Royal realty

Business Plan

2018- 2019
37-02 47th Avenue
long Island City, NY11101
(718)937-3010
royalrealty.ny@veinternational.org
royalrealtyny.wixsite.com/royalrealty

@royalrealtyvei
“Micro Prices,
Macro Living”
 Table of Contents

Executive Summary ............................................................................................................3

Business Rationale ..............................................................................................................4
Customer Empathy ................................................................................................. 4
Problem Statement ..................................................................................................4
Ideal State ............................................................................................................ 4-5
Company Goals ........................................................................................................5
About the Business………………………………………………………………………….................................6
Company Overview ..................................................................................................6
Mission Statement ...................................................................................................6
Organization ........................................................................................................ 6-7
SWOT Analysis .........................................................................................................7
External Environment .........................................................................................................8
Current Economic Conditions ............................................................................ 8-10
Industry Analysis-Real & Virtual ...................................................................... 11-13
Competitive Analysis..............................................................................................13
Marketing Plan..................................................................................................................13
Target Market & Market Segmentation .......................................................... 13-14
Marketing Mix........................................................................................................15
Discussion of Business Risks ....................................................................................... 16-17
Financial Planning .............................................................................................................17
Break Even Analysis ..............................................................................................17
Summary Profit & Loss Statement .........................................................................18
Balance Sheet ....................................................................................................... 19
Sales Projection Summary .....................................................................................20
Financial Statement and Charts .............................................................................21
Financial Write-Up .................................................................................................22
Appendix ...........................................................................................................................23
Bank Balance .................................................................................................... 23-24
Angel Investment Letter ........................................................................................25
Amortization ..........................................................................................................26

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 Executive Summary
_______________________________________________________________________________________________________

Royal Realty is a newly formed real-estate firm located in the city of New York that provides eco-
friendly and affordable micro-apartments. Services provided include studio apartments, one to two-bedroom
apartments. Optional amenities include but not limited to are Indoor pool, Fitness center, and Tenant
Lounge. The apartments also have innovative technologies such as Wi-Fi video doorbell for safety and
security, LED Lighting and Timed Lighting to save up energy consumption and decrease power cost. All the
amenities are part of specific packages that will be offered to tenants to increase both the quality of life and
service.
Globally, there are dozens of Real Estate firms that provide apartments. However, Royal Realty has
made their services more affordable for a competitive edge and to attract our targeted audiences; Virtual
Enterprise (VE) Community (Generation Z) and millennials. The VE community is required to purchase a
living place, immediately leading the company to increase monthly sales. Considering many are still paying
their student loans, Royal Realty gives millennials and Generation Z one last thing to worry about, knowing
they have access to a luxurious New York City lifestyle at a low-cost range.
On October 15th Royal Realty began operating as a C-Corporation giving the opportunity to increment
capital by selling stock. It also offers legal liability keeping the workers of Royal Realty and tenants lawfully
protected. With the loan of $150,000, we plan on implementing the maintenance of the building. The
investment will also cover the startup cost and the operating expenses of the company. Toward the end of the
fiscal year, Royal Realty aimed for a sales profit of $205,305.56 and an average of 136.87 units sold to break
even. Financial reports have allowed Royal Realty for a smooth and stable year since it has surpassed all
financial expectations.
As a present-day New York City-based company, Royal Realty revolves around the idea of
rehabilitating the communities in which we place our apartments, with the addition of our new innovative
apartments. Royal Realty executives have established three main goals to be accomplished by the end of the
fiscal year. The primary goal is gaining a 90 percent occupancy in our complex buildings. Secondarily, the
company aims to first expand into the five boroughs of New York; Queens, Brooklyn, Bronx, and Staten Island.
Once financially stable the expansion will further proceed into other major cities. Eventually, Royal Realty also
plans on giving back to the community. To achieve these goals Royal Realty has already begun to attract
customers using our impressive website, sales promotion and social media.

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Business Rational

Customer Empathy

Royal Realty makes our customers are our main priority. We tend to the difficulties they face trying to find a
place to live that meets their needs. Real Estate companies more often than not manage to overprice apartments
for higher compensation. New Yorkers are left seeing their hard-earned money go. Nowadays it is tough to find
an apartment that is in your price range. The rent in New York City is continuously increasing making many
apartments very expensive. Due to not being able to pay the rent, many families end up losing their homes.
Mortgage trends are on a continuous increase leaving many without the option of buying a home. Our company
Royal Realty offers beautiful micro apartments throughout NYC at an affordable price. The services our
company offers and provides to the virtual enterprise community, recent college graduates, and millennials they
can now have a safe and comfortable place to live with amenities to make their everyday life more manageable.
Royal Realty provides our customers with home and sources of entertainment to compromise the small-scale
apartments. Royal Realty pledges to make our customers’ needs a priority and to address all of their questions
and concerns.

Problem Statement
There is a need for affordable apartments in the city of New York. Many people cannot keep up with their rent
resulting in them losing their homes. According to the 2017 State of the Nation's Housing report, 39 million
American households (33%) are paying more than they can afford for their homes. New York City is one of the
most expensive cities with a population of about 8.623 million people. Problems arise when rent increases and
people begin to pay an exceedingly high amount of rent for small-scale apartments. A studio apartment in New
York can cost you about $1,200, considering the sizes of the apartments which range from 300 sq. ft. to 500 sq.
Ft. A one-bedroom apartment in NYC ranges from $3,000 to $6,000. Prices such as these are the reason people
are battling to maintain a decent place to live.

Ideal State
Our former mayor Bloomberg had a plan to make micro apartments throughout New York City. The goal was
to create affordable and beautiful places to live for low-income families. Since Bloomberg is no longer in

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office, he could not continue thoroughly with his plan, which is why we have taken the initiative to maintain
and create our unique ideas to the micro-apartment planning’s. Our services will be provided to the virtual
enterprise community, recent college graduates, and millennials. We have expanded Bloomberg’s vision and
added eco-friendly products such as; LED lighting, air conditioning all come included in our homes. Amenities
such as a fitness center with a sauna, indoor swimming pool, tenant lounge, laundry room, and screening room
are all optional but are some of the many benefits Royal Realty customer will get to enjoy. There are not many
people that will turn down the luxurious lifestyle if given the opportunity. Here at Royal Realty, we offer
consumers their dream home for a price ranging from $500 to a maximum amount of $2,500, no additional fees.
With Royal Realty, our customers get to enjoy elegant and sumptuous lifestyles without exceeding their budget.

Company Goals

Goal#1: Royal Realty plans to occupy over 90% How: Royal Realty's main priority is to improve our
of their complex building. building as sales goes up to ascend the attraction

Goal#2: Within 3 years Royal Realty intends to How: Adding a busines section on website for
expand in other boroughs of New York City such as business owners
Brooklyn, Bronx, and Staten Island.

Goal#3: 5 Years from now Royal Realty plans on How: Royal Realty plans to stay local until our roots feel
expanding their services to other major cities in the comfrotable enough to purchase more buildings and build
U.S. foundations in other boroughs.

Goal#4: 6 years from now Royal Realty will add How: This goal is essnetial in our growth as Royal Realty will
business property to the list of things we rent. target Key markets, such as New York, Los Angeles. Chicago,
and Las Vegas.

Goal#5: In 8 years Royal Realty plans to own their How: Partner up with a catering compnay to serve our
very own shelter for the homeless. second building which is labeled as a homeless shleter

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About the business

Company Overview
Royal Realty is located at 37-02 47 Avenue Long Island City, NY 11101. The company is a startup Virtual
Enterprise firm established to make a living in the city of New York more affordable for our target audience.
We initiated Royal Realty as of September of 2018 with 20 employees. We choose to become a C-Corporation
because it offers legal liability meaning the corporation is created as an independent entity.
Furthermore, it separates the business and its obligations from the owner, shareholders, and stockholders. Being
a C-Corporation also allows us to increment capital by selling stock. Our company aims to be more than another
Real Estate company; we aim to become the reason our tenants find a place to call home.

Mission Statement
Royal Realty strives to be one of the top realty firms in the city of New York by providing affordable, innovative
and contemporary micro apartments and making the difficulties of renting apartments easier for the first-time
residents and renters.

Organization

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The main objective of the “Team Leader Chart” is to assign each job role, and level. The chart itself is visually
pleasing and attracts the eye to the table and its function. It sub-characterizes the individual departments the
Chief Executive Officer Samuel Filpo, Chief Operating Officer Max Romero, and Chief Financial Officer Saul
Guzman. There are six central departments that Royal Realty functions under; the departments of Marketing,
Administration, Accounting, Sales, Graphics and Human Resources. Each department is overseen by the
assigned Vice President and assures all assigned tasks are completed productively and in a timely matter.

SWOT Analysis

Strengths: Royal Realty praises itself in our customer service skills. We are always there for our customers
whether it is for answering a question or addressing their concerns. Our customers are important to us, and we
see to ensure their satisfaction. Lastly, Royal Realty provides affordable apartment to live in compared to other
real estate firms because they fail to deliver an affordable place to live by.
Weakness: Our weakness is merely being a newly formed firm. As a company, we may find ourselves running
into issues that other, more established companies may not. This weakness also makes it hard for new potential
customers to rent apartments from us, considering they will be skeptical about our services because we fail in
recognition.
External Opportunities: Royal Realty will benefit from buying an abandoned building because of its relatively
low price. Renovating the building and its surrounding area gives us the opportunity to purchase and expand
into other boroughs such as Brooklyn, Staten Island, and the Bronx. The benefits of expanding into more
locations will increase publicity permanently removing our primary weakness.
Threats: Threats for Royal Realty is its competition. Since we are not the only real estate company in Virtual
Enterprise, similar more established companies have loyal customers. It is for this reason that our company
currently, we are relying on sales that we made at a recent networking event.

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External Environment
______________________________________________________________________________________________________

Current Economic Conditions

In New York City living expenses are high for the majority of people, our company targets clients that need
affordable housing with modern designs. The services we provide is connecting renters to micro-apartments they
desire. Some of our amenities operate on eco-friendly features. We have multiple options that clients could choose
from, micro studios, one bedroom, and two bedrooms with prices varying from $500 up to $2,500. Our service
overall is mainly to make it simple for first-time clientele and make our product accessible to younger age groups
as well. In addition to our service, our yearly goal is to target low-income communities and renovate abandoned
buildings as a form to complete our mission to rehabilitation communities which will attract more people to our
new projects.
(worksite: Tradingeconomics.com)
Employment rate
July 2017 - 60.2%
May 2018 - 60.4%
Lowest employment rate in past 2 years: 60.1%
Employment rates will affect our company by allowing us to forecast the amount of people that will be able to
rent apartments or own a house.

US interest rates:
2018 to 2-2.25%
Explanation:
Interest rates affect our firm and the relevant industry because rising interest rates affect both the buyer and seller
in the real estate industry. As interest rates rise, it decreases people’s affordability on purchasing property, so the
value of the property decreases which affects the seller. In addition, with increasing interest rates our firm will
benefit from this because more people would rent rather than buy a home because the monthly payments of the
mortgage would be too high. Our company offers apartments with a fixed monthly price rate that will not increase
over the following years.

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Rate of Inflation: July 2017 - June 2018
July 2017: 1.7
June 2018: 2.9

Inflation rate would affect our company because when prices of goods and services rise the consumers purchasing
power decreases. When inflation rate increases, home values will increase as well. Due to high-interest rates,
people tend to borrow less money when it comes to purchasing a home. With high-interest rates,
home buyers may face tightening lending standards many may not borrow at all. With fewer home buyers they
will turn to apartments to rent which will beneficial to Royal Realty in the long run.

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Rate of change of GDP: July 2016 - 2.3 / July 2017 - 3 / July 2018 - 4.2

GDP affects our company because real estate is a portion of the economic activity within the country. Real
estate is also a part of the market values, goods, and services. GDP represents the economic progress of a
company, and if the GDP is low, then it means the country doesn’t have a well-developed productive and
economic infrastructure.

A country that imports more goods than they export. These factors are essential to our company because
it determines how our company performs and the number of clienteles we get. For example, interest rates affect
our firm because as interest rates rise it decreases the affordability of purchasing property, so the value of the
property decrease. As a result of rising interest rates, our firm will benefit from this because more people would
rent rather than buy a home. The monthly payments of the mortgage would be too high.

Employment rate also affects our company because it determines who is eligible to rent or purchase
property and it represents how the economy is doing as well. GDP changes our company because it shows the
overall performance of the economy and real estate is a portion of the economic activity.

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Industry Analysis
Real Competitors like, Bond Real estate, Core Real, Alpha Properties, and Century 21 are known Real estate
companies in New York City. They offer a wide variety of housing apartments, throughout the 5 boroughs of
NYC. Royal Reality provides a smooth process for purchasing an apartment as it can be a big hassle. During the
year 2000-2006 home stock in NYC grew about 8%. A survey was conducted by “Street Easy” determining if
living in NYC is affordable. 61% of New Yorkers agreed upon the fact that New York is unaffordable.

Royal Realty will do its best by making it easier for consumers to find a potential home. Our target market ranges
from 17 to 38-year old from all over New York City, but our apartment is open to everyone. Our goal at Royal
Realty is to provide reasonably priced homes in the city that never sleeps. We also offer amenities at an affordable
price, unlike our other competitors. Therefore, Royal Realty will be your best option for finding Luxury and
Modernized living space without over exceeding your budget.
The real estate industry has flourished throughout the years, and the main catalyst for it all in New York, especially
with the migration of new and well-known companies throughout the city. As a matter of fact, throughout the
past year in 2018, over 35,000 companies managed their real estate matters for their employees through the
management form of real estate, which is precisely why Royal Realty fits in. Royal Realty has planned their
spread of roots working between the guidelines of being a managing real estate firm. As far as other statistics in
the Real Estate industry, Real Estate is currently at an annual rate of 27.28% industry profitability. Employment
levels in the real estate industry have grown over the past years through 2016 to 6 percent and are projected to
increase at a faster rate to 2026.

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 Challenges
• Bond Real estate, Core Real estate, Alpha Real estate are some of competitors we have in real estate
market. Consumers have more options into choosing which company to trust for the investment of an
apartment.
• High interest rates tend to push away people from purchasing an apartment.
• The Nation's economy is going downhill which means the sale of apartment goes down. This also slow
down sales in the real estate market. Therefore, renting an apartment may be the best option for those
individuals who aren't willing to take the financial risk.
• Today, the average cost of renting a one-bedroom apartment in New York City for a year is about
$32,940 (quoted by Thrillist).
Virtual
Virtual firm Dream House Real Estate offers three different product descriptions. The first one is a 1
master room, full bath, kitchen, and living room with plenty of storage. The second one offers 2 rooms, a kitchen,
and a full bathroom. The last one is premium which includes 3 bedrooms, a kitchen, one- and a half bath and
cleaning services. However, some flaws came noticeably to us, yes, their prices seem lower for their apartments.
So logically our consumers may view them as a better option.
On the other hand, Royal realty is a management real estate firm selling micro apartments, and as a whole,
our prices are made to ensure we break even and match the convenience of our apartments. We know from a
business point of view Dreamhouse is offering a high-quality product, for too low of a price to appeal to a specific
consumer market, leaving room for surprise bumps in prices eventually leaving investors and consumers in
disbelief and merely making a buyer's life more and more difficult. It automatically makes sense to put your
money and your trust into Royal Realty knowing that the success of our company and our client’s satisfaction go
hand in hand.
Dream Home Real Estate is a VE company intended to provide affordable homes for college and high
school students. They offer apartments of luxury quality but still accessible, which allows them to have a greater
range of buyers. Their prices are low enough for a student to spend their hard-earned money on other things. Their
placement combined with their low prices will provide them with a steady flow of students. Overall, their VE
Company will be successful because of their type of business. The number of competitors would be direct and
indirect. Around their area and sell more products at higher prices. Their profitability would be high, the number
of products they sell in a month will result in how much they are increasing. Their expected demand refers to how
many people want those goods. When the supply of a product goes up, the price of a product goes down, and
demand for the product can rise because it costs decreases. A financial condition prospective customer will be a

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customer who will have physical and financial resources. A prospect for the seller is a client who needs the
proposed product but will have some doubts which could lead to a difference of pricing. Fundamentally impacting
our firm base on their amount of sales and profits they are gaining which will increase their profitability income.

Competitive Analysis
99@dventures is another one of Royal Realty’s direct competitors. Their apartments are offered in Europe and
parts of the United States but the prices they offer still do not compare with ours. Although they provide similar
amenities to us, it is our prices and dependability that will set us apart from them. In addition, Dream Homes Real
Estate is Royal Realty’s secondary market. The homes they offer are close in range with our apartments because
their main products consist of home sales. The reality of Dream Homes Real Estate is that the price range provided
is unreliable and can easily fluctuate depending on the market-based economy. Inevitably, Royal Realty aims to
overcome every obstacle put forth and ensures the stability and wellbeing of our customers. Regardless of indirect
or direct companies, Royal Realty will top all and change the idealization of what it means to live in a micro
apartment. Perfect for micro-living in luxury.

VE FIRM
Dream Home Real Estate, Flushing, MI, USA
Standard Package- $650/Month Deluxe Package-$900/Month Premium Package-$1,100/Month

Marketing Plan

Target Market & Market Segmentation

VE Community
Demographic: Ages: 16-18
Geography: New York City
Psychographics: Young VE students looking for a modern, affordable place to live to carry out their virtual lives.
Socio-economic Factors: High School students, Lower class or Middle class, Low or Median household income
Benefits: Beautiful, contemporary micro apartments that are affordable in which you could live comfortably and
safely.

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 Explanation: Upcoming requirements by the VE students is to eventually own property throughout the school
year, we feel that it leads us to future chances and lets Royal Realty capitalize on buyers.
Millennials
Demographic: Ages: 22-37
Geography: New York City
Psychographic: Millennials struggling to look for an affordable place to live that includes innovative technology
and offers them exactly what they are looking for in an apartment.
Socio-economic factors: High school Diploma, Associates Degree, Bachelor’s Degree, Lower Class or Middle
Class with Low or Median household income.
Benefits: Our apartments are affordable which means that it is in their budget being that most Millennials are
still paying of their student loan debt.
Explanation: Our attention is also on high alert for the millennials target market, including fresh out of school
college students. We take care of any living concerns by offering them some of the most affordable living they
can find in NYC with access to the city or smaller parts of Queens due to the location of our apartments in
Long Island City.
Migrating companies
Demographic: 45 to 54-year-old executives looking for opportunities to expand their branch or create a new
remodel for their company’s appearance.
Geography: New York City
Psychographics: Employees or arching employees within companies migrating to New York City whose primary
fear is high priced real estate homes and come in with our price balanced management real estate firms.
Socio- economic factors: High school Diploma, Associates Degree, Bachelor’s Degree, Lower Class or Middle
Class with Low or Median household income.
Explanation: Throughout the world, companies are continually looking for new places to spread their brand
throughout the country, or in most cases around the globe. Royal Realty is fortunate enough to be starting in one
of the biggest markets in the world, New York City. Causing main attractions to names such as Amazon who just
announced a significant relocation of their headquarters straight into Royal Realty’s primary geographic target in
Long Island City.

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Marketing Mix

• Product: Our selection throughout Royal Realty consists of our original 450 square feet studio micro
apartment, to our 1- and 2-bedroom micro-apartments that range from 650 square feet to 950 square feet.
We’ve put our little creative twist and created a wide selection of individually diverse themed micro-
apartments, which can vary from any seasonal ideas that can change at any point throughout the year
and appeal to any of our customer’s aesthetic needs. Lastly, with all of this included Royal Realty tops it
all off with access to your apartment’s community amenities such as, amenities that may consist of -
available for an additional 500-dollar - pools, parking lot, theater room, cafe, sauna, etc.
• Promotion: We aim to inform our customers about Royal Realty or those who are interested in knowing
more information about our company. We do have a website that will answer questions that they may
have in mind. Any information not found in our website can be found if called to our customer service
faculty, who will gladly assist all customers.
Customers will now get to experience the benefits of doing business with our company. Our real estate
agents speak to our customers if they are interested in an apartment or any questions they may have. In
order to promote our ideas, we have social media such as Instagram, Twitter, and Snapchat. We expect
our promotions to be successful because our company makes sure that we are meeting our customers’
needs and making sure that our customers are in a safe and comfortable environment.
• Positioning: The image we aim to create in the minds of our customers is that we are always here to
answer any questions our customers may have and to clarify anything about our services. Our company is
here to offer apartments at a price you can not only afford but will also love. Our business makes sure our
customers can trust us, not to mention we make sure our customers are comfortable in the environment
they are in when they come across our company. This image appeals to the entire market with no
exception.
• Price: Our prices were derived from former Mayor Bloomberg’s idea of affordable micro-apartments.
Our prices range between $500 to $2,500. Since New York City residents face the hardships of expensive
rent, we decided to make our apartments affordable for everyone in the city of New York.
• Placement: Trade shows support 65% of our sales, email solicitations, network, and website sales as well.
Our products are usually shown through our email and trade show information about the apartment, for
example, the location of the apartment, cost and the number rooms the apartment has.

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 Discussion of Business Risks:
Royal Realty faces the possibility of losing potential customers to other well-known and established real
estate companies. Due to the fact that we are a newly formed real estate firm the opportunity of potential customers
to be skeptical as to receive services from our company is very high. It is considered that other real estate firms
already have their name out there and have been a real estate company for a very long time now. That is why we
offer more affordable prices compared to the other real estate companies, and we plan on getting our name out by
partnering with other VE firms and providing some of the most exceptional services our company can offer.
Another risk that we identified would be are Trade show sales because Royal Realty heavily relies on the VE
students to make sales and increment capital. The VE students make up the majority of our sales. That is why we
rely tremendously on trade because it gives us the opportunity to make as many sales that we possibly can. At
trade shows, we create new connections with other VE firms and possible partnerships. If we do not make enough
purchases at the trade shows the company will be facing severe financial risk which then results to our investors
losing their money. That is why we plan on increasing the number of sales we make at trade shows by visiting
every booth and attempt to get most of the VE students to rent an apartment each.
Royal Realty is currently based in New York potentially leading to fewer sales as opposed to other real
estate firms because we are a newly formed company. Not being well known to our public, we also face
restrictions from reaching other potential customers that need affordable apartments and do not live in New York
City. That is why Royal Realty plans on contacting the citizens of New York City that are in need of affordable
apartments to rent first, and then move on to other boroughs and hopefully in the future internationally.
There are several real estate companies out there both real and virtual such as Century 21, Bond Real
Estate, 99@dventures, and Dream Home Real Estate. The Real Estate area is very competitive, but our company
Royal Realty is different. Our company treats people differently in the sense that we care about our customers
and the services we provide. Not only that but our company offers apartments with eco-friendly consumables
such as solar paneled green gardens and led lighting, which is not only great for our customers but our
environment. We make sure that VE students, recent college graduates, and Millennials are suitable, and
comfortable homes that will satisfy their needs. Recognizing our competitive market, we aim to expand into all
boroughs other than our main location in Long Island City. Regardless, we still offer a variety of micro-apartments
that will meet our customers’ needs so that in the end they will be delighted but not only that, we will gain the
trust and loyalty from those who have chosen to invest in our apartments. Strategies we plan on using for dealing
with the risks identified are renting as many apartments as we can. Secondly, we plan on making Royal Realty
know to others by utilizing our website as well as our social media to allow our customers informed and

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connected. Lastly, we will begin sending out surveys every two months in which our customers will answer
questions about our services, and how satisfied they’re with their apartment.

Financial Planning

Break- even Analysis Note: Determining when Royal Realty will break-even with its projected expenses and
start to develop profit, the company produced an analysis. Royal Realty rental price per apartment is $1,500.00,
our average cost of goods sold is $50.00. The average cost of products sold is low because we were able to
purchase an abandoned building that was being auctioned to help revitalize the community as well as increase
the availability of reasonable residences. Our average profit rate is 96.7% which is accurate because it matches
the profit and loss gross margin. Lastly, our annual fixed cost is $209,682.00. For Royal Realty to break-even,
we would need to make total sales of $205,305.52 and will have to rent 137 units.

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Summary of Profit and Loss Statement
Note: We estimate total revenue to be $686,947, our total cost of goods sold will remain at 25,000 because we
have yet to buy another building. Total gross profit to be is $661,947, and gross margin 96%. Once all Royal
Realty’s expenses were calculated our total operating expenses came up to be $198,462 and Net Income of
$463,485.

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Balance Sheet

Note: As of December 31, 2018, Royal Realty had $109,292 cash in bank. All the current and fixed assets total
up to $255,830, while the current liabilities add up to $170,257. Lastly, the total stockholder’s equity added up to
$70,000.

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 Sales Projection Summary

Note: Our monthly projected sales for the 2018-2019 fiscal year is expected to be $686,947. Our total projected
online sales would be 190,000, tradeshow sales would be 201,947, direct sales would be 180,000, and our out of
network sales would be 145,000.

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Financial Statement and Charts
We used the Break-Even Analysis to determine how many units we will have to sell to break even. The
average selling price per sale is $1,500.00. Our average cost of goods sold per transaction is $50.00, and an
average profit rate of 96.7%. Finally, the annual fixed cost is $198,462.00. In our case, Royal Realty will have to
sell 137 units to break even and have total sales of $205,305.52. We estimate our total revenue to be $686,947,
our total cost of goods sold will be $25,000, overall gross profit rate will be $661,947, and our gross margin
should be 96%. After adding all our expenses, we will come to a total operating cost of $198,462, and a net
income of $463,485. Our balance sheet portrays how much money is in the bank account at the specific time of
being filled out.
Currently, we have $109,292, as a current asset. Another asset would be Accounts Receivable of $63,000
and merchandise inventory with $25,000 and lastly supplies with $500. The total current assets would equal to
179,992. Fixed assets included computers that cost $25,000 in total, as well as Furniture and Fixtures with $24,000
and office equipment with $9,038. The total fixed asset of $58,038 after calculations, making the total assets a
sum of $255,830. In current liabilities payroll tax payable has a total of 20,257. In addition, loan payable was
added to the balance sheet with 150,000 and ended up with $170,257 in total liabilities. Lastly, common stocks
added to a total of $70,000 in debts and stockholder’s equity equaled $240,257.

Sales Projection Summary

Our monthly projected sales for the 2018-2019 fiscal year is expected to be $686,947. Our total projected online
sales would be 190,000, our projected tradeshow sales would be 201,947, our projected direct sales would be
180,000, and our out of network sales would be 145,000.

Profit and Loss Statement

Our profit and loss statement were created for the month of November where we gathered all of our company
expenses. The sales department evaluated all costs and the total goods exporting to $25,000 in Royal Realty, as
well as our total revenue of $686,947, and a gross margin of 96%. Our gross profit is $661,947.

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Financial Write-Up

Balance Sheet
The balance sheet explains how much we started the company with and how much our company has spent from
merchandise inventory, and our fixed assets. Our current cash for the month of December is $109,292. Our assets
have increased to $197,792. In our loan payable our company started with $150,000. Our total stocks equity is
$70,000 and with total liabilities and stocks equity of $240,257.

Monthly Sales Projection

Our monthly projections for the month of November have been 30,000 for online sales, $66,946.96 for our
tradeshow, 30,000 indirect, 45,000 for out-of-network. Our sales department provided with the month of
November and the company’s expenses.

Break-Even

Our accounting department provided the break-even, we have started growing out our company and have sold 50
units and have increased by each sale accomplished. Our average price per transaction is $1,500.00. The average
cost of goods sold per purchase is $50.00. The average profit rate for the units is 96.7%. Moreover, the annual
fixed cost is $198,462.00. Our totals sales of break-even are $205,305.52, and our break-even point in units was
136.87.

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 Appendix

Screenshot of the Bank Account

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Letter of support from Angel Investor

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Loan Amortization Table

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