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Enchanted Plaza
Enchanted PlazaA Computer Automated
Virtual Reality Shopping Website
Table of Contents
1. Executive Summary
2. Company Overview / Marketing
3. Management Team - Resumes
4. Company Proprietary Software
5. Capital Funding Methods
6. Start-Up Use of Proceeds
7. 4 Years Sales Forecast
8. Operating Cost Years 1 – 2
9. Profit/ Loss Cash Flow Years 1 – 2
10. Operating Cost Years 3 - 4
11. Profit/Loss Cash Flow Years 3 - 4
12. 4 Years P/L % Summary
13. Competition
14. Notable eCommerce Companies
15. 2006 Global Internet Sales
16. Current Global Internet sales
17. Global eCommerce Projected
18. Conclusion
Executive Summary
Enchanted Plaza
1 Executive Introduction and Summary
Enchanted Plaza is a startup company formed and motivated by the apparent lack in the current internet
industry of a more attractive, less expensive method of internet advertising and retail sales display formats.
To capitalize on this deficiency our VP a computer wizard and his associates have developed a proprietary
technical engineering blueprint for the development of computer software that is capable of producing highly
attractive computer animated, audio – visual - virtual reality 3D displays for use in internet advertising and
retail sales.
Because of these features our displays are not only a much more effective type of media and that they are
totally computer created can be offered at much less cost to our advertising customers, than that of the current
competition.
Some internet companies boast about the reason for their success is because of the number of visitors they have
to their site but in reality any website submitted to the massive search engine system can accumulate hundreds
of millions of visitors in a very short time so these numbers are not of great importance, it is the number of the
visitors who purchase products or services from the site and become customers of the website company that is
important.
It’s simple, if you have a more attractive and interesting website placed in front of millions of viewers you will
have more visitors to your website and if the products offered are of the best quality at a lower price the site will
have more repeat customers and generate more sales, this is particularly true for advertising customers.
Global internet marketing studies and trends indicate that advertising sales will dominate retail sales by the
ratio of 60 % advertising and 40 % retail sales in the near future.
Because of the dynamic capabilities of our displays produces an excellent retail shopping experience in a unique
environment it is an excellent location for commercial advertising therefore we expect our major income
income source will be in advertising display sales.
The disadvantage of internet retail sales is that the revenue to the website is discounted from the retail sales
price, usually about 20 to 30 %. This means that the site has to sell one or a number of product for $ 250 to
receive $ 75. Sales for a directly shipped manufactures product is discounted typically 40% to 50 %. The
Pg. 1 Continued
advantage of internet retail sales however, is that the company does essentially nothing except
display the product and receives 20 to 30 % of the sale and because the sales and payments are
automatically processed by the automated merchant payment processing system the company
has received this income percentage while incurring very little cost.
Our retail sales customer will have the option of us designing their retail “Point of Sales “ ( POS
) displays for a fee, or an increase in the discounted price of their products sold on our website.
What appears to be a disadvantage / advantage of internet advertising sales income is that
although100 % of the sale is billed and received it has also incurred the initial cost of making the
original sale, which by our 2nd
year P/L accounting is about 27 % to 30 %, however these cost
are not recurring, once the sale has been made the company will continue to receive payments
for displaying the ad which incurs no additional cost, therefore if the ad is displayed for any
considerable period of time the cost of the sale will quickly be offset and the remaining payments
to the company will be gross profit.
Also because of the company’s very low overhead , due to our nearly completely computerized
business operations and the enormous search engine generated worldwide public exposure we
will be able to offer better advertising services at a much lower price than the competition and
still maintain a very high profit margin.
The current annual global internet sales market is approximately $449 billion. We at Enchanted Plaza are confident that after receipt of the initial startup capital noted in the “ Capital Funding “ page and with moderate future increases of operating capital as intended within this business plan, the company could, in a relatively short period of time capture a minimum of .001 ( 1/10th of 1 % ) of this market or 449 million dollars in gross annual revenue and with the potential of obtaining a great deal more in the future.
The information detailed within this business plan as follows are about as complete as can be
complied about the company at this juncture, but if we can provide further information for you
please contact the company at the address or phone numbers appended on the conclusion / Summation page at the end of this business plan.
Thank You for your review of our business plan Shawn Marie Lopez, President and Chief Executive Officer
A unique and proprietary three dimensional (3D) virtual reality shopping plazaAnimated marketingCustomizableThe user controls everythingImagine a world-wide virtual shopping experienceWe will offer both nationally and internationally manufactured consumer productsVendors will have actual store imagesStore displays will be customizable to the vendorsEverything will be completely computer automated70% of income will come from marketing salesOnline marketing
Company Introduction
Shawn Marie Lopez: Shawn Marie is the President and CEO as well as the Director of Marketing, Sales and Contract Negotiations for the company. She is the founder of the Enchanted Plaza and is the principle corporate shareholder.
Kyra A. Liebert: Kyra Is the company’s Corporate CFO. Her principle responsibilities are the supervision and management of the company’s non-technical office personnel, sales assistance and customer service. She will also provide the company’s management of all phases of legal, general accounting, corporate records / reporting and tax returns as required. Kyra is a co-founder of the Enchanted Plaza and is a Corporate Officer and shareholder.
John Marler: John is VP and Chief Engineer of the company. His responsibility are on-going development of the company’s and vendor’s current and future technical website software design requirements as well as technical website sales solicitation. John is a co-founder of the Enchanted Plaza and is a Corporate Officer and shareholder.
Jack Thatcher: Is an Independent Business Financial Consultant. Mr. Thatcher is not a corporate officer although he is an important member of the management team and has full authority to represent the company in matters of capital funding in concert with company management.
The Management Team
Website copyright filed, software patent pendingMultifunctional fully animated, highly graphic virtual displays
3D Modeling and Animation w/ audio and video capabilitiesBuildingsInterior- decorations, items for sale, and overall presentation, all updateableExterior- signs, advertisements, decorations
LandscapesMultiple environments based on real life locations and fantasy worldsSelectable dynamic animations such as: birds in the sky, cars driving by, etc.Water fountainsChangeable weather- rain, snow, wind, sun, clouds, etc…
PeopleAbility to update/modify appearanceHeight, skin tone, hair color, hair length, change of clothing, etc.
GUIInterface is easily updateableProvides statistics as you shop such as: money available, cost of item(s) or shopping cart, location, time, etc…Fully integrated with all our clients store merchandise, cost, stock, description of items and shipping informationAbility to store credit card information to the users profilePayment integration with PayPal, Chase Bank, and other automated services
Software
Capital funding
Funding methods
Major Advertisers
SEC Regulation D 506 Offering
NASDAQ Qualified Initial Public Offering
Funding
Use of ProceedsS
tart
up
cap
ital
As follows In Dollars $
Capital Funding 1,000,000Legal Fees for Misc. Corporate DocumentationPPM and SEC Reg D Associated Filing Cost 7,000Promotional Cost and Consulting Fees 5,000 Initial Office Set-up Expense 3,050( See detail below )Initial and On-going Software Development 400,000 ( Software Fund )
Amount Entered as Beginning Cash in the 350,000Cash Flow, Profit / Loss Projection
Total 766,500
Office Expense DetailComputers 3 ea. @ 500 2,250Telephones 3 ea. land line / cell 400Initial office supplies 400
Total 3,050
Total All 753,050
Working Capital Reserves 246,950
In Thousands $ 000 To the Nearest $ 100 ( .1 K )
• Note: Static Display Ads Range from $ 20,000 to $ 50,000 per Month
• Computer Animated or Video Display Ads Range from $ 50,000 to $ 150,000 per Month and Up.
• The Current Global Internet Sales Market is Approximately $ 500 billion
• Enchanted Plaza's Extremely Conservative 4 Year Projected Sales is $ 21 million This Amounts to .4 1/1000's of 1 % of the Global Internet Market
4 Years Sales Forecast
4 Years Sales Forecast as Estimated and Projected
In Thousands $ 000 To the Nearest $ 100 ( .1 K )
Month 1 2 3 4 5 6 Total 7 8 9 10 11 12 Total
Year 1
Sales 0 0 0 20 30 45 95 67.5 101.2 151.8 212 297 320 1149.5 1,244
Year 2 Sales From Year 1 End to Year 2 End Up 395%
Sales 336 352.8 370.4 389 400.7 412.6 2261.5 421 429.3 439 446.7 455.5 464.7 2656.2 4,927
Year 3 Sales From Year 2 End to Year 3 End Up 129 %
Sales 474 483.4 494 503.8 514 527 2996.2 535 545.4 556.3 567.4 575.7 587.3 3367.1 6,363
Year 4 Sales From Year 3 End to Year 4 End Up 136 %
Sales 618 636.5 555.6 675.3 695.5 717.3 3898.2 738 760 783 806.4 830 855 4772.4 8,671
Note: Static Display Ads Range fron $ 20,000 to $ 50,000 per Month 4 Years Total 21205
Computer Animated or Vidio Display Ads Range from $ 50,000 to $ 150,000 per Month and Up.
The Current Global Internet Sales Market is Approximately $ 500 billion
Enchanted Plaza's Extremely Conservative 4 Year Projected Sales is $ 21 million This Amounts to .4 1/1000's of 1 % of the Global Internet Market
Salaries (Years 1-2)
In Dollars to the Nearest $ 100.
Per Month Year 1 Total Year 2 Total
Salaries
Corporate Officers 10,700 10,700 10,700 10,700
Office & Assistants 1 2,000 3 6,000 5 10,000 7 14,000
12,700 16,700 20,700 24,700
Monthly Total x 6 x 6 x 6 x 6
76,200 100,200 176,400 124,200 148,200 272,400
Number of employees 4 6 8 10
Employer Tax Contrib 9,000 est 12 % 12,000 15,000 17,800
700 est 1.3 % 1,300 1,600 1,900
General Biz Insurance 200 200 200 200
Rent 400 400 1,000 1,000
100 100 200 200
Utilities 200 200 300 300
100 100 200 200
10,700 14,300 18,500 21,600
x 6 x 6 x 6 x 6
Total G / A 64,200 85,800 150,000 111,000 129,600 240,600
2,000 2,000 4,000 4,000
800 800 800 800
30,000 30,000 60,000 60,000
Selling Expence per Mo. 32,800 32,800 64,800 64,800
x 6 x 6 x 6 x 6
Total Selling Expense 196,800 196,800 393,600 388,800 388,800 777,600
720,000 1,290,600
Employer Contribution Taxes Federal, State, SSI, Medicare and UE Ins. Are added together and Estimated
Salaries Executive 4,000/ Mo Shawn Marie Lopez Pres, CEO Marketing and Sales Manager
4.000/ Mo Kyra Liebert CFO Chief Financial Officer
2,700/ Mo John Maler, VP, Chief Engineer, Software Development Manager and Sales Solicitation
Administrative 2,000 / Mo. Each Office Administrative Assistant, Customer Service, Software Assistant and Sales Associate
Telephone
Salaries ( Cost of Sales ), G&A and Selling Expense as Estimated and Projected
4 Semi-Annual Periods
1St 6 Mo / Mo 2nd 6 Mo 3rd 6 Mo 4 th 6 Mo
Cost of Sales per Month
Total Saleries
G & A Expense
Workmans Comp
Marketing
Monthly Total
Misc. Office Supplies
Cost of G/ A per Month
Monthly Total
Selling Expense
Air Travel
Car Rental
P/L Cash Flow (Years 1-2)
Cash Flow - Profit / Loss as Projected Years 1 - 2
Summary In Thousands $ ( 000 )
Year 1 Cash Flow 1 2 3 4 5 6 7 8 9 10 11 12 Totals
Investment
Beginning Cash 350 321 292 263 254 255 271 301 365 480 655 915
Sales/Gross Income 0 0 0 20 30 45 67 101 152 212 297 320 1244 1244
Total Cash 350 321 292 283 284 300 338 402 517 692 952 1235
Total Cost per Month -29 -29 -29 -29 -29 -29 -37 -37 -37 -37 -37 -37 -396 -396
Ending Cash 321 292 263 254 255 271 301 365 480 655 915 1198 1198 [848]
Beginning Investment Cash [350]
Profit/Loss -29 -29 -29 -9 1 16 30 64 115 175 260 283 848 1198
Turn Arround Approx break Even
Year 2 Cash Flow 6 Months 6 Months Totals
Beginning Cash 1,198 3,183
Total Sales/Gross Income 2,261 2,656 4,917
Total Cash 3,459 5,839
Total Cost -276 -319 -595
Ending Cash 3,183 5,520
Profit/Loss 1,985 2,337 4,322
Accumulated P /L 1,985 4,322 4,322
Salaries (Years 3-4)
In Dollars to the nearest $ 100.
Per Month Year 3 Total Year 4
Salaries 3rd 6 Mo
Corporate Officers 15,000 17,500 17,500 17,500
Office & Assistants 6 15,000 7 17,500 8 20,000 10 25,000
30,000 35,000 37,500 42,500
Monthly Total x 6 x 6 x 6 x 6
Total Salaries 180,000 210,000 390,000 225,000 255,000 480,000
Number of employees 9 10 11 13
Employer Tax Contrib 21,600 est 12 % 25,200 27,000 30,600
2,300 est 1.3 % 2,700 4,900 5,500
Insurance 600 600 600 600
Rent 1,000 1,000 1,000 1,000
400 400 500 500
Utilities 300 300 300 300
400 400 500 500
26,600 30,600 34,800 39,000
x 6 x 6 x 6 x 6
Total G / A 159,600 183,600 343,200 208,800 234,000 442,800
6,000 6,000 6,000 6,000
1,000 1,000 1,000 1,000
90,000 90,000 90,000 90,000
Selling Expense per Mo. 97,000 97,000 97,000 97,000
x 6 x 6 x 6 x 6
Total selling Expense 582,000 582,000 1,164,000 582,000 582,000 1,164,000
1,897,200 2,086,800
Salaries Executive 5,000 / Mo Shawn Marie Lopez Pres, and CEO
5,000 / Mo Kyra Liebert CFO Chief Financial Officer
5,000 / Mo. John Maler VP Chief Engineer
Administrative 2,500 / Mo. Each Office Administrative Assistant, Customer Service, Software Assistant and Sales Associate
Salaries ( Cost of Sales ), G&A and Selling Expense as Estimated and Projected
4 Semi-Annual Periods
1St 6 Mo 2nd 6 Mo 4 th 6 Mo
Monthly Total
Cost of Sales per Month
G & A Expense
Workmans Comp
Telephone
Misc. Office Supplies
Cost of G/ A per Month
Monthly Total
Selling Expense
Air Travel 4 trips /6 Mo.
Car Rental
Marketing
P/L Cash Flow (Years 3-4)
Cash Flow - Profit / Loss as Projected Years 3 - 4Summary In Thousands $ ( 000 )
Year 3 Cash Flow 6 Months 6 Months Totals
Beginning Cash 5,520 8,098
Sales/Gross Income 2,996 3,367 6,363
Total Cash 8,516 11,465
Total Cost -418 -472 -890
Ending Cash 8,098 10,993
Ending Profit/Loss 2,578 2,895 5,473
Ending Accumulated P/L 2,578 5,473 5,473
Year 4 Cash Flow 6 Months 6 Months Totals
Beginning Cash 10,993 14,378
Sales/Gross Income 3,898 4,772 8,670
Total Cash 14,891 19,150
Total Cost -512 -567 -1,079
Ending Cash 14,378 18,584
Ending Profit/Loss 3,386 4,205 7,591
Ending Accumulated P/L 3,386 7,591 7,591
Projected P/L
4 Years Proforma Profit / Loss as Projected
Page 12 Approx. Summary, In Thousands $ 000
Year 1 Year 2
Sales / Income 1,244 Sales / Income 4,927
Cost of Sales ( Sal ) -176 14.00% Cost of Sales ( Sal ) -272 5.50%
G / A -150 12.00% G / A -241 4.90%
Selling Expense -70 5.60% Selling Expense -82 1.60%
All Cost -396 31.60% All Cost -595 12.00%
Gross Profit 848 68.40% Gross Profit 4,332 88.00%
Total % 100% Total % 100%
Net Operating Net Operating
Pre Tax Profit/Loss 848 44.00% Pre Tax Profit/Loss 4,322 88.00%
On Sales of 1,244 Profit was 848 or 44.% On Sales of 4,917 Profit was 4,322 or 88.%
Year 3 Year 4
Sales / Income 6,363 Sales / Income 8,671
Cost of Sales ( Sal ) -390 6.20% Cost of Sales ( Sal ) -480 5.50%
G / A -343 5.40% G / A -443 4.80%
Selling Expense -156 2.40% Selling Expense -156 1.80%
All Cost -889 14.00% All Cost -1079 12.10%
Gross Profit 5,474 86.00% Gross Profit 7,592 87.90%
Total % 100% Total % 100%
Net Operating Net Operating
Pre Tax Profit/Loss 5,474 86.00% Pre Tax Profit/Loss 7,592 87.90%
On Sales of 6,363 Profit was 5,474 or 86 % On Sales of 8,671 Profit was 7,593 or 87.90 %
Note: See Conclusion Page 18 to Note Generally Inordinately High P&L
A few American companies who’s primary income is from internet and marketing sales:
Facebook- $3,000,000,000 of which 80% was in internet marketing
Expedia, Inc.- $3,348,000,000- marketing and travel
Priceline- $3,072,240,000- marketing and travel
Groupon- $760,000,000- Retail referrals and marketing
Orbitz- $757,5000,000- Travel agent and marketing
Enchanted Plaza
Market Share
Competition and Market Share
Amazon
Notable ecommerce Companies
Total Revenue 48,077,000 34,204,000 24,509,000
Cost of Revenue 37,288,000 26,561,000 18,978,000
Gross Profit 10,789,000 7,643,000 5,531,000
The standout winner in e-commerce continues to be Amazon. Amazon’s revenues rose 29 % in 2010 to $48.0 billion in 2011 and profits grew substantially as noted.Amazon’s main source of income was from a very broad, diversified line of direct and discounted customer retail sales, Internet marketing was estimated to be about 30 % or 14.4 billion. In billions
2011 2010 2009
ecommerce internet technology market research - E-Commerce and ...www.plunkettresearch.com/...internet.../industry-and-business-data
Yahoo
ecommerce cont.’…
Period Ending Dec 25, 2011 Dec 31, 2010 Dec 31, 2009
Total Revenue 2,323,401 2,393,463 2,440,439
Cost of Revenue 957,467 961,778 1,021,230
Gross Profit 1,365,934 1,431,685 1,419,209
In thousands
Amount from marketing was unavailable
ecommerce internet technology market research - E-Commerce and ...www.plunkettresearch.com/...internet.../industry-and-business-data
eBay, Inc.
(NASDAQ: EBAY)
Fiscal year is January-December. In billions
2008 2009 2010 2011
Sales/Revenue 8.54 B 8.73 B 9.15 B 11.68 B
Gross Income 6.08B 5.96 B 6.39 B 7.95 B
Net Income 1.78 B 2.39 B 1.8 B 3.2 B
ecommerce cont.”…
ecommerce internet technology market research - E-Commerce and ...www.plunkettresearch.com/...internet.../industry-and-business-data
Revenue Accounting ( summary )
In billions
Revenue: Year 2010 2011 2012 1st quarter
Gross Revenue 29.3 38. 10.6
Income from operations 10.4 11.7 3.4
Net Income 8.5 9.7 2.9
marketing Revenue inclusive 28. 36. 10.
Internet Sales Revenue was 28/29 = 96.6 % of gross revenue
ecommerce cont.’…
ecommerce internet technology market research - E-Commerce and ...www.plunkettresearch.com/...internet.../industry-and-business-data
Google cont.’…The Top 10 Industries That Spent Big On Google AdWords In 2011
Finance & Insurance – $4.0 Billion (example keywords in this industry include: “self employed health insurance”, “cheap car insurance”, “credit cards for bad credit”)Retailers & General Merchandise – $2.8 Billion (example keywords in this industry include “zumba dance dvd”, “proform treadmill”, “weber grill accessories”)Travel & Tourism – $2.4 Billion (e.g. “New York hotels”, “plane tickets”, “rental car deals”)Jobs & Education – $2.2 Billion (e.g. “accredited online college degrees”, “online certificate programs”, “unemployment benefits”)Home & Garden— $2.1 Billion (e.g. “replacement windows cost”, “appliance repair”, “cabinet refacing”)Computer & Consumer Electronics – $2.0 Billion (“ink cartridges discount”, “pc memory”, “online video conferencing software”)Vehicles – $2.0 Billion (e.g. “cheap hybrid cars”, “certified used cars”, “Bridgestone tires”)Internet & Telecommunications – $1.7 Billion (“pre paid cell phones”, “domain registration”, “cable internet providers”) ……Business & Industrial – $1.6 Billion (“custom business cards”, “cheap office supplies”, “foam packing”)Occasions & Gifts – $1.2 Billion ("funeral flowers arrangements", "flower delivery", "wedding gift registry")
marketing revenues for Google from these 10 industries accounted for 60% of Google’s 2011 revenues. The remaining balance was in advertiser revenues from other industries than those noted above(Just 4% of Google’s revenues came from non-marketing-related sources.)
ecommerce cont.’…
Global Internet Sales 2006
Global Market
Overall Global Internet Traffic is growing at 29 % per year
2010 2013 ( Rounded off to the even billion)• U.S: 166, 235, 12.4%• Europe: 195. 283. 13.2%• Asia: 1 56, 323, 27.5%• Rest of world: 56, 128, 29.7%• Global: 473, 969, 19.4%
www.internetretailer.com/.../global-e-commerce-sales-head-1-trillion-...
China’s e-commerce market is growing 130% a year, a U.K. e-retail trade group says.Topics: Aad Weening, Asia, Brazil, China, e-commerce spending, europe400, European Multi-channel and Online Trade Association, France, IMRG, industry statistics, international e-commerce, international marketing, Israel, Italy, Japan, Latin America, Mexico, Middle East, Spain, UAE, United Kingdom
Global eCommerce
Conclusion
Company Contacts
ShawnMarie Lopez- President & CEO5031 27th Ave NERio Rancho, NM 87144(505) 903-1706(505) 752-9201Email: [email protected]
John Marler, Vice President3857 Montgomery Blvd. NEAlbuquerque, NM 87109(505) 610-7421
Kyra A. Liebert, Chief Financial Officer1921 Verbena Drive NERio Rancho, NM 87144(505) 450-2724Email: [email protected]
Please Note: This business plan is not an offer or solicitation to invest, buy or sell any security at this time. If the intentions of the company shall change in this regard at some future time, the company will in accordance with Federal SEC, State and local laws/rules, file appropriate registration statements or exemptions therefrom.