A Five Year Pro Forma And Capitalization Worksheet Essay

1293 Words Dec 5th, 2015 null Page
A five year pro forma and capitalization worksheet are included in Exhibits 1 and 2 respectively. Details regarding the financial expectations of RLW are as follows: Revenue
Roatán Leather Works’ revenue will be derived from four initial products at varying price points: Bracelets ($15), Belts ($25), Wallets & Clutches ($30) and Bags ($100). These price points were identified based on information taken from surveys and interviews that indicated customer willingness to pay between $25-$100, with current purchasing behavior in line with the lower end of that continuum. Additionally, we benchmarked prices against industry advisor, Parker Clay, and have positioned our products at a more conservative, less expensive price. These products will be distributed through both wholesale and retail channels, and our estimates account for a stronger (70%) share to come from wholesale channels. Additionally, we’re aggressively pricing so as to achieve wholesale contracts by selling to our wholesale partners at a 50% cost relative to anticipated retail pricing. Our revenue estimation for year one is $249,000, which we believe to be a viable number when considering that among all of our anticipated distribution channels, we’ll only need to sell the following in order to meet the target: 1.2 bags per day, 2.3 belts per day, 51.6 bracelets per day and 7.0 wallets/clutches per day. Revenue growth is steady at roughly 55% annually, reaching $1.5 million by year five, which would be…

Related Documents