Business Plan for Garrets Popcorn Shop in Durban, South Africa

The business plan includes objectives such as offering a wide range of popcorn flavors, providing an authentic Chicago experience, and expanding the business throughout South Africa. The company will use non-GMO kernels and natural ingredients to create classic and caramelized popcorn, gourmet cheese popcorn, and other flavors. The plan also includes a competitive comparison, fulfillment strategies, and technological considerations.

Running head: BUSINESS PLAN
Garrets Popcorn Shop
Name of the Student:
Name of the University:
Author’s Note:

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Table of Contents
1.0 Business Summary.....................................................................................................................3
1.1 Objectives..........................................................................................................................3
1.2 Mission..................................................................................................................................4
1.2 Keys to Success.................................................................................................................4
2.0 Company Summary...................................................................................................................4
2.1 Company Ownership.............................................................................................................5
2.2 Start-up Summary..................................................................................................................5
2.3 Company Location and Facilities..........................................................................................7
3.0 Services......................................................................................................................................7
3.1 Service Description................................................................................................................7
3.2 Competitive Comparison.......................................................................................................8
3.3 Fulfilment............................................................................................................................10
3.4 Technology..........................................................................................................................10
3.5 Future Services....................................................................................................................11
4.0 Market Analysis Summary......................................................................................................12
4.1 Market Segmentation...........................................................................................................13
4.2 Target Market Segment.......................................................................................................14
4.3 Service Business Analysis...................................................................................................15
4.3.1 Business Participants........................................................................................................15

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4.3.2 Distributing the product....................................................................................................16
4.3.3 Competition and Buying Patterns.....................................................................................17
5.0 Strategy and Implementation Summary..................................................................................17
5.1 Marketing Strategy..............................................................................................................18
5.2 Competitive Edge................................................................................................................19
5.3 Sales Strategy.......................................................................................................................19
6.0 Management Summary............................................................................................................20
6.1 Personnel Forecast...............................................................................................................21
7.0 Financials.................................................................................................................................22
7.1 Important Assumptions........................................................................................................24
7.2 Financial Indicators.............................................................................................................24
7.3 Breakeven Analysis.............................................................................................................25
7.4 Projected Profit and Loss Statement....................................................................................27
7.5 Projected Cash Flows..........................................................................................................28
7.6 Projected Balance Sheet......................................................................................................29
Reference.......................................................................................................................................30
Appendix........................................................................................................................................34

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1.0 Business Summary
The aim of the assignment is to conduct a business plan for the expansion of the Garrett
Popcorn Shop in terms of the operations and the business services of the company. The main
services offered by the business will be depicted in terms of offering the finest quality of
gourmet popcorn. The services offered by Garrett Popcorn situated in Durban, South Africa will
be aimed mostly at passengers in the King Shaka International Airport.
The business plan will be prepared for the current expansion of the products and services
of the company. The main strategy of the business is to offer the best quality of food products to
the customers and ensure that the customers has a variety of choices in popcorns.
1.1 Objectives
The objective of the company for the initials year would be:
 Offering the finest quality of gourmet popcorn.
 Wide Range of products in the context of popcorn as well as being able to offer the South
African customer popcorn flavors that are homegrown and are also tailor made in line
with South African cuisine. Culture such as Milk tart, Biltong and Boerewors flavored
popcorn in the future, still in keeping with the traditional flavors that Garrets has become
synonymous with.
 Great popcorn at competitive prices as well as being able to provide the customer with an
Authentic Chicago experience for those that may never afford to travel to Chicago.
 Great food at great and competitive prices.

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1.2 Mission
The growing demand for the fast food and the wide variety of food products served by
the company will help the company in the expansion of the various products and services of the
company. The mission of the company is to expand the various operations of the business.
Expansion of the various stores and services of the company in all over the South Africa will be
the key growth strategy of the company.
1.2 Keys to Success
The keys to success for the company will be significantly dependent on the various
business and macro-economic factors of the company. The creation of better and efficient
technologies in the overall operations of the company will be the key factors for the success
of the company. Providing better and quality food at the various stores of the company will
be the key reason for the success of the company.
2.0 Company Summary
Garrett Popcorn will be located at the King Shaka Airport, Durban, South Africa where
the company will be expanding the services of the business and exploring various avenues such
as expanding into South African Movie Theatre such as Nu Metro. The operations of the
company will be carried from the above registered address of Durban, South Africa where the
various operational work of the company will be carried for the company. The company will also
be having a registered website so that customers can get a varied details and information about
the various activities of the company (McKeever 2016).

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2.1 Company Ownership
Garrett Popcorn is owned by the Garrett Brands, the company is Chicago based and the
operations of the company and revenue of the company is earned from the various products and
services rendered by the company. Lance Chody, is the owner and CEO of the Garrett Brands.
(Afuah 2014). The owners and the management of the company who will be taking important
financial and business update for the company.
2.2 Start-up Summary
The operations and the products and services that will be rendered by the stores opened
by the company. The startup expenses and assets that would be required by the company were all
based on the operational expenses and the services, which the company will be providing. The
expenses that will be incurred will be completely based on the operational overview and the
variety of products and services. The key operational and direct expenses that will be incurred by
the company were well identified for the financial planning of the company.

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Start-up Requirements
Start-up Expenses
Fixed Costs Particulars Amount
($)
Premises (RENT & RATES) $2,500
Salaries $4,000
Interest on loan 8% $2,500
Accountant Fees $200
Payroll Tax $250
Retainer contracts $1,450
Sales and Marketing $2,500
Postage & Telephone $100
Broacher’s $250
Logo Designs $300
Market survey $500
Preliminary expenses $500
Lease payments $1,000
Total Fixed Costs $16,050
Average Monthly Costs
Rent $208
Lease payments $83
Interest on loan 3% $208
Postage & Telephone $8
Repairs and Maintenance $21
Salaries / Wages $333
Total Average Monthly Costs $863
x Number of Months: 12
Total Monthly Costs $10,350
Total Startup Expenses $26,400

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Start-up Assets
Owner Funding
Owners Fund $50,000
Total Owner Funding $50,000
Loans
Bank Loan $25,000
Other
Total Loans $25,000
Total Startup Funds $75,000
Assets
Equipment’s $30,000
Land and Building $45,000
Poppers and Utensils $22,500
Total Fixed Assets $97,500
Total Start-up
Assets $172,500
2.3 Company Location and Facilities
The operations and the registered address of the company will be in Durban, South
Africa. The site was selected based on the population and the business community in which the
operations of the company will be operated. Hustle and Bustle market place with better and
healthy working environment has been the key reason for the selection of the location.
3.0 Services
3.1 Service Description
The main services delivered by the business will be depicted in terms of offering the
finest quality of gourmet popcorn. The services offered by Garrett Popcorn situated in Durban,
South Africa will be aimed mostly at passengers in the King Shaka International Airport. In
addition to this, it will also focus on expand the business other parts of South Africa depending
on the success of the initial branch. The company will ensure using highly seasoned old-

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fashioned Copper Kettles for including the non-GMO (genetically modified organisms) kernels
with a complex and at the same time compelling sweetness (Catão and Caixeta 2017). Keeping
the popcorn add-ons classic with natural ingredients will ensure that a greater number of
customers are interested in buying the product. The company will use special non-GMO
mushroom for ensuring it is providing a differentiated service than the existing players in South
Africa. The inclusion of the various types of the popcorn will be based on Classic and
caramelized popcorn, Gourmet cheese popcorn with Real cheddar cheese. In addition to this, the
company will be further seen to be using range of the services which will be depicted with the
use of butter, coconut oil and salt in making the popcorn. Some of the other service will be seen
in terms of service offering such as doing an extensive planning of large-scale procedure to
dominate the market and bring in new ideas. The large-scale manufacturing procedure will make
use of best in class equipment such as Flamemax HW-P16. The individual market segments will
be based on the different types of the services which are depicted to be based on the number of
services relevant with different variety of popcorn. In addition to this, the customers will also
able to acknowledge that the individual market segments offer varied range of services (Burns
2016).
3.2 Competitive Comparison
The competitive comparison will be able to show the relevant offerings in service such as
dealing in varied types of Popcorn. The extensive research will show the understanding of a very
competitive environment in business in the last ten years. The extensive research on competitive
comparison is based on taking creative, customer centric approach towards producing
differentiated styles of popcorn (Cockx, Colen and De Weerdt 2017).

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The location of the setup in Durban, South Africa will be aimed mostly at passengers in
the King Shaka International Airport. Moreover, there will be ample options for the company to
deal with multiple range of popcorn. The customers will have the opportunity to try out assorted
flavours of popcorn such as Cookies & Crème Special Edition Popcorn, Salted Caramel Bourbon
Special Edition Popcorn, Double Butter Popcorn, TPF Texas Toast Popcorn and Ranch Popcorn
(Barnes 2016). The goal of the competitive advantage of the company may be further discerned
with establishing an outlet which shall be synonymous with providing unmatched customer
excellence pertaining to the different variants of such popcorns. This will include enhanced
customer service for the cultural aspect, online store and including various options for the
payment of the services which shall be conducive for the customers in serving a competitive
advantage. The standard production of the popcorn will be further able to establish the facilities,
which shall be synonymous with improved customer service and availability of the payment
options. The establishment of the facilities will be done by identifying particular interest with
newer variant of popcorn. In this way, it will look forward to upgrade its facilities for improving
the popcorn production of that particular variety. (Burke, Robak and Stumph 20108).
Such a differentiated strategy will offer the management with wide range of options for
taking care of the employees and creating a welfare package. This will be able to ensure that the
company will be assessed as one of the best by the stakeholders as it will be designed in a way to
suit the needs of a classic business. Garret Popcorn shall be also responsible for gaining the
relevant competitive advantage in terms of setting the appropriate strategy for an already
completive market in the country. This is evident in form of competing with existing similar
shops such as Cosmic Candy, Sweet Treat and Home Treats Etc. Some of the other available

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options to the customers looking for a similar product can be discerned in form of Sweets from
Heaven and Crazy Sweets (O'Connor and Myers 2018).
3.3 Fulfilment
The various aspects considered for the target market may be identified in form of the
students, the surrounding business, international travellers, domestic travellers and families who
are seeking for a quality, affordable popcorns and easy snack. The fulfilment of the services will
be also evident among the individuals who shall be responsible for looking to a comfortable
environment (Williams and Gillum 2018). The fulfilment of demand will be different across
variety of segments such as international tourists, travellers and family members. Furthermore,
the main aspects of the competitive aspects of the business will allow Garret Popcorn to carry out
the business as per relevant norms of the country. This will permit the business to grow its
services in the next ten years. The main focus of the business will be further placed with a
creative and customer centric approach. The fulfilment of the orders will be also ensured with the
delivery of the relevant services which will be effective as per the different nature of the
techniques use to market the products (Henkel, James and Croce 2016).
3.4 Technology
The technological aspect of the business will be taken into consideration with identifying
the ecommerce of the business as well. This will allow the customers to review their orders in
terms of the time remaining for the preparation of the next order. The implementation of the
technology related services needs to be further considered with taking charge of the installation
and maintenance of the equipment for preparation of the Popcorn. These are mainly considered
with the electronic equipment needed to prepare the products. Some of the other aspect of the
technological consideration for the business needs to be taken into account with the development

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and enhancement of the software’s which are needed with the fulfilment of the relevant updates
to the softwares (De Oliveira et al. 2015).
The shop unit will be able to contribute to the relevant installation of the supply chain
software in terms of the POS systems, organization’s CCTV, logistics software and e-commerce
software. The company will be also responsible for taking charge and maintenance of the
computer and mobile software needed for the development of the applications to control such
activities in the service delivery. It needs to be identified that the production of the popcorn will
involve the use of copper kettles which is the traditional method of preparing popcorn. The
production of popcorn needs to be considered as per medium to high level of capital input. In
terms of the technology and equipment the productivity will also require for additional
manpower. The particular use of technology will be implemented by automated transfer of un
popped popcorn is into the kettle while carrying out with the cooking process. This will ensure
that the business is able to make the most of resources. The adoption of the new technology shall
be beneficial in terms of lowering instances of manually picking up the un popped popcorns and
recooking (Granados and Mooney 2018).
3.5 Future Services
The future service pertaining to the popcorn business shall be beneficial in maintaining
the tradition that will ensure using highly seasoned old-fashioned Copper Kettles for including
the non-GMO kernels with a complex and at the same time compelling sweetness. This will be
maintained by the company by encouraging feedback from customers by adopting quick online
surveys, suggestions, complaints and compliments boxes at the store as moving forward by
implementing the relevant improvement strategies in the future. The consideration of the various
types of the popcorn will be based on offering Classic and caramelized popcorn, Gourmet cheese

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popcorn with Real cheddar cheese and seasonal limited-edition flavours. The company will be
further committed to make explore more healthy and nutritional recipes of preparing popcorn.
This will be done by aiming at low calorie count while preparing the popcorn clear thereby by
using herbs, spices and cinnamon for a burst of flavour. The future services to consider the
competitive scenario which will be identified with establishing standard production of popcorn
(Baker et al. 2015). The future services will also aim at improving the relevant services such as
taking customised order from the customer in terms of preparing the wide variety of popcorns.
Additionally, the business will also consider taking big orders for festivals, parties and events.
The services will be fulfilled with the target market which may be identified in form of the
students, the surrounding business, international travellers, domestic travellers and families who
are seeking for a quality, affordable popcorns and easy snack. There will be significant
improvement made pertaining to supply chain software’s in terms of the POS (Point of Sale)
systems, organization’s CCTV, logistics software and e-commerce software. The use of point of
sale system will ensure that customers are able to make the payment with any internationally
recognised debit or credit card. In terms of the technology and equipment, the productivity of the
business will require appointing additional manpower (Sunstein 2017).
4.0 Market Analysis Summary
The market of South Africa is to be considered whether the same is appropriate for
opening a Garretts popcorn shop which would be providing best quality of popcorn to the
customers (Baker 2014). The business of Garretts Popcorn shop is already a reputed business and
therefore the plan of the entrepreneur is to formed a partnership with the company so that the
entrepreneur is able to expand the operations as well as earn revenue from the same. The offer
which is provided to the management of Garretts popcorn is that a partnership can be established

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with the entrepreneur who would be opening a shop offering the products of the company under
the same brand name. The entrepreneur needs to presents a feasibility report of such partnership
to the management of Garretts popcorn shop so that they can get a license for opening a shop
under their brand name in the country. The plan of the entrepreneur is to initially open a shop
near king Shaka International Airport and if the same is successful then the chain would further
expand in parts of Durban and South Africa with the permission of Garretts popcorn shop. The
company is known for its quality as it has provided the best quality products for a period of 65
years.
4.1 Market Segmentation
Market Segmentation refers to a process whereby the market is divided on the basis of
potential customers of the business (Venter, Wright and Dibb 2015). The process of market
segmentation is carried out by the management of the company in order to ensure that the
potential customers of the business are appropriately identified along with the existing group of
customers of the business.

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The market segmentation which is recognized by the business in relation to South Africa are
listed below in details:
 Students of College and High School: A major market segmentation which is to be
considered by the entrepreneur comprises of students and young generation who like the
innovative flavor of popcorn which is offered by the business (Aslihan Nasir and
Karakaya 2014). Popcorn is very popular among the college teens in any kind parties,
movies and other events. In all kinds of parties, night outs, sleepovers popcorn forms an
important snack food and different flavors of the same would be very successful.
 Tourists: The business is trying to opening a new shop new the airport in Durban and
therefore entrepreneur will be targeting the tourists of the country (Wheelen et al. 2017).
The tourist is attracted to the products which are offered by the business.
 Tie up Contracts: The business also plans to enter into tie up agreements with movie
theaters and amusement parks so that the business can further expand the sales of the
business and can prove to be an important market segment for the business.
4.2 Target Market Segment
Market Needs
The target market segment of the business as per the plan of the management would be
the teenager of the nation. The target market of the business would be students of college and
high school. They enjoy popcorns and especially the special cheese popcorns which is offered by
Garretts Popcorn shop (West, Ford and Ibrahim 2015).
The company aims to establish a niche for the products in the market and also establish
an appropriate business structure so that the business is competitive in the market (Armstrong et

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al. 2015). The company also aims to ensure that the prices charged for its products are kept at a
minimum so that the customers are attracted.
Market Trends
The management of Garretts Popcorn shop has decided to open and expand its business
in South Africa as the market is highly favorable. South Africa grows more than 2 million
hectares of corn per year and for this reason corn is a staple food in South Africa and the country
enjoys a corn culture (Wensley 2016). Therefore, it is natural that the popcorn industry in the
country is favorable and the same is enjoying favorable growth over the years (Irrigation 2019).
Therefore, it is the anticipation of the entrepreneur of the intended company that the business
would be able to generate appropriate amount of revenue in the economy. The entrepreneur
needs to explain the same to the management of Garretts popcorn shop how the business can
achieve new heights in terms of revenue and brand image in the country.
4.3 Service Business Analysis
The economy of South Africa enjoys a growing popcorn culture and therefore the market
is highly favorable for the business. As per the market trend, the adolescents love to consume
popcorn with soda especially in movie theaters, amusement parks. In addition to this, the special
cheese flavor popcorns are highly appreciated by the customers.
4.3.1 Business Participants
In order to enhance the sales of the business, the entrepreneur would be entering into tie
up agreements with different movie halls and amusements parks. The business has the policy of
adapting to the situation in the market (Shagal, Shagal and Sharma 2016). An example can be

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given of the limited edition offers which the company offers for some special occasions such as
election campaigns, Oscar parties.
Some of the products which have been popular among the customers are Spicy
Cheesecorn and dark Chocolate Caramel, Smooth Chocolate corn and similar other varieties.
Therefore, the management can apply the same techniques and introduce same products in the
market so that the customers are attracted to the business.
4.3.2 Distributing the product
The products which is offered by the business will be advertised extensively in order to
ensure that the customers are aware the popcorn brand is available to them. The management of
Garretts Popcorn shop plans to use social media, billboards and other means of advertisement in
order to reach potential customers of the business. The business has also plans to enter into tie up
agreement with different institutions so that product can be established in the market and
potential customers can be attracted to the business. Furthermore, the management has plans to
introduce a loyalty program whereby customers can earn points for purchases made and these

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points can be redeemed towards future purchases. Also, we will look at customized Garretts tins
and memorabilia that displays the Garretts logo such as reusable popcorn bowls, baseball caps,
all that can be made at the store using digital printing technology used with other brands such as
selfie mugs across Malaysia. Coke ran a campaign in South Africa where by a customer can text
their name to Coca-Cola ltd and the company would manufacture labels with actual customer
names on the bottle labels, customers were and still are searching the shelves for a coke with
their name on it. The entrepreneur is also considering to adopt a similar strategy for the famous
Garretts tins. Lastly, the entrepreneur would be welcoming any suggestions regarding the
product and introduce competitions where customers can suggest new flavors for a limited time
frame.
4.3.3 Competition and Buying Patterns
The main competitors which can be identified for the business of Garretts Popcorn shop
are Kingofpop, Queen of Popcorn and My Popcorn Kitchen. These businesses are top
competitors and also has large scale operations in many counties. The market of South Africa is
highly favorable and therefore, the level of competition would be high not only from such high
brand but also from the local businesses which are operating in the industry (Advanceseed.com.
2019). As per market survey, popcorn forms a part of the culture of South Africa and the same is
consider during times of Festivities. As Seasonal Events such as that of the Galileo open air
theatres in Cape town. The customers also tend to buy such products during small parties, movie
get togethers with family and friends.

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5.0 Strategy and Implementation Summary
The main strategy of the business is to offer the best quality of products to the customers
and ensure that the customers has a variety of choices in popcorns. The business plans to firstly
enter into an agreement with the local for getting the best quality of corns which can then be used
to produce popcorns. The management of the company plans to get maximum of the resources
from the local markets so that the overall costs of the business can be reduced (Hill, Jones and
Schilling 2014).
The second major strategy which the management of the company intends to follow is
setting attractive prices for the product which suits the market and which can attract potential
customers. The management plans to be competitive and therefore intends to offer best quality of
product at the lowest possible price (Meyer, Neck and Meeks 2017). Another major strategy
which the company would be following is to offer new flavors which can suit the taste and
preference of the local customers of Durban. The business also would be planning to further
expand the operations of the business by opening more at various venues such as bowling alleys,
entertainment malls that consists of gaming areas as well as local pubs and sports bars plan is
successful.
5.1 Marketing Strategy
The marketing strategy of the business is formulated with a view to make the locals
aware of the product which is being offered by the business. The market of South Africa is
highly competitive and therefore the management of Garretts Popcorn shop needs to
appropriately expend on marketing and advertisement in order to develop competitive edge and
make the product if the business popular.

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The management of Garretts Popcorn shop needs to appropriately set advertisement
budgets so that the management can invest significantly on different media for advertising the
products of the business (Burns, Bush and Sinha 2014). The management plans to use social
media for reaching customers far and wide and would also be using print media. The aim of the
management of Garretts Popcorn shop is to ensure that the name of the shop is known to
everyone. The management plans to open its first shop near an airport in Durban and therefore,
the business plans to offer special offers for tourists so that the management is able to enhance
the revenue of the business (Tanner and Raymond 2015). In addition to this, the business also
would be offering special flavors on certain festivities so that the customers can find some
uniqueness in the products which is offered by the business.
The pricing strategy of the business is also closely related to the market and the quality of
the product which is offered by the business. The management plans to offer the lowest possible
price to the customers for the products so that the business can attract all classes of customers.
The prices of product would be set in such a way that the same are pocket friendly in nature.
5.2 Competitive Edge
The business of Garretts Popcorn shop aims to develop a competitive advantage so that
the business is able to combat the competitive pressures appropriately. The management would
be focusing on maintaining the costs to a lowest level so that appropriate prices can be set by the
management (Wagner III and Hollenbeck 2014). The business would also be introducing new
flavors in order to ensure that the product which is offered by Garretts Popcorn is unique from
the products which is offered by the competitors.

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5.3 Sales Forecast
Particulars Year 1 Year 2 Year 3 Year 4 Year 5
Total Sales $ 35,000 $ 38,500 $ 42,350 $ 46,585 $ 51,244
Garrets Popcorn (Cheese) $ 28,000 $ 30,800 $ 33,880 $ 37,268 $ 40,995
Garrets Popcorn (Caramel) $ 2,800 $ 3,850 $ 4,235 $ 4,659 $ 5,124
Garrets Popcorn (Garret Mix) $ 4,200 $ 3,850 $ 4,235 $ 4,659 $ 5,124
Direct cost of sales $ 19,250 $ 21,175 $ 23,293 $ 25,622 $ 28,184
Garrets Popcorn (Cheese) $ 15,400 $ 16,940 $ 18,634 $ 20,497 $ 22,547
Garrets Popcorn (Caramel) $ 2,310 $ 2,541 $ 2,795 $ 3,075 $ 3,382
Garrets Popcorn (Garret Mix) $ 1,540 $ 1,694 $ 1,863 $ 2,050 $ 2,255
Subtotal of Direct cost of
sales $ 19,250 $ 21,175 $ 23,293 $ 25,622 $ 28,184
6.0 Personnel Plan
The entrepreneur would be heading the business along with some executives who would
be working under him. The plan is to strike a deal of partnership with the business of Garretts
popcorn and take license to sell the products as a franchise in South Africa. The entrepreneur
needs to enter into an agreement and convince the Chairmen of Garretts popcorn, Lance Chody
that the investment in South African Market would only expand the range of operations for the
business of Garretts popcorn. All major decisions regarding the flavor and quantity and pricing
of the product would be set by the entrepreneur considering a franchise fee annual to the parent
company.
6.0 Management Summary
The management recognizes that in order to effectively establish a new form of business
in Durban, an efficient management structure should be set by the business. The top-level
management of the business would be headed by the CEO and the Chairman Lance Chody, who
would be taking all the major decisions along with other directors of the business. The business

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would be requiring a branch head for Durban shop who would be responsible for managing the
operations of the business and supervising the activities of the business. The support employees
would be recruited from the local market so that they can effectively interact with the local
customers of Durban and build interpersonal relationship with the customers.
6.1 Personnel Forecast
The employee base that would be required by the company will be a mix base and variety
of employees like Chefs, Stores Manager, Graphic Designer, Sales People and Office Managers.
The wide base of employee that would be required by the company will help them in getting a
key advantage in the operations of the company. Having a wide variety of employee base in the
company will help the company in the overcoming challenges and hurdles faced by the company
in their operations (McKeever 2016).
PERSONNEL PLAN
YEAR 1 YEAR 2 YEAR 3
Chefs 3500 3700 3900
Stores Manager 2500 2800 3000
Graphic Designer 3100 3200 3500
Sales people 2400 2500 2800
Office Manager 6500 6800 7000
Secretarial 3250 3500 3750
TOTAL
PEOPLE
7 14 20
Total Payroll 21250 22500 23950
7.0 Financials
The financial projection of the Garrett’s Popcorn was estimated after taking several of the
key factors and the forecast for the company. The business factor and the various macro-
economic condition such as government policies, level of interest rates and inflation rates under

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which the operations of the company will be based (Ward 2016). The financials of the company
was based on forecasting the revenue of the company and the relevant forecast for the company
in respect to the same. The profitability, liquidity and various key expenses of the company were
taken into consideration for the planning and forecasting of the financials of the company
(Laudon and Traver 2016).
Sales: The revenue for the company in the initial year is expected to be around $120,000 and the
same is expected to grow at a constant rate of 10%. The same has been based on the vision of the
growth of the company in terms of the increasing product portfolio for the company. The growth
rate in sales of the company is expected to be around 10% for the company (Arnold and Yildiz
2015).
Cost of Goods Sold: The cost of goods sold for the company is expected to be around 55% of
the total revenue of the company which will be the direct expenses of the company in the
financials of the company. The cost of goods sold for the company is expected to remain the
same for the company in the five-year trend period and the same is due to the operational
efficiency, which will be bought by the company in terms of the increasing technological
efficiency for the company (Alviniussen and Jankensgard 2015).
Fixed Assets: The fixed assets of the company will be the plant and equipment, land and
building and the key operational assets of the company such as utensils and poppers that would
be a key operational asset for the company. The depreciation that will be charged on the assets of
the company will be at a straight-line depreciation for the company. The expansion in the assets
of the company will be completely based on the demand and the operational efficiency the same
will be bringing in the operations of the company (Burns and Dewhurst 2016).

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Premises (Rent and Rates): The expenses will be incurred in the form of various stores that will
be opened up by the company and the relevant cost incurred for the same. The primary expenses
that the company will be spending on the same will be around $2,500 and the same is expected
to grow at a constant rate of 10% for the company.
Salaries: Garrett’s Popcorn would have a wide base of employee base in the company, the
relevant expenses that the company will be spending on the same will be around $4,000 in the
initial year, and the same is expected to grow at a constant rate of 10% for the company in the
five year rend period for the company.
Accountant Fees: The accountant fees that the company will be spending on the operations of
the company will be around $200 in the initial year.
Marketing Expenses: Marketing and sales expenses of the company will be the key source for
the expansion of the products and services of the company. Marketing expenses will be the key
expense that the company will be spending so that the customers and business environment are
well known about the company. The marketing expenses of the company will be around $2,500
in the first year itself and the same is expected to grow at a constant rate of 10% for the
company.
Interest on Loan: The interest on loan would be charged at 10% for the company thereby
showing the relevant interest rate charged at the same. The interest on loan would be around $
4,000 on the total debt taken by the company. The debt of the company will be reduced in the
fifth year itself where the company will be reducing the financial risk of the company.
Market Survey Expenses: The market survey expenses that the company will be spending will
help the company in getting the various information and detail of the industry. The market

24BUSINESS PLAN
expenses that the company will be spending will be around $500 for the company in the initial
year and the same is expected to grow for the company at a rate of 10% for the company.
7.1 Important Assumptions
The key assumption that is applied in the financial forecasting of the company was that
the sales of the company is expected to grow at a constant rate of around 10% for the company
and the expense of the company will be growing at 10% itself in the trend period analysed for the
company. The interest that will be charged on the total loan and borrowing of the company will
be 10% and the same s expected to be completely paid off in the five-year trend period.
7.2 Financial Indicators
The return on capital employed by the company will be the key financial indicator for the
company reflecting the overall financial viability and success of the company. The return on
capital employed and the rising profitability of the company will be the key reason for the
growth of the company.
1 2 3 4 5
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
1%
7%
7%
8%
9%
Return on Capital Employed

25BUSINESS PLAN
7.3 Breakeven Analysis
Breakeven analysis is a widely used technique for the production management and
management accountants for determining the total variable and fixed costs of the company and
the revenue the company needs to earn with respect to the same.
Breakeven Analysis
Breakeven Sales Value =
average fixed cost/%
contribution
Revenue
Contributio
n
Fixed
Cost Profit
35000 17500
13516.77
1
3983.22
9
38500 19250
13516.77
1
5733.22
9
33791.92828 16895.964
13516.77
1
3379.19
3
40550.31394 20275.157
13516.77
1
6758.38
6
33000 34000 35000 36000 37000 38000 39000 40000 41000
0
5000
10000
15000
20000
25000
3983.2286875
5733.2286875
3379.192828125
6758.38565625
13516.7713125 13516.771312513516.7713125 13516.7713125
17500
19250
16895.96414062
5
20275.15696875
Contribution
Fixed Cost
Profit

26BUSINESS PLAN

27BUSINESS PLAN
7.4 Projected Profit and Loss Statement
The projected profit and loss statement for the company was built by taking various
accounts and factors into consideration for the company. The profit and loss statement was
developed by taking various account and assumption for the revenue and expenses for the
company.
(4) PROFIT AND LOSS FORECAST
Year 1 2 3 4 5
Revenue 35,000 38,500 42,350 46,585 51,244
Cost of sales 19,250 21,175 23,293 25,622 28,184
Gross profit 15,750 17,325 19,058 20,963 23,060
Gross Margin 33,110 35,229 38,309 41,675 45,355
Expenses/overheads
Premises (rent, rates) 2,500 2,625 2,756 2,894 3,039
Wages and salaries 4,000 4,200 4,410 4,631 4,862
General expenses 300 315 331 347 365
Accountant Fees 200 210 221 232 243
Payroll Tax 250 263 276 289 304
Utilities 1,450 1,523 1,599 1,679 1,762
Sales and Marketing 2,500 2,625 2,756 2,894 3,039
Postage & Telephone [phone]
Repairs and Maintainance 250 263 276 289 304
Preliminary expenses 500 525 551 579 608
Lease Payments 1,000 1,050 1,103 1,158 1,216
Total expenses/overheads 13,050 12,653 13,285 13,949 14,647
Profit before tax 2,700 4,673 5,772 7,014 8,413
Tax @ 30% 810 1,402 1,732 2,104 2,524
Before tax net margin 8% 12% 14% 15% 16%
Profit after tax 1,890 3,271 4,041 4,910 5,889
Transfer to reserves 2,700 4,673 5,772 7,014 8,413
ROC 1% 7% 7% 8% 9%

28BUSINESS PLAN
7.5 Projected Cash Flows
(2) CASHFLOW FORECAST
Year 1 2 3 4 5
CASH INFLOWS
Cash from Sales 35,000 38,500 42,350 46,585 51,244
Directors loans 25,000 25,000 25,000 25,000 25,000
Capital Employed 50,000 55,000 60,500 66,550 73,205
Other cash inflows
TOTAL CASH INFLOW 110,000 118,500 127,850 138,135 149,449
CASH OUTFLOWS
Payments for materials 19,250 21,175 23,293 25,622 28,184
operating expenses ( )
Premises (rent, rates) 2,500 2,625 2,756 2,894 3,039
Salaries 4,000 4,200 4,410 4,631 4,862
General expenses 300 315 331 347 365
Interest and bank charges payable 2,500 2,500 2,500 2,500 2,500
Lease payments 1,000 1,050 1,103 1,158 5000
Corporation Tax 810 1,402 1,732 2,104 2,524
Market survey costs 500 525 551 579 608
Other preliminary expenses 500 525 551 579 608
capital expenditure
Plant and other capital expenditure 22,500 25,000 27,500 35,000 45,000
financing repayments
Loan repayments 5,000 5,000 5,000 5,000
TOTAL CASH OUTFLOWS 53,860 64,317 69,726 80,413 97,689
Cash flow summary
NET CASHFLOW FOR PERIOD 56,140 54,183 58,124 57,722 51,760
OPENING CASH BALANCE 150,000 206,140 260,323 318,447 376,169
CLOSING CASH BALANCE 206,140 260,323 318,447 376,169 427,929

29BUSINESS PLAN
7.6 Projected Balance Sheet
Assets FY-1 FY-2 FY-3 FY-4 FY-5
Current Assets
Cash $70,200 $78,635 $84,374 $85,286 $89,679
Accounts receivable $35,000 $38,500 $42,350 $46,585 $51,244
Total current assets $105,200 $117,135 $126,724 $131,871 $140,923
Fixed (Long-Term) Assets
Vehichels $45,000 $24,000 $21,000 $18,000 $15,000
Furniture $30,000 $28,800 $23,040 $18,432 $14,746
Equipment $22,500 $14,400 $11,520 $9,216 $7,373
(Less accumulated depreciation) $16,500 $13,800 $11,640 $9,912 $8,530
Total fixed assets $81,000 $53,400 $43,920 $35,736 $28,589
Total Assets $186,200 $170,535 $170,644 $167,607 $169,511
Liabilities and Owner's Equity
Current Liabilities
Accounts payable $35,000 $25,000 $27,000 $25,000 $27,000
Accrued Rent $2,500 $2,625 $2,756 $2,894 $3,039
Bank Charges Payable $3,000 $3,000 $3,000 $3,000 $3,000
Short-term loans $10,000 $10,000 $10,000 $10,000 $10,000
Income taxes payable $810 $1,402 $1,732 $2,104 $2,524
Accrued salaries and wages $4,000 $4,200 $4,410 $4,631 $4,862
General Expenses $300 $315 $331 $347 $365
Lease Payment $1,000 $1,050 $1,103 $1,158 $1,216
Current portion of long-term debt $50,000 $45,000 $40,000 $35,000 $30,000
Total current liabilities $106,610 $92,592 $90,331 $84,134 $82,005
Long-Term Liabilities
Long-term debt $25,000 $20,000 $15,000 $10,000 $5,000
Less: Loan Repayment $5,000 $5,000 $5,000 $5,000
Total long-term liabilities $25,000 $15,000 $10,000 $5,000 $0
Owner's Equity
Owner's investment $50,000 $55,000 $60,500 $66,550 $73,205
Net Profits $1,890 $3,271 $4,041 $4,910 $5,889
Reserve and Surplus $2,700 $4,673 $5,772 $7,014 $8,413
Total owner's equity $54,590 $62,943 $70,313 $78,474 $87,507
Total Liabilities and Owner's Equity $186,200 $170,535 $170,644 $167,607 $169,511
Balance Sheet

30BUSINESS PLAN
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Appendix
Statement Highlight
Year 0 FY-1 FY-2 FY-3 FY-4 FY-5
(a) CAPITAL
Investment Capital 200,000 220,000
242,00
0 266,200 292,820
Loans/Borrowings 40,000
Repayment of Loan 0 10,000 10,000 10,000 10,000
(b) SALES FORECAST
Projected Revenue 120,000 132,000
145,20
0 159,720 175,692
(c) COGS 66,000 72,600 79,860 87,846 96,631
(d) EXPENSES (Overhead)
Premises (RENT & RATES) 2,500 2,625 2,756 2,894 3,039
Salary 4,000 4,200 4,410 4,631 4,862
Accountant Fees 200 210 221 232 243
Payroll Tax 250 263 276 289 304
Supplier contracts 1,450 1,523 1,599 1,679 1,762
Marketing Exp. 2,500 2,625 2,756 2,894 3,039
Postage & Telephone [phone]
Broachers 250 263 276 289 304
Logo Designs 300 315 331 347 365
Interest on loan 10% 4,000 4,000 4,000 4,000 4,000
Market survey 500 525 551 579 608
Preliminary Expenses 500 525 551 579 608
Lease payments 1,000 1,050 1,103 1,158 1,216
(e) FIXED ASSETS
Equipments 30,000 34,000 38,000 42,000 45,000
Land and Building 45,000 55,000 65,000 75,000 100,000
Poppers and Utensils 22,500 25,000 27,500 35,000 45,000