Business Plan For Workshop (Key Solutions PTE LTD)

BUSSINESS PLAN
Key Solutions Pte ltd
This material is to be used for training purposes only. Some of the analysis outcome,
procedures and other estimates cost as described within these pages maybe
different than actual on-site situation. Therefore, application should not be made
without consideration of circumstances.
Brian Tan
Managing Director of Key Solutions Pte ltd
Table of Contents
1 Executive Summary............................................................................................................ 3
1.1 Products ...................................................................................................................... 3
2 Management ...................................................................................................................... 4
3 Company Mission and Vision ............................................................................................. 4
3.1 Business Objectives ..................................................................................................... 4
3.2 Mission ........................................................................................................................ 4
3.3 Keys to Success ............................................................................................................ 4
4 Company Summary ............................................................................................................ 5
4.1 Company Ownership ................................................................................................... 5
4.2 Start-up Summary ....................................................................................................... 5
5 Context of the Organisation .............................................................................................. 7
5.1 Internal Context .......................................................................................................... 7
5.2 External Context .......................................................................................................... 8
5.3 Needs and expectations of the interested parties...................................................... 9
6 Market Analysis Summary ............................................................................................... 10
6.1 Market Segmentation ............................................................................................... 10
6.1.1 Family home owners .......................................................................................... 10
6.1.2 Single home owners........................................................................................... 10
6.1.3 Commercial sale ................................................................................................. 11
6.2 Target Market Segment Strategy .............................................................................. 12
6.3 Industry Analysis ....................................................................................................... 12
7 Competition and Buying Patterns .................................................................................... 12
7.1 Surge arrestors .......................................................................................................... 12
7.2 Surge protectors........................................................................................................ 13
7.3 Products .................................................................................................................... 13
8 Strategy and Implementation Summary ......................................................................... 15
8.1 Competitive Edge ...................................................................................................... 15
8.1.1 SWOT Analysis.................................................................................................... 15
8.2 Marketing Strategy.................................................................................................... 16
8.3 Sales Strategy ............................................................................................................ 16
8.4 Milestones ................................................................................................................. 19
8.5 Web Plan Summary ................................................................................................... 20
8.6 Website Marketing Strategy ..................................................................................... 20
8.6.1 Development Requirements .............................................................................. 20
9 Management Summary ................................................................................................... 21
9.1 Personnel Plan ........................................................................................................... 21
10 Financial Plan ................................................................................................................... 23
10.1 Important Assumptions ......................................................................................... 23
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This material is to be used for training purposes only. Some of the analysis outcome, procedures and other estimates cost as described within these
pages maybe different than actual on-site situation. Therefore, application should not be made without consideration of circumstances.
10.2 Break-even Analysis ............................................................................................... 23
10.3 Projected Cash Flow .............................................................................................. 24
10.4 Projected Profit and Loss ....................................................................................... 27
10.5 Business Ratios ...................................................................................................... 30
10.6 Projected Balance Sheet ........................................................................................ 33
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1 Executive Summary
Key Solutions is small business unit selling electronic products. Key Solutions was formed
and will be led by Brian Henderson.
Key Solutions has identified three key factors that will be instrumental to its sustainability:
i. Ensure 100% customer satisfaction: Repeat customers and customer referrals are
valuable.
ii. Design and sell meaningful and valuable power protection products.
iii. Design and implement strict financial controls.
1.1 Products
Key Solutions will offer two main products, surge arrestors and surge protectors. These
products are made by a contract manufacturer and sold under the Key Solutions brand
name:
• Surge Arrestors: This is a piece of equipment that is mounted on the outside of a house
or business near the meter that offers protection from external electrical surges.
• Surge Protectors: This is a piece of equipment that protects individual or groups of

appliances against internal electrical spikes. All of Key Solutions protectors are of
industrial grade.
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2 Management
Brian has an MBA from Case Western Reserve University and has experience working for the
large telecom AVV as an assistant project manager, and Hillson Power working in the value
added services department. Key Solutions has been forecasted to achieve impressive sales
for years two and three, with correspondingly respectable net profit.
3 Company Mission and Vision

3.1 Business Objectives
• To develop a profitable product that is unregulated from the core power generation
business services.
• To become profitable within one year.
• To use this business as a successful model for future ventures.
3.2 Mission
To develop a family of surge protectors and arrestors for consumers that offer safety and
value. Key Solutions will leverage the strength of PANTAGON to help build brand recognition.
All customer's expectations will be exceeded with their innovative, useful products and
complete customer satisfaction is guaranteed.
3.3 Keys to Success
• Offer every customer 100% satisfaction.

• Design and sell meaningful, valuable, power protection products.
• Design and employ strict financial controls
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4 Company Summary
Key Solutions is an unregulated subsidiary of PANTAGON that sells direct to businesses and
consumers. It will be operated as a standalone business leveraging the existing resources
and goodwill of PANTAGON.
Key Solutions will be located on site at PANTAGON, using an office within the complex and
also sharing PANTAGON's computer network connection and phone connections. Key
Solutions will operate their own customer service call department. Key Solutions will use
PANTAGON's existing call centre for sales calls and PANTAGON's existing billing system as
well as their order fulfilment and shipping departments.
Key Solutions will pay a flat rate (10%) for these services. PANTAGON has chosen to create
Key Solutions as a means of increasing the rate of return to shareholders outside the
government regulated rates available to electric utilities.
4.1 Company Ownership
Key Solutions is a wholly owned subsidiary of PANTAGON.
4.2 Start-up Summary
Key Solutions will leverage the existing resources of PANTAGON and pay a set overhead fee
for the resources used. Equipment that will be needed as follows:
• Five computer stations, one laser printer; Microsoft Office, Access, and proprietary
software used by PANTAGON; network connection to PANTAGON.
• Five office furniture setups.
• A five extension phone system.
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START-UP
Requirements
Start-up Expenses
Stationery etc. $100
Brochures $2,000
Website development $5,000
Furniture $1,500
Expensed Equipment $7,000
TOTAL START-UP EXPENSES $15,600
Start-up Assets
Cash Required $21,900
Start-up Inventory $0
Other Current Assets $3,000
Long-term Assets $14,500
TOTAL ASSETS $39,400
Total Requirements $55,000
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5 Context of the Organisation
5.1 Internal Context
Internal Monitoring and review methods

Context
Political • Current legislation • Through meetings with the
• Anticipated future legislation customers
• Government policies • Keep track on the changes
and the updates of the
governments’ news
Economic • General taxation issues • Keep track on the changes

• Market and trade cycles and the updates of the
• Customer/end-user drivers governments’ news
• Interest and exchange rates
Social • Lifestyle trends, Demographics, • Discussion and updates with
• Consumer attitudes and opinions, the team on the market
• Image of the organization trend and marketing
• Advertising and publicity strategy (Monthly)
Technology • Information and communications • IT Manager to check on the

• Consumer buying mechanisms software updates
• Technology access, licensing, patents • Discussion and updates with
• Intellectual property issues the team on the technology
• Global communication used (Monthly)
• Maturity of organization’s
products/services
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5.2 External Context
Internal Monitoring and review

Context methods
Technical Infrastructure and equipment and • IT Manager to updates the
machinery used within the company for latest software with the
product and services director (report as and
when)
• Head of departments report
any faulty infrastructure,
the equipment and machine
Economic • Financial management systems, • Financial executive to

• Cash flow within the organisation ensure that the finance
• Capital reserves and commercial management system is on
viability of the organization the track
• Financial executive will
generate a monthly
financial report and discuss
with the director on the
financial status
Cultural • Shared values (sustainability) • Discussion and updates with

• Team works (bottom-up planning) the team on the operation
issues (Weekly)
Organization • Policies and objectives • Director to conduct a QMS

• Standards for operations Meeting with all the
• Guidelines strategies employees to discuss on the
management system and
space for improvement
Political Decision making by top down approach • The decisions for issues
(Internal) related with the
organisation are the
outcome of the discussion
of the meetings within the
director and head of
departments.
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5.3 Needs and expectations of the interested parties
Interested Needs and expectation Monitoring and review methods

Parties
Customers • On time delivery • Customer feedback survey (after
• High quality of products every order)
• Good customer service • Monthly meeting with the team
• Good after delivery service to discuss on the any operation
• Products comply with the issues
legal and statutory • Conduct QMS meeting quarterly
requirements to discuss on the improvement
required for services
Employees • Good well-fare system • Annual meeting with the

• Motivation Director to review the staff
• Good working environment feedback
• Training to upgrade their skills • Provide feedback channel for
the workers
Suppliers • On-time payment • Discussion and updates with the

• Good customer and suppler team on the operation issues
relationship (Weekly)
Investors • Fulfil the payment on time • Annual review on the financial

(Bank) status to ensure the ability to
fulfil the payment
Media / • Good reputation • Continuous review on the

Public • Positive influence on the public marketing strategy to ensure
positive public influence
Competitors • Project manager to conduct

• How to offer the benefits competitor analysis and
organisation better than those monitoring annually
offered by competitors? • Management review will be
• Does our business have a unique conducted each year to review
selling point (USP)? on the business strategy and
• What are the competitor’s changes on the business plan
activities in the market.
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6 Market Analysis Summary
Key Solutions has identified three distinct market segments that they will target. The first
segment is family home owners, typically with children, and the second is single home
owners.
These two segments have been chosen because families with children typically have a large
number of electronic devices and the upper income single home owners often adopt
technology using lots of gadgets in their home.
The third segment is commercial businesses that have equipment they want protected.
Competition is very limited for surge arrestors as they require electric utility installation.
There is some competition with the surge protectors, however the competitive products are
of a consumer level of quality and protection, different from Key Solutions's products
which offer industrial levels of protection.
6.1 Market Segmentation
Key Solutions has segmented the market into three distinct groups.
6.1.1 Family home owners
This segment generally has electronic equipment and lives in middle- to high-end homes.
• 69% have at least one child.

• The median household income is $77,000.
• Eat out 2.3 times a week.
• 58% of the families have two incomes.
• 63% have cable TV.
• 49% have a broadband Internet connection.
6.1.2 Single home owners
This segment is a single person who owns their own home. They are generally professionals
who often use a lot of electronic technology.
• Ages 25-40.
• 71% are professionals.
• The median household income is $62,000.
• Eat out 2.7 times a week.
• 72% have cable TV.
• 71% have a broadband Internet connection.
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6.1.3 Commercial sale
This segment is small to mid-size businesses that have expensive electronic equipment that
they need protected. Commercial sales are not industry specific. All businesses, regardless
of type, have pieces of equipment that can be protected.
MARKET ANALYSIS
YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5
Potential Customers Growth CAGR
Family homeowners 8% 143,545 154,311 165,884 178,325 191,699 7.50%
Single home owners 8% 165,987 179,266 193,607 209,096 225,824 8.00%
Commercial sales 6% 11,254 11,929 12,645 13,404 14,208 6.00%
Total 7.71% 320,786 345,506 372,136 400,825 431,731 7.71%
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6.2 Target Market Segment Strategy
Key Solutions is targeting these groups since all tend to have many pieces of electronic
equipment all of which are vulnerable to power surges.
While most home owners insurance offers some level of compensation for damage,
deductibles are typically high enough that most people do not make claims. Both segments
are already customers and aware of PANTAGON's reputation for safety, reliability and
operational excellence, making it easy to solicit their business.
6.3 Industry Analysis
Key Solutions operates selling two similar service devices, surge arrestors and surge
protectors. While these products are similar, they have serve different purposes.
The surge arrestors are a product that can only be offered by a utility so it is typically only
sold and installed as a package by the utility.
The surge protectors operate within the more general consumer product segment as
evidenced by the fact that surge protectors can be found by a wide range of retailers such as
hardware stores, do-it-yourself type stores, and computer and electronic retailers.
It should be noted that Key Solutions's parent company, PANTAGON is an electric utility and
is therefore operating within a regulated industry. Current regulation by the public utility
commission (PUC) dictates that the rate of return is capped at 10.5% for utility activities.
Key Solutions however provides a product that operates within the unregulated area of the
utility and therefore does not have rate of return caps. This is quite advantageous to Key
Solutions because it allows them to leverage the assets of the utility without being held to
the same restrictions as the rest of the utility.
7 Competition and Buying Patterns

7.1 Surge arrestors
Key Solutions does not face any real competition for the arrestors due to the installation
requirement of the electric utility.
While there are four current vendors that sell the actual arrestor equipment, it is far more
expensive to buy the equipment and then pay the utility for installation than buying the
package (product and installation) directly from the utility.
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7.2 Surge protectors
Key Solutions faces general competition from several sources. This is qualified as general
competition since the products typically sold (90% of the time) are of consumer quality
versus the industrial quality that Key Solutions offers.
Due to PANTAGON's direct contacts with electrical component manufacturers and their
sheer buying scale/power, Key Solutions is able to offer high-quality industrial grade
products for prices that are similar to the consumer units. Competitors in this segment
include:
• Hardware stores
• Mass merchants
• Do-it-yourself stores
• Computer retailers
• Electronic retailers
7.3 Products
Key Solutions will offer a family of surge arrestors and surge protectors for consumers. A
surge protector protects appliances plugged into it against spikes in voltage.
A surge arrestor or "whole house surge protector" protects all circuits of a house from a
surge in current emanating from outside the building. These products will protect
consumers and their sensitive electric and electronic appliances from power surges or
transient voltage.
A power surge is an increase in voltage significantly above the designated level of flow of
electricity. If a surge or spike is high enough it will inflict serious damage, just like applying
to much water pressure through a hose. Too much will case the hose to burst. The same
thing happens when there is too much electrical pressure through a wire, the wire "bursts."
Surge protectors work by diverting the extra electricity into the outlet's grounding wire. A
surge arrestor offers the same protection, however, the protection occurs before the
current comes into the home. There are several sources of surges.
The most familiar source is lightning. When lightning strikes near a power line, the electrical
energy creates a boost of electrical pressure. A surge arrestor is the best form of protection
against lightning as a lightning surge will overpower most surge protectors.
A more common source is the operation of high power electrical devices such as
refrigerators and air conditioning units. These appliances cause spikes when their
compressors or motors are turned on and off, creating sudden, brief demands for power
and upsetting the flow of the electrical voltage.
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These types of surges can be protected only by surge protectors because the spike occurs
within the home and not from the electrical grid.
The last main source of surges come from the utility company's equipment. The complex
system of equipment that brings electrical power from the grid into the home may
have points of failure that can cause uneven power transmissions.
A combination of a surge arrestor and surge protectors on major or expensive
electric/electronic components can significantly decrease the possibility of surge/spike
damage.
Key Solutions will offer two main products, surge arrestors and surge protectors. These
products are made by a contract manufacturer and sold under the Key Solutions brand
name:
• Surge Arrestors (whole house surge arrestors): This is a piece of equipment that is
mounted on the outside of a house or business near the meter that offers protection
from surges emanating from outside of the house. This product costs $235 including
installation.
Only the electrical utility can install a surge arrestor because the unit is connected
directly to the outside meter and the electrical grid. A surge arrestor is the ONLY
protection against spikes that come in through the outside electrical lines.
• Surge Protectors: This is a piece of equipment that protects individual or groups of

appliances against internal sources of spikes. A protector offers a bit of protection
against outside surges, however, most outside sources of spikes are of high enough
voltage to overpower most protectors.
While most hardware stores, electronic stores, and mass merchants sell some sort of
surge protector, the products offered by Key Solutions are differentiated by their
industrial grade offer and, a far higher level of protection than most other surge
protectors. These units are $50 each and offer the best protection when used in
conjunction with a surge arrestor. Any type of electric or electronic appliance of value
should be protected such as furnaces, refrigerators, stoves, TVs, stereos, computers,
modems, phones, etc.
Key Solutions has chosen to outsource production because

i. it has numerous relationships with contract manufacturers that can make the
products for far less than they can,
ii. Production would create significant capital costs which are truly unnecessary.
The beauty of this business model is the usage of contract manufacturers and the
leveraging of PANTAGON resources.
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8 Strategy and Implementation Summary
Key Solutions has developed a targeted strategy that allows them to leverage their
competitive edge and quickly gain market penetration. Key Solutions's competitive edge is
its ability to use PANTAGON's utility status for the sale of house surge arrestors and
protectors.
The marketing strategy will concentrate on the ability to offer supreme, inexpensive
protection for an entire family's stable of electric and electronic appliances. This campaign
will be communicated through various methods and will focus on the product offerings
coming from the safe, established PANTAGON, an established electronic utility
manufacturer for over 50 years. Please review the following sections for a more detailed
analysis.
8.1 Competitive Edge
Key Solutions competitive edge is their ability to leverage the huge advantage of being
aligned with PANTAGON, an electric utility serving the Cleveland market for over 50 years.
PANTAGON has spent a long time developing brand equity and Key Solutions will be able to
tap into this equity immediately.
Key Solutions will also be able to use PANTAGON's extensive vendor connections and buying
power. The last component of their competitive edge is Key Solutions’ exclusive ability to
install house arrestors. This last edge is a sustainable edge since no other company will ever
be able to make arrestor installations, a function of the regulated power industry.
8.1.1 SWOT Analysis
Strength Weakness
• High Quality: We provide high • No reputation yet: Key Solutions
quality products Our product just established, we
• Relationship Selling: We market the have not established a reputable
product through PANTAGON which brand in the market
has huge customer database • Inexperience Worker: Most of our
• History: Products of PANTAGON workers are sales-person who does
already have the loyalty of not have the technical skill on the
customers and vendors products
Opportunity Threat
• Growing market: The market for • Low demand: The product have low
this device start to grow in recent market demand as
years • Increased competition: Cheaper
• Service: We provide high quality of production rate at China with low
customer service which our production rate increase the
competitors are less likely than ever competition
to provide it.
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8.2 Marketing Strategy
Key Solutions’ marketing strategy will seek to communicate the idea that the products that
they offer are in effect cheap insurance against large electric and electronic appliance
damage or losses.
By proactively purchasing Key Solutions’ products, customers are able to protect against loss
and damage of all of their expensive appliances. While many homeowners probably have
some sort of insurance, deductibles are often prohibitively high, making a claim for damage
to one or a couple appliances not worth the money. Key Solutions will use several forms of
communication for this marketing campaign:
• Inserts in Bills: Colourful inserts will be added into the bills of PANTAGON customers.
Currently, the customers are receiving a monthly bill from PANTAGON and inserts are
an inexpensive, yet powerful way of reaching the customers.
• Website: Key Solutions will have a website which will be comprehensive in describing
the different product offerings as well as allowing the customer to order directly from
the site.
• Direct Mail: Another advantage of the relationship Key Solutions has with PANTAGON is
the ability to use their customer database. This allows Key Solutions to generate a
targeted list of customers that they can send product information to.
8.3 Sales Strategy
Key Solutions’ sales campaign will emphasize the fact that Key Solutions is a subsidiary of
PANTAGON. This will be effective because PANTAGON is a well-known, stable electric utility
known for its safe and reliable operation.
This idea is evidenced by the fact that almost every time that a consumer reaches for a light
switch the light goes on. Sure there are interruptions, often weather related, that interrupt
the electrical service, but those interruptions are reconnected quite fast.
The utility is stable and safe and is always working to serve the customer. These electricity
related products will clearly leverage the brand equity developed by PANTAGON over the
last five decades.
8.3.1.1 Sales Forecast
The sales forecast has been developed as a forecast and tracking tool to provide the
company with realistic sales goals as well as a way to verify progress. The forecast has been
developed as a conservative estimate, not an aggressive sales promise.
By adopting a conservative forecast, Key Solutions increases the likelihood of reaching
sustainable sales growth. The following table and charts provide more detailed information
about the sales cycle, both from a temporal viewpoint and a product perspective.
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SALES FORECAST
YEAR 1 YEAR 2 YEAR 3
Sales
Surge Arrestors $56,841 $83,434 $95,454
Surge Protectors $37,515 $55,066 $63,000
Commercial sales $37,515 $55,066 $63,000
TOTAL SALES $131,871 $193,567 $221,453
Direct Cost of Sales Year 1 Year 2 Year 3
Surge Arrestors $15,915 $23,362 $26,727
Surge Protectors $14,256 $20,925 $23,940
Commercial sales $12,380 $18,172 $20,790
Subtotal Direct Cost of Sales $42,551 $62,459 $71,457
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8.4 Milestones
Key Solutions has identified several quantifiable, reachable milestones that will serve as
goals that the entire organization will work toward in order to make Key Solutions a
sustainable business.
The following table details the specific milestones as well provides a temporal timetable for
expected completion dates. Following the table is a chart for a graphical representation of
the information.
MILESTONES
Milestone Start Date End Date Budget Manager Department
Business plan 1/1/2014 31/12/2016 $0 Brian Strategic

completion development
First products shipped 1/1/2014 31/12/2016 $0 Brian Operations
$50K in sales 1/1/2014 31/12/2016 $0 Brian Sales
12 months of strong 1/1/2014 31/12/2016 $0 Brian Operations

sales, proving concept
Totals $0
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8.5 Web Plan Summary
Key Solutions’ website will be used as both a marketing and sales tool. It will take on
marketing responsibilities as one of the communication methods used to raise awareness
regarding Key Solutions’ product families. Extensive product information will be included on
the site in an easy to use format.
The site will also be used as a sales tool, allowing customers to purchase the products as
well as set up installation appointments for the surge arrestors. Allowing the website to
offer sales support will provide consumers with a convenient way to purchase the products
as well as provide Key Solutions with a low-cost sales program that does not require a live
sales support agent. The site will periodically be updated to encourage customers to make
repeat visits.
8.6 Website Marketing Strategy
Key Solutions will market their website in two primary ways:
• Search engine submission: As search engines become more and more powerful, a large
number of Internet users use them to find relevant information on the Internet. Key
Solutions will submit their site to many popular engines ensuring that their site comes
up high on the list of hits.
• URL reference in all printer material: The Web address, www.safecurrent.com, will be
printed on all material that Key Solutions uses encouraging consumers to check out the
site.
8.6.1 Development Requirements
The website will be developed by PANTAGON's internal Web development team for the
price of $5,000
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9 Management Summary
Brian Henderson received a Bachelors of Science in business and marketing from the
University of Pittsburgh and an MBA from Case Western Reserve University. Upon
graduation from the MBA program, Brian went to work for ATT for three years. At ATT Brian
was an assistant project manager, selling telephone accessories using direct marketing
techniques. After his ATT experience, Brian worked for Allegheny Power, a Pennsylvania-
based electric utility. At Allegheny Power Brian was again an assistant project manager in
charge of selling commercial businesses value added services. Brian spent three years at
Allegheny before joining PANTAGON as a Project Manager.
9.1 Personnel Plan
As a side business unit of PANTAGON, Key Solutions will have only a few employees. Billing,
sales, and order fulfilment will be accomplished using PANTAGON's existing organization,
paying a 10% fee for these services. The employees/positions that Key Solutions will use
include:
• Project Manager: Brian will take on a wide range of functions including business
development, product procurement, management, and sales.
• Finance / Admin: This position will handle any finance issues and payroll of the
workers
• IT Manager: This position will handle any IT related issues
• Human Resource Manager: This position will handle manpower of the

organisation and ensure the sufficient human resources within the organisation
• Customer Service Agents: These positions will assist customers calling about Key
Solutions’ products. Additionally, at times the employees may help Brian with
other activities.
• Operation Workers: These positions is to support the operation include stock-

checking, installation and delivery
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PERSONNEL PLAN
Project Manager $26,900 $23,950 $24,600
Finance / Admin $8,400 $8,400 $8,400
IT Manager $8,000 $8,000 $8,000
Human Resource Manager $8,400 $8,400 $8,400
Customer service agent $8,300 $8,500 $8,500
Customer service agent $8,300
Operation Worker $8,550 $8,600 $8,600
Operation Worker $8,550 $8,550
TOTAL PEOPLE 8 7 6
Total Payroll $85,400 $74,400 $66,500
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10 Financial Plan
The following sections outline important financial information.
10.1 Important Assumptions
The following table details important financial assumptions.
GENERAL ASSUMPTIONS
Plan Month 1 2 3
Current Interest Rate 10.00% 10.00% 10.00%
Long-term Interest Rate 10.00% 10.00% 10.00%
Tax Rate 30.00% 30.00% 30.00%
Other 0 0 0
10.2 Break-even Analysis
The Break-even Analysis indicates what will be needed in monthly revenue to reach the
break even point.
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BREAK-EVEN ANALYSIS
Monthly Revenue Break-even $13,732
Assumptions:
Average Percent Variable Cost 32%
Estimated Monthly Fixed Cost $9,301
10.3 Projected Cash Flow
The following chart and table displays projected cash flow.
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PRO FORMA CASH FLOW
Cash Received
Cash from Operations
Cash Sales $131,871 $193,567 $221,453
SUBTOTAL CASH FROM OPERATIONS $131,871 $193,567 $221,453
Additional Cash Received
Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0
New Long-term Liabilities $0 $0 $0
Sales of Other Current Assets $0 $0 $0
Sales of Long-term Assets $0 $0 $0
New Investment Received $15,000 $0 $0
SUBTOTAL CASH RECEIVED $146,871 $193,567 $221,453
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $85,400 $74,400 $66,500
Bill Payments $69,962 $101,544 $116,462
SUBTOTAL SPENT ON OPERATIONS $155,362 $175,944 $182,962
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Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $7,200 $7,813 $7,878
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
SUBTOTAL CASH SPENT $162,562 $183,757 $190,840
Net Cash Flow ($15,691) $9,810 $30,614
Cash Balance $6,209 $16,019 $46,633
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10.4 Projected Profit and Loss
The following table presents projected profit and loss.
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PRO FORMA PROFIT AND LOSS
Sales $131,871 $193,567 $221,453
Direct Cost of Sales $42,551 $62,459 $71,457
Other Costs of Goods $0 $0 $0
TOTAL COST OF SALES $42,551 $62,459 $71,457
Gross Margin $89,320 $131,108 $149,996
Gross Margin % 67.73% 67.73% 67.73%
Expenses
Payroll $85,400 $74,400 $66,500
Sales and Marketing and Other Expenses $6,000 $8,000 $10,000
Depreciation $1,404 $1,404 $1,404
Rent $6,000 $6,000 $6,000
Utilities $0 $0 $0
Insurance $0 $0 $0
Payroll Taxes $12,810 $9,675 $9,975
Other $0 $0 $0
Total Operating Expenses $111,614 $99,479 $93,879
Profit Before Interest and Taxes ($22,294) $31,629 $56,117
EBITDA ($20,890) $33,033 $57,521
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Interest Expense $4,610 $3,889 $3,105
Taxes Incurred $0 $8,322 $15,904
Net Profit ($26,904) $19,418 $37,109
Net Profit/Sales -20.40% 10.03% 16.76%
10.5 Business Ratios
The following business ratios detail both ratios specific to Key Solutions as well as ratios
specific to the general industry. Variances in Key Solutions's ratios relative to the industry's
can be explained by the fact that Key Solutions is able to leverage the valuable assets of
PANTAGON, an electric utility, to achieve above market margins. As a small business unit of
an electrical utility it is normal for business ratios to be different from the competition.
RATIO ANALYSIS
YEAR 1 YEAR 2 YEAR 3 INDUSTRY

PROFILE
Sales Growth 0.00% 46.78% 14.41% 8.79%
Percent of Total Assets
Inventory 22.53% 23.67% 15.38% 17.86%
Other Current Assets 10.42% 7.46% 4.24% 43.53%
Total Current Assets 54.52% 70.94% 85.47% 77.93%
Long-term Assets 45.48% 29.06% 14.53% 22.07%
TOTAL ASSETS 100.00% 100.00% 100.00% 100.00%
Current Liabilities 29.51% 20.71% 13.67% 31.98%
Long-term Liabilities 148.65% 86.96% 38.28% 20.70%
Total Liabilities 178.16% 107.67% 51.96% 52.68%
Page 30 of 34
NET WORTH -78.16% -7.67% 48.04% 47.32%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 67.73% 67.73% 67.73% 20.85%
Selling, General & Administrative 88.10% 54.09% 50.95% 6.60%

Expenses
Advertising Expenses 0.00% 0.00% 0.00% 0.49%
Profit Before Interest and Taxes -16.91% 16.34% 25.34% 1.44%
Main Ratios
Current 1.85 3.43 6.25 1.96
Quick 1.08 2.28 5.13 1.15
Total Debt to Total Assets 178.16% 107.67% 51.96% 57.62%
Pre-tax Return on Net Worth 119.55% -898.84% 155.82% 3.71%
Pre-tax Return on Assets -93.44% 68.95% 74.86% 8.76%
Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin -20.40% 10.03% 16.76% n.a
Return on Equity 0.00% 0.00% 109.07% n.a
Activity Ratios
Inventory Turnover 10.91 7.80 7.00 n.a
Accounts Payable Turnover 9.23 12.17 12.17 n.a
Payment Days 27 30 28 n.a
Total Asset Turnover 4.58 4.81 3.13 n.a
Page 31 of 34
Debt Ratios
Debt to Net Worth 0.00 0.00 1.08 n.a
Current Liab. to Liab. 0.17 0.19 0.26 n.a
Liquidity Ratios
Net Working Capital $7,200 $20,209 $50,844 n.a
Interest Coverage -4.84 8.13 18.07 n.a
Additional Ratios
Assets to Sales 0.22 0.21 0.32 n.a
Current Debt/Total Assets 30% 21% 14% n.a
Acid Test 1.08 2.28 5.13 n.a
Sales/Net Worth 0.00 0.00 6.51 n.a
Dividend Pay out 0.00 0.00 0.00 n.a
Page 32 of 34
10.6 Projected Balance Sheet
The following table details the projected balance sheet.
PRO FORMA BALANCE SHEET
Assets
Current Assets
Cash $6,209 $16,019 $46,633
Inventory $6,487 $9,522 $10,894
Other Current Assets $3,000 $3,000 $3,000
TOTAL CURRENT ASSETS $15,697 $28,542 $60,527
Long-term Assets
Long-term Assets $14,500 $14,500 $14,500
Accumulated Depreciation $1,404 $2,808 $4,212
TOTAL LONG-TERM ASSETS $13,096 $11,692 $10,288
TOTAL ASSETS $28,793 $40,234 $70,815
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $8,497 $8,333 $9,683
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
SUBTOTAL CURRENT LIABILITIES $8,497 $8,333 $9,683
Page 33 of 34
Long-term Liabilities $42,800 $34,987 $27,109
TOTAL LIABILITIES $51,297 $43,320 $36,793
Paid-in Capital $20,000 $20,000 $20,000
Retained Earnings ($15,600) ($42,504) ($23,086)
Earnings ($26,904) $19,418 $37,109
TOTAL CAPITAL ($22,504) ($3,086) $34,023
TOTAL LIABILITIES AND CAPITAL $28,793 $40,234 $70,815
Net Worth ($22,504) ($3,086) $34,023
Page 34 of 34

Business Plan For Workshop (Key Solutions PTE LTD)

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BUSSINESS PLAN

Key Solutions Pte ltd

• Surge Protectors: This is a piece of equipment that protects individual or groups of

3 Company Mission and Vision

3.3 Keys to Success

• Offer every customer 100% satisfaction.

4.1 Company Ownership

Key Solutions is a wholly owned subsidiary of PANTAGON.

4.2 Start-up Summary

Stationery etc. $100

Website development $5,000

Expensed Equipment $7,000

TOTAL START-UP EXPENSES $15,600

Cash Required $21,900

Other Current Assets $3,000

Long-term Assets $14,500

TOTAL ASSETS $39,400

Total Requirements $55,000

Internal Monitoring and review methods

Economic • General taxation issues • Keep track on the changes

Technology • Information and communications • IT Manager to check on the

Internal Monitoring and review

Economic • Financial management systems, • Financial executive to

Cultural • Shared values (sustainability) • Discussion and updates with

Organization • Policies and objectives • Director to conduct a QMS

Interested Needs and expectation Monitoring and review methods

Employees • Good well-fare system • Annual meeting with the

Suppliers • On-time payment • Discussion and updates with the

Investors • Fulfil the payment on time • Annual review on the financial

Media / • Good reputation • Continuous review on the

Competitors • Project manager to conduct

6.1 Market Segmentation

6.1.1 Family home owners

• 69% have at least one child.

6.1.2 Single home owners

YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5

Potential Customers Growth CAGR

Family homeowners 8% 143,545 154,311 165,884 178,325 191,699 7.50%

Single home owners 8% 165,987 179,266 193,607 209,096 225,824 8.00%

Commercial sales 6% 11,254 11,929 12,645 13,404 14,208 6.00%

Total 7.71% 320,786 345,506 372,136 400,825 431,731 7.71%

6.3 Industry Analysis

7 Competition and Buying Patterns

• Surge Protectors: This is a piece of equipment that protects individual or groups of

Key Solutions has chosen to outsource production because

8.1 Competitive Edge

8.1.1 SWOT Analysis

8.3 Sales Strategy

8.3.1.1 Sales Forecast

YEAR 1 YEAR 2 YEAR 3

Surge Arrestors $56,841 $83,434 $95,454

Surge Protectors $37,515 $55,066 $63,000

Commercial sales $37,515 $55,066 $63,000

TOTAL SALES $131,871 $193,567 $221,453

Direct Cost of Sales Year 1 Year 2 Year 3

Surge Arrestors $15,915 $23,362 $26,727

Surge Protectors $14,256 $20,925 $23,940

Commercial sales $12,380 $18,172 $20,790

Subtotal Direct Cost of Sales $42,551 $62,459 $71,457

Milestone Start Date End Date Budget Manager Department

Business plan 1/1/2014 31/12/2016 $0 Brian Strategic

First products shipped 1/1/2014 31/12/2016 $0 Brian Operations

$50K in sales 1/1/2014 31/12/2016 $0 Brian Sales