We are making the plan for expanding the business( Exporting ) in France from th

Question

We are making the plan for expanding the business( Exporting ) in France from the US.

The business is Taco Bell ( Mexican Fast foods).

Please make a prediction about financial with using the own data.

Years 1 through 5-PROJECTED

Basic Profit & Loss FOR the PRODUCT/SERVICE

Revenue

COGS

GM

SG & A

EBITDA

MAJOR COST REQUIREMENTS (if any)

ASSUMED MARKET SHARE/PENETRATION

IMPORTANT--TO BE ABLE TO DEVELOP FINANCIALS NEED TO HAVE GOOD DATA ON MARKET SIZE

What are the initial franchise fee and royalty fees?

Initial Franchise Fee = $45,000

Monthly Service Fee (Royalties) = 5.5% of Gross Sales

Marketing = 4.25% of Gross Sales (Includes national and local contributions)

Explanation / Answer

Solution :- Assuming the gross sales to be $ 1000000.

Royalty fees = 5.5 % of 1000000 = $ 55000.

Selling, General and Administrative overhead (SGA) = 4.25 % of 1000000 = $ 42500.

Profitability statement

Revenue

(-) Cost of goods sold

100000 (45000 + 55000)

35000 (Assuming 35 % of gross sales i.e., revenue amount)

Gross margin

(-) SG & A expenses

65000

42500

Note :- EBITDA stands for Earnings before interest, tax, depreciation and amortization.

Revenue

(-) Cost of goods sold

100000 (45000 + 55000)

35000 (Assuming 35 % of gross sales i.e., revenue amount)

Gross margin

(-) SG & A expenses

65000

42500

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