IFIM B SCHOOL

BANGALORE

Entrepreneurship Development & New Venture Creation

Submitted to

Prof :BABU

Submitted by
Shabari santhosh.m
Roll no 30

CURRICULUM COMPANION SUITES

Business plan

Table of Contents
1.0 Executive Summary .................................................................................................................... 1
1.1 Mission .......................................................................................................................................... 2
Chart: Highlights .......................................................................................................................... 2
1.2 Keys to Success ........................................................................................................................ 3
2.0 Company Summary ..................................................................................................................... 3
2.1 Company OwneRS hip ............................................................................................................ 3
2.2 Start-up Summary ................................................................................................................... 3
Table: Start-up.............................................................................................................................. 4
Chart: Start-up ............................................................................................................................. 6
3.0 Service Description ...................................................................................................................... 6
4.0 Market Analysis Summary ........................................................................................................ 6
Chart: Market Analysis (Pie) .................................................................................................... 7
Table: Market Analysis ............................................................................................................... 7
4.1 Market Segmentation ............................................................................................................. 7
4.2 Target Market Segment Strategy ...................................................................................... 8
4.3 Market Needs ............................................................................................................................. 8
4.4 Service Business Analysis ..................................................................................................... 8
4.5 Competition and Buying Patterns ...................................................................................... 8
5.0 Strategy and Implementation Summary ............................................................................ 9
5.1 Competitive Edge ..................................................................................................................... 9
5.2 Sales Strategy ........................................................................................................................... 9
Chart: Sales by Year ................................................................................................................. 10
Chart: Sales Monthly ................................................................................................................ 10
Table: Sales Forecast ............................................................................................................... 11
6.0 Management Summary ............................................................................................................ 11
6.1 PeRS onnel Plan ...................................................................................................................... 11
Table: PeRS onnel ...................................................................................................................... 11
7.0 Financial Plan ............................................................................................................................... 12
7.1 Break-even Analysis .............................................................................................................. 12
Table: Break-even Analysis.................................................................................................... 12
Chart: Break-even Analysis ................................................................................................... 12
7.2 Projected Profit and Loss ..................................................................................................... 13
Table: Profit and Loss ............................................................................................................... 13
Chart: Profit Monthly ................................................................................................................ 14
Chart: Profit Yearly .................................................................................................................... 14
Chart: Gross Margin Monthly................................................................................................. 15
Chart: Gross Margin Yearly .................................................................................................... 15
7.3 Projected Cash Flow .............................................................................................................. 16
Chart: Cash .................................................................................................................................. 16
Table: Cash Flow ........................................................................................................................ 17
7.4 Projected Balance Sheet ...................................................................................................... 18
Table: Balance Sheet ................................................................................................................ 18
7.5 Business Ratios ....................................................................................................................... 19
Table: Ratios ................................................................................................................................ 19
Page 1

Table of Contents
Table:
Table:
Table:
Table:
Table:
Table:

Sales Forecast ......................................................................................................................... 1

Personnel ................................................................................................................................... 2
General Assumptions ............................................................................................................ 3
Profit and Loss ......................................................................................................................... 4
Cash Flow .................................................................................................................................. 5
Balance Sheet .......................................................................................................................... 6

Page 2

1.0 Executive Summary

Introduction
Curriculum Companion Suites (CSS) is a medium-sized software development and consulting
firm focused on making the educational process more efficient and effective for K-12
schools. CCS software serves as a virtual teaching assistant for the educational
process. Students can follow along with curriculum electronically through a central computer
terminal at the front of the classroom.
The Company
CCS keys to success are the company's commitment to market awareness and future potential
direction of the educational process, and CCS' relationships with a large number of educational
institutions and districts.
Curriculum Companion Suites is a start-up company comprised of six executives and. The
executives represent all functional areas, with 70 years of combined experience in the software
development industry.

Products
CCS offers a suite of educational software for each grade level, from kindergarten through 12th
grade. These suites are developed in collaboration with major curriculum publishers with whom
CCS has established strategic partners hips.
CCS provides full installation, initial and ongoing consulting support. These services are
provided as part of each software package purchase.
The Market
The competitive marketplace includes only a handful of direct competitors within the learning
information systems vendors segment, providing software products and installation and
systems integration services to kindergarten through senior high (K-12) schools in the United
States. CCS competes primarily against more traditional methods of education, training and
testing, including pencil and paper testing. In addition, CCS competes with other companies
offering educational software products to schools, such as
EDUCOMP,EDURITE,EDSERVE,EVEROONN
Educational institutions and school districts have not been active in searching out technical
enhancements to the educational process. Rather, companies such as CCS have often utilized a
more "push" type of marketing strategy. The educational community has had to be "educated"
themselves on the opportunities of utilizing technical infrastructures to enhance learning
processes.
Since only a handful of other companies are competing directly with CCS in this market, the
company plans to develop a healthy level of market share, with a goal of 10% at the end of
three years
The target market for CCS is the urban/metropolitan educational market, as this market
presents the highest level of opportunity in terms of revenues. Additionally, software

Page 1

installations and customizations in this market are much more feasible in terms of technical
logistics and efficiencies. Thus, profitability is by far more likely in this market.
Relationships have been established with a large number of educational institutions and school
districts across the India . Significant investments have been made by CCS to research and
understand the specific needs and potential enhancements to the current educational process.
Financial Considerations
CCS expects to raise a substantial amount of owner capital, and borrow a comparable amount
in a guaranteed SBA 10-year loan. This provides the bulk of the current financing required.
CCS intends to deliver generous sales in the first year, with steady grown in the second and
third years of the plan.
1.1 Mission
Curriculum Companion Suites aims to offer software curriculum suites to K-12 schools within
the India. market. CCS will focus on providing solutions to enhance the educational capabilities
of schools.

Chart: Highlights

Highlights
14,000,000
12,000,000
10,000,000

Sales
8,000,000

Gross Margin
6,000,000

Net Profit

4,000,000
2,000,000
0
Year 1

Year 2

Year 3

Page 2

1.2 Keys to Success

CCS keys to success include:
1. The company's commitment to being keenly alert to the current educational environment
and future potential direction of the educational process.
2. CCS' relationships with a large number of educational institutions and districts.
2.0 Company Summary
Curriculum Companion Suites is a start-up comprised of six executives. These executives
represent all functional areas, with 70 years of combined experience in the software
development industry. One majority shareholder Shabari santhosh, own 80% of the company.
The bulk of outside financing will come from a 10-year Small Business Administration (SBA)
loan.
2.1 Company Ownership
CSS is incorporated in the state of ANDHRAPRADESH by shabari santhosh. Other investors own
a minority stake. At the moment, the company does not have plans for going public, as most of
the financing is raised internally.
CSS is a start-up company that was registered in the year 2011.
2.2 Start-up Summary
Of the total start-up expenses, the lion's share has been spent on software licenses. Estimated
start-up cash requirements should be sufficient to cover ongoing expenses in the first months
of operation. Shabari santhosh and Fields have each invested heavily, with the rest of
investment coming from minority shareholders . The company has also secured a 10-year SBA
loan and a one-year loan from its bank. Following is a chart and table summarizing projected
initial start-up costs.

Page 3

Table: Start-up

Start-up
Requirements
Start-up Expenses
Legal
Software Licenses
Other
Total Start-up Expenses

RS 3,000
RS 20,000
RS 1,000
RS 24,000

Start-up Assets
Cash Required
Other Current Assets
Long-term Assets
Total Assets

RS 180,000
RS 75,000
RS 100,000
RS 355,000

Total Requirements

RS 379,000

Page 4

Table: Start-up Funding

Start-up Funding
Start-up Expenses to Fund
Start-up Assets to Fund
Total Funding Required

RS 24,000
RS 355,000
RS 379,000

Assets
Non-cash Assets from Start-up
Cash Requirements from Start-up
Additional Cash Raised
Cash Balance on Starting Date
Total Assets

RS 175,000
RS 180,000
RS 0
RS 180,000
RS 355,000

Liabilities and Capital

Liabilities
Current Borrowing
Long-term Liabilities
Accounts Payable (Outstanding Bills)
Other Current Liabilities (interest-free)
Total Liabilities

RS 50,000
RS 150,000
RS 1,000
RS 0
RS 201,000

Capital
Planned Investment
Andrew Christiansen
David Fields
Other
Additional Investment Requirement
Total Planned Investment

RS 60,000
RS 60,000
RS 58,000
RS 0
RS 178,000

Loss at Start-up (Start-up Expenses)

Total Capital

(RS 24,000)
RS 154,000

Total Capital and Liabilities

RS 355,000

Total Funding

RS 379,000

Page 5

Chart: Start-up

Start-up
360,000
320,000
280,000
240,000
200,000
160,000
120,000
80,000
40,000
0
Expenses

Assets

Investment

Loans

3.0 Service Description

CCS offers a suite of educational software for each grade level, from Kindergarten through 12th
grade. These suites are developed in collaboration with major curriculum publishers with whom
CCS has established strategic partnerships.
CCS provides full installation, initial, and ongoing consulting support. These services are
provided as part of each software package purchase.
4.0 Market Analysis Summary
CCS has a focus on K-12 schools within the India. market, especially schools who:

already own educational packages from large curriculum publishers who are CCS strategic
partners
owns software that has been recently developed by CSS.

The following chart and table summarize the total market potential for CSS products.

Page 6

Chart: Market Analysis (Pie)

Table: Market Analysis

Market Analysis
Potential Customers

Growth

Urban K-12 Schools

Rural K-12 Schools
Total

5%
5%
5.01%

Year 1

Year 2

Year 3

Year 4

Year 5

2,500
1,500
4,000

2,625
1,575
4,200

2,756
1,654
4,410

2,894
1,737
4,631

3,039
1,824
4,863

CAGR
5.00%
5.01%
5.01%

4.1 Market Segmentation

Metropolitan Schools
Metropolitan schools often have larger student populations, with more classes, requiring more
extensive and comprehensive software packages. The installations are consequently more
extensive in nature.
Rural Schools
Rural schools often have relatively smaller student populations, and fewer classes. Additional
customization during installations is usually necessary, as the infrastructure for computer
networks is either substandard or nonexistent.

Page 7

4.2 Target Market Segment Strategy

The target market for CCS is the urban/metropolitan educational market, as this market
presents the highest level of opportunity in terms of revenues. Additionally, software
installations and customizations in this market are much more feasible in terms of technical
logistics and efficiencies. Thus, profitability is by far more likely in this market.
Relationships have been established with a large number of educational institutions and school
districts across the INDIA. Significant investments have been made by CCS to research and
understand the specific needs and potential enhancements to the current educational process.
By working closely with educational administrators in efforts to optimize the educational
process, strong relationships have been established and a high sales closing rate has resulted.
4.3 Market Needs
CCS's research has found that educators , as well as parents of K-12 children believe that the
educational process is in need of significant improvements. Children, for the most part, have
been found to strongly prefer an educational environment where they can learn "hands on"
using the computer in conjunction with teacher facilitation, as opposed to teacher facilitation
only.
4.4 Service Business Analysis
Major competition to CSS comes not from other software developers but from traditional book
publishers . In fact, one of the goals of the company is to educate its clientele about the
possibilities and features of the specially-designed software that assists in the educational
process. The tool CSS provides teachers with will help them become more effective and efficient
in classrooms. The company believes that the novelty and added value its products provide to
educators will be key buying decision criteria for the customers .
4.5 Competition and Buying Patterns
Only a handful of other companies are competing directly with CCS in this market. CCS plans to
develop a healthy level of market share, with a goal of 10% at the end of three years . With the
exponential increase in computer and Internet usage among the public in the last five years ,
this is a relatively new market. CCS has taken a lead primarily due to its intense efforts both in
research and development, as well as in establishing relationships in the educational
community.
Educational institutions and school districts have not been active in searching out technical
enhancements to the educational process. Rather, companies such as CCS have often utilized a
more "push" type of marketing strategy. The educational community has had to be "educated"
themselves on the opportunities of utilizing technical infrastructures to enhance learning
processes.
The competitive marketplace includes only a handful of direct competitors within the learning
information systems vendors segment, providing software products and installation and
systems integration services to kindergarten through senior high (K-12) schools in the United
States. Typical learning information systems consist of computer software and related training
designed to improve student academic performance by increasing the quality, quantity, and

Page 8

timeliness of performance data available to educators and by facilitating increased student

practice of essential skills.
There are a number of competing products covering a wide range of educational requirements.
These include:

Accelerated reading products--software for motivating and monitoring increased literaturebased reading practice.
Accelerated math--software aimed to increase a student's competency across this discipline
utilizing the latest techniques.
Professional development training for educators .
Test-generation software.

Software products offered by competitors also aim to improve student academic performance
by intensifying skills practice and increasing the quality, quantity and timeliness of information
available to educators .
CCS competes primarily against more traditional methods of education, training and testing,
including pencil and paper testing. In addition, CCS competes with other companies offering
educational software products to schools, such as EDUCOMP, EDUSERVE, EDURITE,NIIT
5.0 Strategy and Implementation Summary
CCS intends to succeed by offering K-12 schools a technological tool to assist teacheRS in
making the educational process more efficient and effective.
5.1 Competitive Edge
CCS' competitive edge is its new ideas and first to market technologies.
5.2 Sales Strategy
The table and charts shows the level of sales CCS intends to deliver in the first year through
the third year of the plan. Detailed monthly sales for the first year are in the appendix.

Page 9

Chart: Sales by Year

Sales by Year
14,000,000
12,000,000
10,000,000

Software Systems
8,000,000

Installation & Customization

Other Consulting

6,000,000
4,000,000
2,000,000
0
Year 1

Year 2

Year 3

Chart: Sales Monthly

Sales Monthly
900,000
800,000
700,000
600,000

Software Systems

500,000

Installation & Customization

400,000

Other Consulting
300,000
200,000
100,000
0
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Table: Sales Forecast

Sales Forecast
Year 1

Year 2

Year 3

Software Systems
Installation & Customization
Other Consulting
Total Unit Sales

240
240
120
600

276
276
138
690

317
317
159
794

Unit Prices
Software Systems
Installation & Customization
Other Consulting

Year 1
RS 25,000.00
RS 15,000.00
RS 5,000.00

Year 2
RS 25,000.00
RS 15,000.00
RS 5,000.00

Year 3
RS 25,000.00
RS 15,000.00
RS 5,000.00

Software Systems
Installation & Customization
Other Consulting
Total Sales

RS 6,000,000
RS 3,600,000
RS 600,000
RS 10,200,000

RS 6,900,000
RS 4,140,000
RS 690,000
RS 11,730,000

RS 7,935,000
RS 4,761,000
RS 793,500
RS 13,489,500

Direct Unit Costs

Software Systems
Installation & Customization
Other Consulting

Year 1
RS 2,000.00
RS 10,000.00
RS 2,000.00

Year 2
RS 2,000.00
RS 10,000.00
RS 2,000.00

Year 3
RS 2,000.00
RS 10,000.00
RS 2,000.00

RS 480,000
RS 2,400,000
RS 240,000
RS 3,120,000

RS 552,000
RS 2,760,000
RS 276,000
RS 3,588,000

RS 634,800
RS 3,174,000
RS 317,400
RS 4,126,200

Unit Sales

Sales

Direct Cost of Sales

Software Systems
Installation & Customization
Other Consulting
Subtotal Direct Cost of Sales

6.0 Management Summary

Shabari santhosh has extensive experience in business planning ,finance, Fields brings in
experience in the area of marketing, advertising, and communications.
6.1 Personnel Plan
CSS will focus on strong product development and marketing. These are the areas where most
of the investments and training will go. The table below, and in the appendix, outlines the
company's personnel plan for the next years .
Table: Personnel

Personnel Plan
Product Development
Installation Technicians
Administrative
Sales & Marketing
Other
Total People
Total Payroll

Year 1

Year 2

Year 3

RS 900,000
RS 875,000
RS 595,000
RS 900,000
RS 0
82

RS 945,000
RS 918,750
RS 624,750
RS 945,000
RS 0
86

RS 992,250
RS 964,688
RS 655,988
RS 992,250
RS 0
90

RS 3,270,000

RS 3,433,500

RS 3,605,175

Page 11

7.0 Financial Plan

CCS expects to raise its own capital, and to acquire a guaranteed the SBA 10-year loan. This
provides the bulk of the current financing required.
7.1 Break-even Analysis
CCS's Break-even Analysis is based on the average of the first-year figures for total sales by
units, and by operating expenses. These are presented as per-unit revenue, per-unit cost, and
fixed costs. These conservative assumptions make for a more accurate estimate of real risk.
Table: Break-even Analysis

Break-even Analysis
Monthly Units Break-even
Monthly Revenue Break-even

27
RS 466,023

Assumptions:
Average Per-Unit Revenue
Average Per-Unit Variable Cost
Estimated Monthly Fixed Cost

RS 17,000.00
RS 5,200.00
RS 323,475

Chart: Break-even Analysis

Break-even Analysis
300,000

200,000

100,000

(100,000)

(200,000)

(300,000)
0

10

15

20

25

30

35

40

45

50

55

Page 12

7.2 Projected Profit and Loss

The projected Profit and Loss for CCS is presented in the accompanying table. The three yearly
totals are shown here, with year one monthlies in the appendix.
Table: Profit and Loss

Pro Forma Profit and Loss

Year 1

Year 2

Year 3

RS 10,200,000
RS 3,120,000
RS 0
RS 3,120,000

RS 11,730,000
RS 3,588,000
RS 0
RS 3,588,000

RS 13,489,500
RS 4,126,200
RS 0
RS 4,126,200

RS 7,080,000
69.41%

RS 8,142,000
69.41%

RS 9,363,300
69.41%

Payroll
Sales and Marketing and Other Expenses
Depreciation
Utilities
Payroll Taxes
Other

RS 3,270,000
RS 96,000
RS 24,000
RS 1,200
RS 490,500
RS 0

RS 3,433,500
RS 150,000
RS 27,600
RS 1,500
RS 515,025
RS 0

RS 3,605,175
RS 265,000
RS 31,740
RS 1,700
RS 540,776
RS 0

Total Operating Expenses

RS 3,881,700

RS 4,127,625

RS 4,444,391

Profit Before Interest and Taxes

EBITDA
Interest Expense
Taxes Incurred

RS 3,198,300
RS 3,222,300
RS 18,700
RS 808,144

RS 4,014,375
RS 4,041,975
RS 16,400
RS 999,494

RS 4,918,909
RS 4,950,649
RS 14,000
RS 1,246,664

Net Profit
Net Profit/Sales

RS 2,371,456
23.25%

RS 2,998,481
25.56%

RS 3,658,244
27.12%

Sales
Direct Cost of Sales
Other
Total Cost of Sales
Gross Margin
Gross Margin %

Expenses

Page 13

Chart: Profit Monthly

Profit Monthly
200,000
180,000
160,000
140,000
120,000
100,000
80,000
60,000
40,000
20,000
$0
Month 1
Month 3
Month 5
Month 7
Month 9
Month 11
Month 2
Month 4
Month 6
Month 8
Month 10
Month 12

Chart: Profit Yearly

Profit Yearly

4,000,000
3,600,000
3,200,000
2,800,000
2,400,000
2,000,000
1,600,000
1,200,000
800,000
400,000
$0
Year 1

Year 2

Year 3

Page 14

Chart: Gross Margin Monthly

Gross Margin Monthly

600,000

500,000

400,000

300,000

200,000

100,000

0
Month 1
Month 3
Month 5
Month 7
Month 9
Month 11
Month 2
Month 4
Month 6
Month 8
Month 10
Month 12

Chart: Gross Margin Yearly

Gross Margin Yearly

10,000,000
9,000,000
8,000,000
7,000,000
6,000,000
5,000,000
4,000,000
3,000,000
2,000,000
1,000,000
$0
Year 1

Year 2

Year 3

Page 15

7.3 Projected Cash Flow

The cash flow projection shows that provisions for ongoing expenses are adequate to meet
CCS's needs as the business generates cash flow sufficient to support operations.

Chart: Cash

Cash
1,800,000
1,500,000
1,200,000

Net Cash Flow

900,000

Cash Balance
600,000
300,000
0
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Table: Cash Flow

Pro Forma Cash Flow

Year 1

Year 2

Year 3

RS 3,468,000
RS 5,628,700
RS 9,096,700

RS 3,988,200
RS 7,576,305
RS 11,564,505

RS 4,586,430
RS 8,712,751
RS 13,299,181

RS 0
RS 0
RS 0
RS 0
RS 0
RS 0
RS 190,000
RS 9,286,700

RS 0
RS 0
RS 0
RS 0
RS 0
RS 0
RS 0
RS 11,564,505

RS 0
RS 0
RS 0
RS 0
RS 0
RS 0
RS 0
RS 13,299,181

Year 1

Year 2

Year 3

RS 3,270,000
RS 4,171,394
RS 7,441,394

RS 3,433,500
RS 5,201,383
RS 8,634,883

RS 3,605,175
RS 6,118,402
RS 9,723,577

Sales Tax, VAT, HST/GST Paid Out

Principal Repayment of Current Borrowing
Other Liabilities Principal Repayment
Long-term Liabilities Principal Repayment
Purchase Other Current Assets
Purchase Long-term Assets
Dividends
Subtotal Cash Spent

RS 0
RS 12,000
RS 0
RS 12,000
RS 0
RS 135,000
RS 0
RS 7,600,394

RS 0
RS 12,000
RS 0
RS 12,000
RS 0
RS 225,000
RS 0
RS 8,883,883

RS 0
RS 12,000
RS 0
RS 12,000
RS 0
RS 295,000
RS 0
RS 10,042,577

Net Cash Flow

Cash Balance

RS 1,686,306
RS 1,866,306

RS 2,680,622
RS 4,546,928

RS 3,256,604
RS 7,803,532

Cash Received
Cash from Operations
Cash Sales
Cash from Receivables
Subtotal Cash from Operations
Additional Cash Received
Sales Tax, VAT, HST/GST Received
New Current Borrowing
New Other Liabilities (interest-free)
New Long-term Liabilities
Sales of Other Current Assets
Sales of Long-term Assets
New Investment Received
Subtotal Cash Received
Expenditures
Expenditures from Operations
Cash Spending
Bill Payments
Subtotal Spent on Operations
Additional Cash Spent

Page 17

7.4 Projected Balance Sheet

Following is the projected Balance Sheet for CCS. Again, three years of annuals are shown
below, with first year monthlies in the appendix.
Table: Balance Sheet

Pro Forma Balance Sheet

Year 1

Year 2

Year 3

RS 1,866,306
RS 1,103,300
RS 75,000
RS 3,044,606

RS 4,546,928
RS 1,268,795
RS 75,000
RS 5,890,723

RS 7,803,532
RS 1,459,114
RS 75,000
RS 9,337,646

RS 235,000
RS 24,000
RS 211,000
RS 3,255,606

RS 460,000
RS 51,600
RS 408,400
RS 6,299,123

RS 755,000
RS 83,340
RS 671,660
RS 10,009,306

Year 1

Year 2

Year 3

Accounts Payable
Current Borrowing
Other Current Liabilities
Subtotal Current Liabilities

RS 364,149
RS 38,000
RS 0
RS 402,149

RS 433,185
RS 26,000
RS 0
RS 459,185

RS 509,124
RS 14,000
RS 0
RS 523,124

Long-term Liabilities
Total Liabilities

RS 138,000
RS 540,149

RS 126,000
RS 585,185

RS 114,000
RS 637,124

Paid-in Capital
Retained Earnings
Earnings
Total Capital
Total Liabilities and Capital

RS 368,000
(RS 24,000)
RS 2,371,456
RS 2,715,456
RS 3,255,606

RS 368,000
RS 2,347,456
RS 2,998,481
RS 5,713,938
RS 6,299,123

RS 368,000
RS 5,345,938
RS 3,658,244
RS 9,372,182
RS 10,009,306

Net Worth

RS 2,715,456

RS 5,713,938

RS 9,372,182

Assets
Current Assets
Cash
Accounts Receivable
Other Current Assets
Total Current Assets
Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets
Liabilities and Capital
Current Liabilities

Page 18

7.5 Business Ratios

The following table represents business ratios for the educational support software industry.
These numbers are determined by the Standard Industry Classification (SIC) Index code 7372,
Software Publishing Prepackaged.
Table: Ratios
Ratio Analysis
Year 1

Year 2

Year 3

Industry Profile

n.a.

15.00%

15.00%

9.70%

Accounts Receivable
Other Current Assets
Total Current Assets
Long-term Assets
Total Assets

33.89%
2.30%
93.52%
6.48%
100.00%

20.14%
1.19%
93.52%
6.48%
100.00%

14.58%
0.75%
93.29%
6.71%
100.00%

21.50%
45.70%
70.20%
29.80%
100.00%

Current Liabilities
Long-term Liabilities
Total Liabilities
Net Worth

12.35%
4.24%
16.59%
83.41%

7.29%
2.00%
9.29%
90.71%

5.23%
1.14%
6.37%
93.63%

42.40%
19.20%
61.60%
38.40%

100.00%
69.41%
46.04%
0.59%
31.36%

100.00%
69.41%
43.87%
0.85%
34.22%

100.00%
69.41%
42.17%
1.48%
36.46%

100.00%
100.00%
79.40%
1.30%
2.20%

7.57
7.57
16.59%
117.09%
97.67%

12.83
12.83
9.29%
69.97%
63.47%

17.85
17.85
6.37%
52.33%
49.00%

1.51
1.16
61.60%
3.50%
9.20%

Sales Growth
Percent of Total Assets

Percent of Sales
Sales
Gross Margin
Selling, General & Administrative Expenses
Advertising Expenses
Profit Before Interest and Taxes
Main Ratios
Current
Quick
Total Debt to Total Assets
Pre-tax Return on Net Worth
Pre-tax Return on Assets
Additional Ratios

Year 1

Year 2

Year 3

Net Profit Margin

Return on Equity

23.25%
87.33%

25.56%
52.48%

27.12%
39.03%

n.a
n.a

6.10
57
12.45
27
3.13

6.10
56
12.17
28
1.86

6.10
56
12.17
28
1.35

n.a
n.a
n.a
n.a
n.a

0.20
0.74

0.10
0.78

0.07
0.82

n.a
n.a

RS 2,642,456
171.03

RS 5,431,538
244.78

RS 8,814,522
351.35

n.a
n.a

0.32
12%
4.83

0.54
7%
10.07

0.74
5%
15.06

n.a
n.a
n.a

Activity Ratios
Accounts Receivable Turnover
Collection Days
Accounts Payable Turnover
Payment Days
Total Asset Turnover
Debt Ratios
Debt to Net Worth
Current Liab. to Liab.
Liquidity Ratios
Net Working Capital
Interest Coverage
Additional Ratios
Assets to Sales
Current Debt/Total Assets
Acid Test

Page 19

Sales/Net Worth
Dividend Payout

3.76
0.00

2.05
0.00

1.44
0.00

n.a
n.a

Page 20

Appendix
Table: Sales Forecast

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

20
20
10
50

20
20
10
50

20
20
10
50

20
20
10
50

20
20
10
50

20
20
10
50

20
20
10
50

20
20
10
50

20
20
10
50

20
20
10
50

20
20
10
50

20
20
10
50

Unit Sales
Software Systems
Installation & Customization
Other Consulting
Total Unit Sales

0%
0%
0%

Unit Prices

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

Software Systems

RS 25,000.00

RS 25,000.00

RS 25,000.00

RS 25,000.00

RS 25,000.00

RS 25,000.00

RS 25,000.00

RS 25,000.00

RS 25,000.00

RS 25,000.00

RS 25,000.00

RS 25,000.00

Installation & Customization

RS 15,000.00

RS 15,000.00

RS 15,000.00

RS 15,000.00

RS 15,000.00

RS 15,000.00

RS 15,000.00

RS 15,000.00

RS 15,000.00

RS 15,000.00

RS 15,000.00

RS 15,000.00

RS 5,000.00

RS 5,000.00

RS 5,000.00

RS 5,000.00

RS 5,000.00

RS 5,000.00

RS 5,000.00

RS 5,000.00

RS 5,000.00

RS 5,000.00

RS 5,000.00

RS 5,000.00

Software Systems

RS 500,000

RS 500,000

RS 500,000

RS 500,000

RS 500,000

RS 500,000

RS 500,000

RS 500,000

RS 500,000

RS 500,000

RS 500,000

RS 500,000

Installation & Customization

RS 300,000

RS 300,000

RS 300,000

RS 300,000

RS 300,000

RS 300,000

RS 300,000

RS 300,000

RS 300,000

RS 300,000

RS 300,000

RS 300,000

RS 50,000

RS 50,000

RS 50,000

RS 50,000

RS 50,000

RS 50,000

RS 50,000

RS 50,000

RS 50,000

RS 50,000

RS 50,000

RS 50,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

Other Consulting
Sales

Other Consulting
Total Sales
Direct Unit Costs
Software Systems
Installation & Customization
Other Consulting

0.00%
0.00%
0.00%

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

RS 2,000.00
RS 10,000.00
RS 2,000.00

RS 2,000.00
RS 10,000.00
RS 2,000.00

RS 2,000.00
RS 10,000.00
RS 2,000.00

RS 2,000.00
RS 10,000.00
RS 2,000.00

RS 2,000.00
RS 10,000.00
RS 2,000.00

RS 2,000.00
RS 10,000.00
RS 2,000.00

RS 2,000.00
RS 10,000.00
RS 2,000.00

RS 2,000.00
RS 10,000.00
RS 2,000.00

RS 2,000.00
RS 10,000.00
RS 2,000.00

RS 2,000.00
RS 10,000.00
RS 2,000.00

RS 2,000.00
RS 10,000.00
RS 2,000.00

RS 2,000.00
RS 10,000.00
RS 2,000.00

Direct Cost of Sales

Software Systems
Installation & Customization
Other Consulting
Subtotal Direct Cost of Sales

RS 40,000

RS 40,000

RS 40,000

RS 40,000

RS 40,000

RS 40,000

RS 40,000

RS 40,000

RS 40,000

RS 40,000

RS 40,000

RS 40,000

RS 200,000

RS 200,000

RS 200,000

RS 200,000

RS 200,000

RS 200,000

RS 200,000

RS 200,000

RS 200,000

RS 200,000

RS 200,000

RS 200,000

RS 20,000

RS 20,000

RS 20,000

RS 20,000

RS 20,000

RS 20,000

RS 20,000

RS 20,000

RS 20,000

RS 20,000

RS 20,000

RS 20,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

Page 1

Appendix
Table: Personnel

Personnel Plan
Product Development
Installation Technicians
Administrative
Sales & Marketing
Other
Total People
Total Payroll

0%
0%
0%
0%
0%

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

RS 75,000
RS 72,917
RS 49,583
RS 75,000
RS 0
82

RS 75,000
RS 72,917
RS 49,583
RS 75,000
RS 0
82

RS 75,000
RS 72,917
RS 49,583
RS 75,000
RS 0
82

RS 75,000
RS 72,917
RS 49,583
RS 75,000
RS 0
82

RS 75,000
RS 72,917
RS 49,583
RS 75,000
RS 0
82

RS 75,000
RS 72,917
RS 49,583
RS 75,000
RS 0
82

RS 75,000
RS 72,917
RS 49,583
RS 75,000
RS 0
82

RS 75,000
RS 72,917
RS 49,583
RS 75,000
RS 0
82

RS 75,000
RS 72,917
RS 49,583
RS 75,000
RS 0
82

RS 75,000
RS 72,917
RS 49,583
RS 75,000
RS 0
82

RS 75,000
RS 72,917
RS 49,583
RS 75,000
RS 0
82

RS 75,000
RS 72,917
RS 49,583
RS 75,000
RS 0
82

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

Page 2

Appendix
Table: General Assumptions

General Assumptions
Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

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%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

25.00%

Plan Month

Other

Month 12

Page 3

Appendix
Table: Profit and Loss

Pro Forma Profit and Loss

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

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

Direct Cost of Sales

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

Total Cost of Sales

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

RS 260,000

Gross Margin

RS 590,000

RS 590,000

RS 590,000

RS 590,000

RS 590,000

RS 590,000

RS 590,000

RS 590,000

RS 590,000

RS 590,000

RS 590,000

RS 590,000

69.41%

69.41%

69.41%

69.41%

69.41%

69.41%

69.41%

69.41%

69.41%

69.41%

69.41%

69.41%

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 8,000

RS 8,000

RS 8,000

RS 8,000

RS 8,000

RS 8,000

RS 8,000

RS 8,000

RS 8,000

RS 8,000

RS 8,000

RS 8,000

RS 2,000

RS 2,000

RS 2,000

RS 2,000

RS 2,000

RS 2,000

RS 2,000

RS 2,000

RS 2,000

RS 2,000

RS 2,000

RS 2,000

RS 100

RS 100

RS 100

RS 100

RS 100

RS 100

RS 100

RS 100

RS 100

RS 100

RS 100

RS 100

RS 40,875
RS 0

RS 40,875
RS 0

RS 40,875
RS 0

RS 40,875
RS 0

RS 40,875
RS 0

RS 40,875
RS 0

RS 40,875
RS 0

RS 40,875
RS 0

RS 40,875
RS 0

RS 40,875
RS 0

RS 40,875
RS 0

RS 40,875
RS 0

Total Operating Expenses

RS 323,475

RS 323,475

RS 323,475

RS 323,475

RS 323,475

RS 323,475

RS 323,475

RS 323,475

RS 323,475

RS 323,475

RS 323,475

RS 323,475

Profit Before Interest and Taxes

RS 266,525

RS 266,525

RS 266,525

RS 266,525

RS 266,525

RS 266,525

RS 266,525

RS 266,525

RS 266,525

RS 266,525

RS 266,525

RS 266,525

EBITDA

RS 268,525

RS 268,525

RS 268,525

RS 268,525

RS 268,525

RS 268,525

RS 268,525

RS 268,525

RS 268,525

RS 268,525

RS 268,525

RS 268,525

RS 1,650

RS 1,633

RS 1,617

RS 1,600

RS 1,583

RS 1,567

RS 1,550

RS 1,533

RS 1,517

RS 1,500

RS 1,483

RS 1,467

RS 79,463

RS 66,223

RS 66,227

RS 66,231

RS 66,235

RS 66,240

RS 66,244

RS 66,248

RS 66,252

RS 66,256

RS 66,260

RS 66,265

RS 185,413

RS 198,669

RS 198,681

RS 198,694

RS 198,706

RS 198,719

RS 198,731

RS 198,744

RS 198,756

RS 198,769

RS 198,781

RS 198,794

21.81%

23.37%

23.37%

23.38%

23.38%

23.38%

23.38%

23.38%

23.38%

23.38%

23.39%

23.39%

Other

Gross Margin %

Expenses
Payroll
Sales and Marketing and Other
Expenses
Depreciation
Utilities
Payroll Taxes
Other

Interest Expense
Taxes Incurred
Net Profit
Net Profit/Sales

15%

Page 4

Appendix
Table: Cash Flow

Pro Forma Cash Flow

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

RS 289,000

RS 289,000

RS 289,000

RS 289,000

RS 289,000

RS 289,000

RS 289,000

RS 289,000

RS 289,000

RS 289,000

RS 289,000

RS 289,000

RS 0

RS 18,700

RS 561,000

RS 561,000

RS 561,000

RS 561,000

RS 561,000

RS 561,000

RS 561,000

RS 561,000

RS 561,000

RS 561,000

RS 289,000

RS 307,700

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 0
RS 0

RS 0
RS 0

RS 0
RS 0

RS 0
RS 0

RS 0
RS 0

RS 0
RS 0

RS 0
RS 0

RS 0
RS 0

RS 0
RS 0

RS 0
RS 0

RS 0
RS 0

RS 0
RS 0

New Other Liabilities (interest-free)

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

New Long-term Liabilities

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

Sales of Other Current Assets

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

Sales of Long-term Assets

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

New Investment Received

RS 0

RS 190,000

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 289,000

RS 497,700

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

RS 850,000

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 272,500

RS 14,003

RS 389,646

RS 376,831

RS 376,818

RS 376,806

RS 376,793

RS 376,781

RS 376,768

RS 376,756

RS 376,743

RS 376,731

RS 376,718

RS 286,503

RS 662,146

RS 649,331

RS 649,318

RS 649,306

RS 649,293

RS 649,281

RS 649,268

RS 649,256

RS 649,243

RS 649,231

RS 649,218

Cash Received
Cash from Operations
Cash Sales
Cash from Receivables
Subtotal Cash from Operations
Additional Cash Received
Sales Tax, VAT, HST/GST Received
New Current Borrowing

Subtotal Cash Received

Expenditures

0.00%

Expenditures from Operations

Cash Spending
Bill Payments
Subtotal Spent on Operations
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out
Principal Repayment of Current Borrowing
Other Liabilities Principal Repayment

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

RS 1,000

Purchase Other Current Assets

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

Purchase Long-term Assets

RS 0

RS 0

RS 0

RS 15,000

RS 15,000

RS 15,000

RS 15,000

RS 15,000

RS 15,000

RS 15,000

RS 15,000

RS 15,000

Long-term Liabilities Principal Repayment

Dividends
Subtotal Cash Spent
Net Cash Flow

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 0

RS 288,503

RS 664,146

RS 651,331

RS 666,318

RS 666,306

RS 666,293

RS 666,281

RS 666,268

RS 666,256

RS 666,243

RS 666,231

RS 666,218

RS 497

(RS 166,446)

RS 198,669

RS 183,682

RS 183,694

RS 183,707

RS 183,719

RS 183,732

RS 183,744

RS 183,757

RS 183,769

RS 183,782

Page 5

Appendix
Cash Balance

RS 180,497

RS 14,051

RS 212,721

RS 396,402

RS 580,096

RS 763,803

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

RS 180,000

RS 180,497

RS 14,051

RS 212,721

RS 396,402

RS 580,096

Accounts Receivable

RS 0

RS 561,000

Other Current Assets

Total Current Assets

RS 75,000
RS 255,000

RS 75,000
RS 816,497

RS
1,103,300
RS 75,000
RS
1,192,351

RS
1,103,300
RS 75,000
RS
1,391,021

RS
1,103,300
RS 75,000
RS
1,574,702

RS 100,000
RS 0
RS 100,000
RS 355,000

RS 100,000
RS 2,000
RS 98,000
RS 914,497

RS 100,000
RS 4,000
RS 96,000
RS
1,288,351

RS 100,000
RS 6,000
RS 94,000
RS
1,485,021

Month 1

Month 2

RS 1,000
RS 50,000
RS 0
RS 51,000

RS 377,085
RS 49,000
RS 0
RS 426,085

Long-term Liabilities
Total Liabilities

RS 150,000
RS 201,000

Paid-in Capital
Retained Earnings
Earnings

RS 947,522

RS 1,131,254

RS 1,314,998

RS 1,498,755

RS 1,682,524

RS 1,866,306

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

RS 763,803

RS 947,522

RS
1,103,300
RS 75,000
RS
1,758,396

RS
1,103,300
RS 75,000
RS
1,942,103

RS
1,103,300
RS 75,000
RS
2,125,822

RS
1,131,254
RS
1,103,300
RS 75,000
RS
2,309,554

RS
1,314,998
RS
1,103,300
RS 75,000
RS
2,493,298

RS
1,498,755
RS
1,103,300
RS 75,000
RS
2,677,055

RS
1,682,524
RS
1,103,300
RS 75,000
RS
2,860,824

RS
1,866,306
RS
1,103,300
RS 75,000
RS
3,044,606

RS 115,000
RS 8,000
RS 107,000
RS
1,681,702

RS 130,000
RS 10,000
RS 120,000
RS
1,878,396

RS 145,000
RS 12,000
RS 133,000
RS
2,075,103

RS 160,000
RS 14,000
RS 146,000
RS
2,271,822

RS 175,000
RS 16,000
RS 159,000
RS
2,468,554

RS 190,000
RS 18,000
RS 172,000
RS
2,665,298

RS 205,000
RS 20,000
RS 185,000
RS
2,862,055

RS 220,000
RS 22,000
RS 198,000
RS
3,058,824

RS 235,000
RS 24,000
RS 211,000
RS
3,255,606

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

RS 364,270
RS 48,000
RS 0
RS 412,270

RS 364,258
RS 47,000
RS 0
RS 411,258

RS 364,246
RS 46,000
RS 0
RS 410,246

RS 364,234
RS 45,000
RS 0
RS 409,234

RS 364,222
RS 44,000
RS 0
RS 408,222

RS 364,210
RS 43,000
RS 0
RS 407,210

RS 364,198
RS 42,000
RS 0
RS 406,198

RS 364,186
RS 41,000
RS 0
RS 405,186

RS 364,174
RS 40,000
RS 0
RS 404,174

RS 364,161
RS 39,000
RS 0
RS 403,161

RS 364,149
RS 38,000
RS 0
RS 402,149

RS 149,000
RS 575,085

RS 148,000
RS 560,270

RS 147,000
RS 558,258

RS 146,000
RS 556,246

RS 145,000
RS 554,234

RS 144,000
RS 552,222

RS 143,000
RS 550,210

RS 142,000
RS 548,198

RS 141,000
RS 546,186

RS 140,000
RS 544,174

RS 139,000
RS 542,161

RS 138,000
RS 540,149

RS 178,000
(RS 24,000)
RS 0

RS 178,000
(RS 24,000)
RS 185,413

RS 368,000
(RS 24,000)
RS 384,081

RS 368,000
(RS 24,000)
RS 582,763

RS 368,000
(RS 24,000)
RS 781,456

RS 368,000
(RS 24,000)
RS 980,163

Total Capital

RS 154,000

RS 339,413

RS 728,081

RS 926,763

Total Liabilities and Capital

RS 355,000

RS 914,497

RS
1,288,351

RS
1,485,021

RS
1,125,456
RS
1,681,702

RS
1,324,163
RS
1,878,396

RS 368,000
(RS 24,000)
RS
1,178,881
RS
1,522,881
RS
2,075,103

RS 368,000
(RS 24,000)
RS
1,377,613
RS
1,721,613
RS
2,271,822

RS 368,000
(RS 24,000)
RS
1,576,356
RS
1,920,356
RS
2,468,554

RS 368,000
(RS 24,000)
RS
1,775,113
RS
2,119,113
RS
2,665,298

RS 368,000
(RS 24,000)
RS
1,973,881
RS
2,317,881
RS
2,862,055

RS 368,000
(RS 24,000)
RS
2,172,663
RS
2,516,663
RS
3,058,824

RS 368,000
(RS 24,000)
RS
2,371,456
RS
2,715,456
RS
3,255,606

Net Worth

RS 154,000

RS 339,413

RS 728,081

RS 926,763

RS
1,125,456

RS
1,324,163

RS
1,522,881

RS
1,721,613

RS
1,920,356

RS
2,119,113

RS
2,317,881

RS
2,516,663

RS
2,715,456

Table: Balance Sheet

Pro Forma Balance Sheet

Assets

Starting Balances

Current Assets
Cash

Long-term Assets
Long-term Assets
Accumulated Depreciation
Total Long-term Assets
Total Assets

Liabilities and Capital

Current Liabilities
Accounts Payable
Current Borrowing
Other Current Liabilities
Subtotal Current Liabilities

Page 6

Appendix

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