Business Planning for Success:  Whoever started the rumor that new business ventures must lose money 
        during the first few years was full of horse feathers.  There’s no such business principle.  Planning to lose money 
        is a hard habit to break.  Plan to succeed in business from day one.
        Also, don’t let an absence of business experience preclude you from establishing a reasonable and healthy 
        business plan.  If you’re not sure where to begin, begin at the end, i.e. with a net income target.  Net 
        income, that’s the goal most “for profit” businesses seek.  That’s the reason why you work so hard, put 
        up with unreasonable vendors and smile at impatient customers.  Net income, perhaps better known as the 
        “bottom line” is the reward for business owners and investors.  If you don’t plan for it, it probably won’t 
        happen.
       Business Planning Format- Let’s start with a few basic business relationships and terms.  
          1. Net Sales less Cost of Goods Sold = Gross Profit
          2. Gross Profit less Operating Expenses = Operating Income
          3. Operating Income plus “Other Business Income” or minus “Other Business Expenses = Net Income Before Tax
          4. Net Income Before Tax less Taxes = Net Income
                      Company Operating Pro Forma
                                                                                                                                  ►      ►            ►            ►            ►
       Step 1. Enter your goal for net income over the next 12 months.
                    Enter your goal for product and service "mark-ups".
       Step 2. Enter the tax rate that is appropriate for you company?
       Step 3.  Calculates the tax liability based on the chosen tax rate that achieves your net income goal.
       Step 4. Pre-tax Income: Adds the calculated income tax to the net income goal.
       Step 5. Enter any "other" expenses not related to the primary business operations?
       Step 6. Enter "other" income not received from customers
       Step 7. Operating Income: Adds other expenses & subtracts other income from pre-tax income
       Step 8  Enter the annual operating expenses on the worksheet below
       Step 9. Gross Profit: adds operating expenses to operating income
                   Your goal for the company's gross profit rate % is calculated
       Step 11. Revenue: Divide Step 9 by Step 10
       Step 12. Cost of Goods Sold: Subtract gross profit $ (step 9) from Revenue (step 10)
               Company Operating Expense Worksheet
           Step 8
       Merchandise Purchased
       Freight charges
       Supplies - Store
       Supplies - Office
       Payroll
       Payroll Taxes
       Insurance
       Rent / Mortgage Pmt
       Utilities
       Telephone / Fax
       Advertising & Promotion
       Vehicle Expense
       Computer / Internet
       Travel & Entertainment
       Repairs & Maintenance
       Postage
       Freight-out
       Professional Fees (attorney, CPA, etc.)
   Dues & Subscriptions
   Donations / Contributions
   Bank Charges
   Taxes (other than sales)
   License & Fees
   Interest Expense
   Other
   Total Operating Expense          $0
                   Company Operating Pro Forma
      Step 11   Net Sales                                                                       #DIV/0!
      Step 12   less Cost of Goods Sold                                                         #DIV/0!        #DIV/0!
      Step 9.      = Gross Profit                                                                       $0     #DIV/0!
      Step 10.  What is your Gross Profit Rate?                                 0.0%
      Step 8.   less Operating Expenses (Overhead)                                                      $0     #DIV/0!
      Step 7.     = Operating Income                                                                    $0
      Step 6.   plus "Other" Income                                                                     $0
      Step 5.   less "Other" Expenses                                                                   $0
      Step 4.     = Pre-tax Income                                                                      $0
      Step 3.   less Income Tax                                                                         $0
      Step 2.   What is your income tax rate?
      Step 1.   What is your goal for Net Income?                                                              #DIV/0!
      Step 1.   Mark-up Goal
      We started with a couple of goals, a net income goal to reward company ownership and a goal 
      for  marking-up products and services and then built a simple business plan.  That’s the easy 
      part.  The hard part is to make it work in a dynamic market place.  Things will change 
      immediately after the plan is written.  That’s okay.  Keep the goals in mind and “drive your 
      business”.  It’s difficult but sheer determination goes a long way in achieving the plan’s 
      “bottom line”
      What Ifs:   Note the changes in Net Sales as you change mark-ups, tax rates and
                net income goals.