Breakeven Analysis

Enter your company name here

Cost Description
Variable Costs
Cost of Goods Sold
Inventory
Raw Materials
Direct Labor (Includes Payroll Taxes)
Fixed Costs
Salaries (includes payroll taxes) $
Supplies $
Repairs & maintenance $
Advertising $
Car, delivery and travel $
Accounting and legal $
Rent $
Telephone $
Utilities $
Insurance $
Taxes (Real estate, etc.) $
Interest $
Depreciation $
Other (specify) $
Other (specify) $
Miscellaneous expenses $
Principal portion of debt payment $
Owner's draw $
Fixed Costs ($)
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Variable Costs (%)
0.0%
0.0%
0.0%
0.0%
Total Fixed Costs $ -
Total Variable Costs 0%
Breakeven Sales level = 0 Notes on Preparation
You may want to print this information to use as reference later.
To delete these instructions, click the border of
this text box and then press the DELETE key.
Using figures from your Profit and Loss Projection, enter expected
annual fixed and variable costs.
Fixed costs are those that remain the same regardless of your
sales volume. They are expressed in dollars. Rent,
insurance and real estate taxes, for example, are usually fixed.
Variable costs are those which change as your volume of
business changes. They are expressed as a percent of sales.
Inventory, raw materials and direct production labor, for example,
are usually variable costs.

Under the variable expenses column, use whole numbers as a

percentage, not decimal numbers. For example, use 45%,
rather than .45%.

For your business, each category of expense may either be fixed

or variable, but not both.

Suggestions
You may want to print this information to use as reference later.
To delete these instructions, click the border of
this text box and then press the DELETE key.
The categories of expense shown above are just suggestions.
Change the labels to reflect your own accounting systems
and type of business. Breakeven is a "big picture" kind of tool; we
recommend that you combine expense categories to
stay within the 22 lines that this template allows.
One of the best uses of breakeven analysis is to play with various
scenarios. For instance, if you add another person to
the payroll, how many extra sales dollars will be needed to
recover the extra salary expense? If you borrow, how much will
be needed to cover the increased principal and interest
payments? Many owners, especially retailers, like to calculate a
daily breakdown. This gives everyone a target to shoot at for the
day.

Sample Business Plan format

Sample Business Plan Format
This business plan document consists of three parts:
· A Written Section in which you elaborate on the:
o Business (maximum: 15 pages)
o Entrepreneur Team (maximum: 3 pages) and
o Quantified Sustainability Impact of your business (maximum: 5
pages)
The Written Section of the business plan must be no longer
than 20 pages
(Arial 12 point).
· A Financial Plan in which you add the financial data (a
maximum of 10 pages of
tables and assumptions. Please include only directly relevant
data.)
· Supplemental Data regarding the industry, competition,
marketing research etc
that would help VCs understand your industry and make a better
funding decision
(maximum: 10 pages). Be judicious.
Be brief, cogent and direct.
The items listed in the sample below are simply a guideline. Use
the parts that are
applicable to your business plan and eliminate those that are not
relevant. Feel free to
add other data that helps communicate your project and its
details. Use judgement in
providing only the parts that are most important.
Upload your business plan before the Application deadline.
Be prepared to make a power-point presentation based on your
business plan and
financials. Divide responsibility between members of the team.
You have only a short
time to pitch your business plan for funding to the busy Venture
Capitalists to whom
you will make your case. Your team must be ready to answer
questions and
demonstrate sufficient mastery of the data to show that you can
be trusted to
successfully run the business.
Sample Business Plan format
BUSINESS PLAN
< NAME OF COMPANY / TITLE >
< Add your
Logo
Here >
< Date >
< Entrepreneur Team Name >
<Address >
<Address >
<Address >
<Address >
<City >
<Country >
Tel.:
E-mail:
Skype:
Sample Business Plan format
1. THE BUSINESS
1.0 Executive Summary (maximum: 1 page)
1.1 Business Proposal
Short description of product or service and describe the value it
will create for the customers and the market. Introduce
your product/service and how it works.
1.2 Production Process and Development
Describe thee production process of the product/service. How will
you start to develop the products / services? What
resources do you need and how will you get access to these
resources?
Is there a need for (additional) Research & Development (R&D)?
What resources will you tap for this R&D and how will
you finance it? Who will be your R&D suppliers and in what
country are they located? Are there quality standards or
requirements for your product/service or is there any certification
involved?
1.2.1 Suppliers
Elaborate on the supply chain of your product/service. Which
resources do you need and how will you receive these? Do
you already have agreements in place with suppliers?
1.3 Market Structure and Analysis
1.3.1 Target Market and Customer Base
Specify your target market, and why you selected this specific
market. Describe the main characteristics of your (potential)
customer base and their demand; if segmented, describe the
different customer segments. Why did you select this
group/these groups?
1.3.2 Competitor Analysis
Describe the structure of your target market.
Who are the main players (competitors, suppliers, otherr
companies, etc) in your target market? Are there any companies
in your target market with a similar product/service? Are there any
companies in your target market with a complementary
product/service? Are these players successful, if so why, and
what is their market share? Is the target market still wide
open, or is the entry level high, and why?
1.3.3 Market Size and Potential
Describe the market size (i.e. is it a growing market, is it stable or
subject to change, etc), and the trends for the target
market in a 3-year outlook.
Describe the market potential for your product/service in this
target market.
1.3.4 Competitive Advantage
What are the unique selling points of your products/services; how
will you deal with risks of potential competitors; how will
you protect your product (legally)?
Sample Business Plan format
1.4 Marketing and Sales
1.4.1 Sales
What are your existing sales (for established business only)?
What are your sales targets? How will you achieve them?
Which percentage of the total market do you have/will you claim?
1.4.2 Marketing and Communication
How will your (potential) customers know about your product?
What means (media, advertisements, other PR tools) will
you use to reach your target market?
1.4.3 Distribution
Elaborate on the distribution of your product/service. How will
you/have you set up your distribution? Do you/will you make
use of (existing) distribution channels/networks?
1.5 Company Structure
1.5.1 Management
Indicate clearly what expertise and experience is required from
your human resources and how you will obtain it? What
expertise and experience is already present? Describe your
management team, the people you already have on board or
that you are looking for, and their subsequent backgrounds.
1.5.2 Legal Status
Will your product be commercialised under a new / separate legal
entity (e.g. Ltd Company)? If yes, please specify how
and when. What licenses and/or permits will be needed, and how
will you obtain them?
_ For established businesses, of if the start-up company (or other
legal entity) that will execute this plan already has
been established, please include proof of company registration.
1.5.3 Partners and Sponsors
Will you work with technical or financial partners? What are their
roles, motives, ties and commitment? Have partners
already been selected, if not, how will you select them? What
other stakeholders will be involved in your business?
1.6 Risks
What are the main risks of your business?
Risk Measure to counteract the risk
1.7 SWOT Analysis
Indicate the internal (you, your company and product’s) strengths
and weaknesses. Then indicate the external (market,
consumers, economy, prices, competitors, etc.) opportunities and
threats.
STRENGTHS WEAKNESSES
·…
·…
·…
·…
OPPORTUNITIES THREATS
·…
·…
·…
·…
Sample Business Plan format
2. THE ENTREPRENEURS
2.1 Personal motivation and Individual Qualities
Introduce the entrepreneurial team, your qualities and the reason
why you want to start or expand this business. Describe
what drives each of you as a person and how others would
describe you. Explain what your ambitions are with your
business between now and 5 years from now?
2.2 Experience
What is your (professional) background and how will you employ
this in your new venture? Do you have experience in
your target sector? Please include a track record with your
previous experience indicating your current knowledge and in
which way you have the capability to make this a success.
2.3 CVs of the Entrepreneurs and the Role Each One Will
Play
Add the CV’s of team members, business/industry advisors and
Board of Directors, if any.
N.B.: This format is adapted from the McGinnis Venture
Competition at Carnegie Mellon University, and was used in The
First Al Gore Sustainable Technology Competition, New
Delhi, February, 2008.
Sample Business Plan format
3. THE SUSTAINABILITY IMPACT
Describe the impact of your business on global
sustainability.
Each plan will be evaluated for its sustainability benefits. Teams
must submit a 3-5 page synopsis (in PDF-WORDEXCEL)
tabulating the sustainability benefits of the project, e.g. climate
change mitigation, energy efficiency, beneficial
materials (toxicity, efficiency, renewables etc), clean-tech, water
security, species impacts, habitat preservation, etc.
Contestants will have to discuss the metrics by which your
project’s benefits are quantified, as a key part of the intellectual
and analytical process of determining what sustainability entails.
Quantify as much as possible and mention both shortterm
(1-2-3 years) and long-term (10 years) impacts.
Sample Business Plan format
1
4. THE FINANCIAL PLAN
Profit and Loss Statement
Cash Flows (monthly or annually as appropriate)
Balance Sheet
Profit and Loss Statement
[Copy your ‘Profit and Loss Statement’ excel sheet here]
Cash Flows
[Copy your ‘Cash flow’ excel sheet here]
Balance Sheet
[Copy your ‘Balance Sheet’ excel sheet here]
Funding Request and Investment Summary
[copy your document showing the funding needed, various
sources you intend to tap for funding, how you
propose to compensate the Venture Capitalists for the risk they
are taking, by investing in your start-up, the metric
by which you value your company today in its start-up phase, and
how it will be valued when its time for the VC to
exit, either by merger/acquisition (identify likely buyers, if
possible) , or IPO, and justify your estimate of the exit
valuation]
Sample Business Plan format
2
5. SUPPLEMENTAL DATA
N.B.: This format is adapted from the McGinnis Venture
Competition at Carnegie Mellon University,
and was used in The First Al Gore Sustainable Technology
Competition, New Delhi, in February,
2008.
Business Plan Format 
Read Transcript

The Business Plan format is a systematic assessment of all the

factors critical to your business purpose and goals.

Here are some suggested topics you can tailor into your plan:

 A Vision Statement: This will be a concise outline of your

business purpose and goals.
 The People: By far, the most important ingredient for your
success will be yourself. Focus on how your prior
experiences will be applicable to your new business.
Prepare a résumé of yourself and one for each person who
will be involved with you in starting the business. Be factual
and avoid hype. This part of your Business Plan will be read
very carefully by those with whom you will be having
relationships, including lenders, investors and vendors.
Templates for preparing résumés are available in your
library, Kinko's, bookstores and the Internet under
"résumés."

However, you cannot be someone who you are

not. If you lack the ability to perform a key Mari Lohr
function, include this in your business plan. For Graphic
example, if you lack the ability to train staff, Artist
include an explanation how you will
compensate for this deficiency. You could add "Being in
a partner to your plan (discussed in Section 4) business for
or plan to hire key people who will provide skills yourself is not
you don't have. Include biographies of all your for everyone."
intended management.
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 exactly how you plan to go about it. Try to stay focused on
the specialized market you intend to serve.
 Economic Assessment: Provide a complete assessment of
the economic environment in which your business will
become a part. Explain how your business will be
appropriate for the regulatory agencies and demographics
with which you will be dealing. If appropriate, provide
demographic studies and traffic flow data normally available
from local planning departments.
 Cash flow assessment: Include a one-year cash flow that
will incorporate your capital requirements (covered in
Session 8). Include your assessment of what could go wrong
and how you would plan to handle problems.
 Include your marketing plan and expansion plans.
 Refer to helpful government Web sites such as the Small
Business Administration. See "Resources" on the home
page of this Web site.

We provide a full business plan template at the bottom of the

page. For a more advanced template, especially useful if you are
looking for partners or investors, we recommend the Ultimate
Business Plan Template (U.P. $97) from Growthink. We have
negotiated a special 50% discount for MOBI users.

Six Steps To A Great Business Plan

Start-up entrepreneurs often have difficulty writing out business

plans. This discipline is going to help you in many ways so don't
skip this planning tool! To make it easier, here are six steps
that will produce a worthwhile plan:

1. Write out your basic business concept.

2. Gather all the data you can on the feasibility and the
specifics of your business concept.
 3. Focus and refine your concept based on the data you
have compiled.
4. Outline the specifics of your business. Using a "what,
where, why, how" approach might be useful.
5. Put your plan into a compelling form so that it will not only
give you insights and focus but, at the same time, will
become a valuable tool in dealing with business
relationships that will be very important to you.
6. Review the sample plans we furnish and download the
blank format to a MS Word document. Fill this in as you
progress though the course.

Does Your Plan Include the Following Necessary Factors

 R.D.
McDonnell
Architect
 A Sound Business Concept: The single
most common mistake made by
entrepreneurs is not selecting the right "You'll identify
business initially. The best way to learn issues that you
about your prospective business is to work might not
for someone else in that business before otherwise
beginning your own. There can be a huge consider when
gap between your concept of a fine you put them
business and reality. down on
 Understanding of Your Market: A good paper."
way to test your understanding is to test
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great inventions of all time, like airplanes
and cars, did not result in economic
benefit for many of those who tried to
exploit these great advances. For Ezequiel
example, the cumulative earnings of all Padilla
airlines since Wilber Wright flew that first Jugos
plane are less than zero. (Airline losses Tropicales
have been greater than their profits.) Mexican
Success comes to those who find Food
businesses with great economics and not "When your
necessarily great inventions or advances business is
to mankind. doing well,
 Capable Management: Look for people consider buying
you like and admire, who have good the property if it
ethical values, have complementary skills is possible."
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 people who have the skills that you lack. Define your unique
ability and seek out others who turn your weaknesses into
strengths.
 Able Financial Control: You will learn later the importance
of becoming qualified in accounting, computer software and
cash flow management. Most entrepreneurs do not come
from accounting backgrounds and must go back to school to
learn these skills. Would you bet your savings in a game
where you don't know how to keep score? People mistakenly
do it in business all the time.
 A Consistent Business Focus: As a rule, people who
specialize in a product or service will do better than people
who do not specialize. Focus your efforts on something that
you can do so well that you will not be competing solely on
the basis of price.
 A Mindset to Anticipate Change: Don't commit yourself too
early. Your first plan should be written in pencil, not in ink.
Keep a fluid mindset and be aggressive in making revisions
as warranted by changing circumstances and expanding
knowledge.
 Include Plans for Conducting Business
Online: According to the January 2005 Trend/Forecasting
Report of The Dilenschneider Group, in the U.S. alone, the
2004 holiday season online shopping jumped by more than
25% from 2003. (In 2005 it jumped another 25%!) Consumer
and business-to-business online sales are set to expand
exponentially in the coming decade, and small retailers can
reach an ever-increasing pool of customers. Be sure to see
the how-to details in the following Session 10, E-commerce.

Formulate (and Reformulate) Your Business Plan

Donald N. Sull, associate professor of management practice at

the London Business School, in an article in the MIT Sloan
Management Review, offers some practical suggestions on
managing inevitable risks while pursuing opportunities. Here is a
capsulation of his suggestions on how to formulate (and
reformulate) your business plan:

 Be flexible early in the process and keep it fluid. Don't

commit too early. Expect your first plan to be provisional and
subject to revision.
 Ask yourself if your experience or expertise gives you the
right to an opinion on your specific opportunity.
 Identify your potential deal killers: variables that are likely to
prove fatal to the venture.
 Clearly identify what you see as the key drivers of success.
What are you betting on here?
 Raise money only in sufficient amount to finance the
experiment or evaluation you next envision, with a cushion
for contingencies.
 Delay hiring key managers until initial rounds of
experimentation have produced a stable business model.
 At some point, take the plunge and test your product or
service on a small scale in the real world through customer
research, test marketing, or prototypes.
 Test and refine your business model before expanding your
operations.

Top Ten Do's and Don'ts                         Print this Top Ten List

TOP TEN DO'S

1. Prepare a complete business plan for any business you are

considering.
2. Use the business plan templates furnished in each session.
3. Complete sections of your business plan as you proceed
through the course.
 4. Research (use search engines) to find business plans that
are available on the Internet.
5. Package your business plan in an attractive kit as a selling
tool.
6. Submit your business plan to experts in your intended
business for their advice.
7. Spell out your strategies on how you intend to handle
adversities.
8. Spell out the strengths and weaknesses of your
management team.
9. Include a monthly one-year cash flow projection.
10. Freely and frequently modify your business plans to
account for changing conditions.

TOP TEN DON'TS

1. Be optimistic (on the high side) in estimating future sales.

2. Be optimistic (on the low side) in estimating future costs.
3. Disregard or discount weaknesses in your plan. Spell them
out.
4. Stress long-term projections. Better to focus on projections
for your first year.
5. Depend entirely on the uniqueness of your business or the
success of an invention.
6. Project yourself as someone you're not. Be brutally realistic.
7. Be everything to everybody. Highly focused specialists
usually do best.
8. Proceed without adequate financial and accounting know-
how.
9. Base your business plan on a wonderful concept. Test it first.
10. Skip the step of preparing a business plan before
starting.
    

Antoinett
e
Douglas
Mother
   
Love
Family
Day
Care

Sound Byte Transcriptions

Antoinette Douglas - Mother Love Family Day Care       |Listen|

My name is Antoinette Douglas, and the name of my business is

Mother Love Family Day Care. I have had my business for two
and a half years, and it took me a year to make a profit.

My business is organized as a sole proprietorship. I'm working

about 12 hours per day. I will be expanding my childcare and will
be open for 24 hours. I started with a small family day care, which
included 8 children. I have now expanded to a large family day
care and have 14 children.

One of the major problems that I have had was money. I do work
with gang members and welfare recipients, and I have private
parents. In working with gangs, sometimes it will take me three
months to receive my first check, whereas with a private parent, I
will receive money weekly or biweekly.

Another major problem was how parents discipline their children

differently. I had to learn a new way. I have had to go to school
and reeducate myself. I have taken up child development classes
at Compton College and graduated.

Before I even conducted this business, I enrolled in the My Own

Business entrepreneur class. It was very helpful. I have learned
how to set my priorities and goals.

I started off with myself as the only employee and I now have four
employees. My family being very supportive of this business really
helped me. I also transport children to and from school. That's
where my son comes in; he's my driver.

In conclusion, Mother Love Family Day Care has become very

rewarding to me because I am now doing what I like to do. I love
children. Find out what it is that you really want to do, go to
college, and get an education in that field. If you know anyone in
the field, allow him or her to mentor you. Find out as much as you
can about the business before starting. The most important thing I
would like to put emphasis on is getting your education.

Points To Ponder

 Start small and hang in there

 Don't overlook doing what you love to
do

Ezequiel Padilla - Jugos Tropacales Mexican Food    

  |Listen|

My name is Ezequiel Padilla. I'm the owner of Jugos

Ezequiel
Tropicales Fast Food Mexican Restaurant in Compton,
Padilla
California. I started my business ten years ago. I had
Jugos
many years of experience and had my savings. I
 Tropacal  
thought I knew everything. But I didn't have the most
es
Mexican
Food
important thing: a business plan. So, there I was working on a
daily basis with nowhere to go until I learned from the My Own
Business seminar all the basic tools I needed to reach success. I
would like to give you some important tips before you start:

 Create your business plan. There are some computer

programs that will help you do it.
 is very important to find a good location. Make sure you have
plenty of parking.
 Make sure you read and agree to all the terms and
conditions of the lease contract before you sign it.
 Learn the basics of accounting and know your product.
 When you are ready to open your business, be honest and
treat your employees and customers as you would like to be
treated. Remember that a satisfied customer will help
increase your clientele.
 Always be ready for the unexpected.

Overlooking these details might cost you a lot of money, and you
might go out of business. We don't want that.

One last thing, when your business is doing well, consider buying
the property if it is possible. Real estate is always a good
investment. If you follow these simple steps, I'm sure you will be a
successful businessperson like me. Good luck in your business
venture.
Sample Business Plan Structure

All plans should include at least the elements listed below, and
perhaps additional sections depending on the type of industry.

 Executive Summary
 Company Background
 Products or Service Overview
 Unique Selling Proposition and competitive advantages
 The Marketplace
 Operations
 Leadership and management profiles including professional
competencies
 Professional Support
 Risks and Threats assessment
 Financial forecasts including key assumptions
 Relevant appendices

Collecting the information for all the sections is time consuming

and sometimes difficult. The business section of your local library
is always a good place to start research. Ask your friendly
librarian about how to look up market research reports, and how
to investigate competitors.

If you are not familiar with spreadsheet software, constructing the

necessary financial forecasts represents a significant hurdle. You
have 2 choices:

Pay someone to put part or all of the plan together for you, or a
small investment in some business planning software.

The advantage of using a professional is you will receive the

benefits of their experience, combined with a professional looking
plan.
The disadvantage is that it won’t be easy to make changes, and
more importantly, because you will not have been as involved in
its preparation, you won’t be as familiar with its contents as you
maybe should be. Make sure to learn the contents well.

The advantages of investing in business planning software, are

that you will save time and money over having a professional put
the plan together for you.

You will be able to take advantage of the thousands spent

consulting professionals, and users alike, by the software
company in developing the product. You can disregard your
worries about having any spreadsheet skills, or your lack of
confidence in buiding a complete financial model, as this software
will take care of that for you.

For less than the cost of having a professional put the plan
together for you, you can produce a professional document, but
more importantly continuously update your plan for new
information. This means you’ll always have a first class plan ready
to present to banks or investors at any time.

Palo Alto Software produce Business Plan Pro which I notice is

also promoted by the UK clearing bank Barclays PLC through
their Clearlybusiness subsidiary. They wouldn't get behind
promoting a product like this without giving it a thorough trial