Financial Plan
The following sections will outline our financial plan for growth and continued sales. Important assumptions are laid out in each section to better clarify what we are projecting.
Important Assumptions
The current economic climate in the U.S. appears to be on the brink of recession. We do believe that this could have a mild impact on our company’s profitability because many families will start to allocate their expendable income towards more of the basic needs of the family. Spending money to go out to eat will be minimized. H.O.M.E. believes, however, that because our products are contributors to continued good health that people will continue to purchase our products to keep up with a healthy lifestyle.
We expect to raise $90,000 for start up capital between our 3 partners and to take out an SBA 7(a) loan of 30,000. The interest rate on this loan is prime (currently at 5.25%) plus 3.25% for loans under $100,000 with a note of 7 years or less. We are putting a lien on Matou’s current hairstyle business in order to secure our $30,000 loan. This will provide the necessary start-up capital, as well as, give us plenty of working capital to keep our business growing to meet our goal of opening another location in 3-4 years.
General Assumptions
2008 2009 2010
Plan Month 1 2 3
Current Interest Rate 8.5% 8.5% 8.5%
Long-Term Interest Rate 8.5% 8.5% 8.5%
Tax Rate 25.0% ...