Beruflich Dokumente
Kultur Dokumente
1. Executive Summary 2. Value Proposition and Innovation 3. Market Identification and Analysis 4. Marketing and Sales Strategy 5. Sustainable Competitive Advantage 6. Company Product and Service 7. Team 8. Operational and Expansion Plan 9. Financials 10. Appendix 1 2 3 4 6 7 8 11 14 24
1. Executive Summary
As smartphones begin to grow rapidly in the mobile phone industry, most smartphone users face a common issue: short battery life. The constant connection to wireless network has greatly reduced the battery life of these phones to a day or less. To overcome this problem, companies came up with external battery charger to extend battery life. However these external chargers require charging beforehand and more importantly, they still limit the battery life to an extent. In the current market there are portable solar chargers for smartphones but nonetheless they are separate devices that are bulky and expensive. Our product, iSoleil, is an organic solar film that charges portable consumer devices such as smartphones, laptops and tablets. It is embedded into the screen of the device with a thickness of 0.1mm. It gives users access to limitless battery life as long as users are under ambient light. Additionally our solution supersedes the present ones at a fraction the price and provides an environmental friendly option to consumers. Q.cell is a B2B company engaging directly with mobile device makers. Embedding iSoleil into mobile devices will be done during manufacturing stage, making it infeasible for consumers to purchase and install our product themselves. Our marketing team will approach major mobile device companies to promote iSoleil. Promoting iSoleil to these companies will be based on three main features: non-existent, green technology and affordable. Initial year will be focused on selling our product as contracts to smartphone makers at bulk quantities of 100,000 for S$50 per piece. We will expand to laptop and tablet PC makers, selling them at 30,000 for S$100 per piece and 40,000 for S$75 each respectively in the second and third year. To sustain competitive advantage, we will adopt the four strategic approaches. Firstly iSoleil, at a technological forefront, will be the first of its kind to be available in the market. The ingenuity of iSoleil is that it allows smartphone users to be able to use their devices and charge them at the same time. Smartphone manufacturers can then reduce the size of phone batteries, relying on iSoleil to partly charge the phone and thus minimizing the weight of smartphones. Secondly, iSoleil will be sold at an affordable price of S$50 a piece to smartphone makers. Next, we will patent this technology to have exclusive rights. Lastly, as opposed to existing chargers that are made for specific mobile devices, iSoleil integrates itself into all devices. This gives us the ability to capture the entire smartphone market share. In the first year, Q.cell will require an office to base our operations. Next, research and development will begin concurrently with filing of our patent. Production of iSoleil will begin shortly after and at the same time we will market iSoleil to seal our first and second contract. On account of our expansion plans, we will focus on three areas namely improving the efficiency of our organic solar films, tapping into laptop and tablet PC markets and securing
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more contracts with smartphone manufacturers. A major share of our profits will be directed to research and development to improve on our current technology. As of 2008 laptop sales exceeded desktop for the first time and with the encouraging growth of tablet PCs, these two markets poised to be major markets for consumer devices. In the second and third year of setting up, we will start producing solar films for tablets PCs and laptops respectively. In year 1 we plan to sign 2 contracts with 2 smartphone manufacturers to integrate iSoleil into their phones. As part of our expansion plan, we will want to clinch more deals with other manufacturers. As a local start-up, we value Q.cell at S$5million seeking for an investment of S$500,000 from interested investors. Contracts with smartphone manufacturers will bring in sales but high start-up cost required for research and development and production result in negative cash flow of S$276,804 for the first year. However, second and third year post positive cash flow of S$2,047,006 and S$3,727,114 respectively due to robust sales from smartphone, tablets and laptop contracts. Similar to cash flow, return on investment will post negative returns for first year and positive returns for second and third year. Return on investment for first, second and third year are -8.593, 7.645 and 12.256 accordingly.
Problem Having iSoleil, the issue of short battery lifetimes will be settled. Although we know that mobile phone consumers have chargers for their smartphones, most of them choose not to bring them because of the weight and the long wires. Having a non-existent charger without wires will create more convenience for smartphone consumers in terms of weight and problem of dangling wires. Opportunity With iSoleil, the problem of a battery running flat outdoors can be solved. Having a nonexistent charger without wires will create more convenience for smartphone consumers in terms of weight and problem of dangling wires. For the first year, our company will focus on developing our product for smartphones. In the next two years, new designs of solar film will be launched for laptops and tablets. According to the research studies done by International Energy Agency (IEA), the needs of solar power will rise, representing up to 25% of global electricity use. Nowadays, people are starting to change their silicon electronics into solar power electronics since silicon harms the
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environment. In a longer term, solar power electronics may make a significant contribution to the company as its use becomes more widespread. Innovation iSoleil is different current ones in the market that it is directly integrated into the smartphones, and so iSoleil is non-existent to the end user, eliminating the need to charge the device as long as there is ambient light.
above may be portable, however, they are bulky or take up a considerable amount of space when unrolled or unfolded. This differentiation of our product creates a competitive edge compared to other similar products. One major direct competitor in portable solar charger packs is Eton Corporation, which recently introduced Mobius, a solar-powered iPhone charger case. The Mobius boasts a slim and lightweight design, with dimensions 61.9 x 129.5 x 22.2 mm (W x H x D). Yet, in comparison to our product, the Mobius still adds extra bulk to the iPhone. The difference in size will be obvious especially for consumers with smaller hands, who may find difficulty in having a good grip of their devices. On the other hand, our product is placed at the screen side, which enables the solar cell to work even when users are using it. An indirect competitor in organic solar technology is Konarka Technologies. Currently, the National Renewable Energy Laboratory has certified that Konarkas solar cells have achieved an efficiency of 8.3%, the highest recorded for organic solar cells. This reveals an opportunity for research for our company as any efficiency higher than 8.3% would present a competitive advantage.
or plants directly to discuss further about the contracts. Upon the completion of the contract, our team will do delivery of the integrated screen. Price We will sell iSoleil in bulk to the companies in order quantities of 100,000 at SG$50 each. Later on in year two and three, laptop solar films will be sold in bulk of 30,000 at SG$100. Tablet solar films will also be sold in bulk of 40,000 selling at SG$75 each. Promotions We would market directly to our potential customers. Here is our tentative plan for promotion: Hold a company tour and invite representatives from mobile developers to join Hold seminars in business district area and invite our Research and Development team and other related speakers (about solar technology) to engage representatives from companies Do a direct sales presentation of our prototype in our clients offices Maintain the information and friendliness in our website for the convenience of customers SWOT Analysis 3.1 Strengths This is a new technology in the market, which satisfies the market needs. The usage of solar films is highly beneficial for mobile consumers, as it will enable their gadgets to perform at full potential for longer periods of time. Furthermore, it will be integrated directly into their devices. End users do not have to worry about the hassle of an external charging device. Thus, we expect more device users to switch to this new technology, and this shift will result in more profits for our clients. Furthermore, the price of $50 is affordable compared to other products in the industry, which make our product value for money. 3.2 Weaknesses As a start-up providing new technologies, we will have to turn non-existent demands toward latent demands. Proof is essential because our potential customers would probably like to see our credibility. Because we have no previous history in providing this solar system in mobile devices, we will make prototypes to exhibit its effectiveness. 3.3 Opportunities In a globalization world, communication is essential. Therefore, many devices are actively produced to support the ease of communication. This growing consumer communication industry provides a good base for us to tap into the market pool by introducing a new, value, and useful technology. 3.4 Threats Solar technology is not new in the market. We have numerous competitors who are offering a similar value proposition like us. The existence of our competitors could be a threat for us, if we could not offer a competitive advantage. Thus, our simple and light model of solar film
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and our chargers efficiencies will be maintained by our Research and Development team. Further discussion about competitors and risk analysis will be elaborated in the chapter to come. Risk Analysis/Competitor Research Our company recognizes the risks involved in the product venture. The risks and mitigation will be discussed in this section, in addition to ways of keeping ahead of our competitors. Market Risk Our company may face market risk, in which the product may not be well-received by companies when the product is first released. As organic solar technology is still relatively undeveloped, companies may not have absolute confidence to purchase our product. This may be overcome through our market strategies to increase awareness of the product. Compatibility The next difficulty we may face is compatibility issues of the chargers with the gadgets. Due to the wide range of gadgets we endeavour to eventually cater to, much research has to be done. To ensure compatibility of the chargers with their respective gadgets, it is vital that proper outsourcing is carried out for the Research and Development department of the company.
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Our product is a solar film and its name is iSoleil. This product is meant for smartphones initially, since most people are using them. Subsequently the product will be expanded into laptops and tablets.
Key Features Four identified features of iSoleil are: 1. Non-existent: iSoleil is not heavy like other mobile chargers. It is also thin, so that our customers enjoy the functionalities of our product without any hassle. 2. Wireless: Our charger will not have any external cables like all other chargers, which may be inconvenient for some people to carry. Having iSoleil wireless features, the customers need not worry about finding power supplies to charge their smartphones. Besides, our product leaves the USB interface free so that users can plug other devices with the smartphones. 3. Environmental Friendly: iSoleil will not harm the environment since we use sunlight as our main source of energy. Our solar films are made up of biodegradable organic chemicals like poly-3-hexylthiophene (P3HT), [6,6]-phenyl C61-butyric acid methylester (PCBM), potassium poly-3-hexylthiophic acid (P3PHT).
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How the product works Our product consists of biodegradable organic solar cells. The organic molecules in the solar cells absorb solar energy from light. This solar energy will be converted to Direct Current (DC) electricity which powers the device.
7. Team
Organizational Structure The organization is formed of undergraduates from Nanyang Technological University (NTU) with strong interest in innovative researches and developing green electronics products. Chief Executive Officer (CEO)
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Founder/Chief Executive Officer (CEO) : Goh Teck Wee Teck Wee is currently in his third year of studies in Physics and Applied Physics with minor Business, with concentration in Pure Physics at Nanyang Technological University (NTU). He held various leadership role such as Head of Pool Club in Junior College, president of Research & Education, Investment Interactive Club. He has founded Physics Consultation Club in university and has gain popularity among the whole population of the Physics undergraduates as well as the professors. He has knowledge on green technology as he has done similar research on solar cells. Co-founder/Chief Financial Officer (CFO) : Felicia Fibiani Permatasari Felicia is currently in her final year of studies in Physics and Applied Physics with concentration in Applied Physics at Nanyang Technological University (NTU). She has experience in modeling the finance of DBS/POSB as intern. She has received great recognition from the supervisor overseeing the project. She has also taken self upgrading classes for accounting, studying for the Association of Chartered Certified Accountant (ACCA) degree, pertaining to her Physics degree.
Co-founder/Chief Operating Officer (COO): Hans Gouw Hans is currently in his third year of studies in Mathematics and Economics at Nanyang Technological University (NTU). At summer 2010, He helped his fathers home-industry company in production progress for three months. In three months, he has knowledge how to manage few workers (5-10 workers) and how to produce with the highest efficiency with such a constraint.
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Co-founder/Chief Marketing Officer (CMO) : Ignatia Cindy Gunawan Cindy is currently in her final year of studies in Mathematical Sciences with concentration in Statistics at Nanyang Technological University (NTU). She has completed minor in computing and business at Nanyang Technological University. She has experience with the business management as well as business marketing. She is also working closely with the professor in the Nanyang Business School on financial modeling as well as behavioral analysis marketing. Co-founder/Chief Human Resources Officer (CHRO) : Ina Fransiska Ina is currently in her third year of studies in Mathematical Sciences with concentration in Statistics at Nanyang Technological University (NTU). She held a position as Honorary General Secretary in university. She had relevant experiences in managing about 200 members. Being a Secretary requires good time management skills and communication skills. She had overcome few challenges in managing her position such as volunteer activities, overseas activities and fundraising.
Co-founder/Chief Research Officer (CRO): Audrey Koh Jia Min Audrey is currently in her third year of studies in Chemistry and Biological Chemistry with concentration in green chemistry at Nanyang Technological University (NTU). She has experience in research activities and laboratory work, which provides her with the knowledge to troubleshoot and overcome challenges in research.
Co-founder/Chief Technology Officer (CTO) : Huang Yong Quan Yong Quan is currently in his third year of studies in Mathematics and Economics at Nanyang Technological University (NTU). He has a keen interest in technology having research work done with Republic of Singapore Airforce. Being in both streams has given Yongquan the analytical skills of a mathematician and the ability to interpret consumer markets. This gives him the aptitude to identify, evaluate technological problems and create feasible solutions.
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Planning and Milestones Timeline Year 1 Sep-11 week 0&1 Oct-11 1 2 3 Nov-11 1 2
Getting bank loan 1.4M divided among management Filling patent Buying machines (4.5 M) paid in 2 years Getting materials and factory ready Mass Production Establish R&D on smart phone and tablet application R&D Recruiting production staff Finding and signing 1st contract
Dec-11
Jan-12 Feb-12
Mar12
Apr-12 May12
Jun-12
Aug-12
Mass production & Sales R&D on smart phone application, tablet, and laptop Getting Finding and signing 2nd payment contract from 1st contract Middle year maintenance
Getting Finding and signing payment new contract from 2nd contract End of year maintenance
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Year 2
Sep-12
Oct-12
Nov-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
May-13
Jun-13
Jul-13
Aug-13
Buying machines 4.5M payed in 2 years R&D on mobile and laptop application Mass production Getting 3rd payment from 3rd contract Getting 1st payment from 4th contract (tablet) Getting 1st payment from 5th contract (laptop) Getting 4th payment from 6th contract R&D on mobile, laptop and computer application
Finding and Signing next contracts Middle year machine maintenan ce End of year machine maintenanc e Planning for expansion and acquisation
Year 3
Sep-13
Oct-13
Nov-13
Dec-13
Jan-14
Feb-14
Mar-14
Apr-14
May-14
Jun-14
Jul-14
Aug-14
Buying new machines 5M payed in 1 years Increase mass production Getting 2nd Getting 2nd Getting 3rd payment payment payment from tablet from laptop from tablet contract contract contract Finding and Signing next contracts Preparing for acquisation Acquisited by 3M company Getting 3rd payment from laptop contract
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9. Financials
Business Model Strategic Vision We would like to operate based on a vision that we set in the beginning for our future and continuing operations. Our strategic vision is to provide the most efficient energy source in the simplest form of chargers.
Business Objective As a newcomer in the market, our business objective is to strengthen our brand and products in the gadgets industries; to have at least 2 ongoing contracts per year; and to increase sales volume yearly by at least 5%.
Business model This is our business model for the existing operation. However, changes might be made in later time to adjust with the demands and developments.
Contract Signing
Transaction
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Financial Forecast Income Statement For year ending 31 August 2012 (Year 1) Year 1 Sep-11 Oct-11 Nov-11 Dec-11 Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Total(S$)
Revenue Sales Expenditure Salaries Management CPF Contribution (16%) Production + R&D Staff Sales Staff Admin Bank loan Rent (Factory+Warehouse) Patent Filing Other Expenses Utilities Internet Water Waste Removal Manufacturing Maintenance Supply Materials Factory Machines R&D Total expense Net income before taxes taxes(17%) Net income after taxes 0 30,000 20,000 100,000 -1,215,000 0 30,000 20,000 100,000 547,000 5,000 30,000 20,000 100,000 552,000 5,000 30,000 170,000 100,000 800,600 5,000 30,000 300,000 100,000 930,600 500,000 30,000 300,000 100,000 1,425,600 5,000 30,000 300,000 100,000 930,600 5,000 30,000 170,000 100,000 800,600 5,000 30,000 170,000 100,000 800,600 5,000 30,000 170,000 100,000 800,600 5,000 30,000 300,000 100,000 2,471,767 500,000 30,000 300,000 100,000 1,425,600 1,040,000 360,000 2,240,000 1,200,000 10,270,567 -270,567 -45996.3333 -224,570 0 0 0 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 550,000 1,100,000 -1,400,000 10,000 20,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 1,541,167 10,000 10,000 141,167 120,000 20,000 60,000 0 0 0 0 0 32,000 200,000 0 0 32,000 200,000 0 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 630,000 474,400 2,200,000 135,000 0 0 0 5,000,000 0 0 0 0 0 5,000,000 0 0 10,000,000
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Year 2
Sep-12
Oct-12
Nov-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
May-13
Jun-13
Jul-13
Aug-13
Total
Revenue Sales Expenditure Salaries Management CPF Contribution Production + R&D Staff Sales Staff Admin Rent (Factory+Warehouse) Other Expenses Utilities Internet Water Waste Removal Manufacturing Maintenance Supply Materials Factory Machines R&D Total expense Net income before taxes taxes(17%) Net income after taxes 5,000 30,000 170,000 100,000 818,933 5,000 30,000 170,000 100,000 798,933 5,000 30,000 170,000 100,000 798,933 5,000 30,000 390,000 100,000 1,018,933 5,000 30,000 170,000 100,000 798,933 500,000 30,000 170,000 100,000 1,293,933 5,000 30,000 170,000 100,000 798,933 5,000 30,000 170,000 100,000 798,933 5,000 30,000 170,000 100,000 798,934 5,000 30,000 170,000 100,000 798,934 5,000 30,000 170,000 100,000 798,934 500,000 30,000 170,000 100,000 1,293,934 1,050,000 360,000 2,260,000 1,200,000 10,817,200 5,182,800 881,076 4,301,724 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 50,000 100,000 0 600,000 1,200,000 10,000 23,333 10,000 3,333 10,000 3,333 10,000 3,333 10,000 3,333 10,000 3,333 10,000 3,333 10,000 3,333 10,000 3,334 10,000 3,334 10,000 3,334 10,000 3,334 120,000 60,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 70,000 45,600 200,000 15,000 0 840,000 547,200 2,400,000 180,000 0 0 5,000,000 0 3,000,000 0 3,000,000 0 5,000,000 0 0 0 16,000,000
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Year 3
Sep-13
Oct-13
Nov-13
Dec-13
Jan-14
Feb-14
Mar-14
Apr-14
May-14
Jun-14
Jul-14
Aug-14
Total
Revenue Sales Expenditure Salaries Management CPF Contribution Production + R&D Staff Sales Staff Admin Rent (Factory+Warehouse) Other Expenses Utilities Internet Water Waste Removal Manufacturing Maintenance Supply Materials Factory Machines R&D Total expense Net income before taxes taxes(17%) Net income after taxes 150,000 50,000 416,667 100,000 2,099,400 150,000 50,000 416,667 100,000 2,079,400 150,000 50,000 416,667 100,000 2,079,400 150,000 50,000 416,667 100,000 2,079,400 150,000 50,000 416,667 100,000 2,079,400 1,000,000 50,000 416,667 100,000 2,929,400 150,000 50,000 416,667 100,000 2,079,400 150,000 50,000 416,667 100,000 2,079,400 150,000 50,000 416,667 100,000 2,079,401 150,000 50,000 416,667 100,000 2,079,401 150,000 50,000 416,667 100,000 2,079,401 1,000,000 50,000 416,667 100,000 2,929,401 3,500,000 600,000 5,000,000 1,200,000 26,672,800 10,327,200 1,755,624 8,571,576 0 100,000 300,000 0 100,000 300,000 0 100,000 300,000 0 100,000 300,000 0 100,000 300,000 0 100,000 300,000 0 100,000 300,000 0 100,000 300,000 0 100,000 300,000 0 100,000 300,000 0 100,000 300,000 0 100,000 300,000 0 1,200,000 3,600,000 100,000 53,333 100,000 33,333 100,000 33,333 100,000 33,333 100,000 33,333 100,000 33,333 100,000 33,333 100,000 33,333 100,000 33,334 100,000 33,334 100,000 33,334 100,000 33,334 1,200,000 420,000 80,000 114,400 600,000 35,000 80,000 114,400 600,000 35,000 80,000 114,400 600,000 35,000 80,000 114,400 600,000 35,000 80,000 114,400 600,000 35,000 80,000 114,400 600,000 35,000 80,000 114,400 600,000 35,000 80,000 114,400 600,000 35,000 80,000 114,400 600,000 35,000 80,000 114,400 600,000 35,000 80,000 114,400 600,000 35,000 80,000 114,400 600,000 35,000 960,000 1,372,800 7,200,000 420,000 5,000,000 5,000,000 5,000,000 0 3,000,000 3,000,000 3,000,000 0 5,000,000 5,000,000 3,000,000 0 37,000,000
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Cashflow Statement
Discounted Cashflow Revenue Expenses Cashflow from Operations Cashflow from Financing Cashflow from Investments Total Cashflow Discount rate Discount factor Current value
10,000,000 16,000,000 10,270,567 10,817,200 -270,567 5,182,800 0 0 200,000 200,000 -470,567 4,982,800 70.000 55.000 0.588 0.416 -276,804 2,074,006
37,000,000 26,672,800 10,327,200 0 100,000 10,227,200 40.000 0.364 3,727,114 Entity value 5,524,316 Debt 0.000 Company value 5,524,316
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List of ratios
Profitability Ratios Year 1 Gross profit margin Operating profit margin Net profit margin Return on total assests Return on stockholders' equity Earnings per share 0.964 0.023 -0.172 -0.121 -0.255 -1.719 Year 2 0.978 0.324 0.119 0.106 0.174 1.911 Year 3 0.984 0.279 0.108 0.096 0.184 3.983
Liquidity Ratios Year 1 Current ratio Quick ratio Working capital Year 2 Year 3 1.637 2.338 1.892 1.580 2.287 1.862 4030600.000 9362800.000 17727200.000
Leverage ratios Year 1 Debt to assets ratio Debt to equity ratio Long term debt to equity ratio 0.107 0.208 0.000 Year 2 0.000 0.000 0.000 Year 3 0.000 0.000 0.000
Operating ratios Year 1 Days of inventory Inventory turnover Average collection period 365 1 328.5 Year 2 365 1 228.125 Year 3 365 1 197.2972973
Others Year 1 Internal cash flow ROE ROA ROI 81,430 -0.255 -0.132 -8.593 Year 2 Year 3 4,791,324 9,511,336 0.174 0.184 0.106 0.096 7.645 12.256
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Balance Sheet Financial year starts every Sep Assets Cash Accounts Receivables Inventories Total current assets
Gross Fixed Assets
2012
2013
2014
Less accumulated dep Net fixed assets Total assets Liability and Equity Short term borrowing Accounts payable
Accruals
1,000,000 6,000,000 17,000,000 9,000,000 10,000,000 20,000,000 360,000 360,000 600,000 10,360,000 16,360,000 37,600,000 4,500,000 4,500,000 9,500,000 1,800,000 2,880,000 5,528,000 2,700,000 1,620,000 3,972,000 13,060,000 17,980,000 41,572,000
Total current liabilities Long term debt Common stock (1,000,000 shares) Retained Earnings Total equity Total liabilities and equities
1,400,000 0 0 1,400,000 0 0 6,329,400 6,997,200 19,872,800 6,329,400 6,997,200 19,872,800 0 0 0 200,000 250,000 325,000 6,530,600 10,732,800 21,374,200 6,730,600 10,982,800 21,699,200 13,060,000 17,980,000 41,572,000
In the first year, we expect that we can manage to get two contracts which are worth 5,000,000 each. We are planning to sell 100,000 units of solar cells, which costs 50 dollars per unit, in each contract. Our main product in this year is solar charger for smart phone. But, we will suffer a negative profit of 424,571 dollars because high fixed and sunk cost occurred in the first year. In the second year, we predict that our sales increase rapidly by selling contracts of 30,000 units of laptop solar cell charger with 100 dollars per unit and 40,000 units of laptop solar cell charger with 75 dollars per unit in this year. Two of such contracts will be sold during this year. Our main product is still portable solar charger for smart phones and general hand phones. Hence, the sales of smart phone solar cell charger will remain the same. Therefore we will get positive net income of 4,101,724 dollars after tax. In the third year, we forecast that we get four laptop solar cell charger contracts which are worth 3 million each and five smart phones solar cell contracts which are worth 5 million each. Total quantity sold for smart phone solar cell charger is 500,000, while that of laptop solar cell charger is 120,000.
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Other expenses Total operating costs excl dep, amort Dep and amort EBIT
Interest expense
2012 2013 2014 10,000,000 16,000,000 37,000,000 360,000 360,000 600,000 9,769,400 10,457,200 26,072,800 10,129,400 10,817,200 26,672,800 1,800,000 2,880,000 5,528,000 -1,929,400 2,302,800 4,799,200 141,167 0 0 -2,070,567 2,302,800 4,799,200 -351,996 391,476 815,864 -1,718,570 1,911,324 3,983,336
Cost of goods and supply materials. The total costs of our goods and supply materials are estimated to be about 30,000 dollars. A breakdown of the cost is listed down in below. Total cost 15,000 5,000 5,000 5,000 30,000
Active ingredients Cleaning agents Substrates Others Total General and Administrative expense
A patent fee of 20,000 dollars will be paid to register the design of our solar charger. We also rent a factory and warehouse which are both located at Novena. We need to pay 10,000 dollars for monthly rental. 285,000 dollars is paid in total for salary, which is derived from 200,000 dollars for 100 production staff, 15,000 dollars for one junior and one senior sales staff, the rest split equally among the management personnel. Our R&D will cost 100,000 dollars per month. Various fees will add up to 160,000 dollars per month.
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A list of financial ratios is shown. Annual financial ratio Gross profit margin Return on Investment Year 1 0.964 -8.593 Year 2 0.978 7.645 Year 3 0.984 12.256
Cumulative ROI is equal to 11.309%. We forecast that our annual ROI is increasing per year, such that it will be beneficial to investors who would like to see high investment growth. Valuation of Business
As shown from above figure, our firm will expect a sum valuation of $ 5,524,316 by Year 3. Since there is no debt from second year , we have evaluated our company with a total valuation of $5.52 million. Q. Cell is requesting $500,000 from our investors over three years in exchange of 10% equity open to public. Q. Cell will issue 1 million shares in total. Only 100,000 shares will be sold to public and 510,000 shares will be issued to CEO, while the rest will be divided equally to others of co-founders.
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Price Per share = S$500,000 / 100,000 = S$5.0 Pre-Money value = S$5x 1,000,000 = S$5 million Post Money value = S$5 million + S$500,000 = S$5.5 million. Use of proceeds The money raised from our sales will be used to offset operational costs. More importantly, the proceeds will be used in our eventual expansion of the company in the third year. Care has been taken set aside equity so that investors will gain by investing in us. Funding required and equity offered In the first year, our initial start-up capital would amount to 10,270,567 dollars. Due to large amount of capital required to set up our business, especially in the first three months, we need to apply for bank loan in addition to the initial investment. The management will borrow 1,400,000 dollars, shared equally among the individual members. This amount will be paid off by the end of the first financial year, when we would have already made 10,000,000 dollars in sales. In the second and third year, we would have made enough to self-sustain our business purely by sales and current equity. Exit Strategy Our main exit strategy is to let an acquisition company buy over ours. We are planning to start find the suitable acquirer from the end of second year. Once such a company is found, we will start our expansion strategy so that the company will remain appealing for the company taking over. If in the case at the end of third year we are unable to find a suitable acquirer, then we will plan to merge with a reputable company in the industry, such as 3M.
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