You are on page 1of 36

1.

Executive Summary

HL Beauty Enterprise is a company that has created a brand concept consisting of


skin care utilizing multiple channels of distribution. We are seeking recurring investment
to fund the growth of the brand, and position the company for an IPO. The plan that follows
explains our market, our value proposition and our market segmentation strategy. The
detailed financial plans provide a clear view of our sales and profit forecasts. These plans
show how HL Beauty will reach profitability in our first year of operation and generate
shareholder return on equity within three years.
2. Company Introduction

2.1 Company’s Background.

 Company’s name : HL Beauty Enterprise


 Vision :

“Our products will change the way you think about how to get fair and beauty from
inside and outside. Full service comfort, friendly staff, a relaxing atmosphere, and
the best prices in town give you an experience that will leave you glowing both
inside and outside.”

 Mission :

“Our mission at HL Beauty Enterprise is to provide each of our clients with the
most effective cosmetic products that suitable for them and to preserve and
promote the organic usage in consumption cosmetics.”

 Bumiputera’s share: 10%


 Date of registration : November 6, 2014.
 Date of operation : December 12, 2014.
 Company’s registration number : MA 0197402 - H
 Correspondence address :
Lot 1988, Kawasan Perindustrian Bandar Vendor, 78000 Alor Gajah, Melaka.

 Telephone number : 011 – 32099065 (Nani)


 Type of Industry : Cosmetics production.
 Authorized capital : RM 70
 Paid-up capital : RM 25 / each member
 Shareholder’s Name :

1. Nurul Hannani binti Ramlee.


Position: Company’s chairman and general manager.
Share percentage: 35%.
Status: Bumiputera.

2. Mohd Lutfi bin Mohamad.


Position: Company’s marketing manager.
Share percentage: 35%.
Status: Bumiputera.

3. Khairuddin Hisham bin Abdul Kadir.


Position: Company’s financial manager.
Share percentage: 30%.
Status: Bumiputera.
2.2 Business Project Background.

In order to further our business, some aspects need to be accomplished. Our current
products are just a homemade products and the demand is very high at our first launched
thus encouraged us for producing a wider productivity in future and we hope that our
products will be developed and produced at our facilities. In future, we plan the production
of products’ labelling will be managed through our manufacturer of packaging-related.
Production of packaging will be managed through a contract with a manufacturer of quality
packaging-related accessories including; scrub container, cosmetics bottle and labelling
stuff.

HL Beauty will have product lines that specialist on skin care and cosmetics. Within
the line we will offer a wide array of products including body scrubs, cleansing creams,
facial scrubs and body lotions.

Our pricing strategy is to position our products with a shelf price that is in the mid to
lower quadrant of high-quality products and brands. We have accomplished this by making
careful market comparisons and adjusting our packaging size.

We believe our ability to create future product opportunities and growth will only be
limited by our imagination and our ability to attract talented people who understand the
concept of branding.

HL Beauty will occupy a unique market position. No other brand offers a specialty line
that includes skin care, cosmetics that the based is only just made up from organics material.
Quality and price vary widely within our plan. HL Beauty will be positioned as a quality
brand. The Malaysia cosmetics market has seen large annual growth rates over the past
decade. Last year alone, the market grew by over RM 4 million. Clear divisions between
traditional categories are becoming blurred and new lines, such as body scrub are also
emerging as people nowadays always go to spa for applying the body scrub, and we create
a product that is portable so they can apply them everywhere as our products are easy to
bring along for travelling, creating new openings for profit.
In organic cosmetics there is a tremendous opportunity since the female customer has
been grossly overlooked and many of them are hesitating of consuming cosmetics that are
made up based on the chemical materials. Most major companies do not produce products
focused specifically on the both female and male customer. HL Beauty is the only brand
that has developed a line of organic cosmetics for both men and women. Early sales for us
have been exceptional, further highlighting the potential within this category.

Our targeted user is between the ages of 15 and 65. They are female urban professionals
with at least some college. This consumer has an active lifestyle. They are concerned about
environmental issues. Mind and body wellness are important to them. They belong to a
health club; take yoga or tai chi lessons. The effects of aging and the maintenance of a
youthful appearance are a part of their life.

There are a number of new demand trends that have impacted the market and created
greater opportunities. These trends include a returning to age old, time proven, natural
remedies; more consumers that are looking for more holistic and healing benefits from her
skin care products, and today's consumer being more informed and more inquisitive about
the benefits of her personal care products. Thus making major of them preferring organics
products.
2.3 Project Location

Our present location of business is at UniKL MICET which are targeting customers
among of lecturers and students. During technopreneurship festival, we have opened our
booth and make vary promotion. Among of them are our Clara body scrub and the
promotion get large celebration and positive feedback. The location is quite strategic since
the area is located very near to the Adtech Colleague. However, we intend to widen our
production so that our products will be well-known by people around the world thus making
us to our main objective that we could accomplish our goals.

Our address of current location is as stated below;

Lot 1988, Kawasan Perindustrian Bandar Vendor, Taboh Naning, 78000 Alor Gajah,
Melaka.

2.4 Machinery and Equipment

For current production, we are totally depending on UniKL Micet’s extraction devices
to extract orange fruit, main raw material of our current product. However, we are looking
towards having our own machines to operate our whole production. Other process of
making the body scrub are all homemade thus making people use our product without
hesitation because we handle the process with full awareness, prudent, detailed, provident
and scrupulous as the raw material are all organics.
2.5 Raw Material Requirements

Our products are focused on organic materials merely. So we faced challenges there
to get these materials are not easy. Among of them which are the basis for the products
are, orange fruit, pure olive oil, natural mineral salts and orange sacs. Our one batch
production process can produce about 20 to 23 units of body scrub. However the demand
is very high as we can see from the festival that we have joined, 48 units were sold out in
just only one day. We have seen the excellent potential of our products thus we are looking
towards future with more production we could produce. Below picture shows how the
Clara Body Scrub, one of our famous product being produced;

Figure 1: Clara Scrub production process.


3. Marketing Aspect

3.1 General Market Aspect

Malaysia cosmetics market grew by over 500 million in 1999. A major factor in the
growth of this segment was the impact of niche lines with spa positioning. Clear divisions
between categories are becoming blurred. The Spa theme now touches on virtually all
product categories. However, we at HL Beauty only focused on Clara Body Scrub for now.
But that is not becoming the obstacle as our product have a different features from others.
All categories (except Men's) experienced growth. 1999 sales (x$1,000) and growth by
category broke down as follows:

Sales Growth Market Share

Skin Care $5,551 3.40% 28.00%

Color Cosmetics $6,173 8.90% 31.00%

Fragrance $3,345 1.40% 17.00%

Body and Bath $3,498 7.50% 17.00%

Men's Line $1,478 -2.50% 7.00%

Total $20,045 6.60% 100.00%

For the purpose of this analysis we are focusing solely on the both female and male
market. Therefore our potential customers’ base (for the purpose of developing
projections) does include any statistics or provisions for all gender consumers. We have
used the demographic report for spa goers conducted by spa weekly as a basis for our
assumptions.

We developed our potential customer base with the following parameters: Consumer
with some college between the ages of 24 and 65. We completely discounted women with
no college, women between 15 and 25, women over 65 and the entire male population. It
is estimated that the female population will grow at a rate of 5.18% annually from 2000 to
2025. This data is for the entire Malaysia. Of the 3,642,000 women represented between
the ages of 25 and 65 who attended college, 2,293,000 (87%) afraid of consuming today’s
chemical cosmetic products.
3.2 Company’s Target Market

The cosmetics industry is in a state of flux. Traditional brands (Revlon, L'Oreal,


Lancôme etc.) are viewed as old. The consumer is looking for more holistic and healing
benefits from their cosmetic products. They are no longer content with just the appearance
benefits offered by traditional brands. The Body Shop brought them an awareness of
cruelty free and natural products. These initial nudges lead to today's consumer being more
informed and more inquisitive about the benefits of their personal care products. Their
body scrub needs to protect them from the suns damaging rays, moisturize their skin and
reduce the effects of aging. They are seeking relief from the effects of a hectic 24/7
lifestyle. They have learned the benefits of herbal therapy and aromatherapy. They have
either experienced or read about the benefits (both physical and emotional) of a Day Spa.

Traditionally the dynamics of the industry have favoured large houses because they
can fund the major advertising and marketing campaigns associated with this industry.
Today an underground (or gorilla) marketing effort can be more effective in gaining
credibility with this market segment. In the past the volume of product required to produce
a batch, and the cost of producing packaging have favoured the larger players. Today,
technology has evolved to allow the efficient production of small batches. Packaging
resources exist that allow for efficient cost controls and rapid delivery of these
components. In brief, the advantages of size that created barriers to entry for new players
have been swept aside. The cosmetic giants still hold a dominant position in this industry
and they will most likely continue to. But they have realized the need to acquire new brands
and to keep their affiliation in the background.

In recent years names like Safii, Rania, Syahira, d’Herbs and No Frills have been
acquired. This strategy indicates that a few of the traditional big players recognize the
benefits, for themselves and the industry, of emerging niche brands. Add to this equation
the growth of the day spa industry in Malaysia over the last 20 years. In 1980 there were
25 day spas in Malaysia. By 1990 that number had risen to 100. Today there are over 300
day spas in Malaysia. Malaysia are beginning to understand the benefits and pleasures of
taking care of themselves.
3.3 Benefits and Customer Value

HL Beauty distributes quality personal care products. This is accomplished through


a company-stuff.

The initial launch for our products will be our scrub. The product in this range have
been developed in our labs in UniKL MICET’s pilot plant. The mineral salt is unique in
the entire world for its wide range of sea natural. For four billion years the warm waters
of the Pantai Puteri have been flowing north along the Selat Melaka coast creating a unique
ecosystem. Our product development and the relationship between the sea and the human
body will be fantastic reaction. In this section we intend to define the initial product,
product benefits and our pricing strategy. Our methodology in choosing the body scrub for
our initial launch is based on two primary issues:

1. The benefits of body scrub treatment are just coming to light in Malaysia.
2. Our name and logo make this launch of products from the sea a natural. We will be
able to develop a meaningful and moving product story through this relationship.

Clara Body Scrub

Purpose: Cleans off dead skin cells to promote regeneration of healthy new cells.
Enlightens complexion and imparts radiance to the skin. Softens and purifies
the epidermis. Fights dryness, restores and maintains hydrolipidic film,
nourishes, regenerates, prevents aging and improves elasticity. Protects skin
from the harsh environment. Leaves the skin firm and smooth.

Primary ingredients: Spherical micro-marbles exfoliate without causing irritation.


Crithmun maritimum extract purifies epidermis and boosts cell
regeneration. Orange fruit, mineral salts and olive oil as the main
based of the product.

Skin types: All

Use: Every other week for dry and sensitive skins, weekly for oily and normal skin types.
Apply gently on clean skin, rinse with water and apply Biocatalyst Tonic.
3.3 Market and Competitor

Because we will develop our brand image and market positioning primarily
through our skin care line, we will focus our competitive review on that segment of the
market. The skin care market is very broad. It includes products labelled as body scrub
that range in price from RM6 to over RM30. Our market positioning will be in the lower
price quadrant of high quality natural products.

Our primary competitors for this customer are:

Avon: Founded in 1951, this brand has an image that is well established with the
consumer. Their main strength has been that the products work. Avon has been a family
business for four generations. The products are being made in small batches in a New
York City facility. They have a wide and varied distribution strategy. Their packaging
and labelling is very clinical in appearance. In recent years the brand has experienced
almost geometric growth. This has caused them serious internal problems. They have
been unable to meet demand and have stopped adding customers. In spring 2000 Estee
Lauder acquired them. According to internal sources Lauder will move the
manufacturing to OEM facilities and shut down the internal capabilities. They plan to
focus growth on traditional department stores and on a roll out of Avon own stores. The
obvious plus of this marriage is the availability of cash and technical resources. The
potential risk is that Lauder will associate the brand closely with Department stores and
that the OEM manufacturing will result in the changing of certain formulas and a
reduction in product effectiveness.

Swissvernice: Founded in 1978 by Horst Rechelbacher (an artist), Swissvernice has


become synonymous with quality skin-care products and salons. They are distributed,
worldwide, by over 3,000 Swissvernice salons. It has nurtured a well-defined image and
secured a very effective distribution network. Aveda salons are a combination of licensed
properties and company owned locations. Their product philosophy is centered in
Ayurveda healing and aromatherapy. Recently Estee Lauder acquired them.

Garnier: Garnier was launched in 1968 with skin care and makeup products that are all
allergy tested and fragrance. Garnier products are marketed as part of a three-step system:
cleanse, exfoliate and moisturize. The products are marketed primarily through
department stores. In recent years their image has become dated. Garnier makes a
significant amount of their sales through "bonus week" at department stores. The 18 to
35 crowd does not consider them current and their product development hasn't kept pace
with changing consumer awareness. Garnier is a division of Estee Lauder.

Nivea: Nivea distributes body and skin care products through their own stores, a
consumer catalogue and wholesales globally to department and specialty stores. Their
products are more "fashion" influenced than treatment based. They have two main stores
in Malaysia. Their target market is younger and less affluent than Bluespas'.

Syurah: A former stock analyst started Syurah in 2002. The products are botanical based
natural body crèmes and lotions. They are distributed primarily through day spas and
specialty stores. Informed sources say they will be launching a consumer catalogue. Their
main target for increasing distribution is through day spas and resorts.
3.4 Growth Strategies to Compete with Competitor

The growth of the Body and Bath category and the Alternate channels is being
driven by three major market influences:

1. An acceleration of cross distribution creating new opportunities for branded day


spas and catalogues.

2. Pampering has taken a front seat in the consumers mind and is viewed as a need
rather than a want. This has created an opportunity for new spa lines, spa-oriented
products encompassing aromatherapy and new age positioning.

3. The day spa influence is creating consumer awareness of the benefits of quality skin
care and body & bath products.

Today's skin care customer is looking for magic. They wants to believe that there
is a potion in a bottle that will erase their wrinkles. Consumers spent a record RM 600
million on skin care alone in 1999. Approximately RM 196 million (32.7%) of that was
spent on upscale scrub. The baby boomers, who don't want to age without putting up a
fight, have been spurring this growth. But even men and women in their early 30's have
been turning to expensive scrub and lotions. Most manufacturers believe this is being
driven primarily by vanity.

At HL Beauty Enterprise we believe it is a result of a better-educated consumer


base and easier access to information. We believe that you only need to look at the
proliferation of spas, the awareness of vitamins and the benefits of eating and living
healthy for both mind and body. These indicators are not unrelated and we believe they
signal a change in values and lifestyle rather than just a fashion trend. While it may well
have been spurred on by the growth in the stock market and the general economy, we do
not believe that it is dependent upon the continued rapid growth of these factors. Once
the consumer has recognized the benefits of these products they will not be willing to
simply give them up.
The major growth category within these segments is body scrub. In body scrub the
hottest "new" product is Clara Body Scrub. This scrub was formulated from, Alfalfa,
Citrus, Kelp and Vitamins by a watson physicist to heal scared tissues. A bottle costs RM
6. In interviews women have described it as "magical." Demand for these products is so
high that we have begun to limit the quantity a customer can buy. When the scrub was
introduced in Techno Fest last December there was a waiting list of more than 10 people.

Certainly these are not your mothers' body scrub. This new generation of scrub is
more scientifically advanced than anything previous manufacturers brought to market.
Research has shown that our body scrub can smooth out wrinkles and even out irregular
pigmentation. Other natural ingredients can speed up the regeneration process of skin
cells, tone the skin, clarify the complexion, and reduce wrinkles as well. Many
manufacturers site the high cost of research as a major reason for the high price of their
products. However this "new" trend is more a returning to age old, time proven, natural
remedies than new science. One noted chemist and cosmetics researcher recently stated
that charging more than RM 400 for a hundred mL of any scrub is unwarranted. They
stated that while there are some very special ingredients that are costly, when prices go
above this level it is just maxing out snob appeal. When you combine these facts with the
rapidly increasing level of consumer education and the demand for a price-value
equation, you can begin to see the market niche that is developing for high-quality skin
care at price points reflective of their ingredients and value.
Our strategy is to develop HL Beauty as a brand that represents quality and value.
The tactics underneath this strategy and the programs we will put in place cover a broad
range of disciplines. They are presented here in order of importance. Here we go our
strategy pyramid.

1. Products that perform:

 Continually develop and bring to market products that function as intended and
represent an acceptable price--value proposition to the consumer.

 Skin care and fragrance will be developed around two natural themes: Lavender
therapy, and orange sense.
 Working with female spa instructors and students to develop an apparel and
accessory range that meets their desire and beauty needs.

2. People:

 Locate, nurture and develop a team that is talented, committed and understands
the concept of brand.

 Training and incentive programs will assist in inspiring our people to "walk the
walk," and reward performance.

 Employee stock option and profit sharing programs will be available at all
levels.

3. Targeted marketing programs:

 Focus on PR campaigns and affiliations with opinion leaders that reinforce our
image.

 Print advertising will be focused on the benefits of our products, both physical
and emotional. They will speak to the lifestyle our target consumer aspires to have.
It will be carefully placed to insure the proper affiliation.

 Point of sale graphics will reinforce our message of function and quality. We
will create a package of shop in shop and concession concepts for spas and retail
accounts.

 Develop a team of "technical representatives" to support key accounts with


product and sales training.
4. Development of HL Beauty day spas and retail stores:

 Day spas will be carefully sited to generate acceptable revenue and enhance our
brand image.

 Existence of our own day spas will help to establish and reinforce our authority.

 Retail stores will be located in major shopping areas and malls. HL Beauty retail
stores will bring the product and brand image to consumers in major markets.

5. Distribution through day spas and resorts:

 Further enhance the HL Beauty image with the consumer by targeting prestige
spas and resorts.

6. Controlled distribution at wholesale:


 Affiliating with retailers who have a consumer image and awareness that supports

HL Beauty will reinforce our image.

7. Creation of the Bluespa catalogue:


 Allow us to reach a broader (geographically) audience at reasonable cost and in a

controlled method.

 Explain our products and our philosophy in an informative and interesting format.

 Create brand awareness in new markets and measure consumer acceptance prior
to committing brick and mortar resources.

8. Implementation of the HL Beauty website:

 Provide the consumer with a reference for treating the skin.


 Provide a training tool for HL Beauty accredited facilities on the Web.

 Wholesale customers will be able to utilize the site to train their staff and to place
reorders or learn about new products.

 Retail and wholesale customers will be able to set up automatic replenishment on

the Web and we will be able to reach out and remind them when they need product,
based upon average usage data and time since last purchase.
3.5 Long Term Goals of Company

From 2014 through 2017 we will grow in head count from ten to sixty-five. The
majority of this growth will come in store personnel, going from one in 2014 to 10 in
2017. This will be a direct result of adding retail locations. Our support staff will grow
from three to thirty-three in the same period. During this time frame our retail revenues
are planned to grow almost exponentially. We believe the plan shows a controlled and
conservative ramp up of personnel. In the first year (2014) we will fill the following
critical positions: vice president of product development, director of retail and spa
operations, director of finance, creative director and administrative manager. In the first
years of development these people will all fill multiple rolls and be instrumental in the
future success of HL Beauty Enterprise.

PERSONNEL PLAN YEAR 1 YEAR 2 YEAR 3


Production Personel RM RM RM

Shipping Manager 233 400 450

Shipping Clerk 54 220 230

Shipping Clerk 0 200 210

Shipping Clerk 0 0 200

Shipping Clerk 0 0 0

SUBTOTAL 287 820 1090

Sales and Marketing RM RM RM


Personel
Store Manager 204 640 1280

Asst. Manager 178 540 1120

Sales 178 326 652

District Manager 0 0 420

SUBTOTAL 561 1506 3472


General and RM RM RM
Administrative Personel
President 400 1100 1210

Vice President of 410 500 550

Product Development
Director of Retail and 370 500 550

Spa Operations
Director of Finance 0 650 715

Director of Human 0 0 600

Resources
Director of Marketing 240 750 825

Training Manager 0 400 440

Administrative Assistant 297 400 440

SUBTOTAL 1717 4300 5330

Total Payroll 2565 6626 9892


4. Employment of Knowledge Worker

4.1 Management Team

ORGANIZATION CHART

CHAIRMAN AND GENERAL MANAGER


(NURUL HANNANI BT RAMLEE)

FINANCIAL MANAGER MARKETING MANAGER


(KHAIRUDDIN HISHAM B ABD (MOHAMAD LUTFI B MOHAMAD)
KADIR)
CHAIRMAN AND GENERAL MANAGER

Name : NURUL HANNANI BT RAMLEE

Identity Card Number : 931126-02-5548

Permanent Address : Lot 10, Taman Seroja,

58000, Sik

Kedah.

E-mail : Nani52@yahoo.com

Telephone number : 019-5098780

Date of Birth : 26 November 1993

Age : 21

Marital Status : Single

Academic Qualification : Bachelor in Chemical Engineering Technology


(Process)

Sijil Pelajaran Malaysia (SPM)

Skill : Can speak in Malay and English

Computer literacy

Good leadership

Good communication skills


MARKETING MANAGER

Name : MOHAMAD LUTFI B MOHAMAD

Identity Card Number : 930509-11-5023

Permanent Address : A-524, Kg Lama,

12000, K.Nerus

Terengganu.

E-mail : Lupi93@yahoo.com

Telephone number : 013-9236578

Date of Birth : 09 May 1993

Age : 21

Marital Status : Single

Academic Qualification : Bachelor in Chemical Engineering Technology


(Process)

Sijil Pelajaran Malaysia (SPM)

Skill : Can speak in Malay and English

Computer literacy

Good communication skills

Hardworking
FINANCIAL MANAGER

Name : KHAIRUDDIN HISHAM BIN ABDUL KADIR

Identity Card Number : 931028-11-5505

Permanent Address : A-235, Kg Binjai,

32000, Chukai

Terengganu.

E-mail : Kodeng28@yahoo.com

Telephone number : 014-8098780

Date of Birth : 28 October 1993

Age : 21

Marital Status : Single

Academic Qualification : Bachelor in Chemical Engineering Technology


(Process)

Sijil Pelajaran Malaysia (SPM)

Skill : Can speak in Malay and English

Computer literacy

Good communication skills

Multitasking
5. Financial Projection

HL Beauty Enterprise will become profitable in our third year of operation. Initial
growth will be financed by a combination of equity investment and debt financing. Our
ratios are well within prudent limits and our growth plans are challenging, but realistic.
The tables in this section explain the detail behind our financing plan and our growth
plans.

5.1 Projected Profit and Loss

HL Beauty is expected to reach profitability in year three. Certain expenses in the


early years may appear outside the accepted ranges (i.e. marketing) as a % of sales. This
is a result of our strategy to bring the brand to prominence in three years and should be
considered as a start-up cost. Likewise, our initial salary numbers and staffing reflect our
growth plan rather than a stable or mature business. Our margin numbers may appear
high. This is the result of a retail strategy. Our retail stores and catalogue will calculate
margin from first cost. Our retail effort will not receive sales credit for internal sales (this
reflects a more accurate picture of retail profitability and of growth). Our margins are
projected lower in years two and three to account for promotions to retailer intended to
assist in reaching our retailers sales targets. In years four and five, margins move up again
as the number of retail stores increases and the catalogue comes online. As the retail
business overtakes the retail business we believe maintained margins can exceed median.
Retail commissions are calculated at a straight percent of sales. We have assumed a
continuation of outside sales management in these tables.
PROFIT AND LOSS YEAR 1 YEAR 2 YEAR 3

(RM) (RM) (RM)

Sales 470 3737 10,033

Direct Cost of Sales 146 1,324 3,548

Production Payroll 28 82 109

Ecommerce & Catalog 0 125 500


Production &
Fulfillment

TOTAL COST OF 175 1,531 4,157


SALES

Gross Margin 2940 2206 5876

Gross Margin % 62.66% 59.03% 58.57%

Operating Expenses

Sales and Marketing


Expenses

Sales and Marketing 560 1506 3472


Payroll

Advertising/Promotion 90 195 413


Retail

Advertising/Promotion 800 2500 5000


Brand

Travel & 160 747 2006


Enterntainment

Selling Supplies 40 373 1003

Wholesale Commissions 260 3600 9600


5.2 Projected Cash Flow

Our cash flow projections are shown on the following table. Cash flow after capital
expenditures and investment varies between positive and negative, depending upon our
rate of expansion and increasing accounts receivable.

CASH FLOW YEAR 1 YEAR 2 YEAR 3

(RM) (RM) (RM)

Cash Received

Cash from Operations

Cash Sales 247 747 2,006

Cash from Receivables 75 1,158 4,692

SUBTOTAL CASH 322 1,905 6,698


FROM
OPERATIONS

Additional Cash
Received

Sales Tax, VAT, 0 0 0


HST/GST Received

New Current 100 0 0


Borrowing

New Other Liabilities 0 0 0


(interest-free)

New Long-term 0 0 0
Liabilities
Sales of Other Current 0 0 0
Assets

Sales of Long-term 0 0 0
Assets

New Investment 1,500 1,200 1,500


Received

SUBTOTAL CASH 1,922 3,105 8,198


RECEIVED

Expenditures Year 1 Year 2 Year 3

Expenditures from
Operations

Cash Spending 257 947 1,495

Bill Payments 283 2,571 6,645

SUBTOTAL SPENT 541 3,519 8,140


ON OPERATIONS

Additional Cash Spent

Sales Tax, VAT, 0 0 0


HST/GST Paid Out

Principal Repayment 150 50 0


of Current Borrowing

Other Liabilities 0 0 0
Principal Repayment

Long-term Liabilities 0 0 0
Principal Repayment

Purchase Other 50 0 0
Current Assets
Purchase Long-term 192 242 465
Assets

Dividends 0 0 0

SUBTOTAL CASH 934 3,812 8,606


SPENT

Net Cash Flow 988 (706) (407)

Cash Balance 1,128 422 140


5.3 Performance Balance Sheet

The following table is our balance sheet projection through 2017.

PRO BALANCE SHEET YEAR 1 YEAR 2 YEAR 3

(RM) (RM) (RM)

Assets

Current Assets

Cash 1,128 422 14

Accounts Receivable 147 1,979 5,314

Inventory 43 127 341

Other Current Assets 50 50 50

TOTAL CURRENT 1,369 2,579 5,720


ASSETS

Long-term Assets

Long-term Assets 257 500 966

Accumulated 14 51 125
Depreciation

TOTAL LONG-TERM 243 449 841


ASSETS

TOTAL ASSETS 1,613 3,028 6,561

Liabilities and Capital Year 1 Year 2 Year 3

Current Liabilities

Accounts Payable 95 221 575


Current Borrowing 50 0 0

Other Current Liabilities 0 0 0

SUBTOTAL CURRENT 145 221 575


LIABILITIES

Long-term Liabilities 0 0 0

TOTAL LIABILITIES 145 221 575

Paid-in Capital 1,820 3,020 4,520

Retained Earnings (170) (352) (213)

Earnings (182) 139 1,679

TOTAL CAPITAL 1,467 2,806 5,986

TOTAL LIABILITIES 1,613 3,028 6,561


AND CAPITAL

Net Worth 1,467 2,806 5,986


6. Conclusion

HL Beauty Enterprise will show the company growing to a multi-hundred


thousand ringgit a year distributor of high quality natural organic products and related
scrub for both men and women. We will begin life as a retailer company with a retail
component and evolve to a retail company with a component within our first ten years.
Our public offering in year three will provide the funding to launch a retail roll out that
will take us to 10 stores in the following three years, expand our e-commerce program and
grow our catalogue distribution. It will allow us to begin development of new product lines
that complement HL Beauty and further define our image. We will move to worldwide
distribution. Once the brand has been established it will have significant cache with the
Asian market and our European manufacturing ties will provide us a logical place in that
market. HL Beauty will become one of the most recognized brands in quality skin care
and related products for the active male and female consumer.
7. Appendices

You might also like