Post on 06-Apr-2018
transcript
8/2/2019 Mid Atlantic Recycling
1/44
March 2004
This sample business plan has been made available to users ofBusiness Plan Pro, business planningsoftware published by Palo Alto Software, Inc. Names, locat ions and numbers may have been
changed, and substantial portions of the original plan text may have been omitted to preserveconfidentiality and proprietary information.
You are welcome to use this plan as a starting point to create your own, but you do not have
permission to resell, reproduce, publish, distribute or even copy this plan as it exists here.
Requests for reprints, academic use, and other dissemination of this sample plan should be emailed
to the marketing department of Palo Alto Software at marketing@paloalto.com. For productinformation visit our Website: www.paloalto.com or call: 1-800-229-7526.
Copyright Palo Alto Software, Inc., 1995-2007 All rights reserved.
8/2/2019 Mid Atlantic Recycling
2/44
Confidentiality Agreement
The undersigned reader acknowledges that the information provided by _______________ in thisbusiness plan is confidential; therefore, reader agrees not to disclose it without the express writtenpermission of _______________.
It is acknowledged by reader that information to be furnished in this business plan is in all respectsconfidential in nature, other than information which is in the public domain through other means and
that any disclosure or use of same by reader, may cause serious harm or damage to_______________.Upon request, this document is to be immediately returned to _______________.
___________________Signature___________________
Name (typed or printed)___________________
DateThis is a business plan. It does not imply an offering of securities.
8/2/2019 Mid Atlantic Recycling
3/44
Table of Contents
1.0 Executive Summary.............................................................................................................................11.1 Mission........................................................................................................................................21.2 Keys to Success ........................................................................................................................31.3 Objectives ...................................................................................................................................3
2.0 Company Summary.............................................................................................................................32.1 Start-up Summar ......................................................................................................................32.2 Company Locations and Faci lities ..........................................................................................52.2.1 Government Regulation..........................................................................................................5
2.3 Company Ownership .................................................................................................................53.0 Products and Services........................................................................................................................5
3.1 Product and Service Description.............................................................................................63.2 Competitive Comparison..........................................................................................................73.3 Sales Literature..........................................................................................................................83.4 Technolog ..................................................................................................................................93.5 Future Products and Services ..................................................................................................9
4.0 Market Analysis Summar ................................................................................................................10
4.1 Market Segmentation..............................................................................................................104.2 Target Market Segment Strategy...........................................................................................124.2.1 Market Growth.......................................................................................................................124.2.2 Market Needs .......................................................................................................................134.2.3 Market Trends.......................................................................................................................134.3 Service Business Analysis .....................................................................................................134.3.1 Business Participants ..........................................................................................................134.3.2 Distributing a Service...........................................................................................................14
4.3.3 Competition and Buying Patterns.......................................................................................144.3.4 Main Competitors.................................................................................................................14
5.0 Strategy and Implementation Summar ..........................................................................................145 1 Value Proposition 15
8/2/2019 Mid Atlantic Recycling
4/44
Table of Contents8.5 Projected Profit and Loss .......................................................................................................25
8.6 Projected Cash Flow...............................................................................................................288.7 Projected Balance Sheet........................................................................................................318.8 Business Ratios.......................................................................................................................32
8/2/2019 Mid Atlantic Recycling
5/44
Mid-Atlantic Recycling
1.0 Executive Summary
Mid-Atlantic Recycling, LLC's area of business will be to collect, recycle/compost, and marketwaste from municipality waste processing plants for use use as a consumer good. This recycled
product will meet two critical needs:
1. It will give municipalities a feasible and cost effective alternative to landfilling the waste,
and2. It will help meet the growing demand for organic soil enhancers and fertilizers. The material
that will be recycled is human waste sludge.
Our recycled waste will be targeted toward fertilizer manufacturers, nurseries, landscapers,farmers, government agencies, golf courses, and others. All of these potential customers willbenefit from the compost's numerous soil enhancing characteristics.
Additionally, we will offer a service to waste processing plants owned by municipalities. Currently
these plants face several issues regarding the disposal of human waste sludge. Landfills are fillingup and costs of disposal are rising. Also, due to recent legislation, as of 2008 many landfills will
no longer be able to accept human waste sludge. Mid-Atlantic Recycling will solve this problemby accepting this waste at a nominal charge and recycling it into a useful product.
Mid-Atlantic Recycling is entering a niche market in that human waste sludge has not beenrecycled on any sizeable scale in West Virginia or the Mid-Atlantic region. This is a unique and
viable concept that addresses the needs of various customers and reaches an untapped marketwith tremendous growth potential.
One of the most attractive aspects is that the business is projected to attain a strong cashposition and achieve profitability in the first year of operation. Due to a large need for these
products and services, and a lack of direct competition, our projection of quick profitability isattainable.
8/2/2019 Mid Atlantic Recycling
6/44
Mid-Atlantic Recycling
1.1 Mission
Mid-Atlantic Recycling's mission is threefold. Our first responsibility is to ensure the financial well
being of the business. Second, is to provide municipalities with an economical, alternative for the
disposal of human waste sludge. Third, is to provide a top quality, recycled material to theconsumer so that they may benefit from compost's many good properties and organic elements.In addition, we hope to build in the consumer a positive feeling about the feasibility of using
recycled human sludge as a fertilizer.
8/2/2019 Mid Atlantic Recycling
7/44
Mid-Atlantic Recycling
1.2 Keys to Success
The keys to success in our business are:
Overcome perception issues that may exist with using compost made from human wastesludge.
Establish and build relationships and trust with customers to help shield from future
competition. Expand rapidly to control the market.
Offer reasonable prices. Get investment.
1.3 Objectives
1. Flush sales for the first twelve months of operations and growing each year thereafter.2. Establish the recycling facility in Monroe County, WV; to include six composting units in
2004.3. Open additional facilities in 2005 and 2006 to serve other areas of the state and the Mid-
Atlantic region.4. Continue to market Mid-Atlantic Recycling by contacting and soliciting business from
additional municipalities and compost using customers.
2.0 Company Summary
The legal name of the company will be Mid-Atlantic Recycling, LLC. Mid-Atlantic Recycling will be
formed as a Limited Liability Company in West Virginia. Due to its tax benefits, a LLC will beadvantageous.
2.1 Start-up Summar
8/2/2019 Mid Atlantic Recycling
8/44
Mid-Atlantic Recycling
Table: Start-up
Start-up
Requirement
Start-up Expense
Legal $500
Phone/uti li ties deposit $500
8/2/2019 Mid Atlantic Recycling
9/44
Mid-Atlantic Recycling
2.2 Company Locations and Faci lities
Mid-Atlantic Recycling will operate in Monroe County, WV, near the community of Lindside, WV.The Lindside location is approximately 10 miles from Peterstown, WV. The recycling facilities will
be located on a 58+ acre property owned by company president, Oliver Pyne; 5 acres will be setaside for the recycling facility set up and operation. This site is ideal as it provides access tolocal municipalities and to Interstates 77 and 81. Also there is room for expansion as the
business grows.
Additionally, Mid-Atlantic Recycling's business location is located in a federally designated"historically underutilized business zone" or HUBZone. As discussed under the Competitive
Comparison section below, this designation gives Mid-Atlantic Recycling certain advantages inselling to the government.
As the business expands to additional counties in subsequent years, we will need to leaseproperty on which to site our facilities.
2.2.1 Government Regulation
Because Mid-Atlantic Recycling recycles a waste product and incorporates it into anenvironmental product, the company is under the potential jurisdiction of the EnvironmentalProtection Agency. The recycling and sale of human waste may be regulated by federal or state
authorities. Mid-Atlantic Recycling will obtain all required federal and state permits and licensesto operate its facilities.
2.3 Company Ownership
Mid-Atlantic Recycling is owned by its founder and president, Oliver Pyne. Mr. Pyne will be anactive participant in management decisions.
3 0 Products and Services
8/2/2019 Mid Atlantic Recycling
10/44
Mid-Atlantic Recycling
3.1 Product and Service Description
Nationwide, many landfills are closing or exhausting their remaining capacity. However, due toenvironmental restrictions, zoning laws, and other regulatory and bureaucratic delays, very few
new landfills are opening to offset the looming space crisis. Meanwhile municipal waste, includinghuman waste sludge, continues to flow in greater volume. Handling their waste streams hasbecome a major problem for most municipalities. With more waste created daily, landfills
nationwide are rapidly facing a capacity crisis.
In West Virginia this situation has been made even more critical due to recent passage oflegislation requiring that by 2008 only landfills lined with a very heavy duty liner will be able to
accept human waste sludge. Thus, in the not too distant future, most landfills now acceptingthe sludge will no longer be able to accept it. Additionally, it will be very impractical, and costprohibitive, to install the required liner in working landfills. Therefore, options for disposing of
human waste sludge are about to become very, very limited, which means disposal will becomemuch, much more costly.
Considering this environment, we will offer municipalities an extremely valuable service -- an
alternative means for disposal of their human waste sludge. Municipalities currently pay landfills a"tipping" fee to dispose of their waste. The tipping fee is typically $15 to $50 per ton; theaverage tipping fee in West Virginia is $32 per ton. As noted above, in the near future many
landfills will stop receiving human waste sludge and prices are expected to increase dramaticallydue to simple supply and demand. Not only will tipping fees increase, but as municipalities have
to go farther and farther afield to find accommodating landfills, transportation costs for thewaste will also increase. We will help them solve this problem, and ultimately save them, and
their tax payers, money. We will place skid boxes at their waste treatment plants and removethe sludge for them. The tipping fee, a fee for skid box rental, and a fee for picking up andreturning the skid boxes will be paid to Mid-Atlantic Recycling by the municipalities. This will be
done at a price competitive with or lower than what they are now paying.
Mid-Atlantic Recycling will receive the sludge and recycle it using an organic composter. This will
8/2/2019 Mid Atlantic Recycling
11/44
Mid-Atlantic Recycling
3.2 Competitive Comparison
The Mid-Atlantic Recycling business model adds great value through both our service and ourproduct.
Our service, accepting human waste sludge from municipalities, partially relieves the burden onrapidly filling landfills, and provides an alternative disposal channel to municipalities facing a
legislative deadline which threatens to cut off their traditional means of disposing of the waste.
As noted earlier, there is a trend in the market away from chemical fertilizers toward morenatural organic soil enhancements. Our product, composted human sludge, responds to this
market trend. Compost has many advantages over traditional fertilizer. Traditional chemicalfertilizer sells for approximately $250 per ton while our compost will be priced at around $50-$100per ton. Our compost is similar to fertilizers; however, it reacts differently from most fertilizers.
Compost releases nutrients over a long period of time, on average two to three months. Thechemical reaction in present fertilizers takes place immediately and usually lasts no longer than
three to four weeks. After three to four weeks, the customer may have to buy more fertilizer,costing both time and money. On golf courses, when chemical fertilizer is applied, golf must
cease for the day; however, when compost is applied, golf can continue uninterrupted. Asdemonstrated, compost has many advantages over traditional fertilizers.
Our human sludge compost also has distinct advantages over other types of composts as well.To be a viable, lucrative, growing business, we must be a reliable source of compost supply to
our customers. To serve the market and grow in it availability of our product cannot beintermittent or "hit and miss." We must be able to meet the demand every time within a
reasonable delivery time. By the inherent nature of the business, human waste sludge will alwaysbe available for composting in large, dependable quantities, at one or a few locations, at aconstant/stable quality and at a stable cost. Other composts cannot compete with this in that
similar quantities are not available from so few locations which increases their labor andtransportation costs related to collection. Additionally, if collection is from farms, they may use
horse manure, poultry manure, cow manure, hog manure, etc. in varying quantities over time.
8/2/2019 Mid Atlantic Recycling
12/44
Mid-Atlantic RecyclingSmall Disadvantaged Business (SDB) program: This program offers several important
incentives:
1. Price evaluation adjustment: qualified SDBs receive a price evaluation adjustment of up to
10 percent on procurements where mandated by regulation. The price evaluation adjustmentfor SDBs bidding as primes became effective October 1, 1998. Regulations mandate thisapproach in competitive acquisitions over the simplified acquisition threshold (usually
$100,000) where the SIC Code for the prime contract is authorized by U.S. Department ofCommerce benchmarks. The price evaluation adjustment does not apply to 8(a) acquisitions
and small business set-asides.
2. Evaluation factor: qualified prime contractors can receive a credit when using SDBs assubcontractors. This evaluation factor for SDB participation became effective January 1,1999. The incentive applies only to competitive negotiated acquisitions over $500,000, or$1,000,000 in construction. Firms certified by the SBA as SDBs remain on the list of SDB-
certified firms for a period of three years.
The 8(a) Program: SBA s 8(a) program, named for a section of the Small Business Act, is abusiness development initiative that helps socially and economically disadvantaged Americans
gain access to economic opportunity.
1. Participants can receive sole-source contracts, up to a ceiling of $3 million for services.
While SBA helps 8(a) firms build their competitive and institutional know-how, the agencyalso encourages them to participate in competitive acquisitions.
2. Federal acquisition policies encourage federal agencies to award a certain percentage oftheir contracts to SDBs. To speed up the award process, the SBA has signed Memoranda of
Understanding (MOUs) with 25 federal agencies allowing them to contract directly withcertified 8(a) firms.
3. Recent changes permit 8(a) firms to form joint ventures and teams to bid on contracts. This
enhances the ability of 8(a) firms to perform larger prime contracts and overcome theeffects of contract bundling, the combining of two or more contracts together into one large
contract.
8/2/2019 Mid Atlantic Recycling
13/44
Mid-Atlantic Recycling
3.4 Technology
Composting is biological decomposition of organic materials. Bacteria, fungi, protozoans, insects,worms and other organisms typically play a part in the decomposition process. Composting is
nature s means of recyc ling. It will turn grass clipping, leaves, vegetables, fruit and otherorganic materials into a very beneficial soil amendment. Composting is also an effective means ofreducing the amount of solid wastes going into our nation s landfills. Mid-Atlantic Recycling's
process will greatly speed up the natural composting process.
As briefly described above, the human waste sludge used in Mid-Atlantic Recycling's process willbe picked up from municipalities in skid boxes provided by Mid-Atlantic Recycling. Accepting the
waste, rental of the boxes, and transportation will all be sold as a service to the municipalities.
Upon arrival at our recycling facility, the sludge will be placed into one of six organic in-vessel
digesters. These vessels are proven for composting various types of animal manure. In addition,Mid-Atlantic Recycling's president, Oliver Pyne, has tested the unit' ability to successfully
compost human waste. The material compost produced was tested by the equipmentmanufacturer (CV Organics, Inc. of White Springs, TN) and found to be a high quality compost.
Additionally, the compost material was recently tested by West Virginia University AgriculturalService Laboratory and found to be an exceptional soil amendment.
These recycling/composting units work as follows. The unit is 50 feet long. The sludge is placedinto one end of the unit. To make compost, additional dry fibrous material such as sawdust,
wood chips, or bark must be added. We will acquire a steady supply of these from InternationalPaper Company.
The unit turns slowly, making four revolutions per hour, to ensure that adequate oxygen gets to
all of the composting material. Also, the unit is set on a very slight, 2 degree, angle so that asthe unit turns, the material slowly migrates toward the opposite end of the unit. During thecomposting process, the material heats up (due to the natural reaction) to temperatures of
approximately 140 degrees Farenheit; this kills any harmful bacteria in the composting material.
8/2/2019 Mid Atlantic Recycling
14/44
Mid-Atlantic Recycling
4.0 Market Analysis Summar
There are customers at both ends of our supply chain that will benefit from our services andproducts. Municipalities will benefit from our service by having an alternative means of waste
disposal. Other potential customers who will benefit from our compost product include turf farms,fertilizer manufacturers, nurseries, landscapers, golf courses, homeowners, and even the federalgovernment for use in highway construct ion reseeding. Therefore, we have two basic market
segments; those waste treatment facilities which will benefit from our services and consumerswho will benefit from our product.
The Worldwatch Institute reports that landfills are overflowing and the costs of disposing of
sewage and garbage is rising. City leaders can relieve over extended municipal budgets, preventthe contamination of drinking water, and help farmers build healthier soils by recycling garbageand human waste back to farms. At least 13 U.S. states have 6 years or less before all of their
landfills are completely full. (Paper 135: Recycling Organic Waste: From Urban Pollutant to FarmResource.) We offer a service by which municipalities can dispose of their waste without it
having to be land filled anywhere. This is of great value to this customer.
At the other end of our process are the users of our compost. According to Cornell University(www.cals.cornell.edu/dept/compost.feas.study.html) composting is experiencing a resurgenceof activity which is driven by increased understanding of the agronomic benefits of compost
utilization, and rising disposal costs for municipal wastes. Also, according to Purdue University(www.ctic.purdue.edu/Core4/Nutrient/ManureMgt/Paper35.html) consumption of compost in the
commercial market is growing due to people looking for a more organic or natural substitute fortraditional chemical fertilizers. Recycling is at the forefront of responding to this growth trend in
the Mid-Atlantic USA. We will initially focus on selling compost to fertilizer manufacturers,nurseries, and landscapers. We already have commitments from a fertilizer manufacturer and a
landscaper to purchase 600 tons per year or more of our compost material.
Five major market segments for compost have been identified:
8/2/2019 Mid Atlantic Recycling
15/44
Mid-Atlantic Recycling
Table: Market Analysis
Market Anal ysi
2004 2005 2006 2007 2008
Potential Customer Growth CAGR
Municipalities with treatment
plant
1% 34 34 34 34 34 0.00%
Compost user 5% 1,779 1,868 1,961 2,059 2,162 5.00%
Othe 0% 0 0 0 0 0 0.00%
Total 4.91% 1,813 1,902 1,995 2,093 2,196 4.91%
8/2/2019 Mid Atlantic Recycling
16/44
Mid-Atlantic Recycling
4.2 Target Market Segment Strategy
To target our customers, we examined the market trends. Mid-Atlantic Recycling's productstarget buyers of organic fertilizers and soil enhancers. This market has grown significantly in
recent years and we expect to capture a quarter of this multi billion-dollar market.
This market growth is fueled by a more health conscious consumer. People are better informed
about the potential side effects associated with chemical fertilizer products both to their healthand to the environment.
The growth of a more organic approach to gardening comes at a time when chemical options are
diminishing. In 2000, the federal Environmental Protection Agency reached agreement with themakers of two widely used pesticides Diazinon and Chlorpyrifos to phase them out becauseof health problems associated with overexposure. Popular brands of Diazinon include Ortho and
Spectracide; Chlorpyrifos is marketed under the trade name Dursban and is included in numerousfamiliar products, including Ortho Lawn Insect Spray (Washington Post, Thursday, May 10,
2001).
According to an executive with the Scotts Co. in Marysville, Ohio, the pace of research intoorganic products continues feverishly, and their use is bound to increase.
Sales of organic foods have risen sharply. Organic food sales at the retail level totaled $10.4billion, according to Katherine DiMatteo, executive director of the Organic Trade Association.
This year, retail sales of organic foods are expected to exceed $15 billion with more than $32billion projected by 2009 (CNBC, Dec. 3, 2004).
Findings from a 15-year study at the Kamlath Institute, Newton, Pa., might lead to a solution
that could help reduce emissions of greenhouse gases. The researchers suggest thatregenerative agricultural management systems based on organic fertilizer can preserve carbonand nitrogen in the soil, thus reducing emissions. Moreover, they maintain that organic methods
can produce the same yields as conventional systems that use synthetic fertilizer. If the major
8/2/2019 Mid Atlantic Recycling
17/44
Mid-Atlantic Recycling
4.2.2 Market Needs
Several companies compete in the fertilizer market. Their major selling points are performanceand price. However, health conscious consumers have created growing competition between
chemical and organic products. Mid-Atlantic Recycling's competition can be divided into twoforms: direct and indirect.
Our direct competitors would include other compost producers capable of producing sufficientproduct to supply the growing compost demand. There is no other compost producer in West
Virginia that meets this need. Therefore, we have no direct competition in the state.Additionally, there are only a handful in the entire Mid-Atlantic USA; therefore, our direct
competition on a regional basis is extremely limited.
Our indirect competitors are fertilizer manufacturers (who also are a part of our target market).
As noted elsewhere in this business plan, the trend is away from chemical fertilizers, towardnatural organic soil enhancers. Thus the market for chemical fertilizer is decreasing while our
market is increasing.
4.2.3 Market Trends
Current trends in the market greatly favor the start-up of our recycling business.
Laws have been passed in West Virginia placing greater restrictions of the types of landfillswhich can receive human waste sludge. These laws take effect in 2008. Municipalities are
already seeking alternative means of disposal as disposal prices are expected to skyrocket aslandfill space decreases dramatically. Our recycling service solves this problem for municipalities.
The organic industry now boasts sales in excess of $9 billion at retail, with growth forecast tocontinue at 25% per year (http://lists.ibiblio.org/pipermail/marketfarming/2002-
October/000063.html). The demand for compost to use in organic farming and other applicationsis growing rapidly
8/2/2019 Mid Atlantic Recycling
18/44
Mid-Atlantic Recycling
4.3.2 Distributing a Service
Indirect competitors are those companies that offer only chemical soil enhancers and plantfoods. Mid-Atlantic Recycling feels that these companies are an indirect form of competition
because though the products they promote attempt to give the same results as our directcompetition, they fall far short of current market expectations, and it will only be a matter oftime until these companies' products will be out-dated. Even so, Mid-Atlantic Recycling does
acknowledge that as these companies' products become outdated, many companies will becertain to phase-in their own organic substitutes in place of the chemicals. This, in itself,
presents a potential market for our compost.
4.3.3 Competition and Buying Patterns
To be a player in the organic fertilizer and soil produce market, Mid-Atlantic Recycling identifiedmarket needs to gain an overall competitive advantage. The following explains our product 's
competitive advantages. Our product is:
Organic: Our organic product allows us to be responsive to the dominant market trend. We
offer all of the advantages that organic products have over chemical competitors. Comparable application times: Based on the West Virginia University laboratory analysis,
our product is comparable in potency to chemical fertilizer. Thus the application time is alsocomparable, which saves money and labor since there is no need to purchase and apply
additional products. Recycled: This part of our product has to do with marketing. We are a company that cares
about the consumer and the environment. We offer a valuable product, at low cost, thatsaves landfill space.
4.3.4 Main Competitors
As noted earlier, direct competitors are essentially non-existent in the Mid-Atlantic region. Ourmajor indirect competitors are chemical fertilizer manufacturers However their products are
8/2/2019 Mid Atlantic Recycling
19/44
Mid-Atlantic Recycling
5.1 Value Proposition
Our value proposition is two- fold.
Value proposition for municipalities: We offer a service that is a cost effective, budgetsaving means to addressing a growing waste disposal problem.
Value proposition for end users of compost material: Compost is a valuable soil
amendment that improves many soil properties, such as porosity, structural and thermalstability, water retention, resistance to wind and water erosion, and tillage. Compost also
decreases soil crusting, regulates storage and release of nutrients, enhances thedevelopment of beneficial microorganisms, builds up plant resistance to parasites and
disease, and promotes faster root development. Plants and crops treated properly withcompost may produce higher yields and have less weed growth. Chemical fertilizers do notoffer this value.
5.2 Competitive Edge
The competitive edges we have are summarized as follows.
Cost: The price of our compost product is much less than chemical fertilizers. Organic product: We offer an organic product which is responsive to current market trends.
This includes all of the advantages organics offer over chemicals.
Recycled: Recycled products characterize a "caring company" and are more appealing to thecustomer's changing att itude toward organic fertilizer as opposed to chemical fertilizer.
Elimination of disposal issues: Municipalities now have a waste that takes up landfillspace. Our service recycles the waste which saves valuable landfill space.
More effective between application times: Normal times between applications can range
from two to four weeks. Our product lasts for many months, thereby saving the customertime and money (no additional expenditure for more product).
HUBZone location: Provides advantage in selling to the government. SDB and 8(a) certifications: Provide additional advantages in selling to the government
8/2/2019 Mid Atlantic Recycling
20/44
Mid-Atlantic Recycling
5.3.1 Sales Forecast
The table below outlines the sales forecast and cost of goods sold. The forecast is based onreasonable sales projections within this very large market.
An additional revenue stream will be the collection and removal of sawdust, wood chip, and barkfrom the International Paper Company on a full time basis; the contract for this work has been
won. The sawdust materials collected will be used in the composting process.
The high growth is based on our plans to expand by increasing operations in Monroe County andplacing similar facilities in other areas of the West Virginia. We anticipate that by 2005 we will
have two such facilities and by 2006 we anticipate having four. Thus our sales forecast doublesin each of those years.
Table: Sales Forecast
Sales Forecast
FY 2005 FY 2006 FY 2007
Unit SaleSawdust collection services in hour 13,440 13,440 13,440
Waste acceptance in ton 10,640 25,920 51,840
Compost sales in ton 14,776 36,000 72,000
Total Unit Sale 38,856 75,360 137,280
Unit Prices FY 2005 FY 2006 FY 2007
Sawdust collection services in hour $14.20 $14.77 $15.36
Waste acceptance in ton $18.00 $18.00 $18.00
Compost sales in ton $50.00 $52.50 $55.13
Sale
Sawdust collection services in hour $190,848 $198,509 $206,438
Waste acceptance in ton $191,520 $466,560 $933,120
C t l i t $738 800 $1 890 000 $3 969 360
8/2/2019 Mid Atlantic Recycling
21/44
8/2/2019 Mid Atlantic Recycling
22/44
Mid-Atlantic Recycling
5.4 Marketing Strategy
The marketing strategy is the core of the main strategy:
1. Emphasize high value, high quality products and services.2. Build a relationship oriented business.3. Focus on municipalities, fertilizer manufacturers, landscapers, nurseries, and the federal
government as key initial markets.
5.4.1 Promotion Strategy
Our promotional strategy will be two-fold: first phase promotion will focus on before, during, and
six months following our opening; the second phase of promotion will deal with the long term.The purpose of the first phase is to assist with rapid market entry to ensure early and sustainedprofitability. The purpose of the second phase is to ensure long-term growth and help propel us
toward achieving our goal of expanding state wide and across the Mid-Atlantic region.
First Phase Promotions
Publicity: We will send news releases to all of the major newspapers in West Virginia.Publication of news articles about Mid-Atlantic Recycling will lend great credibility and be anexcellent way to let all target markets know about this new, innovative business and the
solutions it provides for municipalities and users of compost or fertilizers. We will similarlyseek publicity in the form of news stories from local (eastern West Virginia) radio and
television stations. Advertising: We will utilize direct mail and face-to-face promotional strategies to raise
awareness about our products and services in the target markets. Newspaper advertising
may also be used. Radio and television ads are not certain, we will evaluate theireffectiveness before further implementat ion.
Internet: We will have a content heavy website geared toward educating potentialcustomers about the benefits of our products and services All literature business cards
8/2/2019 Mid Atlantic Recycling
23/44
Mid-Atlantic Recycling
5.4.2 Positioning Statement
For municipalities seeking an answer to their waste disposal problems, Mid-Atlantic Recycling isthe service of choice and trusted strategic ally who gives them a cost effective solution.
For users of fertilizer and soil amendment products, Mid-Atlantic Recycling is a dependableprovider of low cost and consistent high quality compost products.
5.4.3 Pricing Strategy
The going rate per ton for compost is $50 and up. This price is low enough to ensure rapidgrowth in the market yet still provide a very healthy profit, given that we have no direct
competition and chemical fertilizer is much more expensive. This is possible because we are onthe front end of the industry growth in this region.
However, according to the West Virginia University Cooperative Extension Service, we may beable to analyze and register our material as a fertilizer. In that case the price per ton will be in
the $100 per ton range still well below the rate of $250 per ton charged for manufactured
chemical fertilizers; given this scenario, the sales figures below are very conservative.
Additionally, we will be priced at market rates for the waste disposal service we offer tomunicipalities. Tipping fees are generally $15 and up per ton. Additionally, we will charge
competitive skid box rental fees and transportation costs.
5.5 Milestones
The following table lists important program milestones, with dates and managers in charge, and
budgets for each. The milestone schedule indicates our emphasis on planning for implementation.
Table: Milestones
8/2/2019 Mid Atlantic Recycling
24/44
Mid-Atlantic Recycling
6.0 Web Plan Summary
Our website will be the virtual business card and portfolio for the company, as well as its online
"home." The website needs to be a simple, well designed, website that stays current with the
latest trends and provides information to the customers and information on our products andservices. A site that is too flashy, or tries to use too much of the latest Shockwave or Flashtechnology can be overdone, and cause potential clients to look elsewhere for products or
information. Our website will be an important means by which we can educate potential
8/2/2019 Mid Atlantic Recycling
25/44
Mid-Atlantic Recycling
7.0 Management Summar
Mr. Oliver Pyne is the mind behind Mid-Atlantic Recycling. He saw the need for human wastesludge to be recycled and used in several different and environmentally beneficial ways. With the
development, determination, motivation, and persistence of everyone involved, Mid-AtlanticRecycling will be the leading producer of composted human waste sludge in West Virginia and aleader in the Mid-Atlantic region.
The management team of Mid-Atlantic Recycling will be comprised of the following executive
positions:
President: Oliver Pyne. Mr. Pyne has a degree in Agriculture from West Virginia Universityand has spent 30 years in the farming and agriculture industry. He has extensivelyresearched and tested this composting process to ensure that it works with human waste
sludge, and is thoroughly familiar with the process from start to finish. Mr. Pyne hasexperience in the operation, fabrication and maintenance of heavy equipment. This ability will
be critical to the success of the business. Operations Manager: Sam Cole. Mr. Cole has operated a landscaping firm for 7 years and is
intimately familiar with the uses of compost materials as well as the markets. Controller: Alexander Main. Mr. Main has a background in business and management and will
handle administrative details such as taxes, check writing and bookkeeping.
At Mid-Atlantic Recycling, the management team believes that this unique way of recycling will
change the way consumers look at fertilize and compost products. As with any company, theresponsibilities and duties of the management team are very important and cannot be taken
lightly. Mid-Atlantic Recycling's management will work together as a team to create a successfulcompany.
7.1 Management Team
The responsibilities involved in the company Mid-Atlantic Recycling are great and abundant Mid-
8/2/2019 Mid Atlantic Recycling
26/44
Mid-Atlantic Recycling
7.2 Management Team Gaps
To assist in sales and marketing, Mid-Atlantic Recycling plans to utilize the services of BlevinsConsulting, LLC, a management consultant firm based in West Virginia. Blevins Consulting
specializes in business planning, marketing planning, training, website design and marketing, andmarketing to the federal government.
Marketing and sales will play an important role in convincing consumers to switch from their oldproducts to Mid-Atlantic Recycling's products. Blevins will help create the need for our products
and services while at the same time capturing the attention of the consumers' targeted. Some ofBlevins duties will include writing press releases, coordinating print and radio press, monitoring
the competition, making presentations to potential clients, and studying the markets to identifycustomers' needs and determine how to best appeal to those needs.
7.3 Personnel Plan
The Personnel Plan reflects the staffing levels required to manage and achieve the anticipated
levels of production, and establish the customer base needed to achieve the revenues projected
and reach profitability.
We have projected a staff of 22 employees in 2004. This includes the owner, 2 managers, 3truck drivers, 4 equipment operators, 2 laborers, 2 metal workers, and 1 secretary; this staff of
15 will operate the recycling facility. In addition, a staff of seven, including one supervisor and 6laborers, will provide sawdust, wood chip, and bark removal at the International Paper Company
on a full time basis; the contract for this work has been won. The sawdust materials collectedwill be used in the composting process.
In addition to the above, Mid-Atlantic Recycling plans to hire a local trucking firm to delivercompost materials to customers. This is expected to result in the creation of two additional jobs.
Therefore the total employment impact of this venture is expected to be the creation of 24 jobs
8/2/2019 Mid Atlantic Recycling
27/44
Mid-Atlantic Recycling
8.1 Start-up Funding
The start-up funding will be provided as follows: Owner equity investment of in the form of aloan from the Regional Council of Governments Revolving Loan Fund; this loan is secured by the
owner's real estate assets. The Regional Revolving Loan Fund is an economic development fundsponsored by three West Virginia counties: Mercer, Greenbrier, and Monroe.
The balance of funding will be provided through an SBA guaranteed loan. Details of funding areshown in the table below.
Table: Start-up Funding
Start-up Funding
Start-up Expenses to Fund $92,180
Start-up Assets to Fund $907,820
Total Funding Required $1,000,000
Asset
Non-cash Assets from Start-up $826,920
Cash Requirements from Start-up $80,900
Additional Cash Raised $0
Cash Balance on Starting Date $80,900
Total Asset $907,820
Liabilities and Capital
Liabilitie
Current Borrowing $0
Long-term Liabili ties $850,000
Accounts Payable (Outstanding Bills) $0
Other Current Liabili ties (interest-free) $0
Total Liabili tie $850,000
8/2/2019 Mid Atlantic Recycling
28/44
Mid-Atlantic Recycling
Table: Use of Funds
Use of Funds
Use Amount
Processing P lants 2 x $190,460 $380,920
Processing Plants bui lt in-hou se 2 x
$40,000
$80,000
Skid Truck 2 x $73,000 (avg price) $146,000
Sheds 48'x72' 4 x $18,500 $74,000
Backhoe $40,000
Front-end Loader 2 x $50 ,000 $1 00,0 00
Tandem Dump Traile $6,000
Total $826,920
8.3 Important Assumptions
The table below presents some assumptions used in the financial calculations of this business
plan.
Table: General Assumptions
General Assumptions
FY 2005 FY 2006 FY 2007
Plan Month 1 2 3
Current Interest Rate 7.00% 7.00% 7.00%
Long-term Interest Rate 7.00% 7.00% 7.00%
Tax Rate 25.00% 25.00% 25.00%
Othe 0 0 0
8.4 Break-even Analysis
The chart and table below contain the break even analysis for Mid Atlantic Recycling
8/2/2019 Mid Atlantic Recycling
29/44
Mid-Atlantic Recycling
8.5 Projected Profit and Loss
The following table summarizes our anticipated profit and loss for the first three years. A monthly
profit and loss projection for the first year of operations is included in the appendices.
8/2/2019 Mid Atlantic Recycling
30/44
Mid-Atlantic Recycling
Table: Profit and Loss
Pro Forma Profit a nd Los
FY 2005 FY 2006 FY 2007
Sale $1,121,168 $2,555,069 $5,108,918
Direct Cost of Sale $122,550 $297,853 $612,688
Other Costs of Goods $0 $0 $0
Total Cost of Sales $122,550 $297,853 $612,688
Gross Margin $998,618 $2,257,215 $4,496,230
Gross Margin % 89.07% 88.34% 88.01%
Expense
Payroll $374,053 $766,326 $1,422,040
Sal es and Marketi ng and Other Expenses $12,000 $24,000 $48,000
Depreciation $165,384 $325,384 $645,384
Rent $0 $40,000 $100,000
Util itie $18,000 $36,000 $72,000
Insurance $18,000 $36,000 $72,000
Payroll Taxe $56,108 $114,949 $213,306
Maintanence and Repair $4,800 $9,600 $20,000
Othe $24,000 $48,000 $96,000
Total Operating Expense $672,345 $1,400,259 $2,688,730
Profi t Before Interest and Taxe $326,273 $856,956 $1,807,500
EBITDA $491,657 $1,182,340 $2,452,884
Interest Expense $57,217 $52,956 $48,223
Taxes Incurred $67,264 $201,000 $439,819
Net Profit $201,792 $603,000 $1,319,458
Net Profit/Sale 18.00% 23.60% 25.83%
8/2/2019 Mid Atlantic Recycling
31/44
Mid-Atlantic Recycling
8/2/2019 Mid Atlantic Recycling
32/44
Mid-Atlantic Recycling
8.6 Projected Cash Flow
The chart and table below project increasing cash flow throughout the first three years of plan
implementat ion. The second and third years of operation reflect large long-term asset purchases
which reflects our intent to expand the business by opening additional facilities in those years.This expansion will be funded by business revenue with no antic ipated need for outside financing.
The row labelled "Long-term Liabilities Principal Repayment" reflects repayment of the SBA
8/2/2019 Mid Atlantic Recycling
33/44
Mid-Atlantic Recycling
8/2/2019 Mid Atlantic Recycling
34/44
Mid-Atlantic Recycling
Table: Cash Flow
Pro Forma Cash Flow
FY 2005 FY 2006 FY 2007
Cash Received
Cash from Operation
Cash Sale $448,467 $1,022,028 $2,043,567
Cash from Receivables $542,495 $1,366,516 $2,768,762
Subtotal Cash from Operations $990,962 $2,388,544 $4,812,329
Additional Cash Received
Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $0 $0 $0
New Other Liabil ities (interest-free) $0 $0 $0
New Long-term Liabil itie $0 $0 $0
Sales of Other Current Assets $0 $0 $0
Sales of Long-term Asset $0 $0 $0
New Investment Received $0 $0 $0
Subtotal Cash Received $990,962 $2,388,544 $4,812,329
Expenditures FY 2005 FY 2006 FY 2007
Expenditures from Operation
Cash Spending $374,053 $766,326 $1,422,040
Bill Payment $357,477 $843,317 $1,684,617
Subtotal Spent on Operation $731,530 $1,609,643 $3,106,657
Additional Cash Spent
Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0
Other Liabil ities Principal Repayment $0 $0 $0
Long-term Li abi li ties Pri ncipal Repayment $60,859 $65,258 $69,976
Purchase Other Current Asset $0 $0 $0
8/2/2019 Mid Atlantic Recycling
35/44
Mid-Atlantic Recycling
8.7 Projected Balance Sheet
The following table projects healthy growth in sales and net worth.
Table: Balance Sheet
Pro Forma Bal ance Sheet
FY 2005 FY 2006 FY 2007
Asset
Current Asset
Cash $259,474 $143,117 $138,814
Accounts Receivable $130,206 $296,731 $593,320
Inventory $13,494 $32,796 $67,463
Other Current Asset $0 $0 $0
Total Current Asset $403,174 $472,644 $799,597
Long-term Assets
Long-term Assets $826,920 $1,626,920 $3,226,920
Accumulated Depreciation $165,384 $490,768 $1,136,152Total Long-term Assets $661,536 $1,136,152 $2,090,768
Total Asset $1,064,710 $1,608,796 $2,890,365
Liabili ties and Capital FY 2005 FY 2006 FY 2007
Current Liabilitie
Accounts Payable $35,957 $72,301 $144,387
Current Borrowing $0 $0 $0
Other Current Liabili tie $0 $0 $0
Subtotal Current Liabil ities $35,957 $72,301 $144,387
Long-term Liabili ties $789,141 $723,883 $653,908
Total Liabili tie $825,098 $796,184 $798,294
8/2/2019 Mid Atlantic Recycling
36/44
Mid-Atlantic Recycling
8.8 Business Ratios
The following table outlines some of the more important ratios from the Recycling, wastematerials industry. The final column, Industry Profile, details spec ific ratios based on the industry
as it is classified by the Standard Industry Classification (SIC) code, 4953.9905.
8/2/2019 Mid Atlantic Recycling
37/44
Mid-Atlantic Recycling
Table: Ratios
Ratio Analysi
FY 2005 FY 2006 FY 2007 Industry Profi le
Sales Growth 0.00% 127.89% 99.95% 7.24%
Percent of Total Assets
Accounts Receivable 12.23% 18.44% 20.53% 4.89%
Inventory 1.27% 2.04% 2.33% 0.35%
Other Current Asset 0.00% 0.00% 0.00% 31.71%
Total Current Asset 37.87% 29.38% 27.66% 36.95%Long-term Assets 62.13% 70.62% 72.34% 63.05%
Total Asset 100.00% 100.00% 100.00% 100.00%
Current Liabil i tie 3.38% 4.49% 5.00% 18.58%
Long-term Liabili ties 74.12% 45.00% 22.62% 26.10%
Total Liabili tie 77.50% 49.49% 27.62% 44.68%
Net Worth 22.50% 50.51% 72.38% 55.32%
Percent of Sale
Sale 100.00% 100.00% 100.00% 100.00%
Gross Margin 89.07% 88.34% 88.01% 34.70%
Selling, General & Administrative Expense 72.77% 64.88% 61.97% 14.39%
Advertising Expenses 0.00% 0.00% 0.00% 0.25%
Profit Before Interest and Taxe 29.10% 33.54% 35.38% 1.59%
Main Ratio
Current 11.21 6.54 5.54 1.10
Quic 10.84 6.08 5.07 0.89
Total Debt to Total Asset 77.50% 49.49% 27.62% 63.47%
Pre-tax Return on Net Worth 112.29% 98.94% 84.09% 1.16%
Pre-tax Return on Asset 25.27% 49.98% 60.87% 3.16%
Additional Ratio FY 2005 FY 2006 FY 2007
8/2/2019 Mid Atlantic Recycling
38/44
Mid-Atlantic RecyclingDividend Payout 0.10 0.05 0.03 n.a
8/2/2019 Mid Atlantic Recycling
39/44
Appendix
Page 1
Table: Sales Forecast
Sales Forecast
Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb
Unit Sales
Sawdust collection services in hours 1,120 1,120 1,120 1,120 1,120 1,120 1,120 1,120 1,120 1,120 1,120 1,120
Waste acceptance in tons 200 400 600 800 1,080 1,080 1,080 1,080 1,080 1,080 1,080 1,080
Compost sales in tons 277 555 833 1,111 1,500 1,500 1,500 1,500 1,500 1,500 1,500 1,500
Total Unit Sales 1,597 2,075 2,553 3,031 3,700 3,700 3,700 3,700 3,700 3,700 3,700 3,700
Unit Prices Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb
Sawdust collection services in hours $14.20 $14.20 $14.20 $14.20 $14.20 $14.20 $14.20 $14.20 $14.20 $14.20 $14.20 $14.20
Waste acceptance in tons $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00 $18.00
Compost sales in tons $50.00 $50.00 $50.00 $50.00 $50.00 $50.00 $50.00 $50.00 $50.00 $50.00 $50.00 $50.00
Sales
Sawdust collection services in hours $15,904 $15,904 $15,904 $15,904 $15,904 $15,904 $15,904 $15,904 $15,904 $15,904 $15,904 $15,904
Waste acceptance in tons $3,600 $7,200 $10,800 $14,400 $19,440 $19,440 $19,440 $19,440 $19,440 $19,440 $19,440 $19,440
Compost sales in tons $13,850 $27,750 $41,650 $55,550 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000
Total Sales $33,354 $50,854 $68,354 $85,854 $110,344 $110,344 $110,344 $110,344 $110,344 $110,344 $110,344 $110,344
Direct Unit Costs Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb
Sawdust collection services in hours 5.00% $0.71 $0.71 $0.71 $0.71 $0.71 $0.71 $0.71 $0.71 $0.71 $0.71 $0.71 $0.71
Waste acceptance in tons 5.00% $0.90 $0.90 $0.90 $0.90 $0.90 $0.90 $0.90 $0.90 $0.90 $0.90 $0.90 $0.90
Compost sales in tons 14.00% $7.00 $7.00 $7.00 $7.00 $7.00 $7.00 $7.00 $7.00 $7.00 $7.00 $7.00 $7.00
Direct Cost of Sales
Sawdust collection services in hours $795 $795 $795 $795 $795 $795 $795 $795 $795 $795 $795 $795
Waste acceptance in tons $180 $360 $540 $720 $972 $972 $972 $972 $972 $972 $972 $972
Compost sales in tons $1,939 $3,885 $5,831 $7,777 $10,500 $10,500 $10,500 $10,500 $10,500 $10,500 $10,500 $10,500
Subtotal Direct Cost of Sales $2,914 $5,040 $7,166 $9,292 $12,267 $12,267 $12,267 $12,267 $12,267 $12,267 $12,267 $12,267
8/2/2019 Mid Atlantic Recycling
40/44
Appendix
Page 2
Table: Personnel
Personnel Plan
Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb
Management/supervisory 0% $8,837 $8,837 $8,837 $8,837 $8,837 $8,837 $8,837 $8,837 $8,837 $8,837 $8,837 $8,837
Production labor 0% $11,168 $13,401 $14,900 $16,380 $16,380 $16,380 $16,380 $16,380 $16,380 $16,380 $16,380 $16,380
Sawdust collection team 0% $6,760 $6,760 $6,760 $6,760 $6,760 $6,760 $6,760 $6,760 $6,760 $6,760 $6,760 $6,760
Other 0% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total People 15 18 20 22 22 22 22 22 22 22 22 22
Total Payroll $26,765 $28,998 $30,497 $31,977 $31,977 $31,977 $31,977 $31,977 $31,977 $31,977 $31,977 $31,977
8/2/2019 Mid Atlantic Recycling
41/44
Appendix
Page 3
Table: General Assumptions
General Assumptions
Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb
Plan Month 1 2 3 4 5 6 7 8 9 10 11 12
Current Interest Rate 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00%
Long-term Interest Rate 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00%
Tax Rate 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00%
Other 0 0 0 0 0 0 0 0 0 0 0 0
8/2/2019 Mid Atlantic Recycling
42/44
Appendix
Page 4
Table: Profit and Loss
Pro Forma Profit and Loss
Mar Apr May Jun Jul Aug Sep Oc Nov Dec Jan Feb
Sales $33,354 $50,854 $68,354 $85,854 $110,344 $110,344 $110,344 $110,344 $110,344 $110,344 $110,344 $110,344
Direct Cost of Sales $2,914 $5,040 $7,166 $9,292 $12,267 $12,267 $12,267 $12,267 $12,267 $12,267 $12,267 $12,267
Other Costs of Goods $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Cost of Sales $2,914 $5,040 $7,166 $9,292 $12,267 $12,267 $12,267 $12,267 $12,267 $12,267 $12,267 $12,267
Gross Margin $30,440 $45,814 $61,188 $76,562 $98,077 $98,077 $98,077 $98,077 $98,077 $98,077 $98,077 $98,077
Gross Margin % 91.26% 90.09% 89.52% 89.18% 88.88% 88.88% 88.88% 88.88% 88.88% 88.88% 88.88% 88.88%
Expenses
Payroll $26,765 $28,998 $30,497 $31,977 $31,977 $31,977 $31,977 $31,977 $31,977 $31,977 $31,977 $31,977
Sales and Marketing and Other
Expenses
$1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000 $1,000
Depreciation $13,782 $13,782 $13,782 $13,782 $13,782 $13,782 $13,782 $13,782 $13,782 $13,782 $13,782 $13,782
Rent $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Utilities $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
Insurance $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
Payroll Taxes 15% $4,015 $4,350 $4,575 $4,797 $4,797 $4,797 $4,797 $4,797 $4,797 $4,797 $4,797 $4,797
Maintanence and Repair 15% $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 $400 $400
Other $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000
Total Operating Expenses $50,962 $53,530 $55,254 $56,956 $56,956 $56,956 $56,956 $56,956 $56,956 $56,956 $56,956 $56,956
Profit Before Interest and Taxes ($20,522) ($7,716) $5,934 $19,606 $41,121 $41,121 $41,121 $41,121 $41,121 $41,121 $41,121 $41,121
EBITDA ($6,740) $6,066 $19,716 $33,388 $54,903 $54,903 $54,903 $54,903 $54,903 $54,903 $54,903 $54,903
Interest Expense $4,930 $4,901 $4,872 $4,843 $4,813 $4,784 $4,754 $4,724 $4,694 $4,664 $4,634 $4,603
Taxes Incurred ($6,363) ($3,154) $266 $3,691 $9,077 $9,084 $9,092 $9,099 $9,107 $9,114 $9,122 $9,129
Net Profit ($19,089) ($9,463) $797 $11,073 $27,231 $27,253 $27,275 $27,298 $27,320 $27,343 $27,366 $27,388
Net Profit/Sales -57.23% -18.61% 1.17% 12.90% 24.68% 24.70% 24.72% 24.74% 24.76% 24.78% 24.80% 24.82%
8/2/2019 Mid Atlantic Recycling
43/44
Appendix
Page 5
Table: Cash Flow
Pro Forma Cash Flow
Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb
Cash Received
Cash from Operations
Cash Sales $13,342 $20,342 $27,342 $34,342 $44,138 $44,138 $44,138 $44,138 $44,138 $44,138 $44,138 $44,138
Cash from Receivables $0 $667 $20,362 $30,862 $41,362 $52,002 $66,206 $66,206 $66,206 $66,206 $66,206 $66,206
Subtotal Cash from Operations $13,342 $21,009 $47,704 $65,204 $85,500 $96,140 $110,344 $110,344 $110,344 $110,344 $110,344 $110,344
Additional Cash Received
Sales Tax , VAT, HST/GST Received 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales of Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales of Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Investment Received $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash Received $13,342 $21,009 $47,704 $65,204 $85,500 $96,140 $110,344 $110,344 $110,344 $110,344 $110,344 $110,344
Expenditures Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb
Expenditures from Operations
Cash Spending $26,765 $28,998 $30,497 $31,977 $31,977 $31,977 $31,977 $31,977 $31,977 $31,977 $31,977 $31,977
Bill Payments $503 $15,260 $20,067 $25,808 $31,670 $40,517 $37,331 $37,309 $37,287 $37,264 $37,241 $37,219
Subtotal Spent on Operations $27,268 $44,258 $50,564 $57,785 $63,647 $72,494 $69,308 $69,286 $69,264 $69,241 $69,218 $69,196
Additional Cash Spent
Sales Tax , VAT, HST/GST Paid Ou $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Liabilities Principal Repayment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Long-term Liabilities Principal Repayment $4,911 $4,940 $4,968 $4,997 $5,026 $5,056 $5,085 $5,115 $5,145 $5,175 $5,205 $5,235
Purchase Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Purchase Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Dividends $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $20,000
Subtotal Cash Spent $32,179 $49,198 $55,532 $62,783 $68,673 $77,550 $74,394 $74,401 $74,408 $74,416 $74,423 $94,431
Net Cash Flow ($18,838) ($28,189) ($7,828) $2,421 $16,827 $18,590 $35,950 $35,943 $35,936 $35,928 $35,921 $15,913
Cash Balance $62,062 $33,873 $26,045 $28,466 $45,293 $63,883 $99,834 $135,777 $171,712 $207,640 $243,561 $259,474
8/2/2019 Mid Atlantic Recycling
44/44
Appendix
Page 6
Table: Balance Sheet
Pro Forma Balance Sheet
Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb
Assets Starting Balances
Curren t Assets
Cash $80,900 $62,062 $33,873 $26,045 $28,466 $45,293 $63,883 $99,834 $135,777 $171,712 $207,640 $243,561 $259,474
Accounts Receivable $0 $20,012 $49,858 $70,508 $91,158 $116,002 $130,206 $130,206 $130,206 $130,206 $130,206 $130,206 $130,206
Inventory $0 $3,206 $5,544 $7,883 $10,221 $13,494 $13,494 $13,494 $13,494 $13,494 $13,494 $13,494 $13,494
Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Current Assets $80,900 $85,280 $89,275 $104,436 $129,846 $174,789 $207,583 $243,534 $279,477 $315,412 $351,340 $387,261 $403,174
Long -term Assets
Long-term Assets $826,920 $826,920 $826,920 $826,920 $826,920 $826,920 $826,920 $826,920 $826,920 $826,920 $826,920 $826,920 $826,920
Accumulated Depreciation $0 $13,782 $27,564 $41,346 $55,128 $68,910 $82,692 $96,474 $110,256 $124,038 $137,820 $151,602 $165,384
Total Lo ng-term Assets $82 6,920 $8 13,13 8 $7 99,35 6 $7 85 ,57 4 $7 71 ,79 2 $ 758 ,0 10 $ 744 ,2 28 $73 0,446 $71 6,664 $70 2,882 $68 9,1 00 $67 5,3 18 $ 66 1,5 36
Total Assets $90 7,820 $8 98,41 8 $8 88,63 1 $8 90 ,01 0 $9 01 ,63 8 $ 932 ,7 99 $ 951 ,8 11 $97 3,980 $99 6,141 $1,01 8,294 $1,04 0,4 40 $1,06 2,5 79 $1,06 4,7 10
Liabilities and Capital Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb
Current Liabilities
Accounts Payable $0 $14,598 $19,213 $24,763 $30,316 $39,272 $36,088 $36,066 $36,044 $36,023 $36,001 $35,979 $35,957
Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Current Liabilities $0 $14,598 $19,213 $24,763 $30,316 $39,272 $36,088 $36,066 $36,044 $36,023 $36,001 $35,979 $35,957
L ong -term L ia bilitie s $85 0,000 $8 45,08 9 $8 40,15 0 $8 35 ,18 1 $8 30 ,18 4 $ 825 ,1 57 $ 820 ,1 02 $81 5,016 $80 9,901 $80 4,757 $79 9,5 82 $79 4,3 77 $ 78 9,1 41
Total Liabilities $850,000 $859,687 $859,362 $859,944 $860,500 $864,430 $856,189 $851,082 $845,946 $840,779 $835,583 $830,356 $825,098
Paid-in Capital $150,000 $150,000 $150,000 $150,000 $150,000 $150,000 $150,000 $150,000 $150,000 $150,000 $150,000 $150,000 $150,000
Retain ed Earnin gs ($ 92,180 ) ($ 92,18 0) ($ 92,18 0) ($92 ,1 80) ($92 ,1 80) ($9 2,180 ) ($9 2,180 ) ($9 2,180 ) ($9 2,180 ) ($9 2,180 ) ($9 2,180 ) ($9 2,180 ) ($11 2,180 )
Earnings $0 ($19,089) ($28,551) ($27,755) ($16,682) $10,549 $37,802 $65,077 $92,375 $119,695 $147,038 $174,403 $201,792
Total Capital $57,820 $38,731 $29,269 $30,065 $41,138 $68,369 $95,622 $122,897 $150,195 $177,515 $204,858 $232,223 $239,612
To ta l L ia bil itie s a nd Ca pita l $ 90 7,8 20 $ 89 8,4 18 $ 88 8,6 31 $ 89 0,0 10 $ 90 1,6 38 $ 93 2,7 99 $ 95 1,8 11 $ 97 3,9 80 $ 99 6,1 41 $ 1,0 18 ,2 94 $ 1,0 40 ,4 40 $ 1,0 62 ,5 79 $ 1,0 64 ,7 10
Net Worth $57,820 $38,731 $29,269 $30,065 $41,138 $68,369 $95,622 $122,897 $150,195 $177,515 $204,858 $232,223 $239,612