INDIAN RESTAURANT BUSINESS PLAN
1.0 Executive Summary 2.1 2.2 2.3 2.4 2.5
Company Ownership & Structure History Start up Funding Source of Funds Company Locations and Facilities
3.1 Service Description 3.2 Competitive Landscape 4.1 4.2 4.3 4.4 4.5 4.6 4.7
Target Market: Population, Household Statistics Summary Target Market: Pusiness Statistics Summary Target Market: Age & Race Demographics Target Market: Income & Housing Demographics Target Market: Education Profile Target Market: Occupational Analysis of Population Industry Analysis: Household Food Expenditure Analysis
5.1 5.2 5.3 5.4 5.5 5.6 5.7
Competitive Edge Positioning Advertising Strategy Strategic Alliances Sales Strategy Sales Projections Milestones
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6.1 Financials: Pro-forma Income & Expense Statement 6.2 Financials: Pro-forma Balance Sheet
1.0 Executive Summary Welcome Restaurants USA Inc. a wholly owned subsidiary of Welcome Restaurants Private Limited (Indian Parent Company) is looking to expand its operations by buying a 50% stake in Indian Express Restaurant Inc., a New York corporation that currently owns and operates a full service Indian restaurant in New York City. After the investment of $1,000,000 is completed, Welcome Restaurants USA Inc. will look to expand the existing operations of Indian Express and also look to open up to 2 more restaurants offering a delectable Indian cuisine that blends foods from all parts of the Indian subcontinent. Given the excellent management team and experience of the principals these ventures are sure to be profitable and generate employment and revenues in the communities they serve. 2.1 Company Ownership & Structure Welcome Restaurants USA Inc. (US subsidiary) is a New York State Corporation and is a wholly owned subsidiary of Welcome Restaurants Private Limited a corporation based in Bangalore, India with interests in hospitality. Welcome Restaurants USA Inc. will be making an investment of $1,000,000 to buy a 50% stake of Indian Express Restaurant Inc., a New York corporation.
2.2 History
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2
Welcome Restaurants Private Limited is the Parent company of Welcome Restaurants USA Inc. Over the years Welcome Restaurants Private Limited has developed an expertise in the hospitality and restaurant business and is now looking to expand overseas. With this strategic focus a United States subsidiary called Welcome Restaurants USA Inc. was established in August of 2007. The purpose of the subsidiary is to grow the Welcome brand internationally by making strategic acquisitions and growing organically by opening new restaurants in the United States.
2.3 Start up Funding Welcome Restaurants USA Inc. will begin its expansion into the United States market by making a strategic acquisition and buying a 50% stake in the operations of Indian Express Restaurant Inc. – a New York corporation. The funds will be used by Welcome Restaurants USA Inc. to expand the existing operations of Indian Express Restaurant Inc. and also to start two new restaurants in the New York metro area. 2.4 Source of Funds Welcome Restaurants USA Inc. will be making the investment of $1,000,000 from its own cash reserves that are derived from the hospitality interests of its parent company Welcome Restaurants Private Limited in Mumbai, India. 2.5 Company Locations and Facilities Welcome Restaurants USA Inc. will be purchasing a 50% stake in Indian Express Restaurant Inc. located at 147 West, 16th Street between Park and Lexington Avenues, New York, NY 10016. 3.1 Service Description Welcome Restaurants USA Inc. through its investment in Indian Express Restaurant Inc. will be able to offer its clientele a unique blend of Indian cooking – different from the typical North or South Indian fare dished out by most restaurants. Using the concept of fusion cooking, Welcome will be able to present unique and eclectic assortments of appetizers, entrees and deserts that are rare to find in a typical Indian restaurant. 3.2 Competitive Landscape With its incredibly diverse population New York City is able to support many restaurants serving up different varieties of foods. The Indian full service restaurant is no different and New York City currently boasts around 200 restaurants that serve some kind of India fare. However of the 200 odd full service Indian restaurants the vast majority of them focus on providing the traditional and dependable delicacies of North Indian cooking; around 20% of the all Indian restaurants offer South India delicacies and very few of them are true competitors to Welcomes Hotels USA Inc. Given the unique blend of foods from the entire sub-continent Welcome Restaurants USA Inc. will be able to offer improved derivatives of classic Indian cooking. 4.1 Target Market: Population, Household Statistics Summary
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New York City is widely regarded as the most culturally diverse city in the United States with a population that boasts residents from all over the world. Also New York City has a much higher per capital income and median household income when compared to the average for the country.
4.1 Target Market: Population, Household Statistics Summary (cont'd)
New York NY
United States
Resident total population estimate 2007
1,620,867
299,398,484
Resident population 2000
1,537,195
281,421,906
Resident population 1990
1,487,536
248,709,873
Resident population 1980
1,428,285
226,545,805
13.48%
32.16%
37.5
37.6
Civilian labor force 2007
916,053
151,428,000
Civilian labor force 2000
855,227
142,583,000
Civilian labor force 1990
780,346
125,840,000
Change in labor force 1990 - 2007
17.39%
20.33%
Households
772,957
108,954,329
1.98
2.6
Median Household Income
$55,208
$44,334
Income per Capita
$110,292
$34,471
Persons below poverty line
18.06%
12.70%
Male Population
47.73%
48.65%
Female Population
52.27%
51.35%
Married Population
39.34%
58.89%
Single Population
60.66%
41.11%
% Change in population (1980 to 2007) Median Age
Household Size
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Item
4
Population & Household & Business statistics summary for New York, NY
4.2 Target Market: Business Statistics Summary Minority owned businesses are well represented in New York City as we can see with Black, Hispanic and women owned firms running better than the national averages. Having a diverse population is key to the success of Welcome Restaurants USA Inc. since Indian food is most appealing to clients who prefer diversity in their food habits. Retail sales per capita – another measure of the spending power of local New York City residents is $16,178 a good 57% above the national average retail sales per capita of $10,615. This again bodes well for us in the restaurant business.
New York, NY
United States
Black-owned firms, percent
12.40%
5.2%
Asian-owned firms, percent
14.20%
4.8%
Hispanic-owned firms
16.40%
6.8%
Women-owned firms
31.80%
28.2%
Manufacturers shipments ($1000)
$10,950,335
$3,916,136,712
Wholesale trade sales ($1000)
$140,669,286 $4,634,755,112
Retail sales ($1000)
$25,904,575
$3,056,421,997
$16,718
$10,615
$10,714,578
$449,498,718
Building permits
8790
1,838,903
Current Unemployment Rate
4.40%
5.50%
Sales Taxes
8.63%
6.00%
Retail sales per capita Accommodation and foodservices sales ($1000)
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5
Business statistics summary for New York, NY
4.3 Target Market: Age & Race Demographics
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The race graph below simply reiterates the earlier mentioned diversity that New York City has come to be known for. With 24% of its population claiming Hispanic origin and 11% and
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The Age chart below highlights the fact that New York City has a good share of its population between the ages of 18 and 65 – a good 64% - higher than the national average of 61%. We believe that is an important element of success in the restaurant business since this is the age group that is most likely to have disposable income and eat away from their homes.
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18% claiming Asian and Black heritage, NYC offers restaurants serving Indian foods like ours an excellent client base.
4.4 Target Market: Income & Housing Demographics The Income distribution of households in New York City shows a substantial amount of households earning between $35k and $100k – what is very important however is to understand that in New York City the composition of households is very different from the rest of the country. For example only 39% of the population in New York City is married versus 52% for the national average. A lot more single people means a lot less cooking at home!
Less than 15k Between 15k and 25k Between 25k and 35k Between 35k and 50k Between 50k and 75k Between 75k and 100k Between 100k and 150k Between 150k and 250k Between 250k and 500k Greater than 500k
New York, NY
United States
18.12% 8.97% 8.27% 11.73% 14.69% 9.64% 11.74% 8.61% 4.46% 3.78%
13.64% 11.21% 11.46% 15.84% 19.28% 11.53% 10.70% 4.43% 1.31% 0.61%
When the value of owner occupied housing metrics is compared we can see that New York City is way ahead of the rest of the country with most of its housing stock valued higher than $300k. It has always been expensive to purchase a home in New York City due to the relatively higher values of property and we believe that this strongly points to the economic strength and vitality in the local market place – a very important element for us in the restaurant business.
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Income Category
8
Estimated Households by Income class for New York, NY
Less Than $20k $20k to $39k $40k to $59k $60k to $79k $80k to $99k $100k to $149k $150k to $199k $200k to $299k $300k to $399k $400k to $499k $500k to $749k $ 1mil or more
New York, NY
United States
1.76% 1.64% 0.68% 0.33% 0.56% 2.42% 4.79% 10.50% 9.86% 9.27% 15.85% 30.96%
3.01% 4.37% 5.74% 7.07% 8.41% 19.74% 14.06% 16.59% 8.21% 4.53% 4.75% 1.86%
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Value
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New York, NY - Owner occupied housing units analysis
4.5 Target Market: Education Profile With more 4 year college students and graduates than the national average, New York City easily stands out as having a population of relatively better educated citizens. For restaurants serving ethnic cuisine like Indian foods this is a very important element in the marketplace. We strongly believe that fusion Indian cooking is well received by clients with relatively higher education and economic backgrounds. New York, NY - Education profile of population Education
New York, NY
United States
School Expenditure Pupil / Teacher Ratio Students per Librarian Students per Counselor 2 yr College Graduates 4 yr College Graduates Graduate Degrees High School Graduates
$7,461 20 1441 597 3.45% 25.48% 23.06% 77.69%
$6,058 15.9 907 546 8.22% 15.16% 7.16% 79.62%
4.6 Target Market: Occupational Analysis of Population A quick look at the occupations of the New York City residents clearly shows a relatively high proportion of the workforce involved in Management and Professional occupations. Since the office crowd is a very important element of our revenues and brings in almost 40% of our total income, we think that this demographic pattern works very well in our favor.
Management, Business & Financial Operations Professional and Related Occupations Service Sales & Office Farming, Fishing & Forestry Construction, Extraction & Maintenance Production & Transportation
New York, NY
United States
21.44% 33.76% 12.73% 23.54% 0.03% 2.35% 6.16%
13.61% 20.24% 14.75% 26.74% 0.74% 9.48% 14.44%
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Occupation
10
New York, NY - Occupation analysis of population
4.7 Industry Analysis: Household Food Expenditure Analysis In the following table we have analyzed the major trends that affect our industry and that is the amount spent by households. While the larger survey deals with monies spent by a household on every item, we have decided to focus on the part that matters the most to us and that of course the amount of money spent by households nationally on foods away from home. In 1997 we find that out of the total 104 million households in the nation the annual expenditure was approximately $33k per household. Of this $2,876 or 8.50% of the total household expenditure was spent on foods consumed at home. $1,823 or roughly 5.40% was spent on foods away from home. Also, $ 309 or 0.90% was spent on alcoholic beverages.
average roughly Another roughly
Clearly, as long as this trend of consumption of food away from home continues, all food purveyors including fast food shops, limited service restaurants and full service restaurants
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The most important trend that matters to us is of course the expenditure on foods away from home. It is significant to note that while this expense of 5.60% of total expenditure does not mean that all the money is spent on full service restaurants let alone fine Italian dining, it does however show that the consumers preferences nationally towards eating out have not changed significantly between 1996 and 2007.
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When we look at 2007 we find that out of the 118 million households in the nation, the average annual expenditure is $48,398. Of this $ 3,417 or 7.06% of the total expenditure was spent on food consumed at home. Another $2,694 or roughly 5.60% was spent on food away from home. Alcoholic beverages consumption remained roughly the same at 1% or $497 in 2007.
like us will do well. It is important to note that the 10 year period covered above does not cover a protracted recession but does include the slowdown of 2001 – 2002 during which the spending habits of the national population did not change towards outside food consumption.
Expenditure: Avg. Annual Expenditure: food away from Expenditure food at home home
1997
104,212
$33,797
$2,876
1998
105,576
$34,819
1999
107,182
2000
108,465
2001 2002
Total Expenditure on food
Expenditure on Alcoholic beverages
$1,823
$4,699
$309
$2,880
$1,921
$4,801
$309
$35,535
$2,780
$2,030
$4,810
$309
$36,995
$2,915
$2,116
$5,031
$318
109,367
$38,045
$3,021
$2,137
$5,158
$372
110,339
$39,518
$3,086
$2,235
$5,321
$349
2003
112,108
$40,677
$3,099
$2,276
$5,375
$376
2004
115,356
$40,817
$3,129
$2,211
$5,340
$391
2005
116,282
$43,395
$3,347
$2,434
$5,781
$459
2006
117,356
$46,409
$3,297
$2,634
$5,931
$426
2007
118,843
$48,398
$3,417
$2,694
$6,111
$497
Food away from home as a % of Total Household Expenditure in 1997
5.39%
Food away from home as a % of Total Household Expenditure in 2007
5.57%
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Year
No. of households (000)
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Average Annual Household Food Expenditures: 1997 to 2007
5.1 Competitive Edge We believe that in today’s competitive full service restaurant business there are three things that are keys to success:
Location and Leases Excellent and diverse menu priced reasonably Ambience and customer service
We believe that at Welcome Restaurants USA we have all three elements down pat! Our choice of locations is the city of New York. A business friendly local government coupled with a highly educated, well heeled population is the perfect venue for fine Indian dining offered by Welcome Restaurants USA and Indian Express Restaurants. Our diverse menu selection during both lunch and dinner hours has been developed after years of experience in the industry by our chefs. Care has been taken to pick crowd pleasers and house specials that are not easy to find in Indian dining and the fare is priced very reasonably in line with local competitors. 5.2 Positioning We are positioning ourselves to market to the middle to upper middle class clientele of well heeled working professionals who live and work in New York City. Our typical customer is well educated having a graduate degree, working and/or living in New York city, looking for a tasteful and different Indian dining experience than what is offered by the local deli. 5.3 Advertising Strategy Welcome Restaurants USA Inc. will advertise using all possible forms of media including print, radio and television.
Our media advertising will be focused on publications serving the Indian community “India Abroad” and “Desi Talk”. Our online advertising will be focused on websites like Citysearch.com, yelp.com, restaurant.com and seamless web. Local promotions will also include sponsorship of local charity events and participating in food drives and other local causes.
5.4 Strategic Alliances We currently have an alliance with Seamless web that allows clients to place their orders via the web. We have been able to mind a steady base of customers from local firms like Credit Suisse, JP Morgan Chase, Metlife and other non-institutional clients as well.
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There are two ways to approach sales – one is go with volume and this is the typical modus operandi of the fast food industry; many full service restaurants also use this approach. The other is go with quality service at market rates but focus on building a richer customer dining experience so that we can cultivate a permanent relationship with the customer. We favor the later approach at Welcome Restaurants USA Inc.
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5.5 Sales Strategy
5.6 Sales Projections We believe that it is very important to be realistic in the projection of sales in the planning process and have decided to look at three possible market scenarios in our sales projections.
Slow market: As the words imply, this would indicate a weak market for the full service restaurant business as was the case after the attack of September 11, 2001 where the full service restaurant business suffered its worse days in recent memory. This experience is also possible during a recession where folks decide to be cautious with their disposable income. Good market: This would be a regular and normal environment during which healthy business activity can be experienced by us in the full service restaurant business. Great market: This would suggest an excellent operating environment with the consumer feeling very confident and spending on food away from home a lot more than normal. The dot com era of the late nineties was such an operating environment where full service restaurants did extremely well.
5.6 Sales Projections (cont'd)
Also indicated in our projections are the seasonal adjustments that are normal in our business with January to March being tepid, business picking up in June and July, and of course the best time for us being the holiday months of November and December. We have also indicated projections for 1, 2 and 3 restaurants. Our first initiative is to the expand the operations of Indian Express Restaurant Inc. Once we have consolidated our investments and operations there we intend to expand this investment into one or two new operations.
GOOD MARKET
GREAT MARKET
NO. OF RESTAURANTS
NO. OF RESTAURANTS
NO. OF RESTAURANTS
1
2
3
1
2
3
1
2
3
$75,000
$150,000
$225,000
$93,750
$187,500
$281,250
$107,813
$215,625
$323,438
Feb
$90,000
$180,000
$270,000
$112,500
$225,000
$337,500
$129,375
$258,750
$388,125
Mar
$105,000
$210,000
$315,000
$131,250
$262,500
$393,750
$150,938
$301,875
$452,813
Q1
$270,000
$540,000
$810,000
$337,500
$675,000 $1,012,500 $388,125
$776,250
$1,164,375
Apr
$105,000
$210,000
$315,000
$131,250
$262,500
$393,750
$150,938
$301,875
$452,813
May $120,000
$240,000
$360,000
$150,000
$300,000
$450,000
$172,500
$345,000
$517,500
Jun
$150,000
$300,000
$450,000
$187,500
$375,000
$562,500
$215,625
$431,250
$646,875
Q2
$375,000
$750,000 $1,125,000 $468,750
$937,500 $1,406,250 $539,063 $1,078,125
Jul
$135,000
$270,000
$405,000
$168,750
$337,500
$506,250
$194,063
$388,125
$582,188
Aug
$105,000
$210,000
$315,000
$131,250
$262,500
$393,750
$150,938
$301,875
$452,813
Jan
$1,617,188
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SLOW MARKET
14
Welcome Restaurants USA Inc. Sales Projections: 2009
Sep
$135,000
$270,000
Q3
$375,000
$750,000 $1,125,000 $468,750
$937,500 $1,406,250 $539,063 $1,078,125
Oct
$135,000
$270,000
$405,000
$168,750
$337,500
$506,250
$194,063
$388,125
$582,188
Nov
$150,000
$300,000
$450,000
$187,500
$375,000
$562,500
$215,625
$431,250
$646,875
Dec
$195,000
$390,000
$585,000
$243,750
$487,500
$731,250
$280,313
$560,625
Q4
$480,000
$960,000 $1,440,000 $600,000 $1,200,000 $1,800,000 $690,000 $1,380,000
$2,070,000
$1,500,000 $3,000,000 $4,500,000 $1,875,000 $3,750,000 $5,625,000 $2,156,250 $4,312,500
$6,468,750
Tot
$405,000
$168,750
$337,500
$506,250
$194,063
$388,125
$582,188 $1,617,188
$840,938
5.6 Sales Projections (cont'd) Welcome Restaurants USA Inc. Sales Projections: 2010 SLOW MARKET
GOOD MARKET
GREAT MARKET
NO. OF RESTAURANTS
NO. OF RESTAURANTS
NO. OF RESTAURANTS
3
1
2
3
1
2
3
$196,875 $295,313 113,203 $226,406
$339,609
Feb
94,500
$189,000 $283,500 118,125 $236,250 $354,375 135,844 $271,688
$407,531
Mar
110,250 $220,500 $330,750 137,813 $275,625 $413,438 158,484 $316,969
$475,453
Q1
283,500
$1,222,594
Apr
110,250 $220,500 $330,750 137,813 $275,625 $413,438 158,484 $316,969
$567,000
$850,500
98,438
354,375
$708,750
$1,063,125
407,531
$815,063
$475,453
15
2
$157,500 $236,250
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1 78,750
Jan
May
126,000 $252,000 $378,000 157,500 $315,000 $472,500 181,125 $362,250
Jun
157,500 $315,000 $472,500 196,875 $393,750 $590,625 226,406 $452,813
$679,219
Q2
393,750
$1,132,031
$1,698,047
Jul
141,750 $283,500 $425,250 177,188 $354,375 $531,563 203,766 $407,531
$611,297
Aug
110,250 $220,500 $330,750 137,813 $275,625 $413,438 158,484 $316,969
$475,453
Sep
141,750 $283,500 $425,250 177,188 $354,375 $531,563 203,766 $407,531
$611,297
Q3
393,750
$1,132,031
$1,698,047
Oct
141,750 $283,500 $425,250 177,188 $354,375 $531,563 203,766 $407,531
$611,297
Nov
157,500 $315,000 $472,500 196,875 $393,750 $590,625 226,406 $452,813
$679,219
Dec
204,750 $409,500 $614,250 255,938 $511,875 $767,813 294,328 $588,656
$882,984
Q4
504,000
$1,449,000
$2,173,500
Total 1,575,000 $3,150,000 $4,725,000 1,968,750 $3,937,500 $5,906,250 2,264,063 $4,528,125
$6,792,188
$787,500
$787,500
$1,181,250
$1,181,250
$1,008,000 $1,512,000
492,188
492,188
630,000
$984,375
$984,375
$1,476,563
$1,476,563
$1,260,000 $1,890,000
566,016
566,016
724,500
$543,375
5.6 Sales Projections (cont'd) Welcome Restaurants USA Inc. Sales Projections: 2011 SLOW MARKET
GOOD MARKET
GREAT MARKET
NO. OF RESTAURANTS
NO. OF RESTAURANTS
NO. OF RESTAURANTS
3
1
2
3
1
2
3 $356,590
Feb
$99,225 $198,450 $297,675 $124,031 $248,063 $372,094 $142,636 $285,272
$427,908
Mar
$115,763 $231,525 $347,288 $144,703 $289,406 $434,109 $166,409 $332,817
$499,226
Q1
$297,675
$1,283,723
$595,350
$893,025
$372,094
$744,188
$1,116,281 $427,908
$855,816
16
2
Page
1
$82,688 $165,375 $248,063 $103,359 $206,719 $310,078 $118,863 $237,727
Jan
$570,544
Jun
$165,375 $330,750 $496,125 $206,719 $413,438 $620,156 $237,727 $475,453
$713,180
Q2
$413,438
$1,240,313 $516,797 $1,033,594 $1,550,391 $594,316 $1,188,633
$1,782,949
Jul
$148,838 $297,675 $446,513 $186,047 $372,094 $558,141 $213,954 $427,908
$641,862
Aug
$115,763 $231,525 $347,288 $144,703 $289,406 $434,109 $166,409 $332,817
$499,226
Sep
$148,838 $297,675 $446,513 $186,047 $372,094 $558,141 $213,954 $427,908
$641,862
Q3
$413,438
$1,240,313 $516,797 $1,033,594 $1,550,391 $594,316 $1,188,633
$1,782,949
Oct
$148,838 $297,675 $446,513 $186,047 $372,094 $558,141 $213,954 $427,908
$641,862
Nov
$165,375 $330,750 $496,125 $206,719 $413,438 $620,156 $237,727 $475,453
$713,180
Dec
$214,988 $429,975 $644,963 $268,734 $537,469 $806,203 $309,045 $618,089
$927,134
Q4
$529,200 $1,058,400 $1,587,600 $661,500 $1,323,000 $1,984,500 $760,725 $1,521,450
$2,282,175
Total 1,653,750 $3,307,500 $4,961,250 2,067,188 $4,134,375 $6,201,563 2,377,266 $4,754,531
$7,131,797
$826,875
$826,875
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$499,226
Page
$115,763 $231,525 $347,288 $144,703 $289,406 $434,109 $166,409 $332,817
May $132,300 $264,600 $396,900 $165,375 $330,750 $496,125 $190,181 $380,363
Apr
5.7 Milestones
Presented here are the key milestones in our business plan for Mayflower Restaurants USA Inc. Upon receiving the regulatory okay for Mr. Patel from the USCIS we will begin the process making our investment into Indian Express Restaurants Inc. and also the expansion of the business interests into other restaurants as described earlier.
WELCOME RESTAURANTS USA INC. - PROJECT TIMELINE
Week of
1
2
3
4
5
6
7
8
9
10/6/2008 10/13/2008 10/20/2008 10/27/2008
11/17/2008 11/24/2008
Page
11/10/2008
18
11/3/2008
12/1/2008 12/8/2008 12/15/2008 12/22/2008 12/29/2008 1/5/2009 1/12/2009 1/19/2009 1/26/2009 2/2/2009 2/9/2009 2/16/2009 2/23/2009 3/2/2009 3/9/2009 3/16/2009 3/23/2009 3/30/2009 4/6/2009 4/13/2009 4/20/2009 4/27/2009 5/4/2009
1
2
No. Name of Project
3
4
Starting Week
5
6
Ending Week
7
8
9
Responsible Party
1
Filing of L-1 Petition
10/6/2008
10/13/2008
Attorney
2
Processing & Approval of L-1
10/20/2008
12/29/2008
USCIS
3
Indian Express Investment
1/5/2009
1/5/2009
Welcome Hotels USA Inc.
4
Expansion of existing business
1/12/2009
5/4/2009
Satish Patel
5
New Site Research
4/6/2009
ongoing
Satish Patel
6
Market Research
4/6/2009
ongoing
Satish Patel
7 8 9
Page
As indicated in our earlier discussions, we expect that with the opening of other restaurants the total income for our combined new operations will be substantial more than the current income for the Indian Express Restaurant that will be controlled by Welcome Restaurants USA Inc. Our pro-forma financials have been put together with a very conservative growth with only one of restaurant to give investors and banks a better idea of the profitability in
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6.1 Financials: Pro-forma Income & Expense Statement
an average environment with a steady growth rate consistent with our peers in the restaurant business. We would like to point out however that we anticipate a significantly better sales picture as indicated in our sales projections.
Welcome Restaurants USA Inc. Proforma Income & Expense Statement 2009 SALES Cost of Goods Sold Gross Profit Gross Margin %
2010
$1,875,000 $1,968,750 $656,250
$669,375
$1,218,750 $1,299,375 65.00%
66.00%
2011 $2,067,188 $682,172 $1,385,016 67.00%
$9,375
$9,656
$9,946
Advertising
$18,750
$19,688
$20,672
Auto Expenses
$5,438
$5,546
$5,657
Bad Debts
$18,750
$18,938
$19,127
Bank charges
$5,250
$5,303
$5,356
Credit card processing
$37,500
$38,250
$39,015
Catering & Banquet Supplies
$4,688
$4,781
$4,877
Cleaning / Janitorial Services
$5,625
$5,794
$5,968
Depreciation
$34,700
$34,700
$34,700
Charitable Donations
$5,000
$5,000
$5,000
Employer Taxes
$33,240
$34,902
$36,647
Entertainment
$5,625
$5,738
$5,852
Extermination
$4,875
$5,021
$5,172
Flowers & Decoration
$4,688
$4,828
$4,973
Gifts
$14,063
$14,063
$14,063
Gross Wages
$349,891
$367,385
$385,754
Insurance
$18,750
$19,313
$19,892
Kitchen Utensils
$4,688
$4,828
$4,973
Linen & Laundry
$5,250
$5,408
$5,570
Miscelleaneous Expenses
$5,063
$5,164
$5,267
Musician / Music
$5,625
$5,738
$5,852
Paper & Printing Services Rent
$6,563
$6,694
$6,828
$210,000
$220,500
$231,525
Office Expenses
$4,688
$4,922
$5,168
Office Supplies
$10,000
$10,200
$10,404
Subscriptions, Licenses & Fees
$4,125
$4,331
$4,548
Security & Computer maintenance
$2,813
$2,869
$2,926
Tableware / Cutlery
$5,625
$5,794
$5,968
Telephone
$3,750
$3,788
$3,825
Training
$15,000
$15,750
$16,538
Utilities
$4,500
$4,725
$4,961
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Accounting & Legal Fees
20
OPERATING EXPENSES
Web Design
$2,813
$2,953
$3,101
TOTAL OPERATING EXPENSES
$866,705
$902,566
$940,122
Profit before Interest & Taxes
$352,045
$396,809
$444,893
Interest Expenses
$14,134
$12,419
$10,563
Provisional Taxes
$123,216
$138,883
$155,713
NET INCOME
$214,696
$245,507
$278,618
11.45%
12.47%
13.48%
% of Sales
6.2 Financials: Pro-forma Balance Sheet Welcome Restaurants USA Inc. Proforma Balance Sheet A S S E T S
2009
2010
2011
CURRENT ASSETS Cash
$1,011,803 $1,269,594
$1,558,637
Accounts Receivable
$4,688
$4,922
$5,168
Inventory
$20,000
$20,000
$20,000
$1,036,491 $1,294,516
$1,583,805
Furniture, Fixtures & Equipment
$347,000 $347,000
$347,000
Accumulated Depreciation
-$34,700
-$69,400
-$104,100
Security Deposit
$35,000
$35,000
$35,000
$347,300 $312,600
$277,900
$1,383,791 $1,607,116
$1,861,705
TOTAL CURRENT ASSETS
FIXED ASSETS
TOTAL FIXED ASSETS TOTAL ASSETS
L I A B I L I T I E S & C A P I T A L
2009
2009
2010
$3,750
$3,938
$4,134
Taxes Payable
$0
$0
$0
Other Current Liabilities
$0
$0
$0
$3,750
$3,938
$4,134
TOTAL CURRENT LIABILITIES
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Accounts Payable
21
CURRENT LIABILITIES
LONG TERM LIABILITIES Long-term loans outstanding TOTAL LONG-TERM LIABILITIES
$165,345 $142,976
$118,750
$165,345
$118,750
$142,976
CAPITAL $214,696
$460,202
$1,000,000 $738,821
TOTAL CAPITAL
$1,214,696 $1,460,202
$1,738,821
TOTAL LIABILITIES & CAPITAL
$1,383,791 $1,607,116
$1,861,705
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Retained Earnings
$1,000,000 $1,000,000
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Common Stock
