Executive Summary

Executive Summary
Introduction
It is the mission of Vashon Solicitation Services to provide clients with top quality call center
services 24 hours-a-day. A service that provides our clients with the greatest chance of
communicating with their end customers. We do B2B and B2C services including both inbound
and outbound calls. We have a dedicated and well trained cadre of customer support specialists
who are able to consistently provide excellent services delivered in a timely and cost-effective
manner.
Whatever a client's customer relations goals are: quantifying sales leads, taking orders,
responding to ad inquiries, market research, or general information requests, VSS has the people
with the expertise to professionally service those needs.
The Company
VSS will be a limited liability partnership registered in the state of Delaware for tax purposes. Its
founder is Mr. Martin Gibbs, a former telemarketing head with Medfone, Inc. Mr. Gibbs has
brought together a highly respected group of telemarketing and customer relations specialists
who have a total of 35 years of combined experience with this industry.
The company has a limited number of private investors and does not plan to go public. The
company has its main offices in Gig Harbor, Washington. The facilities include office spaces,
conference rooms, and a phone center. The company expects to begin offering services in June
of Year 1.
The Services
Vashon offers a wide range of call center service including both inbound and outbound calls. We
provide bilingual services in both english and spanish. The most common needs that we can
fulfill are:
• Generate sales leads

• Set appointments
• Market research
• Surveys (including statistical analysis and political surveys)
• First level help desk
• Database or mailing list information
• Business development
• Point-of-sale product promotion
• Seminar and conference invitations
VSS is not a telemarketing company, we do not create the marketing campaigns for our clients.
Experience has shown that many companies desire to create their own marketing campaign since
they already have marketing personnel with extensive contact and experience in the industry.
The Market
The telemarketing industry is a growing industry with most companies having an annual growth
between 6.5% and 8%. This is due to businesses that are becoming increasingly aware of the
need for market information and the desire to reduce customer turnover rates in a hard hit
economy. A significant trend in this industry is the growing number of clients who wish to
outsource telemarketing functions to client companies instead of developing such infrastructure
in-house. This makes for an excellent opportunity for VSS. However, long-term analysis of
growth rates in this industry show a cyclical pattern and VSS does not expect this high growth
rate to continue.
VSS plans to enter into two market segments. First, we will work in the medical services
industry since they have a high need to maintain contact with their patients at all times. We will
also be working as a first level help desk for a number of small high-tech companies, and be
taking on short-term projects such as surveys from small clients.
Financial Considerations
Start-up assets required are shown in the tables accompanying the Start-up Summary topic. This
includes expenses and the cash needed to support operations until revenues reach an acceptable
level. Most of the company's liabilities will come from outside private investors and
management investment, however, we have obtained current borrowing from Bank of America
Commercial Investments, the principal to be paid off in two years. A long-term loan through
Charter Bank of Tillamook will be paid off in ten years. We also have a line of credit from
Viking Bank that we can draw upon if need be.
The company expects to reach profitability in year two and does not anticipate any serious cash
flow problems. We conservatively believe that during the first three years that about three
ongoing contracts per month will guarantee a break-even point.
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1.1 Keys to Success
Vashon's keys to long-term survivability and profitability are:
• Create long-term contracts that demand constant monitoring or on-call services.

• Keeping close contact with clients and establishing a well functioning long-term
relationship with them to generate repeat business and obtain a top notch reputation.
• Establish a comprehensive service experience for our clients that includes consultation,
progress reports and post-program feedback.
1.2 Mission
It is the mission of VSS to provide our clients with top quality call center services 24 hours-a-
day that provide the greatest chance of communicating with end customers. We do B2B and B2C
services including both inbound and outbound calls. We have a dedicated and well trained cadre
of customer support specialists who are able to consistently provide excellent services delivered
in a timely and cost-effective manner.
Whatever a client's customer relations goals are: quantifying sales leads, taking orders,
responding to ad inquiries, market research, or general information requests, VSS has the people
with the expertise to professionally service your needs.
1.3 Objectives
The three year goals for Vashon Solicitation Services LLC (VSS) are:
• Achieve break-even by year two.

• Establish long-term contracts with at least four clients.
• Establish minimum 95% customer satisfaction rate to form long-term relationships with
our clients and create word of mouth marketing.
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Company Summary
VSS will be a limited liability partnership registered in the state of Delaware for tax purposes. Its
founder is Mr. Martin Gibbs, a former telemarketing head with Medfone, Inc. Mr. Gibbs has
brought together a highly respected group of telemarketing and customer relations specialists
who have a total of 35 years of combined experience with this industry.
The company has a limited number of private investors and does not plan to go public. The
company has its main offices in Gig Harbor, Washington. The facilities include office spaces,
conference rooms, and a phone center. The company expects to begin offering its services in
June of Year 1.
The company's main clients will be companies that require high amounts of communication
between themselves and their clients. This includes medical services, and companies that wish to
outsource first-level help desk support. By focusing on institutions such as these that have
special needs, we believe we will be able to better serve our clients and produce a superior
service that is more effective that other call center firms.
2.1 Start-up Summary
Start-up assets required are shown in the tables below. This includes expenses and the cash
needed to support operations until revenues reach an acceptable level. Most of the company's
liabilities will come from outside private investors and management investment, however, we
have obtained current borrowing from Bank of America Commercial Investments, the principal
to be paid off in two years. A long-term loan through Charter Bank of Tillamook will be paid off
in ten years.We also have a line of credit from Viking Bank that we can draw upon if need be.
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Start-up Requirements
Start-up Expenses
Legal $2,000
Insurance $1,000
utilities $200
Rent $3,000
Accounting and bookkeeping fees $2,000
Expensed equipment $8,000
Advertising $3,500
Other $8,000
Total Start-up Expenses $27,700
Start-up Assets
Cash Required $117,800
Other Current Assets $3,500
Long-term Assets $25,000
Total Assets $146,300
Total Requirements $174,000
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Start-up Funding
Start-up Expenses to Fund $27,700
Start-up Assets to Fund $146,300
Total Funding Required $174,000
Assets
Non-cash Assets from Start-up $28,500
Cash Requirements from Start-up $117,800
Additional Cash Raised $0
Cash Balance on Starting Date $117,800
Total Assets $146,300
Liabilities and Capital
Liabilities
Current Borrowing $16,000
Long-term Liabilities $55,000
Accounts Payable (Outstanding Bills) $3,000
Other Current Liabilities (interest-free) $0
Total Liabilities $74,000
Capital
Planned Investment
Mr. Martin Gibbs $25,000
Ms. Mary Stuart $20,000
Mr. Henry Hannover $20,000
Mr. Nicolas Caput $8,000
Others $27,000
Additional Investment Requirement $0
Total Planned Investment $100,000
Loss at Start-up (Start-up Expenses) ($27,700)
Total Capital $72,300
Total Capital and Liabilities $146,300
Total Funding $174,000
2.2 Company Ownership
The company will have a number of outside private investors who will own 27% of the
company's shares. The rest will be owned by the senior management including Mr. Martin
Gibbs, (25%), Ms. Mary Stuart (20%), Mr. Henry Hannover, (20%), and Mr. Nicholas Caput
(8%). All other financing will come from loans.
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Services
Vashon offers a wide range of call center service including both inbound and outbound calls. We
provide bilingual services in both english and spanish. The most common needs for call centers
are:
• Generate sales leads

• Set appointments
• Market research
• Surveys (including statistical analysis and political surveys)
• First level help desk
• Database or mailing list information
• Business development
• Point-of-sale product promotion
• Seminar and conference invitations
VSS is not a telemarketing company we do not create the marketing campaigns for our clients.
Experience has shown that many companies desire to create their own marketing campaign since
they already have marketing personnel with extensive contact and experience in the industry.
However, the costs of carrying out such a telemarketing campaign can be prohibitive and often
the firm does not wish to develop the infrastructure to do so. This requires developing different
skills and core competencies that divert management and resources from their primary duties.
This is where VSS comes in. We either connect a prospective client with a telemarketing
company (we have arrangements and contacts with three such consulting firms) or once such a
campaign is designed we implement it for our clients. We work closely with our clients in the
creation of the campaign's goals, scope, length, and costs so has to create as close a fit between
the client needs and our capabilities.
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Market Analysis Summary

economy. A significant trend in this industry is the growing number of clients who wish to
outsource telemarketing functions to client companies instead of developing such infrastructure
in-house. This makes for an excellent opportunity for VSS. However, long-term analysis of
growth rates in this industry show a cyclical pattern and VSS does not expect this high growth
rate to continue.
The telemarketing industry is quite fragmented with companies that vary greatly in size, scope,
services offered, and market share. Many companies are general advertising agencies that offer
telemarketing services along with a wide range of other consulting services. In addition, many
companies, still not realizing the potential advantages of outsourcing, choose to develop their
own telemarketing services.
industry since they have a high need to maintain contact with their patients at all times. We also
will be working as a first level help desk for a number of small high-tech companies. Mr. Gibbs
and Ms. Stuart have already signed contracts with Evergreen Medical and Sno-net, Inc. to serve
in these capacities. We will also be taking on short-term projects, such as surveys, from small
clients.
4.1 Market Segmentation
Virtually every company, both large and small require some form of telemarketing at some point.
Often it is a survey to determine customer satisfaction or awareness. Sometimes it is effectively
communicating an upcoming event such as a conference.
Other companies wish to know if telemarketing is a feasible method of sales generation. One of
the new uses for call centers is in first level help desk services. About 75-80% of all technical
problems faced by end customers can be solved by non-technical customer service
representatives who are familiar with a computer or technical system and who have a scripted set
of procedures to solve most common occuring problems. This is where an outsourced call center
can save a client a large amount of money and allow a reduction in personnel needed on call 24
hours-a-day.
industry since they have a high need to maintain contact with their patients at all times. We also
will be working as a first level help desk for a number of small high-tech companies.
Mr. Gibbs and Ms. Stuart have already signed contracts with Evergreen Medical and Sno-net,
Inc. to serve in these capacities. Our customer service representatives are already in the process
of receiving hands-on training from these two companies to meet their needs. We will also be
taking on short-term projects such as surveys from small clients.
Once we have established a good working relationship with these initial clients, we will leverage
our reputation and profitability into new contacts and contracts with other local companies. Our
ultimate goal is to service the entire west coast region and become the company with a dominant
market share.
The market analysis table and graph which follows shows the number of businesses within the
state of Washington. This will be our initial geographical focus for the first four to five years of
our company's existance. Later, as we expand to a west coast scope, our future business plans
will include all of our potential clients in this area.
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Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential Customers Growth CAGR
High-tech companies 2% 400 408 416 424 432 1.94%
Medical companies 3% 350 361 372 383 394 3.00%
Other 3% 2,200 2,266 2,334 2,404 2,476 3.00%
Total 2.86% 2,950 3,035 3,122 3,211 3,302 2.86%
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4.2 Service Business Analysis
economy. However, long-term analysis of growth rates in this industry show a cyclical pattern
and VSS does not expect this high growth rate to continue.
The telemarketing industry is quite fragmented with companies that vary greatly in size, scope,
services offered, and market share. Many companies are general advertising agencies that offer
telemarketing services along with a wide range of other consulting services. In addition, many
companies, not realizing the potential advantages of outsourcing, choose to develop their own
telemarketing services.
VSS believes that the greatest threat at the moment is in new entrants to the market who perceive
an opportunity in a "high" growth industry. The most likely entrants will be pre-existing
advertising agencies wishing to horizontally integrate and enter new sub-markets.
The one major disadvantage to new entrants is that all firms engaged in contracting to
telemarketing agencies face significant switching costs when bringing on a new partner.
Furthermore, VSS understands that in this industry there is a significant learning curve that
creates declining "unit" costs as a firm gains more cumulative experience in the field itself and
with long-term clients specifically. Finally there are significant start-up costs associated with
creating a call center.
Rivalry among different call center agencies is quite intense. The telemarketing industry as a
whole is mature with long-term moderate growth. Most of the largest agencies are mutually
dependent when it comes to jockeying for position and market share. The fact that there are so
many diverse and seemingly "generic" or general telemarketing agencies makes this a cutthroat
industry.
The threat of clients backwardly integrating so as to have all their advertising done in-house is
one of the major factors that buyers use to indirectly control price in this industry, and increase
competition among firms. This must always be foremost in the minds of Vashon's management
when offering services and setting prices.
4.2.1 Competition and Buying Patterns

Competition
Competition includes all potential call centers and telemarketing agencies across the country. In
addition we have indirect competition from organizations that handle all their telemarketing in-
house. Practically speaking, this means we have the greatest threat from the largest telemarketing
agencies such as Crouch & Weasley, Berman Telemarketing, and other big, nationwide call
center companies that hold significant market share. The call center industry is highly
fragmented, with a large number of small companies that mainly cater to small firms and a few
large companies that seek the largest contracts from companies such as Sprint, GM, etc. This
makes competition within the industry very intense. Through our focused strategy of serving
niche markets such as help desk services, we intend to avoid such a debilitating environment and
avoid its drawbacks such as price wars, and etc.
Buying patterns and needs

Companies usually enter into contracts with call center firms based on their reputation of
professionalism and effective campaigns in the past. This reputation is difficult to obtain by new
firms unless its personnel bring it with them from previous companies such as ours. Price and
scope are also important reasons for accepting contracts, especially if the company is small.
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Strategy and Implementation Summary

Vashon Solicitation Services' business strategy is to enter into a focused approach to its services
rather than being everything to its clients. Our company does not intend to be a telemarketing
consultation firm, nor will it ever become so. We are a call center firm that simply implements
telemarketing campaigns or help desk functions for its clients. These services are where we can
offer a higher standard of quality to our clients. This will allow us to charge a higher profit
margin for these differentiated and more focused services.
5.1 Marketing Strategy
Vashon has already concluded two contracts with local companies requiring 24 hour call center
services. These will provide us with initial revenue and the chance to build our reputation. Our
company intends to use testimonials from such clients to build further contracts. We have begun
to establish our presence using various marketing methods such as flyers, cold calls, B2B
contacts, and we will be attending conventions and other events as well.
5.2 Sales Strategy
Vashon's management will be focusing on leveraging its employee's established reputations and
contacts in the telemarketing industry to generate contracts. Both Mr. Gibbs and Mr. Hannover
have been in the industry for many years and experience shows that many of their existing clients
will still wish to work with them despite having to establish a new contract with VSS. We also
understand that we may need to lower costs in our first couple of years in order to attract new
customers and close deals.
In addition to our first contracts with Evergreen Medical and Sno-net, Inc. Mr. Hannover has
been actively seeking to acquire a large contract with National Conventions & Events over the
past seven months. This company is the largest event organizing firm on the West coast and has
been seeking a call center firm for a customer survey project to be launched in the near
future. VSS believes that its chances for acquiring this contract are excellent.
5.2.1 Sales Forecast
Sales are based on the various contract projects we anticipate acquiring in the various market
segments. Revenues are based on average costs per project/contract based on estimated time and
complexity of contract plus and undisclosed profit margin. The company does not have any
significant direct costs of sales.
We anticipate that our most attractive target markets, medical services and help desk clients will
provide us with significant early revenue. As time goes on, and we acquire more customers, the
percentage of short-term and other projects will increase.
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Sales Forecast
Year 1 Year 2 Year 3
Sales
Medical call center services $132,000 $180,000 $270,000
Help desk services $69,000 $120,000 $150,000
Short-term projects $43,500 $65,000 $96,000
Other projects $33,500 $58,000 $69,000
Total Sales $278,000 $423,000 $585,000
Direct Cost of Sales Year 1 Year 2 Year 3
Row 1 $0 $0 $0
Other $0 $0 $0
Subtotal Direct Cost of Sales $0 $0 $0
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Management Summary
The company will have four officers including our president, Mr. Martin Gibbs. Our head of
operations will be Mr. Nicholas Caput, plus 12 customer service representatives. Finances and
general admin will be handled by Ms. Stuart.
The company plans to hire additional service representatives, and administrative personnel as we
begin to get large numbers of contracts.
6.1 Personnel
Vashon's management brings to the company strong capabilities in contract negotiation, project
management, telemarketing, and a unique combination of skills drawn from other businesses.
Key Personnel
Mr. Martin Gibbs is a graduate of the University of Missouri where he obtained his business
degree degree in 1971. Since then, Mr. Gibbs has had extensive experience in marketing,
telemarketing, and project management. This includes experience in budgeting, project
oversight, etc. In 1996 he obtained a graduate degree in marketing from University of
Washington. Mr. Gibbs spent the last four years as the telemarketing department head with
Medfone, Inc.
Mr. Nicholas Caput graduated from Arizona State University with a bachelors degree in
marketing in 1975. From 1978-1988 Mr. Caput worked for Nelson Marketing Consultants. In
1989 he went to work for Anderson Consulting in their marketing division, where he worked as a
project manager.
Personnel Plan
Mr. Martin Gibbs - President $36,000 $36,000 $60,000
Ms. Mary Stuart - Office Manager $36,000 $36,000 $60,000
Mr. Nicholas Caput - Operations $36,000 $36,000 $36,000
Customer service representatives $101,050 $203,000 $203,000
Total People 19 27 27
Total Payroll $209,050 $311,000 $359,000
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Financial Plan
Our financial plan anticipates two years of negative profits as we gain sales volume. We have
budgeted enough investment to cover these losses and have an additional credit line available if
sales do not match predictions.
7.1 Important Assumptions
We are assuming approximately 75% sales on credit and average interest rates of 10%. These are
considered to be conservative in case our predictions are erroneous.
General Assumptions
Plan Month 1 2 3
Current Interest Rate 10.00% 10.00% 10.00%
Long-term Interest Rate 10.00% 10.00% 10.00%
Tax Rate 30.00% 30.00% 30.00%
Other 0 0 0
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7.2 Break-even Analysis
Our break-even analysis is based on the assumptions that our gross margin is approximately
100%. In other words, we will have insignificant direct cost of sales. Since each contract will be
of different scope, length, and complexity, it is difficult to assign and average per unit revenue
figure. However, it is conservatively believed that during the first three years, average
profitability per month per segment will be moderate. This is because we will be dealing with
smaller companies at first that have smaller contracts. We expect that about three ongoing
contracts per month will guarantee a break-even point.
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Break-even Analysis
Monthly Revenue Break-even $27,234
Assumptions:
Average Percent Variable Cost 0%
Estimated Monthly Fixed Cost $27,234
7.3 Projected Profit and Loss
The following table itemizes our revenues and associated costs. We expect to be paying higher
costs in marketing and advertising than other companies as we attempt to build sales volume. As
shown in the table in the Appendix, we expect monthly profits to begin in December 2003.
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Pro Forma Profit and Loss

Sales $278,000 $423,000 $585,000
Direct Cost of Sales $0 $0 $0
Other Costs of Sales $4,300 $6,000 $6,000
Total Cost of Sales $4,300 $6,000 $6,000
Gross Margin $273,700 $417,000 $579,000
Gross Margin % 98.45% 98.58% 98.97%
Expenses
Payroll $209,050 $311,000 $359,000
Sales and Marketing and Other Expenses $18,000 $10,000 $10,000
Depreciation $0 $0 $2,500
Rent $18,000 $18,000 $18,000
Utilities $7,200 $8,000 $9,000
Insurance $13,200 $14,000 $15,000
Payroll Taxes $31,358 $46,650 $53,850
Travel $12,000 $8,000 $4,000
Other $18,000 $15,000 $15,000
Total Operating Expenses $326,808 $430,650 $486,350
Profit Before Interest and Taxes ($53,108) ($13,650) $92,650
EBITDA ($53,108) ($13,650) $95,150
Interest Expense $8,183 $9,400 $9,100
Taxes Incurred $0 $0 $25,065
Net Profit ($61,291) ($23,050) $58,485
Net Profit/Sales -22.05% -5.45% 10.00%
7.4 Projected Cash Flow
The following is our cash flow chart and diagram. We do not expect to have any short-term cash
flow problems even though we will be operating at a loss for the first nine months. Our short-
term loan will be repaid in two equal payments in 2004-2005. Our long-term loan will be paid
off in ten years.
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Pro Forma Cash Flow

Cash Received
Cash from Operations
Cash Sales $69,500 $105,750 $146,250
Cash from Receivables $159,050 $291,458 $409,934
Subtotal Cash from Operations $228,550 $397,208 $556,184
Additional Cash Received
Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $20,000 $6,000 $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 $3,000 $5,000 $0
Subtotal Cash Received $251,550 $408,208 $556,184
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $209,050 $311,000 $359,000
Bill Payments $121,806 $135,385 $162,552
Subtotal Spent on Operations $330,856 $446,385 $521,552
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $8,000
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $0 $0 $4,000
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $330,856 $446,385 $533,552
Net Cash Flow ($79,306) ($38,177) $22,632
Cash Balance $38,494 $317 $22,949
7.5 Projected Balance Sheet
The following table shows the projected balance sheet for VSS.
Pro Forma Balance Sheet

Assets
Current Assets
Cash $38,494 $317 $22,949
Accounts Receivable $49,450 $75,242 $104,058
Other Current Assets $3,500 $3,500 $3,500
Total Current Assets $91,444 $79,059 $130,507
Long-term Assets
Long-term Assets $25,000 $25,000 $25,000
Accumulated Depreciation $0 $0 $2,500
Total Long-term Assets $25,000 $25,000 $22,500
Total Assets $116,444 $104,059 $153,007
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $11,435 $11,100 $13,563
Current Borrowing $36,000 $42,000 $34,000
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $47,435 $53,100 $47,563
Long-term Liabilities $55,000 $55,000 $51,000
Total Liabilities $102,435 $108,100 $98,563
Paid-in Capital $103,000 $108,000 $108,000
Retained Earnings ($27,700) ($88,991) ($112,041)
Earnings ($61,291) ($23,050) $58,485
Total Capital $14,009 ($4,041) $54,444
Total Liabilities and Capital $116,444 $104,059 $153,007
Net Worth $14,009 ($4,041) $54,444
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7.6 Business Ratios
We have included industry standard ratios from the telemarketing solicitation services industry to
compare with ours. These ratios are as closely matched to our industry as management could
find, however there are some significant differences, especially in sales growth, financing ratios,
long-term asset investments and net worth. However, our projections indicate a healthy company
that will be able to obtain and retain long-term profitability.
Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 52.16% 38.30% 8.79%
Percent of Total Assets
Accounts Receivable 42.47% 72.31% 68.01% 28.12%
Other Current Assets 3.01% 3.36% 2.29% 44.18%
Total Current Assets 78.53% 75.98% 85.29% 76.27%
Long-term Assets 21.47% 24.02% 14.71% 23.73%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 40.74% 51.03% 31.09% 38.61%
Long-term Liabilities 47.23% 52.85% 33.33% 13.60%
Total Liabilities 87.97% 103.88% 64.42% 52.21%
Net Worth 12.03% -3.88% 35.58% 47.79%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 98.45% 98.58% 98.97% 100.00%
Selling, General & Administrative Expenses 120.50% 104.03% 88.98% 82.68%
Advertising Expenses 0.00% 0.00% 0.00% 1.66%
Profit Before Interest and Taxes -19.10% -3.23% 15.84% 1.37%
Main Ratios
Current 1.93 1.49 2.74 1.59
Quick 1.93 1.49 2.74 1.22
Total Debt to Total Assets 87.97% 103.88% 64.42% 3.09%
Pre-tax Return on Net Worth -437.51% 570.43% 153.46% 60.22%
Pre-tax Return on Assets -52.64% -22.15% 54.61% 7.76%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin -22.05% -5.45% 10.00% n.a
Return on Equity -437.51% 0.00% 107.42% n.a
Activity Ratios
Accounts Receivable Turnover 4.22 4.22 4.22 n.a
Collection Days 56 72 75 n.a
Accounts Payable Turnover 11.39 12.17 12.17 n.a
Payment Days 28 30 27 n.a
Total Asset Turnover 2.39 4.06 3.82 n.a
Debt Ratios
Debt to Net Worth 7.31 0.00 1.81 n.a
Current Liab. to Liab. 0.46 0.49 0.48 n.a
Liquidity Ratios
Net Working Capital $44,009 $25,959 $82,944 n.a
Interest Coverage -6.49 -1.45 10.18 n.a
Additional Ratios
Assets to Sales 0.42 0.25 0.26 n.a
Current Debt/Total Assets 41% 51% 31% n.a
Acid Test 0.89 0.07 0.56 n.a
Sales/Net Worth 19.84 0.00 10.74 n.a
Dividend Payout 0.00 0.00 0.00 n.a
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Appendix
Sales Forecast
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Sales
Medical call center services 0% $8,000 $8,000 $8,000 $12,000 $12,000 $12,000 $12,000 $12,000 $12,000 $12,000 $12,000 $12,000
Help desk services 0% $0 $0 $0 $5,000 $5,000 $5,000 $8,000 $8,000 $8,000 $8,000 $11,000 $11,000
Short-term projects 0% $2,000 $2,500 $0 $0 $2,000 $3,000 $3,000 $6,000 $4,000 $7,000 $7,000 $7,000
Other projects 0% $1,000 $1,500 $0 $0 $0 $0 $7,000 $5,000 $7,000 $5,000 $2,000 $5,000
Total Sales $11,000 $12,000 $8,000 $17,000 $19,000 $20,000 $30,000 $31,000 $31,000 $32,000 $32,000 $35,000
Direct Cost of Sales Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Row 1 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Direct Cost of Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
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Personnel Plan
Mr. Martin Gibbs - President 0% $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Ms. Mary Stuart - Office Manager 0% $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Mr. Nicholas Caput - Operations 0% $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Customer service representatives 0% $5,760 $5,760 $5,760 $5,760 $5,760 $7,680 $9,600 $10,000 $10,000 $10,000 $11,500 $13,470
Total People 0% 9 9 9 9 9 11 13 15 15 15 17 19
Total Payroll $14,760 $14,760 $14,760 $14,760 $14,760 $16,680 $18,600 $19,000 $19,000 $19,000 $20,500 $22,470
General Assumptions
Month
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11
12
Plan Month 1 2 3 4 5 6 7 8 9 10 11 12
Current Interest Rate 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00%
Long-term Interest Rate 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00%
Tax Rate 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

Month
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11
12
Sales $11,000 $12,000 $8,000 $17,000 $19,000 $20,000 $30,000 $31,000 $31,000 $32,000 $32,000 $35,000
Direct Cost of Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Costs of Sales $200 $100 $100 $200 $300 $300 $500 $600 $500 $500 $500 $500
Total Cost of Sales $200 $100 $100 $200 $300 $300 $500 $600 $500 $500 $500 $500
Gross Margin $10,800 $11,900 $7,900 $16,800 $18,700 $19,700 $29,500 $30,400 $30,500 $31,500 $31,500 $34,500
Gross Margin % 98.18% 99.17% 98.75% 98.82% 98.42% 98.50% 98.33% 98.06% 98.39% 98.44% 98.44% 98.57%
Expenses
Payroll $14,760 $14,760 $14,760 $14,760 $14,760 $16,680 $18,600 $19,000 $19,000 $19,000 $20,500 $22,470
Sales and Marketing and
$1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
Other Expenses
Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Rent $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
Utilities $600 $600 $600 $600 $600 $600 $600 $600 $600 $600 $600 $600
Insurance $1,100 $1,100 $1,100 $1,100 $1,100 $1,100 $1,100 $1,100 $1,100 $1,100 $1,100 $1,100
Payroll Taxes 15% $2,214 $2,214 $2,214 $2,214 $2,214 $2,502 $2,790 $2,850 $2,850 $2,850 $3,075 $3,371
Travel 15% $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000
Other $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
Total Operating Expenses $24,174 $24,174 $24,174 $24,174 $24,174 $26,382 $28,590 $29,050 $29,050 $29,050 $30,775 $33,041
Profit Before Interest and
($13,374) ($12,274) ($16,274) ($7,374) ($5,474) ($6,682) $910 $1,350 $1,450 $2,450 $725 $1,460
Taxes
EBITDA ($13,374) ($12,274) ($16,274) ($7,374) ($5,474) ($6,682) $910 $1,350 $1,450 $2,450 $725 $1,460
Interest Expense $592 $592 $592 $592 $633 $675 $717 $758 $758 $758 $758 $758
Taxes Incurred $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Net Profit ($13,966) ($12,866) ($16,866) ($7,966) ($6,107) ($7,357) $193 $592 $692 $1,692 ($33) $701
Net Profit/Sales -126.96% -107.21% -210.82% -46.86% -32.14% -36.79% 0.64% 1.91% 2.23% 5.29% -0.10% 2.00%
Pro Forma Cash Flow

Cash Received
Cash from Operations
Cash Sales $2,750 $3,000 $2,000 $4,250 $4,750 $5,000 $7,500 $7,750 $7,750 $8,000 $8,000 $8,750
Cash from Receivables $0 $275 $8,275 $8,900 $6,225 $12,800 $14,275 $15,250 $22,525 $23,250 $23,275 $24,000
Subtotal Cash from Operations $2,750 $3,275 $10,275 $13,150 $10,975 $17,800 $21,775 $23,000 $30,275 $31,250 $31,275 $32,750
Additional Cash Received
Sales Tax, VAT, HST/GST Received 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Current Borrowing $0 $0 $0 $0 $5,000 $5,000 $5,000 $5,000 $0 $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales of Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales of Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Investment Received $0 $0 $0 $0 $0 $0 $1,500 $1,500 $0 $0 $0 $0
Subtotal Cash Received $2,750 $3,275 $10,275 $13,150 $15,975 $22,800 $28,275 $29,500 $30,275 $31,250 $31,275 $32,750
Expenditures Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Expenditures from Operations
Cash Spending $14,760 $14,760 $14,760 $14,760 $14,760 $16,680 $18,600 $19,000 $19,000 $19,000 $20,500 $22,470
Bill Payments $3,340 $10,202 $10,106 $10,109 $10,210 $10,358 $10,695 $11,213 $11,405 $11,308 $11,316 $11,543
Subtotal Spent on Operations $18,100 $24,962 $24,866 $24,869 $24,970 $27,038 $29,295 $30,213 $30,405 $30,308 $31,816 $34,013
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Principal Repayment of Current
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Borrowing
Other Liabilities Principal Repayment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Long-term Liabilities Principal
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Repayment
Purchase Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Purchase Long-term Assets $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
Subtotal Cash Spent $18,100 $24,962 $24,866 $24,869 $24,970 $27,038 $29,295 $30,213 $30,405 $30,308 $31,816 $34,013
Net Cash Flow ($15,350) ($21,687) ($14,591) ($11,719) ($8,995) ($4,238) ($1,020) ($713) ($130) $942 ($541) ($1,263)
Cash Balance $102,450 $80,762 $66,172 $54,453 $45,457 $41,219 $40,199 $39,486 $39,356 $40,298 $39,757 $38,494
Learn more »
Pro Forma Balance Sheet

Assets Starting Balances
Current Assets
Cash $117,800 $102,450 $80,762 $66,172 $54,453 $45,457 $41,219 $40,199 $39,486 $39,356 $40,298 $39,757 $38,494
Accounts Receivable $0 $8,250 $16,975 $14,700 $18,550 $26,575 $28,775 $37,000 $45,000 $45,725 $46,475 $47,200 $49,450
Other Current Assets $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500 $3,500
Total Current Assets $121,300 $114,200 $101,237 $84,372 $76,503 $75,532 $73,494 $80,699 $87,986 $88,581 $90,273 $90,457 $91,444
Long-term Assets
Long-term Assets $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000
Accumulated Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Long-term Assets $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000 $25,000
Total Assets $146,300 $139,200 $126,237 $109,372 $101,503 $100,532 $98,494 $105,699 $112,986 $113,581 $115,273 $115,457 $116,444
Liabilities and Capital Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Current Liabilities
Accounts Payable $3,000 $9,865 $9,769 $9,769 $9,865 $10,002 $10,321 $10,833 $11,028 $10,931 $10,931 $11,149 $11,435
Current Borrowing $16,000 $16,000 $16,000 $16,000 $16,000 $21,000 $26,000 $31,000 $36,000 $36,000 $36,000 $36,000 $36,000
Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Current Liabilities $19,000 $25,865 $25,769 $25,769 $25,865 $31,002 $36,321 $41,833 $47,028 $46,931 $46,931 $47,149 $47,435
Long-term Liabilities $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $55,000 $55,000
Total Liabilities $74,000 $80,865 $80,769 $80,769 $80,865 $86,002 $91,321 $96,833 $102,028 $101,931 $101,931 $102,149 $102,435
Paid-in Capital $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $101,500 $103,000 $103,000 $103,000 $103,000 $103,000
Retained Earnings ($27,700) ($27,700) ($27,700) ($27,700) ($27,700) ($27,700) ($27,700) ($27,700) ($27,700) ($27,700) ($27,700) ($27,700) ($27,700)
Earnings $0 ($13,966) ($26,831) ($43,697) ($51,663) ($57,770) ($65,127) ($64,934) ($64,342) ($63,650) ($61,959) ($61,992) ($61,291)
Total Capital $72,300 $58,334 $45,469 $28,603 $20,637 $14,530 $7,173 $8,866 $10,958 $11,650 $13,341 $13,308 $14,009
Total Liabilities and Capital $146,300 $139,200 $126,237 $109,372 $101,503 $100,532 $98,494 $105,699 $112,986 $113,581 $115,273 $115,457 $116,444
Net Worth $72,300 $58,334 $45,469 $28,603 $20,637 $14,530 $7,173 $8,866 $10,958 $11,650 $13,341 $13,308 $14,009
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Executive Summary

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Executive Summary

• Generate sales leads

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1.1 Keys to Success

Vashon's keys to long-term survivability and profitability are:

• Create long-term contracts that demand constant monitoring or on-call services.

• Achieve break-even by year two.

2.1 Start-up Summary

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2.2 Company Ownership

• Generate sales leads

Market Analysis Summary

4.1 Market Segmentation

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4.2 Service Business Analysis

4.2.1 Competition and Buying Patterns

Buying patterns and needs

Strategy and Implementation Summary

5.1 Marketing Strategy

5.2 Sales Strategy

5.2.1 Sales Forecast

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7.1 Important Assumptions

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7.2 Break-even Analysis

7.3 Projected Profit and Loss

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Pro Forma Profit and Loss

7.4 Projected Cash Flow

Pro Forma Cash Flow

7.5 Projected Balance Sheet

Pro Forma Balance Sheet

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7.6 Business Ratios

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Pro Forma Profit and Loss

Pro Forma Cash Flow

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Pro Forma Balance Sheet

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