Laundromax Case Study Example | Topics and Well Written Essays - 750 words

Laundromax - Case Study ExampleWith my financial management role, my plan for financing would start with personal owner equity. This would act as a cross-file to outside investors of the personal trust that the founders have in the growth and success of their business and hence worth a further inducement for additional foreigner investment. In order for Laundromax to attain self-sufficiency as a party, 100 stores must be established at an estimate of $500,000 per fully functional and functional store. This puts the total ceiling required to attain self-sufficiency at an estimate cost of $50,000,000. With such heavy initial capital outlay, personal equity would non be sufficient to meet this expenses and hence the vision of the business. I would result to investment capital with major focus on investment banks and venture capital firms who are willing and able to raise a major part of the required capital in return for an equivalent stake in the companys assets. ... The rate at which the funds should be infused in the business will be greatly dependent on the strategic expansion pauperism of the management. In this case, from the given projections, the 100th store may be opened sometime in the 4th year of operation with the highest number of store opening before the 100th being in the third year. Thus, according to the historical information and the forecasts presented, the preferable allocation of capital according to the number of stores required would be $4,500,000 in the first year, $11,500,000 in the second year, $25,000,000 in the third year and $14,000,000 in the third year to attain the 100th store mark comfortably. The preceding(prenominal) estimations of the capital requirement of the business in its various stages of development are not sufficient financial projections to be able to convince potential investors of the financial soundness of the business and to give them assurance of the security of their investment. In order to present a pro per financial plan in their business plan, Reese and Mounger should involve certain financial forecasts including Cash flow forecasts, A break-even analysis, A projected statement of profit or loss, and A projected statement of financial position. in that location in, the cash flow forecasts give a view of the expected cash inflows and out flows to and from the company, the break even analysis shows the expectation of future profit by the company detailing the point at which the company would equate expenses to revenues generated, A projected statement of profit or loss details the expected revenues and expenses to the company, opus the projected statement of financial position shows an expectation of the companys holding of assets and liabilities. With these projections, Reese and Mounger would have a