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Week 8 Project Activity: Final Budget Proposal Presentation

Using a presentation tool such as PowerPoint (with narration), WebEx, Prezi, etc., create a presentation directed to the management team for your start-up business that will outline your proposal, summarize the key points and defend your budget.


Papa Geo’s Restaurant

Budget Proposal



Maria DiNardo


Professor Dixon

Table of Contents

SectionTitleSubsectionTitlePage Number
1.0Executive Summary4
2.0Sales Forecast4
2.1Sales Forecast
2.2Methods and Assumptions
3.0Capital Expenditure Budget4
4.0Investment Analysis5
4.1Cash Flows5
4.2NPV Analysis5
4.3Rate of Return Calculations6
4.4Payback Period Calculations6
5.0Pro Forma Financial Statements7
5.1Pro Forma Income Statement7
5.2Pro Forma Balance Sheet7
5.3Pro Forma Cash Budget8
6.0Works Cited8
7.1Appendix 1: [description]
7.2Appendix 2: [description]

1.0 Executive Summary

Papa Geo’s Restaurant needs to be competitive and unveil marketing crusades to protect their returns in the business. However, it is guided by typical objectives in the marketing plan. The first objective of the restaurant is ensuring customer satisfaction and loyalty. The target market entails about 10,000 families which is a totality of lower to middle class clients with zero direct competition. However, the customers’ satisfaction is determined the customer’s loyalty to the restaurant especially due to the services that they receive. The restaurant wins the customers through the good Italian food of low price. Stunning cleanliness of the restaurant is welcoming and eye catching which applies to both the foods served and the environment. Generation of the restraint traffic will impact the Restaurant towards success. The restaurant will cultivate a customer base such as having demanding lunchtimes and dinner services through intensive marketing. It will achieve this through weekly and monthly promotions as the marketing strategies.

The restaurant needs to attain their financial goals. The objective is to meet the financial income goal of $40000 annually. At the starting of the second year the company expects to attain a minimum of 2% profits of the sales. The main objective of the restaurant is profitability. It is attainable with the managerial ability to achieve the weekly goals especially through cost reduction with profitability growth concurrently. The restaurant needs to develop a restaurant brand. As the restaurant grows successfully, it will improve its place in the local market and toughen the brand. The quality of the food served has a great influence on the restaurant branding. The company purposes to cook using healthy products and use the brand to win new customers (Myers, 2019).

2.0 Sales ForecastThe sales forecast table illustrates the restaurants ability to offer services to the clients through listing the total services sold and the net sales in every year.2.1 Sales ForecastYear 1Year 2Year 3Year 4Year 5Sales$1,074,150$2,157,700$2,390,100$2,625,920$2,880,040The sales are expected to rise each year as the restaurant continues to gain a higher customer base each year through marketing.2.2 Methods and AssumptionsThe sales forecast figures were obtained from the customer surveys which are based on the Italian fast food industry. Using the historical analysis of other restaurants with similar services and the customer base similar to that of this restaurant, we were able to structure the sales for each year in the next five years.3.0 Capital Expenditure Budgetyear 1year 2year 3year 4year 5$204,360$393,000$411,800$440,500$460,700(payroll)$50,000$53,000$53,000$52,000$50,000(marketing)$25,000$30,000$34,000$37,000$41,000(utilities)$12,000$38,000$43,000$44,000$45,000(repairs/maintainance)$2,400$10,000$11,000$13,000$15,200(dishes/ cleaning supplies)$15,000$18,000$22,000$24,000$31,000(employee healthcare)$17,000$50,000$50,000$50,000$5,000(rent)   $325,760$606,000$624,800$660,500$647,900This data was gathered from numerous consumer surveys of the fast food industry. Using the data, we were able to develop the most crucial costs for every restaurant and then estimate the increment of capital expenditure as the restaurant’s sales grow.4.0 Investment AnalysisThe discount rate used in the calculations is 5 % since it is the most dominant rate that most restaurants similar to this one use (Van den, 2019). The net present value of the firm is calculated as $2,695,521which illustrates that the company’s investment is very productive. In addition, the rate of return in all years indicates that the company’s profitability is approximately twice the amount of investment that was made.4.1 Cash flowsyear 1year 2year 3year 4year 5$1,074,150$2,157,700$2,390,100$2,625,920$2,880,040(cash sales)$69,045$134,673$148,117$162,899$179,146(taxes)$10,300$12,000$13,000$14,000$15,000(sales of current assets)($204,360)($393,200)($411,860)($431,453)($451,717)(cash spending)($570,420)($1,380,599)($1,493,514)($1,619,145)($1,758,632)(bill payment)$378,715$530,574$645,843$752,221$863,837(net cash flow)$495,311$1,112,740$1,537,093$2,508,380$2,647,942(cash balance)    4.2 NPV Analysisnpv    year 1year 2year 3year 4year 5$378,715$530,574$645,843$752,221$863,837$360,680.00$481,246$557,903$618,854$676,838     Npv$2,695,521   4.3 Rate of Return current value of investmentoriginal value of investmentrate of returnyear 11,000,000250,000400year 22,000,0001,000,000200year 32,200,0001,500,000147year 42,500,0001,700,000147year 52,900,0001,900,0001524.4 Payback Period cash inflowcumulative cash flowsinitial oulayremaining paymentyear1$378,715$378,715-1,000,000-621,285year 2$530,574$909,289 288,004year 3$645,843$1,555,132  year 4$752,221$2,307,353  year 5$863,837$3,171,190   $3,171,190     payback period is two years  5.0 Pro forma Financial StatementsThis section represents the financial analysis of the activities which takes place within the restaurant. It helps us understand the profitability of a firm, its cash inflows and outflows as well as the amounts of assets and liabilities that a company possesses (Fernando, 2019)5.1 Pro Forma Income Statementpro formula income statement     year 1year 2year 3year 4year 5net sales$1,074,150$2,157,700$2,390,100$2,625,920$2,880,040direct costs of sales$375,103$700,340$770,238$847,101$931,564operating expenses$325,760$606,000$624,800$660,500$647,900taxes incurred$114,899$200,001$238,831$281,506$328,753net profits$258,388$651,359756,231$836,813$971,8235.2 Pro Forma Balance Sheetspro forma balance sheetcash$495,311$1,112,740$1,537,093$2,508,380$2,647,942inventory$14,331$26,756$29,427$32,364$35,591Other Current Assets($10,300)($22,300)($35,300)($49,300)($64,300)net current assets$499,342$1,117,196$1,531,220$2,491,444$2,619,233Long term assets$0$0$0$0$0liabilitiescurrent borrowing0$0$0$0$0accounts payable$98,320$114,831$123,464$133,942$145,495other current liabilities$69,045$203,718$351,835$514,734$693,880net current liabilities$167,364$318,549$475,299$648,675$839,374earnings$258,388$651,359756,231$836,813$971,8235.3 Pro Forma Cash Budgetpro forma cash flows    cash sales$1,074,150$2,157,700$2,390,100$2,625,920$2,880,040sales of current assets$10,300$12,000$13,000$14,000$15,000cash spending($204,360)($393,200)($411,860)($431,453)($451,717)additional cash spent($570,420)($1,380,599)($1,493,514)($1,619,145)($1,758,632)net cash flow$309,670$395,901$497,726$589,322$684,691cash balance$495,311$1,112,740$1,537,093$2,508,380$2,647,9426.0 Works CitedList any sources you cited in the body of your report.Fernando, H. S. K. S. B. (2019). Business Proposal on Rail Carriage Manufacturing&Repairing Plant in Sri Lanka (Master’s thesis, 华南理工大学).Myers, M. D. (2019). Qualitative research in business and management. Sage Publications Limited.Van den Berghe, H., De Meyere, M., Denys, K., & Calcoen, J. (2019). Proposal business plan WRC network-December 2019. Proposal business plan WRC network-December 2019.