Green Rabbit want to finance growth mainly through cash flow. We recognize that this means we will have to grow more slowly than we might like. The most important indicator in our case is inventory

Executive Summary

Green Rabbit want to finance growth mainly through cash flow. We recognize that this means we will have to grow more slowly than we might like. The most important indicator in our case is inventory turnover. We have to make sure that food inventory turnover stays at approximately one turn per month, or we risk loss through spoilage.

We do not want to let our average collection days get above 45 under any circumstances. This could cause a serious problem with cash flow, because our working capital situation is tight. Most credit sales will be via credit and debit cards. We target a net profit of 14% at the least, and concentrate first year cash on marketing costs and expecting a significant increase in sales.

Grand opening is one of the examples of big marketing investing, as we desire to attract attention right from the second the doors are open and word to be spread across Kanata community. Magnets will be given away for free, so at least 1000 people would have a reminder of our store on their fridges. Photographer is going to be invited so the result of our investments such as Disney princesses and balloons expositions can be captured and shared in social media.

The rest of the general start-up capital goes toward labor payment to layer, accouter for helping us with documental organization. Over all for the organization we would need nine thousand four hundred fifty Canadian dollars. For prepaid expenses we would need $18 271 for legal formation of our business and getting all needed permits in order to play nice music, serve good food and have a bright big signage not only on top of the entrance, but on the building, getting alarm system and so on. For website host service we would use word press, as Alexandra has experience creating websites and blogs in there.

Our inventory comes from certified organic suppliers: farms and businesses such as Ottawa Organics, Aubin farm, Eco products etc. Everything in café is going to be organic: materials, paint, plates and forks, lamps. Overall expenses on inventory is $10 806. For leasehold improvements we would use around $4 000-$6 000 for one area: white wooden floors, various of lightning, luxurious tiles in washrooms, set of artistic Mexican sinks: every penny was being counted and aimed on creation of strong brand image and memory in customer’s mind. Overall, for the improvements and labour in whole floor we need $31 292.

Suprisely, we invest more in design and walls than equipment, as one of the benefits of baby food preparation is that all you need is good blender, food processor and frying pan: the rest of the equipment such as food thermometers, mixing sets and so on cost not much, however have short period of deprecation: around 5 years. Overall equipment cost is $27,199.

START-UP COST
	QUANTITY	COST	TOTAL	REFERENCE
GENERAL START-UP COST
Organizational
Business cards	10 000			Zoom Printing
Flyers	5 000			Zoom Printing
Magnets	1 000			Zoom Printing
Advertising	4 (1 month)	1 325		Kanata Courier
The BABY SHOW (1 booth 50 sq.ft) Bisness Registration GRAND OPENING EXPENSES Balloons (bags 20 each) BALLOONS EXPOSITIONS: · Snazzy Impression Bouquet · Signature Topiary · Link-a-Loon Balloon Arch Actresses/Disney Prinseses performance Meal Testers Milkshakes Event Invitations “Floral Touch” Photographer(hours)	1.5	39.99 16.99 84.99 160 for 1 + 75 each 7.49 for 10	79.98 16.99 84.99 59.92	OH Baby! Magazine Government of Canada Cody Party Cody Party Cody Party Cody Party Princes Parties Vista Print Alexandra’s friend $2 316

GENERAL STAR-UP COST(2)
	QUANTITY	COST	TOTAL	REFERENCE
Organizational
Business Lawyer(hrs)			3 060	Marks&Marks
Accountant(hrs)			4 050	Padgett
Employee training				Alexandra
SUB-TOTAL ORGANIZATIONAL (TABLES 1-2):				$9 445

START-UP COST (3)
	QUANTITY	COST	TOTAL	REFERENCE
PREPAID EXPENSES
Business Name Registration				Service Ontario
Business Name search		19.99	19.99	IncorpDirect Inc
Web Adress: Wordpress Premium (1 year)				Wordpress: Website and Blog
Lease(months)		4 643	13 929	Brenetcom
PERMITS
Permnent Sign Permit Street Ad Permit Food Premises(year) Licence Location Sign Perfoming Right Licence (Bacround Music 15A) Trade Marking Fire Safety 20pds Insurance Alarm System (months) Hydro/Elec. (months) Natural Gas Hook Up Telephone Internet WIFI SUB-TOTAL PREPAID EXPENSES	3m 1 year monthly monthly	94.51 18.95	94.51 18.95	City of Ottawa City of Ottawa City of Ottawa City of Ottawa City of Ottawa City of Ottawa Canadian Tyre Co-operators National Capital Alarm Hydro One Enbridge Chart Mobile Storm Internet $18 271

GENERAL START-UP COST(4)
	QUANTITY	COST($)	TOTAL($)	REFERENCE
INVENTORY AND OFFICE SUPPLIES
Arugula-baby loose,organic (pounds)		5,33	10.66	Ottawa Organics
Asparagus,Bunched organic (p)		2,10	10.5	Ottawa Organics
Avocados-Hass, organic		1.40		Ottawa Organics
Bananas-organic (p) Beans-green organic(p) Beets- bunch, various, organic (p) Bok Choy-organic(p) Broccolini organic(p) Burdock Root, organic (p) Cabbage-green, organic(p) Cabbage-red, organic(p) Carrots-1# bags, organic Celery-organic(p) Cucumber-regular,organic (p) Dill-organic Escarole-, organic Gala-3lb bag Galangal(p) Garlic,organic(p) Grapefruit-red, organic(p) Grapes-red seedless,org(p) Herbs-Happy Valley plants, organic(bag) Kiwi-Organic(each) Lemon-Organic(p) Lettuce Red leaf, Organic(p) Limes Organic (each) Mangoes Organic (p) Mint(bag) Mushrooms-portobello, org(p) Onions-Organic 3lb bag Oranges-blood, organic(p) Potatoes white, organic 5 lb Radish-Organic(p) Scallions-Organic (p) Spinach-baby, Organic (p) Strawberries organic 1 lb Tomatoes-Cherry, organic(p) Tomatoes-Grape, organic(p) 3.8% Whole Organic Milk(4L) Organic Cheese (p) Grass Fed Beef 1lb Grass Fed Lamb 1lb Free range turkey 1 lb Organic Duck 1 lb Organic Chiken 1lb Fresh Farm Eggs dozen Scented Organic Roses dozen Homemade Pickles Jar Lap 48”x60”x Woolen Blankets Traditional French Baguette, organic Cassoni, organic Olive Cilantro, Organic Rye Demi, organic English Muffins, organic Organic Coffe Blend “45 degrees” gounded (p) Organic Coffe “Crazy Goat, cherry” grounded (p) Oregon Chai, organic spiced tea(p) Brown Sugar 3lb Brown Rice, organic 3lb Custom Design, glass jars 650 ml, labelled Clear Hinged Clamshell, eco-friendly(case 240) 2-compartment Hinged Sugarcane Clamshell EP-B002 (case250) 4 oz Sugarcane Soup Portion Cup (case 1800) 32 oz Salad Bowl (case 150) Medium Square Plate EP-P022 (case 500) Kit-Okant Strach Cutlery-Wrapped Set(250) 16 oz hot cups (1000) 16 oz green stripe cold cup (1000) OFFICE SUPPLIES Storex Binders(4) Kraft-Self-Sealing envelopes(20) Swingline light touch stapler Xerox Business Paper 5000 Lexmark colourfull cartritges Pilot begreen collection tape Pilot highlighters Pilot rolling pen set Desctop File Light touch staples pack Rolodex desk organizer SUB TOTAL INVENTORY AND OFFICE SUPPLIES:		0.86 2.38 2.48 1.42 2.72 5,22 0,92 1,00 1.04 0,95 3.25 1.87 2,75 4,65 10,61 2,87 1.24 2.02 2,23 0,26 1,04 0,27 1,34 1,88 4,53 1,46 1,99 2,55 1,51 4,60 5,61 3,75 1,72 9,87 10,2 7.50 1,50 2,90 2,50 13,99 13,99 12,99 4,55 28,62 63,47 88,75 63,02 125,55 143,28 3,99 40,99 84,99 399,99 440,99 4,79 6,59 2,89 8,49 8,49 24,99	25,8 23,8 24.8 14.2 27.2 10,44 9,2 10.4 14,25 18,7 27,5 9,3 10,61 5,74 6,2 10,1 11,15 2,6 10,4 5,4 6,7 13,16 45,3 1,46 19,9 12,75 15,1 40,6 28,05 37,5 17,2 98,7 7.50 4,5 8,7 7,5 279,8 279,8 259,8 9,1 5 000 84,00 177,5 125,55 143,28 39,0 81,98 84,99 399,99 440,99 4,79 6,59 2,89 8,49 8,49 24,99	Ottawa Organics Ottawa Organics Ottawa Organics Ottawa Organics Ott.Org Organic Growers,ON Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Organic Growers Harmony Organic Harmony Organic Aubin Farm Aubin Farm Aubin Farm Aubin Farm Aubin Farm Aubin Farm Aubin Farm Aubin Farm Aubin Farm St.John’s Bakery St.John’s Bakery St.Johns Bakery St,Johns Bakery St,Jonhns Bakery Diesel House Diesel House Diesel House Diesel House Ottawa Organics Couronne Co Eco Products Eco Products Eco Products Eco Products Eco Products Eco Products Eco Products Eco Products Costco Costco Costco Costco Costco Costco Costco Costco Costco Costco Costco $10 806

LEASE HOLD IMPROVEMENT COST
	QUANTITY	COST	TOTAL	REFERENCE
GENERAL AREA
Floor Maple Natural Exclusive,café collection	743 sq.	6,96	5 171	Laurentian Hardwood
Floor labour (hr)				Laurentian Hardwood
Sealing prep labour (hr)				Canadian Tire
Ceiling Eco-Paint				Canadian Tire
Elk lighting modern organics(leaves, oat) Uttermost Naturals Knotted rattan hanging shade light Lithonia fluorescent lamp strip Electrician (hr)		206,10 272,80 46,05	3 709 90	Lights Online.com Lights Online.com Lights Online.com Capital Electric $11,780

BATHROOM
Bathroom eco-painting, labor				Canadian Tire, Painted by Alex
Floor
Hand-made Mexican Sink				Kijiji.ca
Toilet Invisia Cube			1 500	Caroma
Wall tile” Gold Onyx”	20 sq			Olympia Tile
Tile” Bootique Collection”	15 sq	56,70	850	Olympia Tile $4,390

KITCHEN
Stove top		3,999	3,999	Home Depot
Ventilation
Floor tile “White caramel”	20 sq			Home Depot
Counter “Natural”			1 050	Home Depot
Sink				Home Depot
Walls eco- Paint				Canadian Tire $4,439

FRONT OF THE BUILDING
Green Rabbit Custom Outdoor sign, lighted				Miller McConnell
Palm Plants		41,99	83,98	Wild Willy Flowers
Sign Neon Light Lamp Stick TOTAL LEASHOLDD IMPROVWEMENTSl				Light Online.com $10 683
				$31 292

EQUIPMENT COST
Custom sofa playground				BoMar Soft Playgrounds
White tables				Ikea
Kid craft table and chairs set		129,98		Hayneedle
Kid craft pastel play kitchen		134,99	134,99	Hayneedle
Peacock Print		184,99	184,99	Hayneedle
Vintage Chair Beach Blue		199,99		Hayneedle
Metal Coat Rack Home style chairs High kids chair, organic Giraffe wooden coat rack Baby Nursery Set Kitchen Mixer professional Electric Meat Grinder Professional food beverage blender Hamilton Beach Smoothie Blender Kuvings silent multi juicer Jura Capresso Coffe Maker Nesco real tea maker Sephra CF18L Chocolate Fountaine Earth pan cooking set Calphalon Stock Pot with lid set Calphalon stainless steel cookware set Spices stand Chopping boards Professional Knife Set Cheese board Multi peeler Kitchen storage shelve set,blue Insinkerator Garbage disposal Organic Candle set (100) Vinotemp 3.1 refrigirator Vinotemp stove pro Dimplex White cube electric fireplace Maverick food thermometer Mixing bowl set, 16 pieces Measure set Zyliss 13850 Nano disinfection scanner Little Ben cooking timer Electronic kitchen scales Digital multi-function Printer HPoffice desktop 23-B119C Gigaset DX800A hybrid desktop phone Bestar Cadence U-shape Workstation TOTAL START-UP:		72.98 44,99 313,99 99,95 59,99 2,499 81,99 169,95 169,99 99,99 399,99 24,98 79,99 699,00 140,00 4,50 499,99 179,00 75,00 989,99 229,00 54,99 69,99 28,99 159,99 17,00 59,99 788,74 440,99 732,24 199,99	72.98 3,780 44,99 313,99 99,95 59,99 2,499 81,99 169,95 169,99 99,99 399,99 24,98 239,97 699,99 140,00 9,00 999,98 179,00 75,00 1 979 2 600 229,00 54,99 69,99 18,99 159,99 17,00 59,99 788,74 440,99 732,24 199,99	Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Hayneedle Costco Costco Costco Costco Costco $27,199 $107 013

CASH RESERVE FOUND
Salaries: Owner/Cook		$3 800
Cashier FT		$3 520	$10 530
Sales Person PT		$1 500	$4 500
Pre-Advertising		$1 325	$1325
Insurance		$1200	$1200
Legal Rent		$1 821 $4 643	$1821 $13 929
TOTAL			$33,376 $132 705

APPLICATION OF FUNDS

General Start-up Cost total

$2 316

Organizational Cost

$9 445

Prepaid Expenses

$18 271

Opening Inventory/Office Supplies

$10 806

Leasehold Improvements

$31 292

Equipment Cost

$27 199

Cash Reserve Fund

Total Application of Funds

Total Assets:

$33,376

$ 139 834

Alexandra is sole owner of “Green Rabbit” and for startup expenses and possible first year debts will be paid from savings as for opening our doors and operating safely for three months we will need $139 834 and savings are $160 000. So $20 166 will be money for the “black day”.

SOURCES OF FOUNDS
Owner’s savings	$160 000
Equity Loans	$139 834 $0.00

Cash Flow Summary

So, on our realistic cash flow scenario you can see that big amount of income goes toward advertising expenses and rent, however advertising expenses are subject to change based on performance. For our sales projections:

Type of revenue	6 days:	Monthly:	Revenue:
Drinks totals	120 items		$763
Baby food totals	60 items		$3120
Soup of the day totals	30 items		$840
Salad totals Other items totals:	48 items 42+20=62		$1687
Max Total Per Day:	10+5+5+10+8 $1589	$47 670	$47 670
Year two 7% growth Year three 13% growth	+$1,112 +$1,445		+$33,369 +$43,379

If we would have 10 orders per day it will make around 60 orders per working week. Each would order drink for herself and baby so it makes at least two drinks per order. 60*2=120 approximate min drinks orders per 1 week. 70% would take organic muffin with coffee/tea. If we could have our 60 mothers come by at least two times a week and make an order of three items we would have 60*2*3=360 items to sell. We pretend that only half of customers order soup of the day and 80% would order salad. Our 30 soup orders would lead of purchasing around 20 pieces of our organic fine breads, and it will be a task of our cashier to offer breads along soups. So based on that calculations, if we charge $13 per baby meal, $1,59 for coffee and 1,49 for tea, $7 for soup and $8,79 for salad, $2 for muffin and $99 for a bread, revenue of $47 670 per month looks very realistic. However, in our Cash Flow projection we minimized our first three months by 20% ($9,534) of that number, in three months we expect full flow of orders due to lack of product uniqueness and advertisement attraction. The next following three moths 10% growth and the end of the year is projected as full sales.

On realistic, worst and best cases our total cash out stays positive and varies from $408 512 to $660 405.

Please see tables on pages 2-13 for numbers references.

RETURN ON ASSETSFirst year return on assets is 29.50%, with the pretax net profit of $41 173 and total current assets of $139 834, the number is pretty stable for the first year of operation.
Net Profit: 41 173
Total Assets: 139 834
INVENTORY TUROVER
In order to calculate our inventory turnover we assign ending inventory first:
Показать полностью..

Beginning inventory + purchases = Cost available for sale
$10 806 +3120= $13926

Cost of goods sold: $210304
Beginning Inventory: $10806
Ending Inventory:13074
Inventory turnover per year: 17.6
Inventory turnover in days: 21 days
Source: inventory turnover calculator
http://www.banks2.sbresources.com/NewCal/InventoryTur..

Then take Cost available for sale - Cost of goods sold during the period = ending inventory.

First year return on assets is 29.50%, with the pretax net profit of $41 173 and total current assets of $139 834, the number is pretty stable for the first year of operation.

Net Profit: 41 173

Total Assets: 139 834

INVENTORY TUROVER

In order to calculate our inventory turnover we assign ending inventory first: Beginning inventory + purchases = Cost available for sale

$10 806 +3120= $13926

Cost of goods sold: $210304

Beginning Inventory: $10806

Ending Inventory: $13074

Inventory turnover per year: 17.6

Inventory turnover in days: 21 days

Source: inventory turnover calculator

http://www.banks2.sbresources.com/NewCal/InventoryTur..

BREAK-EVEN

According to the table with item to be sold projection, we combine all totals for the month from each category and see that we expect to sell 2000 items per moth it would make 15 360 per year, according to our cash flow our fixed cost is $ 25 670 for the month six of realistic cash flow statement(expenses we will need to pay such as bills and wages) Average price per unit is $12 and variable cost is $3.5.

That is the main reason we plan to invest a lot into advertisement, we need sales in order to cover our expenses: we want to establish long-term relationships with mothers right away and make them come back every time their baby is hungry so we can sell more 2,445 units per month.

Financial ratios are one of the most important tools for analyzing Green Rabbit to business owners, enabling them to evaluate their company's performance and health. Financial ratios are calculated by using the information provided in historical and/or forecasted balance sheets and income statements. Ratios are most commonly used for trend analysis - tracking your company's financial figures over a period of time. Financial ratios allow companies to compare performance in a given period versus financial results in previous periods, and against the financial results of other businesses in similar industries.
CURRENT RATIO
Liquidity ratios focus on a company’s ability to pay its bills when they come due.

Green Rabbit’s current assets are $71898 according to opening balance sheet and has a zero liabilities to pay it clearly states a sufficient liquidity to fund ongoing debt that arises and as I mentioned before, we have spare $20 166 from owners savings in order to pay unexpected debt.

Please see appendixes for references.

Information was based on the following websites:

REFERENCES:

http://www.cbo-eco.ca/en/index.cfm/guides/business-start-up-info-guide/#NameRegistration Business Start Up Information Guide

http://www.codypartynepean.com/en/codypartymerivale/index.php?s=17&t=3&headingID=1318

CODY PARTY SUPPLIER

http://www.vistaprint.ca/gallery.aspx?pg=39&preid=53&xnav=TsrImage_07

VISTAPRINT SUPPLIER

http://www.marks-marks.com/ SUPPLIER

http://www.smallbizottawa.ca/ SUPPLIER

https://signup.wordpress.com/signup/ WEBSITE

http://www.brentcomrealty.com/flyers/420Hazeldean.pdf LEASE

http://localagent.cooperators.ca/Business-Insurance-in-Ottawa/Ontario INSURANCE

http://www.hydroone.com/MyBusiness/Pages/Default.aspx HYDRO

https://www.enbridgegas.com/homes/accounts-billing/residential-gas-rates/ GAS

http://www.couronneco.com/custom_design.html JARS

http://www.ecoproductsstore.com/greenstripe_limited_editions_1.html SUPPLIER

http://www.costco.ca/business-phones.html EQUIPMENT

http://www.capitalelectric.ca/index-4.html ELECTRICITY

http://www.caromausa.com/products/index/cu_products/97.php

http://www.olympiatile.com/in-commerce/product/search_results.html

http://www.wildwillysflorist.com/categories/green-plants

http://www.hayneedle.com/sale/angelo58homedoverchairvintagesummerbeachblue.cfm

http://www.hayneedle.com/baby/nursery-furniture_list_181794

http://www.hayneedle.com/kitchen/blenders_list_180317

http://www.cra-arc.gc.ca/ctao/

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