Executive Summary
Located off Federal Highway, next to the new PJ Plaza, Merdeka Tackle and Trip Shop will
offer a convenient one-stop resource for all fishing products to travelers
heading into the Merdeka National Parks System . Federal Highway is the gateway
to over 130 public fishing locations and the PJ Plaza is the last commercial
shopping and dining area before entering the Merdeka National Parks System. Merdeka
Tackle and Trip Shop will capitalize on its location to pull in customers. It
will offer a wide selection of fishing products as well as information on
fishing conditions.
Fahmi Ahmad, owner of Merdeka Tackle and Trip Shop,
has been an avid fisherman in the area for the past 10 years. He knows all the
area's best fishing locations and has managed two fishing tackle and bait shops
in the past seven years.
1.1 Objectives
- To
become a familiar and essential shopping destination for travelers heading
out for a day of fishing.
- Build
a customer base that will grow each year.
- Offer
exceptional service and products to both the experienced and novice
fishing enthusiast.
- Offer
the best fishing trip around the world .
1.2 Keys to Success
The keys to success for Merdeka Tackle and Trip
Shop are the following:
- Location: Merdeka Tackle and Trip
Shop is located off Federal Highway , next to the new PJPlaza. Federal
Highway is the gateway to over 130
public fishing locations in the Merdeka National Park System. PJ Plaza is
the last commercial shopping and dining location before entering the
Merdeka National Park System. Many travelers routinely stop in the plaza
at the beginning and end of their day in the park system.
- Service: Fahmi Ahmad, owner of Merdeka
Tackle and Trip Shop, knows that customers are not in his shop to browse.
They need the right product or the best information on where to fish.
Merdeka Tackle and Trip Shop will offer exceptional service and get the
customers on their way so they can enjoy a day of fishing.
1.3 Mission
The mission of Merdeka Tackle and Trip Shop is to
be the best, most visible, fishing product and information resource in the
Merdeka National Parks area. We want travelers to plan stopping at our store as
a important step in their day of fishing.
Company Summary
Merdeka Tackle and Trip Shop will offer a convenient one-stop resource for
all fishing products to travelers heading into the Merdeka National Parks
System. The shop will be open April to November.
2.1 Company Ownership
Merdeka Tackle and Trip Shop is a sole proprietorship owned by Fahmi
Ahmad.
2.2 Start-up Summary
Estimated start-up costs and expenses are set forth below. The
start-up costs are to be financed by Fahmi Ahmad’s personal investment.
Start-up Funding
|
|
Start-up Expenses to Fund
|
RM
12,300
|
Start-up Assets to Fund
|
RM
12,700
|
Total Funding Required
|
RM
25,000
|
Assets
|
|
Non-cash Assets from Start-up
|
RM
0
|
Cash Requirements from Start-up
|
RM
12,700
|
Additional Cash Raised
|
RM
0
|
Cash Balance on Starting Date
|
RM
12,700
|
Total Assets
|
RM
12,700
|
Liabilities and Capital
|
|
Liabilities
|
|
Current Borrowing
|
RM
0
|
Long-term Liabilities
|
RM
0
|
Accounts Payable (Outstanding Bills)
|
RM
0
|
Other Current Liabilities
(interest-free)
|
RM
0
|
Total Liabilities
|
RM
0
|
Capital
|
|
Planned Investment
|
|
Fahmi Ahmad
|
RM
25,000
|
Other
|
RM
0
|
Additional Investment Requirement
|
RM
0
|
Total Planned Investment
|
RM
25,000
|
Loss at Start-up (Start-up Expenses)
|
(RM
12,300)
|
Total Capital
|
RM
12,700
|
Total Capital and Liabilities
|
RM
12,700
|
Total Funding
|
RM
25,000
|
Start-up
|
|
Requirements
|
|
Start-up Expenses
|
|
Legal
|
RM
500
|
Insurance
|
RM
0
|
Rent
|
RM
800
|
Inventory
|
RM
7,000
|
Display Equipment
|
RM
2,000
|
Store Sign
|
RM
2,000
|
Other
|
RM
0
|
Total Start-up Expenses
|
RM
12,300
|
Start-up Assets
|
|
Cash Required
|
RM
12,700
|
Start-up Inventory
|
RM
0
|
Other Current Assets
|
RM
0
|
Long-term Assets
|
RM
0
|
Total Assets
|
RM
12,700
|
Total Requirements
|
RM
25,000
|
Products
Store products include:
- Fly
rods and reels.
- Lines-leaders-tippets.
- Fishing
gadgets-net/retractors.
- Fishing
footgear.
- Raingear.
- Maps.
- Flies
and fly tying materials.
- Gear
bags.
- Tubes.
- Fishing
Trip with more 1000 fishing location around the world.
- Misc:
drinks, snacks, souvenirs, etc.
Market Analysis Summary
The Merdeka Tackle and Trip Shop is dotted with a number of small
fishing tackle and bait shops on small roads around the park system. Most of
them only serve a few fishing areas and have irregular operating hours. Federal
Highway is the only main traffic artery
into the park system and yet there are currently no other tackle and bait shop
located on Federal Highway. This is because the closest commercial center to
the park system, PJ Plaza, is eight miles from the park's entrance. Over 90% of
the park visitors use Federal Highway to
access the park system. Last year, the park system welcomed 100,000 fishing
enthusiasts.
These enthusiasts were typically male between the ages of 20-45
years old. A fishing party of three to five is the norm for the area.
Approximately 70% of these fishing enthusiasts visit the park system several
times a year and develop strong customer relationships with the area's
businesses.
The Merdeka Tackle and Trip Shop will create a base of loyal
customers with quality service and fishing information that customers will come
to depend.
Strategy and
Implementation Summary
Federal Highway is a four-lane highway running
north to the park system and south to the town of Petaling Jaya. The Merdeka Tackle and
Trip Shop is located just off the northbound lanes and is next to the PJ Plaza.
The shop will erect a large sign to grab customer attention to its location.
Once in the store, Fahmi Ahmad will provide the
exceptional service that will build a loyal customer base.
5.1 Competitive Edge
Merdeka Tackle and Trip Shop ‘s competitive edge is
two-fold:
·
Location: Merdeka Tackle and Trip Shop is located off Federal Highway, next to
the new PJ Plaza. Federal Highway is the gateway to over 130 public fishing
locations in the Merdeka National Park System. Many travelers routinely stop in
the plaza at the beginning and the end of their day in the park system.
·
Service: Fahmi Ahmad has the experience to
provide exceptional service.
5.2 Sales Strategy
The key to customer satisfaction is a
customer-friendly store that is easy to navigate and has knowledgeable people
to help customers find what they want quickly.
5.2.1 Sales Forecast
The following is the sales forecast for three
years. The monthly estimates for the first year are included in the appendices.
Sales Forecast
|
|||
Year 1
|
Year 2
|
Year 3
|
|
Sales
|
|||
Fishing Products
|
RM 48,400
|
RM 60,000
|
RM 70,000
|
Misc
|
RM 7,600
|
RM 8,000
|
RM 9,000
|
Total Sales
|
RM 56,000
|
RM 68,000
|
RM 79,000
|
Direct Cost of Sales
|
Year 1
|
Year 2
|
Year 3
|
Fishing Products
|
RM 7,000
|
RM 9,000
|
RM 10,000
|
Misc
|
RM 1,500
|
RM 1,750
|
RM 2,000
|
Subtotal Direct Cost of Sales
|
RM 8,500
|
RM 10,750
|
RM 12,000
|
Personnel Plan
|
|||
Year
1
|
Year
2
|
Year
3
|
|
Fahmi Ahmad
|
RM 24,000
|
RM 28,000
|
RM 35,000
|
Other
|
RM 0
|
RM 0
|
RM 0
|
Total People
|
1
|
1
|
1
|
Total Payroll
|
RM 24,000
|
RM 28,000
|
RM 35,000
|
Financial Plan
The following sections will outline the important financial
assumptions, break-even analysis, profit and loss, cash flow, and the balance
sheet.
7.1 Break-even Analysis
The break-even analysis indicates what is needed in monthly
revenue to break even.
The following table and charts will highlight projected profit and
loss. The appendices include first year monthly P & L estimates.
Pro Forma Profit and Loss
|
|||
Year
1
|
Year
2
|
Year
3
|
|
Sales
|
RM 56,000
|
RM 68,000
|
RM 79,000
|
Direct Cost of Sales
|
RM 8,500
|
RM 10,750
|
RM 12,000
|
Other Production Expenses
|
RM 0
|
RM 0
|
RM 0
|
Total Cost of Sales
|
RM 8,500
|
RM 10,750
|
RM 12,000
|
Gross Margin
|
RM 47,500
|
RM 57,250
|
RM 67,000
|
Gross Margin %
|
84.82%
|
84.19%
|
84.81%
|
Expenses
|
|||
Payroll
|
RM 24,000
|
RM 28,000
|
RM 35,000
|
Sales and Marketing and Other Expenses
|
RM 8,000
|
RM 10,000
|
RM 11,000
|
Depreciation
|
RM 0
|
RM 0
|
RM 0
|
Leased Equipment
|
RM 0
|
RM 0
|
RM 0
|
Utilities
|
RM 1,470
|
RM 1,800
|
RM 1,800
|
Insurance
|
RM 0
|
RM 0
|
RM 0
|
Rent
|
RM 9,700
|
RM 9,700
|
RM 9,700
|
Payroll Taxes
|
RM 3,600
|
RM 4,200
|
RM 5,250
|
Other
|
RM 0
|
RM 0
|
RM 0
|
Total Operating Expenses
|
RM 46,770
|
RM 53,700
|
RM 62,750
|
Profit Before Interest and Taxes
|
RM 730
|
RM 3,550
|
RM 4,250
|
EBITDA
|
RM 730
|
RM 3,550
|
RM 4,250
|
Interest Expense
|
RM 0
|
RM 0
|
RM 0
|
Taxes Incurred
|
RM 219
|
RM 1,065
|
RM 1,275
|
Net Profit
|
RM 511
|
RM 2,485
|
RM 2,975
|
Net Profit/Sales
|
0.91%
|
3.65%
|
3.77%
|
7.3 Projected Cash Flow
The following is the projected cash flow for three years. First
year monthlies are in the appendix.
Pro Forma Cash Flow
|
|||
Year
1
|
Year
2
|
Year
3
|
|
Cash Received
|
|||
Cash from Operations
|
|||
Cash Sales
|
RM 56,000
|
RM 68,000
|
RM 79,000
|
Subtotal Cash from Operations
|
RM 56,000
|
RM 68,000
|
RM 79,000
|
Additional Cash Received
|
|||
Sales Tax, VAT, HST/GST Received
|
RM 0
|
RM 0
|
RM 0
|
New Current Borrowing
|
RM 0
|
RM 0
|
RM 0
|
New Other Liabilities (interest-free)
|
RM 0
|
RM 0
|
RM 0
|
New Long-term Liabilities
|
RM 0
|
RM 0
|
RM 0
|
Sales of Other Current Assets
|
RM 0
|
RM 0
|
RM 0
|
Sales of Long-term Assets
|
RM 0
|
RM 0
|
RM 0
|
New Investment Received
|
RM 0
|
RM 0
|
RM 0
|
Subtotal Cash Received
|
RM 56,000
|
RM 68,000
|
RM 79,000
|
Expenditures
|
Year
1
|
Year
2
|
Year
3
|
Expenditures from Operations
|
|||
Cash Spending
|
RM 24,000
|
RM 28,000
|
RM 35,000
|
Bill Payments
|
RM 32,132
|
RM 35,243
|
RM 40,920
|
Subtotal Spent on Operations
|
RM 56,132
|
RM 63,243
|
RM 75,920
|
Additional Cash Spent
|
|||
Sales Tax, VAT, HST/GST Paid Out
|
RM 0
|
RM 0
|
RM 0
|
Principal Repayment of Current
Borrowing
|
RM 0
|
RM 0
|
RM 0
|
Other Liabilities Principal Repayment
|
RM 0
|
RM 0
|
RM 0
|
Long-term Liabilities Principal
Repayment
|
RM 0
|
RM 0
|
RM 0
|
Purchase Other Current Assets
|
RM 0
|
RM 0
|
RM 0
|
Purchase Long-term Assets
|
RM 0
|
RM 0
|
RM 0
|
Dividends
|
RM 0
|
RM 0
|
RM 0
|
Subtotal Cash Spent
|
RM 56,132
|
RM 63,243
|
RM 75,920
|
Net Cash Flow
|
(RM 132)
|
RM 4,757
|
RM 3,080
|
Cash Balance
|
RM 12,568
|
RM 17,325
|
RM 20,405
|
7.4 Projected Balance Sheet
The following is the projected balance sheet for three years. The
first year monthly projections can be seen in the appendix.
Pro Forma Balance Sheet
|
|||
Year
1
|
Year
2
|
Year
3
|
|
Assets
|
|||
Current Assets
|
|||
Cash
|
RM 12,568
|
RM 17,325
|
RM 20,405
|
Inventory
|
RM 1,170
|
RM 1,480
|
RM 1,652
|
Other Current Assets
|
RM 0
|
RM 0
|
RM 0
|
Total Current Assets
|
RM 13,738
|
RM 18,805
|
RM 22,057
|
Long-term Assets
|
|||
Long-term Assets
|
RM 0
|
RM 0
|
RM 0
|
Accumulated Depreciation
|
RM 0
|
RM 0
|
RM 0
|
Total Long-term Assets
|
RM 0
|
RM 0
|
RM 0
|
Total Assets
|
RM 13,738
|
RM 18,805
|
RM 22,057
|
Liabilities and Capital
|
Year
1
|
Year
2
|
Year
3
|
Current Liabilities
|
|||
Accounts Payable
|
RM 527
|
RM 3,109
|
RM 3,386
|
Current Borrowing
|
RM 0
|
RM 0
|
RM 0
|
Other Current Liabilities
|
RM 0
|
RM 0
|
RM 0
|
Subtotal Current Liabilities
|
RM 527
|
RM 3,109
|
RM 3,386
|
Long-term Liabilities
|
RM 0
|
RM 0
|
RM 0
|
Total Liabilities
|
RM 527
|
RM 3,109
|
RM 3,386
|
Paid-in Capital
|
RM 25,000
|
RM 25,000
|
RM 25,000
|
Retained Earnings
|
(RM 12,300)
|
(RM 11,789)
|
(RM 9,304)
|
Earnings
|
RM 511
|
RM 2,485
|
RM 2,975
|
Total Capital
|
RM 13,211
|
RM 15,696
|
RM 18,671
|
Total Liabilities and Capital
|
RM 13,738
|
RM 18,805
|
RM 22,057
|
Net Worth
|
RM 13,211
|
RM 15,696
|
RM 18,671
|
7.5 Business Ratios
Business ratios for the years of this plan are shown below.
Industry profile ratios based on the Standard Industrial Classification (SIC)
code 5091, Sporting & Recreational Goods, are shown for comparison.
Ratio Analysis
|
||||
Year
1
|
Year
2
|
Year
3
|
Industry
Profile
|
|
Sales Growth
|
0.00%
|
21.43%
|
16.18%
|
11.50%
|
Percent of Total Assets
|
||||
Inventory
|
8.52%
|
7.87%
|
7.49%
|
28.00%
|
Other Current Assets
|
0.00%
|
0.00%
|
0.00%
|
29.00%
|
Total Current Assets
|
100.00%
|
100.00%
|
100.00%
|
88.70%
|
Long-term Assets
|
0.00%
|
0.00%
|
0.00%
|
11.30%
|
Total Assets
|
100.00%
|
100.00%
|
100.00%
|
100.00%
|
Current Liabilities
|
3.83%
|
16.53%
|
15.35%
|
38.00%
|
Long-term Liabilities
|
0.00%
|
0.00%
|
0.00%
|
9.00%
|
Total Liabilities
|
3.83%
|
16.53%
|
15.35%
|
47.00%
|
Net Worth
|
96.17%
|
83.47%
|
84.65%
|
53.00%
|
Percent of Sales
|
||||
Sales
|
100.00%
|
100.00%
|
100.00%
|
100.00%
|
Gross Margin
|
84.82%
|
84.19%
|
84.81%
|
23.00%
|
Selling, General & Administrative
Expenses
|
83.91%
|
80.54%
|
81.04%
|
14.80%
|
Advertising Expenses
|
14.29%
|
14.71%
|
13.92%
|
0.70%
|
Profit Before Interest and Taxes
|
1.30%
|
5.22%
|
5.38%
|
2.00%
|
Main Ratios
|
||||
Current
|
26.08
|
6.05
|
6.51
|
2.19
|
Quick
|
23.86
|
5.57
|
6.03
|
1.22
|
Total Debt to Total Assets
|
3.83%
|
16.53%
|
15.35%
|
47.00%
|
Pre-tax Return on Net Worth
|
5.53%
|
22.62%
|
22.76%
|
5.30%
|
Pre-tax Return on Assets
|
5.31%
|
18.88%
|
19.27%
|
10.10%
|
Additional Ratios
|
Year
1
|
Year
2
|
Year
3
|
|
Net Profit Margin
|
0.91%
|
3.65%
|
3.77%
|
n.a
|
Return on Equity
|
3.87%
|
15.83%
|
15.93%
|
n.a
|
Activity Ratios
|
||||
Inventory Turnover
|
9.23
|
8.11
|
7.66
|
n.a
|
Accounts Payable Turnover
|
61.99
|
12.17
|
12.17
|
n.a
|
Payment Days
|
27
|
18
|
29
|
n.a
|
Total Asset Turnover
|
4.08
|
3.62
|
3.58
|
n.a
|
Debt Ratios
|
||||
Debt to Net Worth
|
0.04
|
0.20
|
0.18
|
n.a
|
Current Liab. to Liab.
|
1.00
|
1.00
|
1.00
|
n.a
|
Liquidity Ratios
|
||||
Net Working Capital
|
$13,211
|
$15,696
|
$18,671
|
n.a
|
Interest Coverage
|
0.00
|
0.00
|
0.00
|
n.a
|
Additional Ratios
|
||||
Assets to Sales
|
0.25
|
0.28
|
0.28
|
n.a
|
Current Debt/Total Assets
|
4%
|
17%
|
15%
|
n.a
|
Acid Test
|
23.86
|
5.57
|
6.03
|
n.a
|
Sales/Net Worth
|
4.24
|
4.33
|
4.23
|
n.a
|
Dividend Payout
|
0.00
|
0.00
|
0.00
|
n.a
|