month12

sales

Mothers' Attire

0%

108000

216000

360000

540000

648000

696000

720000

600000

480000

408000

288000

240000

Bridesmaids'

Attire

0%

102816

154224

274176

514080

496944

548352

685440

548352

445536

445536

342720

308448

RelativeDresses

0%

9600

14400

16800

38400

43200

43200

50400

48000

45600

40800

33600

31200

Shoes0%

1200

19200

48000

72000

91200

96000

108000

100800

72000

72000

48000

43200

OtherAccessories

0%

20400

24000

48000

78000

81600

100800

100800

86400

74400

62400

48000

40800

Total

Sales

252

816

427

824

746

976

1242

480

1360

944

1484

352

1484

352

1383

552

1117

536

1028

736

760

320

663

648

DirectCost ofSales

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month11

Month12

Clothing

0 0202848

361824

361824

800976

749616

587904

536544

328464

303072

277104

ShoesandOtherAccessories

194

40

259

20

576

00

7056

0

7776

0

6336

0

5472

0

3456

0

2736

0

2592

0

230

40

230

40

SubtotalDirectCost ofSales

19440

25920

260448

432384

686064

864336

804336

622464

563904

354384

326112

300144


22/29


23/29

Rate

TaxRate

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

30.00%

Other 0 0 0 0 0 0 0 0 0 0 0 0

PRO FORMA PROFIT AND LOSS

Month1

Month 2

Month3

Month4

Month5

Month6

Month7

Month8

Month9

Month10

Month11

Month12

Sales252816

427824

746976

1242480

1360944

1484352

1664640

1383552

1117536

1028736

760320

663648

DirectCost ofSales

194402592

0

26044

8

43238

4

68606

4

86433

6

80433

6

62246

4

56390

4

35438

4

32611

2

30014

4

CreditCardFees

3648 6144 10752 17904 19584 21360 23952 19920 16080 14832 10944 9552

TotalCostt ofSales

2308832064

271200

450288

705648

885696

828288

642384

579984

369168

337056

309696

GrossMgargin

229728

395760

475776

792192

655296

598656

836352

741168

537552

659568

423264

353952

GrossMargin%

90.87

%

92.50

%

63.69

%

63.76

%

48.15

%

40.33

%

50.24

%

53.57

%

48.10

%

64.11

%

55.67

%

53.33

%

Expenses

Payroll122880

122880

122880

122880

122880

122880

122880

122880

122880

122880

122880

122880

SalessandMarketing andOtherExpenses

7200024000

24000 96000 33600 33600 33600 33600 33600 $2,500 33600 33600

Depreciation 8640 8640 8640 8640 8640 8640 8640 8640 8640 8640 8640 8640

Rentincludingtriple nets

211200

211200

211200

211200

211200

211200

211200

211200

211200

211200

211200

211200

Utilities 3600036000

36000 36000 36000 36000 36000 36000 36000 36000 36000 36000

Insurance 16800 1680 16800 16800 16800 16800 16800 16800 16800 16800 16800 16800


24/29

0

PayrollTaxes

15%

1843218432

18432 18432 18432 18432 18432 18432 18432 18432 18432 18432

Supplies 1440014400

14400 14400 14400 14400 14400 14400 14400 14400 14400 14400

RepairsandMaintenance

9600 9600 9600 9600 9600 9600 9600 9600 9600 9600 9600 9600

Professional Fees

4800 4800 4800 24000 48000 24000 4800 4800 4800 4800 4800 4800

TaxesandLicenses

15%

0 0 0 0 0 0 0 4800 0 48000 0 0

NewSample

Inventory

0 0 96000 96000 96000 96000 96000 48000 48000192000

96000 96000

TotalOperatingExpenses

514752

466752

581952

653952

615552

591552

572352

529152

524352

802752

572352

572352

ProfitBeforeInterestandTaxes

(285024)

(70992)

(106176)

138240

39744 7104264000

212016

13200(143184)

(149088)

(218400)

EBITDA(276384)

(62352)

(97536)

146880

48384 15744272640

220656

21840(134544)

(140448)

(209760)

InterestExpense

15984 15696

15456 15168 14880 14640 14352 14064 13824 13536 13248 13008

TaxesIncurred

0 0 0 0 0 0 0 0 0 0 0 0

Net Profit(301008)

(86736)

(121632)

123072

24816(24768)

249648

197952

(624)(156720)

(162336)

(231408)

NetProfit/Sales

-119.06%

-20.27%

-16.28%

9.91% 1.82%-0.51%

15.00%

14.31%

-0.06%

-15.23%

-21.35%

-34.87%

PRO FORMA CASH FLOW

Month 1

Month2

Month 3Mont

h 4Mont

h 5Mont

h 6Mont

h 7Mont

h 8Mont

h 9Month 10

Month11

Month12

CashReceived


25/29

CashfromOperations

CashSales

252816

427824

7469761242480

1360944

1484352

224640

1383552

1117536

1028736

760320

663648

SubtotalCashfromOperations

252816

427824

7469761242480

1360944

1484352

1664640

138552

1117536

1028736

760320

663648

Additional CashReceived

SalesTax,VAT,

HST/GSTReceived

0.00

% 0 0 0 0 0 0 0 0 0 0 0 0

NewCurrentBorrowing

0 0 0 0 0 0 0 0 0 0 0 0

NewOtherLiabilities

(interest-free)

0 0 0 0 0 0 0 0 0 0 0 0

NewLong-termLiabilities

0 0 0 0 0 0 0 0 0 0 0 0

Sales ofOtherCurrentAssets

0 0 0 0 0 0 0 0 0 0 0 0

Sales ofLong-termAssets

0 0 0 0 0 0 0 0 0 0 0 0

NewInvestmentReceived

0 0 0 0 0 0 0 0 0 0 0 0


26/29

SubtotalCashReceived

252816

427824

7469761242480

1360944

1484352

1664640

1383552

1117536

1028736

760320

663648

Expenditures

Month 1

Month2

Month 3Mont

h 4Mont

h 5Mont

h 6Mont

h 7Mont

h 8Mont

h 9Month 10

Month11

Month12

ExpendituresfromOperations

CashSpending

122880

122880

122880122880

122880

122880

122880

122880

122880

122880

122880

122880

BillPayments

61440401328

$7,523361104

479232

581520

1344000

1545120

120576

856272

918960

821328

759216

SubtotalSpent onOperations

184320

524208

483984 602112

704400

1466880

1668000

1328256

979152

1041840

944208

882096

Additional CashSpent

SalesTax,VAT,HST/GST Paid

Out

0 0 0 0 0 0 0 0 0 0 0 0

PrincipalRepayment ofCurrentBorrowing

0 0 0 0 0 0 0 0 0 0 0 0

OtherLiabilitiesPrincipalRepayment

0 0 0 0 0 0 0 0 0 0 0 0

Long-termLiabilitiesPrincipalRepayment

52080 52080 52080 52080 52080 52080 52080 52080 52080 52080 52080 52080


27/29

PurchaseOtherCurrentAssets

0 0 0 0 0 0 0 0 0 0 0 0

PurchaseLong-termAssets

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

SubtotalCashSpent

236400

576288

536064654192

756480

1518960

1720080

1380336

1031232

1093920

996288

934176

Net CashFlow

16416(148464)

210912588288

604464

(34608)

(55440)

3216 86304(65184)

(235968)

(270528)

Cash

Balance

10676

16

91915

2

113011217183

52

23228

16

22882

08

22327

68

22359

84

23222

88

22571

04

20211

36

17506

08

PRO FORMA BALANCE SHEET

Month1

Month2

Month3

Month4

Month5

Month6

Month7

Month8

Month9

Month10

Month11

Month12

Assets

Startin

g Balances

CurrentAssets

Cash 1051200

1067616

919152

1130112

1718352

2322816

2288208

2232768

2235984

2322288

2257104

2021136

1750608

Inventory

1360800

1341360

1315440

1054992

622608

754656

950736

884784

684672

620304

389808

358704

330144

OtherCurrentAssets

48000 48000 48000 48000 48000 48000 48000 48000 48000 48000 48000 48000 48000

TotalCurrentAssets

2460000

2456976

2282592

2233056

2388960

3125472

3286944

3165552

2968656

2990592

2694912

2427840

2128752

Long-termAssets

408000

408000

408000

408000

408000

408000

408000

408000

408000

408000

408000

408000

408000


28/29

AccumulatedDepreciation

0 8640 17280 25920 34560 43200 51840 60480 69120 77760 86400 95040103680

TotalLong-termAssets

408000

399360

390720

382080

373440

364800

356160

347520

338880

330240

321600

312960

304320

TotalAssets

2868000

2856336

2673312

2615136

2762400

3490272

3643104

3513072

3307536

3320832

3016512

2740800

2433072

Liabilities andCapital

Month1

Month2

Month3

Month4

Month5

Month6

Month7

Month8

Month9

Month10

Month11

Month12

CurrentLiabilities

AccountsPayable

48000 389424

345216

460752

536976

1292112

1504512

1176912

825504

891504

795984

734688

710496

CurrentBorrowing

0 0 0 0 0 0 0 0 0 0 0 0 0

OtherCurrentLiabilities

0 0 0 0 0 0 0 0 0 0 0 0 0

SubtotalCurrent

Liabilities

48000

38942

4

34521

6

46075

2

53697

6

12921

12

15045

12

11769

12

82550

4

89150

4

79598

4

73468

8

71049

6

Long-termLiabilities

3120000

3067920

3015840

2963760

2911680

2859600

2807520

2755440

2703360

2651280

2599200

2547120

2495040

TotalLiabilities

3168000

3457344

3361056

3424512

344832

4151712

4312032

393252

3528864

3542784

3395184

3281808

3205536

Paid-inCapital

1440000

1440000

1440000

1440000

1440000

1440000

1440000

1440000

1440000

1440000

1440000

1440000

1440000

RetainedEarnings

(1740000)

(1740000)

(1740000)

(1740000)

(1740000)

(1740000)

(1740000)

(1740000)

(1740000)

(1740000)

(1740000)

(1740000)

(1740000)

Earnings

0(301008)

(387696)

(509328)

(38656)

(361440)

(368928)

(119328)

78672 78048(78720)

(241056)

(472416)

TotalCapital

(300000)

(601008)

(687696)

(809328)

(686256)

(661440)

(668928)

(419328)

(221328)

(221952)

(378720)

(541056)

(772416)


29/29

TotalLiabilities andCapital

2868000

2856336

2673312

2615136

2762400

3490272

3643104

3513072

3307536

3320832

3016512

2740800

2433072

NetWorth

(300000)

(601008)

(687696)

(809328)

(686256)

(661440)

(668928)

(419328)

(221328)

(221952)

(378720)

(541056)

(772416)

bridal shop

Documents