FINANCIAL PLAN

A. Summary of Financial Needs

This is an outline giving the following information:
1. The entrepreneurs will need Php 3,000,000 as their capital for the business.
Asset/s
Cash

Php 1,783,180

Total Assets

Php 1,783,180

2. The Break Down: (computed in a yearly basis)

Salaries (inclusive of 13th month pay)

Php 793,000

General Manager

Php 195,000

Secretary

Php 156,000

Accountant

Php 156,000

Shoe Designer

Php 156,000

Sales Clerk

Php 130,000

Rents

Php 240,000

Utilities

Php 138,000

Includes (in a monthly basis):

Electricity

Php 10,000

Phone Bill

Php 1,500

Furniture and Fixtures

Php 85,500

Includes:
Shoe Rack

Php 40,000

Laptop

Php 30,000

Printer

Php 13,500

Router

Php 1,200

Telephone

Php 800

Office Supplies

Php 16,680

Includes(in a monthly basis):

Blank Receipts

Php 1,000

Ink Cartridge

Php 390

Products

Php 360,000

Manufacturer (300x)

Php 1,200/piece

Detachable Heels (Selling price)

Php 2,200

Advertisements

Php 150,000

Fliers

Php 10,000

Signage

Php 40,000

Magazine Ads

Php 100,000

TOTAL

Php 1,783,180

B. Loan Fund Dispersal Statement

Happy Heel will utilize the anticipated loan funds in the amount of P1,000,000 to enable
us to pay for the manufacturing of our product, its advertisement and compensation for the
services of the employees.
C. Pro Forma Cash Flow Statement
Happy Heel is a shoe product that aims to provide comfort, cost efficiency and value for
money to its customers. Based on the survey we conducted, 47 out of 50 female (94%)
respondents are willing to buy the product. Manilas female population is at 830,357 which
253,258 are in the age of 18-40. We assume that 1% of the 253,258 shops at SM Manila,
however, not all of them will go to our shoe store. Taking that into consideration, we estimated
that 4 out of 10 will go to our store and buy or 1,000 women.
(2,200) (1000)= Php 2,200,000 the projected gross income from sales

Cash Flow Statement

Cash Flow from Operating Expenses:

Total

Cash Received from Customers (Sales)

2,200,000

Cash Paid for Operating Expenses:

Salaries Expense

793,000

Rent Expense

240,000

Utility Expense

138,000

Office Supplies Expense

16,680

Advertisements Expense

150,000

Cash Flow from Investing Activities:

Furniture and Fixture:

(1,337,680
)

862,320

Total
40,000

Acquisition of Shoe Rack

Acquisition of Laptop

30,000

Acquisition of Printer

13,500

Acquisition of Router

1,200

Acquisition of Telephone

800

(85,500)
776,820

Cash Flow from Financing Expenses:

Total

Increase in Cash, December 31, 2012

776,820

The table above shows that the company incurred and increase in cash amounting to
Php 776,820. The loan of the partners amounting to Php 1,000,000 for their Start-up capital
can be paid on a semi annual basis so that the business will be able to survive the introduction
phase as it entails more risk. Once the business stabilizes and maintains its customers it can
easily pay the loan balance.

D. Three Year Income Projection

Income
Projection for
period ending
December 31,
2012

Income
Projection for
period ending
December 31,
2013

Income
Projection for
period ending
December 31,
2014

P 2,200,000

P 4,600,000

P 7,500,000

Less: Cost of Goods Sold

1,200,000

2,400,000

3,600,000

Gross Income

1,000,000

2,200,000

3,900,000

793,000

793,000

793,000

Rent Expense

240,000

240,000

240,000

Utility Expense

138,000

138,000

138,000

Office supplies Expense

16,680

16,680

16,680

Advertisement Expense

150,000

175,000

225,000

40,000

400

400

Acquisition of Laptop

30,000

300

300

Acquisition of Printer

13,500

135

135

Acquisition of Router

1,200

120

120

800

80

80

P (423,180)

P 836,285

P 2,486,285

Cash Received from Customers

(Sales)

Less: Salaries Expense

Furnitures and Fixtures:

Acquisition of Shoe Rack

Acquisition of Telephone
INCOME:

The table shows the three-year projected income status of the business. Most of the
expenses do not change since they are expenses for the operation and administration of the
business. The only increasing expense is the advertisement expense. The product of Happy
Heel is in its introductory stage so it needs massive and constant advertisement and exposure

to the target market so it can make a mark on the minds of the target. An increase in
advertisement will only lead to increase income due to the fact that more and more people will
buy the product. There will be a net loss in the first year of company but it is expected as the
business is in its infancy and just building up its portfolio. Fortunately, the business will be able
to bounce back and gain a net income on its second year due to more promotions and
aggressive sales.

E. Projected Balance Sheet

Assets:
Salaries Expense

793,000

Rent Expense

240,000

Utilities Expense

138,000

Furniture and Fixtures

85,500

Supplies Expense

16,680

Advertisement Expense

150,000

Product Expense

360,000

TOTAL

P 1,783,180
Capital and Liabilities

Capital
Loans Payable
TOTAL

F. Break-Even Analysis

783,180
1,000,000
P 1,783,180

Monthly basis
Salary Expense

P 61,000

Utility Expense

P 11,500

Advertising Expense

P 12,500

Rent Expense

P 20,000

Office Supplies

P 1,390

Fixed Cost

P 106,390

Manufacturing cost

P 1,200

Selling Price: P 2,200

P 2,200 P 1,200 = P 1,000 income
Fixed Cost/Income
P 106, 390/ P 1,000 = 107
Happy Heel business must sell 107 detachable shoes in the course of one month or
approximately 4 shoes per day to breakeven.