Cozy Coffee Shop Financial Plan: Sales, Personnel & Projections

The assignment content provides financial data for a company over three years (Year 1, Year 2, and Year 3). The data includes expenses such as payroll, sales and marketing, depreciation, rent, maintenance, utilities, and other operating expenses. The total operating expenses are GBP 272,863.00 in Year 1, GBP 307,717.30 in Year 2, and GBP 337,317.43 in Year 3. The profit before interest and taxes is GBP 145,637.00 in Year 1, GBP 152,632.70 in Year 2, and GBP 169,067.57 in Year 3. The net profit is GBP 107,111.25 in Year 1, GBP 112,500.00 in Year 2, and GBP 125,250.00 in Year 3. Additionally, the assignment includes projected financial data such as break-even point, balance sheet, and references to financial planning and valuation of financial companies.

Cozy coffee shop
Financial Plan

Table of Contents
Introduction......................................................................................................................................2
Sales strategy...................................................................................................................................2
Sales forecast...................................................................................................................................3
Personnel plan..................................................................................................................................4
Financial plan...................................................................................................................................5
Projected Cash flow statement.....................................................................................................7
Projected profit and loss statement..............................................................................................9
Projected Break-even point........................................................................................................11
Projected Balance sheet.............................................................................................................13
References......................................................................................................................................16

Introduction
In this present paper, we will discuss the financial plan of a coffee shop, namely Cozy coffee
shop which is located in Hill head, Byres road at Glasgow. The paper also describes the sales
strategy, sales forecast, and personnel plan, projected cash flow, projected profit and loss
statement, projected break-even, and projected balance sheet.
It is an independent coffee shop which serves various items to the consumers such as coffee
drinks, pastry, and bakery. Various coffee shops are located in the same area, so the company
will be distinct its environment by playing live piano and relaxing ambience for the clients which
helps to provide a competitive advantage to the company (Nadiri et al., 2013). The piano will
play for five hours a day. The financial plan helps to take strategic decisions by forecast the
financial health and efficiency of business (Masari et al., 2014).
Sales strategy
The sales and marketing strategy of the company is to build a loyal customer base by focusing on
attracting customers by serving high quality of food products at affordable price. The online
advertisements are done through social media in order to promote the brand in the eyes of the
consumers. Discounts and offers are provided at festive seasons which helpto attract a large
number of consumers, and that directly impacts on the sales volume of the company (Arrondel et
al., 2014). In order to provide a high quality of service on time, the two employees are required
to serve in which one will take the order and another one will handle sales transactions. The
feedback of consumers will take in order to improve the quality in a customised manner. The
banners and fliers are also used to promote the brand.

Sales forecast
The cost of food is assumed at 30% for coffee beverages, 25% on soft drinks and 35% for retail
pastries and bakery. The sale forecast of three years is projected below:
Sales forecast
Sales Year1 Year2 Year3
Coffee beverage
GBP
340,000.00
GBP
374,000.00
GBP
411,400.00
Bakery
GBP
75,000.00
GBP
82,500.00
GBP
90,750.00
Soft drinks
GBP
50,000.00
GBP
55,000.00
GBP
60,500.00
Pastries , others
GBP
145,000.00
GBP
159,500.00
GBP
175,450.00
Total sales
GBP
610,000.00
GBP
671,000.00
GBP
738,100.00
Direct cost of
sales
Coffee beverage
GBP
102,000.00
GBP
112,200.00
GBP
123,420.00
Bakery
GBP
26,250.00
GBP
28,875.00
GBP
31,762.50
Soft drinks
GBP
12,500.00
GBP
13,750.00
GBP
15,125.00
Pastries , others
GBP
50,750.00
GBP
55,825.00
GBP
61,407.50
Total direct
costs
GBP
191,500.00
GBP
210,650.00
GBP
231,715.00

Coffee
beverage Bakery Soft drinks Pastries ,
others
$0
$50,000
$100,000
$150,000
$200,000
$250,000
$300,000
$350,000
$400,000
$450,000
Year1
Year2
Year3
Personnel plan
Though the business is small so the total employee will be twelve in which one is the manager,
one human resource, one is the finance manager, one marketing manager, one inventory
manager, sales manager, floor manager, two bakers and two baristas. The personnel plan is
explained below:
Personnel plan
Year1 Year2 Year3
Manager GBP
25,000.00
GBP
27,500.00
GBP
30,250.00
Employees(6) GBP
48,000.00
GBP
60,800.00
GBP
66,880.00
Piano player
($18/hr.)
GBP
32,400.00
GBP
35,640.00
GBP
39,204.00
Barista(2) GBP GBP GBP

6,480.00 7,128.00 7,840.80
Bakers(2) GBP
52,540.00
GBP
57,794.00
GBP
63,573.40
Total employee 12 13 13
Total payroll GBP
164,420
GBP
188,862
GBP
207,748
Financial plan
The financial plan is defined as the projected budget which is used to take critical decisions on
the basis of projected financial statement of the company (Mittra et al., 2012). The business is
funded through personal funds of GBP120, 000; current borrowings of GBP10, 000, long term
liabilities 30,000, and 20,000 from crowd funding (other investors).
Requirements
Start-up expenses
Legal
GBP
1,500.00
Stationary GBP 500.00
Brochures
GBP
3,650.00
Consultants
GBP
2,500.00
Insurance
GBP
2,800.00
Rent
GBP
4,500.00
Remodeling
GBP
11,000.00
Other
GBP
3,080.00
Total start-up expenses
GBP
29,530.00
Start-up Assets

Start-up inventory
GBP
40,717.00
Cash
GBP
67,123.00
Long term assets
GBP
42,630.00
Total assets
GBP
150,470.00
Total requirements
GBP
180,000.00
Startup funding
Expenses
GBP
29,530.00
Startup assets
GBP
150,470.00
Total fund required
GBP
180,000.00
Assets
Non cash assets
GBP
83,347.00
Cash requirement
GBP
67,123.00
Additional cash GBP 0.00
Opening cash balance
GBP
67,123.00
Total assets
GBP
150,470.00
Current borrowing
GBP
10,000.00
Long term liabilities
GBP
30,000.00
Accounts payable GBP 0.00
Other current liabilities GBP 0.00
Total liabilities
GBP
40,000.00
Capital
Planned investment
Mr. X
GBP
60,000.00
Mr. Y
GBP
60,000.00

Other investors
GBP
20,000.00
Additional investment GBP 0.00
Total planned
investment
GBP
140,000.00
Loss at start-up
GBP
29,530.00
Total capital
GBP
169,530.00
Total capital and
liabilities
GBP
150,470.00
Total funding
GBP
180,000.00
Projected Cash flow statement
It shows the inflows and outflows of the company within the particular time period.
Projected Cash Flow
Year1 Year2 Year3
Cash Received
Cash sales
GBP
610,000.00
GBP
671,000.00
GBP
738,100.00
Cash from operations
GBP
610,000.00
GBP
671,000.00
GBP
738,100.00
Sales tax received GBP 0.00 GBP 0.00 GBP 0.00
New borrowing GBP 0.00 GBP 0.00 GBP 0.00
New long term liabilities GBP 0.00 GBP 0.00 GBP 0.00
Sales of other current assets GBP 0.00 GBP 0.00 GBP 0.00
Sales of long term assets GBP 0.00 GBP 0.00 GBP 0.00
Investment received GBP 0.00 GBP 0.00 GBP 0.00
Total cash received
GBP
610,000.00
GBP
671,000.00
GBP
738,100.00
Expenditures Year1 Year2 Year3
Expenditures from operations
Cash spending
GBP
164,420.00
GBP
188,862.00
GBP
207,748.20
Bill payments 350875 385815 410865
Total spent on operations
Tax paid GBP 0.00 GBP 0.00 GBP 0.00
Principal repayment of current GBP GBP GBP

borrowings 2,500.00 2,500.00 2,500.00
Other liabilities principal repayment GBP 0.00 GBP 0.00 GBP 0.00
Long term liabilities principal
repayment GBP 0.00
GBP
3,285.00
GBP
3,865.00
Purchase other current assets GBP 0.00 GBP 0.00 GBP 0.00
Purchase long term assets GBP 0.00
GBP
2,000.00
GBP
2,000.00
Dividends GBP 0.00 GBP 0.00 GBP 0.00
Total expenses in cash
GBP
517,795.00
GBP
582,462.00
GBP
626,978.20
Net cash flow
GBP
92,205.00
GBP
88,538.00
GBP
111,121.80
Cash balance
GBP
92,205.00
GBP
180,743.00
GBP
291,864.80
Projected profit and loss statement
It reflects the profit and loss of the company within the particular period of time. The company
has maintained the gross profit margin of 68.61%.
Profit and loss account
Year1 Year2 Year3
Sales
GBP
610,000.00
GBP
671,000.00
GBP
738,100.00
Direct cost of sales
GBP
191,500.00
GBP
210,650.00
GBP
231,715.00
Other GBP 0.00 GBP 0.00 GBP 0.00
Total cost of sales
GBP
191,500.00
GBP
210,650.00
GBP
231,715.00

Gross Margin
GBP
418,500.00
GBP
460,350.00
GBP
506,385.00
Gross Margin% 68.61% 68.61% 68.61%
Expenses
Payroll
GBP
164,420.00
GBP
188,862.00
GBP
207,748.20
Free Wi-Fi 180 216 216
Sales and Marketing
expenses
GBP
61,000.00
GBP
67,100.00
GBP
73,810.00
Depreciation 3500 3000 3000
Rent 5000 5000 5000
Maintenance
GBP
6,100.00
GBP
6,710.00
GBP
7,381.00
Utilities 8000 8500 9000
Payroll taxes
GBP
24,663.00
GBP
28,329.30
GBP
31,162.23
Other $0 $0 $0
Total operating expenses
GBP
272,863.00
GBP
307,717.30
GBP
337,317.43

Profit before interest and
taxes
GBP
145,637.00
GBP
152,632.70
GBP
169,067.57
EBITDA
GBP
149,137.00
GBP
155,632.70
GBP
172,067.57
interest expense 2822 2632.7 2067.57
Taxes incurred
GBP
35,703.75
GBP
37,500.00
GBP
41,750.00
Net profit
GBP
107,111.25
GBP
112,500.00
GBP
125,250.00
Net profit/sales % 17.56% 16.77% 16.97%
Projected Break-even point
Assumption
Monthly
revenue 211288
Variable cost 35919
Fixed costs 31693.2
Total cost 67612
Profit 143675.

8
Break-even
units
0.29411
8
Break even
sales 42257.6
Projected Balance sheet
Balance sheet
Assets Year1 Year2 Year3

Current assets
Cash GBP
159,328.00
GBP
247,866.00
GBP
358,987.80
Inventory 119473.25 121761.25 124141.25
Other current assets 0 0 0
Total current assets GBP
278,801.25
GBP
369,627.25
GBP
483,129.05
Long-term assets 42630 56819 64042.2
Piano 2500 2200 2000
De'Longhi Scultura Coffee
machine
130 110 90
Hygiene license 20 40 40
Accumulated depreciation 3500 3000 3000
Total long-term assets 48780 62169 69172.2
Total assets GBP
327,581.25
GBP
431,796.25
GBP
552,301.25
Liabilities and capital
Current liabilities
Accounts payable 32500 32500 34560
Current borrowing 7500 5000 2500
Other current liabilities 0 0 0
Total current liability 40000 37500 37060
Long term liabilities 30,000 26,715 22,850

Total liabilities 110000 101715 96970
Paid-in capital 140000 140000 140000
Retained earnings -29530 77581.25 190081.25
Earnings GBP
107,111.25
GBP
112,500.00
GBP
125,250.00
Total capital 217581.25 330081.25 455331.25
Total liabilities and capital GBP327581.25 GBP431796.2
5
GBP552301.25
Net worth 217581.25 330081.25 455331.25