How to Write a Business Plan

242 | HOW TO WRITE A BUSINESS PLAN

-13-

J. Product Selling Prices and Costs

The projections included in this business plan are based on several assumptions about

product selling prices and costs.

Wholesale Selling Price

Kinet-O-Scroll (Commercial Unit) $550.00

Kinet-O-Scope (Recreational Unit) $150.00

Direct (Variable) Cost of Each Unit

Packaging Direct Labor Direct Material Total Cost

Kinet-O-Scroll $11.00 $24.00 $100.00 $135.00

Kinet-O-Scope $2.00 $12.00 $ 30.00 $44.00

These figures do not allow for any corporation overhead, such as rent, management

costs, etc. They are based solely on the cost of producing each unit. All costs and selling

prices have been developed through extensive market research and profitability analysis.

They reflect the realities of the marketplace, as well as the price objectives of management.

K. Financial Statement and Projections

As DAY INTERNATIONAL, INC., is still in the start-up phase, we have yet to develop

positive cash flow.^3 As the attached profit and loss projection and cash flow forecast

indicate, however, we expect the corporation to begin to generate a positive cash flow

and profit before the end of the first year of operations. To accomplish this, however,

the corporation needs a total infusion of $150,000 equity capital. The founders have

contributed half of that amount and are seeking additional investors for the balance. In

exchange for a $75,000 investment, the investor would receive a one-third interest in the