2 Business Plan Question Chapter 6 My proposed business is a

#2 Business Plan Question Chapter 6

My proposed business is a farm and retail store like runnings.

Please Deveople a break even analysis (potential)

NT QUESTIONS this chapter, develop a six-month projection and then present it to a group of your peers 2. Develop a break-even analysis for your business.

Solution

Sales & Break even projection of a store Grocery & other super store Jan Feb March April May June EXPECTED SALES IN UNITS Product UNIT Fresh Green vegetables KGS 100 200 250 250 300 300 Organic vegetables KGS 100 110 125 150 150 200 Ready to eat PIECE 500 550 550 600 600 750 Groceries PIECE 100 200 250 250 300 300 Frozen items PIECE 100 200 250 250 300 300 Milk and other products PIECE 500 550 550 600 600 750 Shoes PIECE 50 55 70 75 80 90 Acessories PIECE 100 200 250 250 300 300 Cosmetics PIECE 50 55 70 75 80 90 Garden/ Camping and fishing equipment PIECE 50 55 70 75 80 90 other equipment PIECE 25 30 40 40 100 100 Miscellaneous items PIECE 50 55 70 75 80 90 Average prices are considered PRICE PER UNIT IN USD Product Fresh Green vegetables KGS 2 2 2 3 3 3.5 Organic vegetables KGS 2.5 3 3.5 3.5 3.5 3.5 Ready to eat PIECE 10 10 12 12 12.5 12.5 Groceries PIECE 15 15 15 700 750 800 Frozen items PIECE 10 10 12 12 12.5 12.5 Milk and other products PIECE 10 12 12 12 14 14 Shoes PIECE 50 55 65 65 65 70 Acessories PIECE 20 25 30 35 35 35 Cosmetics PIECE 7 7 10 10 10 10 Garden/ Camping and fishing equipment PIECE 250 300 300 350 400 400 other equipment PIECE 75 75 80 80 80 100 Miscellaneous items PIECE 25 25 35 35 50 50 TOTAL REVENUE IN USD Product Fresh Green vegetables KGS 200 400 500 750 900 1050 Organic vegetables KGS 250 330 437.5 525 525 700 Ready to eat PIECE 5000 5500 6600 7200 7500 9375 Groceries PIECE 1500 3000 3750 175000 225000 240000 Frozen items PIECE 1000 2000 3000 3000 3750 3750 Milk and other products PIECE 5000 6600 6600 7200 8400 10500 Shoes PIECE 2500 3025 4550 4875 5200 6300 Acessories PIECE 2000 5000 7500 8750 10500 10500 Cosmetics PIECE 350 385 700 750 800 900 Garden/ Camping and fishing equipment PIECE 12500 16500 21000 26250 32000 36000 other equipment PIECE 1875 2250 3200 3200 8000 10000 Miscellaneous items PIECE 1250 1375 2450 2625 4000 4500 Totals In flow in USD 33425 46365 60287.5 240125 306575 333575 Total Variable costs Fixed Over Heads per month 5000 5000 5000 5000 5000 5000 Salaries(PLUS INCENTIVES) 5500 6000 6000 7000 8000 8000 Rent 6500 6500 6500 6500 6500 6500 Inventory carrying cost 200 200 200 200 200 200 Advertising and marketing 500 600 500 500 650 650 (Initial investment of 200,000 usd is spread over 12 months) 16666.67 16666.67 16666.67 16666.67 16666.67 16666.67 Interest on capital at 1% 2000 2000 2000 2000 2000 2000 Expenses 36366.67 36966.67 36866.67 37866.67 39016.67 39016.67 Profit Before tax -2941.67 9398.333 23420.83 202258.3 267558.3 294558.3 tax @ 18% average on sales 6016.5 8345.7 10851.75 43222.5 55183.5 60043.5 Total Net profit -8958.17 1052.633 12569.08 159035.8 212374.8 234514.8 Breakeven is seen in February Break even point Remarks Sales increasing after 6 months as increased footfalls due to advertising on line and offline May and June sees increase in sales of hobby equipment