Financial Plan for Digital Marketing Business

The financial plan is refers to as the comprehensive evaluation of the individual current pay and future state of financial by making the use of current known variable in order to estimate the assets value, income and withdrawal plans. This financial plan include the projections related to the new digital business that the company is looking to start.

Financial plan
6 / 2 / 2 0 1 9

Financial 1
Contents
Financial plan...................................................................................................................................2
Star-up cost..................................................................................................................................2
Profit and loss statement..............................................................................................................3
Profit and loss statement for 3 years........................................................................................5
Cash flow Statement for the year.................................................................................................7
Balance Sheet.............................................................................................................................10
References......................................................................................................................................12

Financial 2
Financial plan
The financial plan is refers to as the comprehensive evaluation of the individual current pay and
future state of financial by making the use of current known variable in order to estimate the
assets value, income and withdrawal plans (Pilbeam, 2018). This financial plan include the
projections related to the new digital business that the company is looking to start.
Star-up cost
The below given is the start-up cost which include the office cost as well as the equipment’s cost
that is initial cost to the company.
Start up cost for digital marketing business
Start-up cost Cost Equipments costs Cost
Office utilities Plant and equipments
Office rent $ 24,000 Computer equipments $ 13,500
Coworking space $ 3,000 Computer software $ 225
Internet shared (120mb) $ 1,020 Furniture $ 600
Business internet $ 2,160 Security system $ 1,190
Business registration $ 1,000 Water filter $ 1,200
Legal fees $ 2,500 Other equipments $ 2,400
Accounting fees $ 1,750
Wages/ Salaries $ 144,000
Insurance $ 1,800
Business utilities
Website formation $ 2,800
Logos $ 1,200
Domain $ 150
Email $ 1,500
Software
Microsoft suite $ 125
Ahref $ 399
Screaming Frog $ 149
Keyword tracker $ 1,188
Advertisement $ 800
Bank charges $ 3,000

Financial 3
Other expenses $ 2,000
Total Start-up costs $ 194,541 Total equipment’s cost $ 19,115
Workings of wages and salaries
CEO 36000
Manager 1 18000
Manager 2 15000
Remaining Employees
10 Employees (7500*10) 75000
Total 144000
Assumptions: All figures are GST exclusive
Notes:
Domain has been taken for 1 year
Registration of the starting up a business is approx. $1000 excluding GST and includes all the other
expenses.
For the salaries and wages amount refer the working note that reflects the same.
3 part time workers for 5000 each
Profit and loss statement
Profit and loss statement is financial statement that includes the summary of the revenue,
expenses, and other cost that are incurred by the new digital business (Robinson, Henry Pirie and
Broihahn, 2015). The statement shows that there is loss in the initial stage but it will be profit in
coming years.
Profit and loss statement
Month
Jan
20
Feb
20
Mar
20
Apr
20
May
20
Jun
20
Jul
20
Aug
20
Sep
20
Oct
20
Nov
20
Dec
20
Tot
al
Incom
e
Sales
Sale of

Financial 4
goods/
service
s -
22,8
00
25,0
80
27,5
88
30,3
47
33,3
81
36,7
20
40,3
92
44,4
31
48,8
74
53,7
61
59,1
37
422
,51
1
Sundry
Income - - - 500 - - - 50 - - - 100 650
Total
Sales -
22,8
00
25,0
80
28,0
88
30,3
47
33,3
81
36,7
20
40,4
42
44,4
31
48,8
74
53,7
61
59,2
37
423
,16
1
Cost of
goods
sold
3,80
0
3,99
0
4,19
0
4,39
9
4,61
9
4,85
0
5,09
2
5,34
7
5,61
4
5,89
5
6,19
0
6,49
9
60,
485
Total
Cost
of
Sales
3,80
0
3,9
90
4,1
90
4,3
99
4,6
19
4,8
50
5,0
92
5,3
47
5,6
14
5,8
95
6,1
90
6,4
99
60,
485
-
Gross
Profit
(3,80
0)
18,8
10
20,8
91
23,6
89
25,7
28
28,5
32
31,6
27
35,0
95
38,8
16
42,9
79
47,5
71
52,7
38
362
,67
6
Expen
ses -
Genera
l &
Admini
strative -
Bank
charge
s 250 250 250 250 250 250 250 250 250 250 250 250
3,0
00
Electric
ty
expens
es
1,40
0
1,42
8
1,45
7
1,48
6
1,51
5
1,54
6
1,57
7
1,60
8
1,64
0
1,67
3
1,70
7
1,74
1
18,
777
Busine
ss
internet
2,16
0 - - - - - - - - - - -
2,1
60
Licens
e fees
2,50
0 - - - - - - - - - - -
2,5
00
Busine
ss
insuran
ce
1,80
0 - - - - - - - - - - -
1,8
00
Interne
t
shared
1,02
0
1,02
0
1,02
0
1,02
0
1,02
0
1,02
0
1,02
0
1,02
0
1,02
0
1,02
0
1,02
0
1,02
0
12,
240
Adverti
sing 800 800 800 800 800 800 800 800 800 800 800 800
9,6
00

Financial 5
Insuran
ce 150 150 150 150 150 150 150 150 150 150 150 150
1,8
00
Registr
ations
1,00
0 - - - - - - - - - - -
1,0
00
Domai
n name
registra
tion 150 - - - - - - - - - - - 150
Cowor
king
space
3,00
0 - - - - - - - - - - -
3,0
00
Websit
e
formati
on
2,80
0 - - - - - - - - - - -
2,8
00
Salarie
s/
Wages
12,0
00
12,0
00
12,0
00
12,0
00
12,0
00
12,0
00
12,0
00
12,0
00
12,0
00
12,0
00
12,0
00
12,0
00
144
,00
0
Office
rent
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
24,
000
Micros
oft
suite 125 - - - - - - - - - - - 125
Ahref 399 - - - - - - - - - - - 399
Screa
ming
Frog 149 - - - - - - - - - - - 149
Keywor
d
tracker
1,18
8 - - - - - - - - - - -
1,1
88
Other
expens
es
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
2,00
0
24,
000
Depric
ation 675 675 675 675 675 675 675 675 675 675 675 675
8,1
00
Total
Expen
ses
35,5
66.0
0
19,6
48.0
0
19,6
76.5
6
19,7
05.6
9
19,7
35.4
1
19,7
65.7
1
19,7
96.6
3
19,8
28.1
6
19,8
60.3
2
19,8
93.1
3
19,9
26.5
9
19,9
60.7
2
252
,68
8
Month
Net
Profit /
(Loss)
(39,3
66.0
0)
(838
.00)
1,21
3.94
3,98
3.33
5,99
2.47
8,76
5.90
11,8
30.6
4
15,2
66.4
5
18,9
56.1
0
23,0
85.6
5
27,6
44.8
2
32,7
77.3
1
109
,98
8

Financial 6
Assumptions:
Sales of the company are expected to grow by 10% evey month
Electricity expenses will increase by 2%
The cost of goods sold are expected to increase by 5%
Deprecation is considered at 5% of office equipment’s
Profit and loss statement for 3 years
The profit and loss statement for coming 3 years proposed which shows that digital marketing
business of company is able to attain profit for all coming three years. This reflects the company
should expand their business in Chinese market because they are able to attain high profit.
Profit and loss statement
2020 2021 2022
Income
Sales
Sale of goods/services 422,511 473,211.88 558,390.02
Sundry Income 650 728.00 859.04
Total Sales 423,161 473,940 559,249
Cost of goods sold 60,485 65,323.89 71,856.28
Total Cost of Sales 60,485 65,323.89 71,856.28
-
Gross Profit 362,676 408,616 487,393
Expenses -
General &
Administrative -
Bank charges 3,000 3,120 3,338.40
Electricty expenses 18,777 19,528 20,894.96
Business internet

Financial 7
2,160 2,246 2,403.65
License fees 2,500 2,600 2,782.00
Business insurance 1,800 1,872 2,003.04
Internet shared 12,240 12,730 13,620.67
Advertising 9,600 9,984 10,682.88
Insurance 1,800 1,872 2,003.04
Registrations 1,000 1,040 1,112.80
Domain name
registration 150 156 166.92
Coworking space 3,000 3,120 3,338.40
Website formation 2,800 2,912 3,115.84
Salaries/Wages 144,000 158,400.00 174,240.00
Office rent 24,000 24,960 26,707.20
Microsoft suite 125 130 139.10
Ahref 399 415 444.01
Screaming Frog 149 155 165.81
Keyword tracker 1,188 1,236 1,322.01
Other expenses 24,000 24,960 26,707.20
Deprication 675 675 675
Total Expenses 252,687.93 271,435.44 295,187.92
Month Net Profit /
(Loss) 109,987.60 137,180.55 192,204.86
Assumption for next 3 years
It has been assumed that a sale of first year that is 2020 is considered as the total of every month of
2020 that helps in projecting the sales of 2021.
The sales of second year will increase by 12% and 18% in 2021 and 2022, which is projected
considering the growing demand of consumer in China.

Financial 8
Cost of goods sold is projected to increase by 8% and 10% in 2021 and 2020
Expenses are expected to increase by 4% and 7%
Salary and wages increase by 10% for both years
Cash flow Statement for the year
Cash flow statement known as the financial statement that shows the financial statement in
which shows the changes in respect to balance sheet accounts and income effect cash and cash
equivalent. This further breaks into the analysis down to operating, investing as well as the
financial activities. The cash flow statement for the new digital business is given below: -
Cash Flow for
Digital
Business
CASH
FLOW
Jan
20
Feb
20
Mar
20
Apr
20
Ma
y
20
Ju
n
20
Jul
20
Au
g
20
Se
p
20
Oc
t
20
No
v
20
Dec
20
Tota
l
OPENING
BALANCE
Cash
incoming
Sales
-
22,80
0
25,0
80
28,0
88
30,
34
7
33,
38
1
36,
72
0
40,
44
2
44,
43
1
48,
87
4
53,
76
1
59,
237
423,
161
Total
incoming
£
-
£
22,8
00
£
25,
080
£
28,
088
£
30
,3
47
£
33
,3
81
£
36
,7
20
£
40
,4
42
£
44
,4
31
£
48
,8
74
£
53
,7
61
£
59,
23
7
£42
3,1
61
Cash
outgoing
Goods
and
material
purchased 3,800 3,990
4,19
0
4,39
9
4,6
19
4,8
50
5,0
92
5,3
47
5,6
14
5,8
95
6,1
90
6,4
99
60,4
85
Expens
es
General &

Financial 9
Administrat
ive -
Bank
charges 250 250 250 250
25
0
25
0
25
0
25
0
25
0
25
0
25
0 250
3,00
0
Electricty
expenses 1,400 1,428
1,45
7
1,48
6
1,5
15
1,5
46
1,5
77
1,6
08
1,6
40
1,6
73
1,7
07
1,7
41
18,7
77
Business
internet 2,160 - - - - - - - - - - -
2,16
0
License
fees 2,500 - - - - - - - - - - -
2,50
0
Business
insurance 1,800 - - - - - - - - - - -
1,80
0
Internet
shared 1,020 1,020
1,02
0
1,02
0
1,0
20
1,0
20
1,0
20
1,0
20
1,0
20
1,0
20
1,0
20
1,0
20
12,2
40
Advertising 800 800 800 800
80
0
80
0
80
0
80
0
80
0
80
0
80
0 800
9,60
0
Insurance 150 150 150 150
15
0
15
0
15
0
15
0
15
0
15
0
15
0 150
1,80
0
Registratio
ns 1,000 - - - - - - - - - - -
1,00
0
Domain
name
registration 150 - - - - - - - - - - - 150
Coworking
space 3,000 - - - - - - - - - - -
3,00
0
Website
formation 2,800 - - - - - - - - - - -
2,80
0
Salaries/
Wages
12,00
0
12,00
0
12,0
00
12,0
00
12,
00
0
12,
00
0
12,
00
0
12,
00
0
12,
00
0
12,
00
0
12,
00
0
12,
000
144,
000
Rent 2,000 2,000
2,00
0
2,00
0
2,0
00
2,0
00
2,0
00
2,0
00
2,0
00
2,0
00
2,0
00
2,0
00
24,0
00
Microsoft
suite 125 - - - - - - - - - - - 125
Ahref 399 - - - - - - - - - - - 399
Screaming
Frog 149 - - - - - - - - - - - 149

Financial 10
Keyword
tracker 1,188 - - - - - - - - - - -
1,18
8
Other
expenses 2,000 2,000
2,00
0
2,00
0
2,0
00
2,0
00
2,0
00
2,0
00
2,0
00
2,0
00
2,0
00
2,0
00
24,0
00
Total
outgoing
£
38,69
1
£
23,63
8
£
23,8
66
£
24,1
05
£
24,
35
4
£
24,
61
6
£
24,
88
9
£
25,
17
5
£
25,
47
5
£
25,
78
8
£
26,
11
6
£
26,
46
0
£
313
,17
3
Projected
cash flow
position
Opening
cash
balance
£
-
-£
38,6
91
-£
39,
529
-£
38,
315
-£
34
,3
32
-£
28
,3
39
-£
19
,5
73
-£
7,
74
3
£
7,
52
4
£
26
,4
80
£
49
,5
65
£
77,
21
0
Change
during
month
-£
38,6
91
-£
838
£
1,2
14
£
3,9
83
£
5,
99
2
£
8,
76
6
£
11
,8
31
£
15
,2
66
£
18
,9
56
£
23
,0
86
£
27
,6
45
£
32,
77
7
CLOSIN
G
BALANCE
-£
38,6
91
-£
39,5
29
-£
38,
315
-£
34,
332
-£
28
,3
39
-£
19
,5
73
-£
7,
74
3
£
7,
52
4
£
26
,4
80
£
49
,5
65
£
77
,2
10
£
10
9,9
88
Balance Sheet
In the financial accounting, the balance sheet or the statement of the financial position reflects
the condition of the company that majorly include assets and liabilities of the company (Easton
and Sommers, 2018). The balance sheet for the new digital business is given below: -
Balance sheet forecast for the
period ending August 2020
Assets Amount
Current Assets 159,988
Cash 109,988
Short-term investment
Stock hand
Accounts receivables 50,000
Other
Non-Current Assets 12825
Land and building at cost

Financial 11
Plant and equipment at cost 13,500
Motor Vehicle at cost
Office equipment at cost
Leashold improvements at cost
Less- depreciation (675)
Intangible assets
Goodwill -
Other -
Total assets 172813
Liabilities
Current Liabilities 100000
Bank overdraft
Short-term loans
Trade creditors 100,000
Other
Non-current liabilities 0
Proprietor's loans
Secured loans
Other
Total liabilities 100000
Owner's equity
Total assets 172,813
Less-Total liabilities 100,000
Owner's equity 72,813

Financial 12
References
Easton, M., and Sommers, Z. (2018) Financial Statement Analysis & Valuation, 5e.
Pilbeam, K. (2018) Finance & financial markets. Macmillan International Higher Education.
Robinson, T.R., Henry, E., Pirie, W.L. and Broihahn, M.A. (2015) International financial
statement analysis. John Wiley & Sons.