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     The Queen’s Beer Tavern

         Portland, Oregon

 customerservice@queensbeer.com




www.cus...
Table of Contents

I. Executive Summary                                   04
II. General Company Description              ...
9.3 12 Month Profit/Loss            29
     9.4 3 Year Profit Projection        32
     9.5 Opening Day Balance Sheet     ...
I. Executive Summary


       Queen’s has been a successful Irish themed bar in the center of downtown

Portland, Oregon f...
$150 thousand to purchase the tavern and also will assist with the microbrewery’s

startup expenses.


                   ...
of Queen’s is a subchapter "S" corporation. The company location is in Portland,

Oregon.



2.3 Company Concept/History

...
kitchen, and plenty of room for games such as darts, pool, and other amusements make

this an excellent local attraction.
...
III. Products and Services

3.1 Product Description


       Queen’s will continue to offer a wide variety of spirits, con...
The service quality at Queen’s will be second to none. All wait, bar, and kitchen

staff will receive a full day’s trainin...
the products that they seek, making the visit itself undifferentiated from on

establishment to the next.


          Howe...
annual sales of $40 million based on a local market of only five counties.4 In this type of

environment, each firm attemp...
kind of population growth expected to continue, Portland and the surrounding area can

not only support another microbrew ...
The market segmentation for Queen’s target market is divided into the leading

market segments for its industry. The divis...
new connoisseur in brewing that has revolutionized the industry. With so

          many new types and brands of beer avai...
offers a limited menu of such things as sandwiches, hamburgers, fish and chips, and

other appetizers. While for holidays ...
young professionals aged 25-40 with an emphasis on pop-radio. In order to ensure the

maximum efficiency from this campaig...
3. Berbati’s Pan Cafe. This is a restaurant/nightclub that attracts national level

       entertainers and huge crowds. I...
Strengths. Queen’s is an established company but one with a fresh brand and an

experienced owner/manager in Mr. Milton. A...
•   7 Day a week Availability                 •   Market growth expected in 2008



WEAKNESSES                            ...
V. Operational Plan

5.1 Production

       All production of food and service delivery occur onsite. The microbrewery fac...
5.5 Exit Strategies

       Queen’s fully expects to stay operational and financially solvent however, at

times this is n...
VI. Management and Organization

6.1 Company Structure & Ownership

        The company is going to be licensed as a limit...
Restaurant/Floor Manager: This individual will manage and oversee all food related

activities such as kitchen and food pr...
VII. Personal Financial Statements

7.1 Personal Financial Statements

                                        PERSONAL FI...
Are any assets pledged other than as described on the
                                                                    ...
SCHEDULE E – BANKS OR FINANCE COMPANIES WHERE CREDIT HAS BEEN
OBTAINED

Name & Address of       Credit In The Name        ...
VIII. Startup Expenses and Capitalization

8.1 Capitalization

       Mr. Milton is the sole investor related to the purch...
Funding & Investor
INVESTOR 1                    $30,000
INVESTOR 2                         $0
OWNER 1                    ...
IX. Financial Plan

9.1 Primary Assumptions

Cash Sales: Projected gross sales will be based on the average of the monthly...
Sales     $1,017,000       $1,307,000       $1,410,000
                          Direct Costs of Goods        $457,650    ...
The following chart and table show the Projected Cash Flow for Queen’s:




      QUEEN’S Pro Forma Cash Flows
           ...
Expenditures          2003        2004         2005

                Expenditures from Operations
                        ...
Total Current Assets       $224,164     $297,194     $296,530

                          Long-term Assets
                ...
acquiring it, Queen’s will be able to make an increased profit by the second year. The

break-even point is approximately ...
APPLIED 7 BARREL FULL MASH BREWERY SPECIFICATIONS
                            ABT MALT CONVEYING SYSTEM
* Malt auger,4 inc...
* Polished stainless steel wedge wire two piece false bottom
* Premasher and sparge devices with 3/4" MNPT nipples, clamp ...
* 3 1/2" open impeller, epdm O rings, replaceable rotating seal
* 3600 rpm, 1 1/2 h.p., 220 V, 1ø, TEFC motor, 10 amps.
* ...
4 - 1 1/2" triclamp clamps and hycar gaskets
  2 - 1 1/2" triclamp caps
                                GLYCOL CHILLER SYS...
SERVING TANK OUTLETS
* Stainless steel outlet manifolds for connecting three beer lines
* Clamps, valves, gaskets, piping
...
Appendix 3: Business Ratios

                              40
Standard business ratios are provided in the following table. The ratios show

strong, yet safe growth for Queen’s in the ...
Additional Ratios    2003    2004        2005
                        Net Profit Margin   2.03%   3.97%       4.30%   n.a
...
Atkinson, William. “Working Smart.” Beverage World, 125/12(2006): 72.

“Limited Liability Company.” Internal Revenue Servi...
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Bar Tavern Business Plan

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This business plan is based on a business research company that is web-based. It can be reformatted into any market or any other business context. It has the financials, marketing plan, and all other business plan requirements and major headings. These major headings may include those similar to the following:
I. Executive Summary
II. General Company Description
III. Products and Services
IV. Marketing Plan
V. Operational
IV. Management and Organization
VII. Personal Financial Statements
VIII. Startup Expenses and Capitalization
IX. Financial Plan
Research Bibliography

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  1. 1. www.china-doll.org The Queen’s Beer Tavern Portland, Oregon customerservice@queensbeer.com www.customwrittenbusinessplans.com www.prewrittenbusinessplans.com www.universityessayexperts.com www.researchandwriting.org 1
  2. 2. Table of Contents I. Executive Summary 04 II. General Company Description 05 2.1 Overview 05 2.2 Legal Description 05 2.3 Company Concept/History 06 2.4 Current Status 06 2.5 Vision & Mission Statement 07 III. Products and Services 08 3.1 Product Description 08 3.2 Service Description 08 IV. Marketing Plan 09 4.1 Industry Overview 09 4.1.1 Market Size 11 4.1.2 Target Market 12 4.1.3 Marketing Objectives 14 4.2 Products/Services 14 4.2.1 Pricing Strategy 15 4.2.2 Promotion Strategy 15 4.2.3 Distribution/Placement Strategy 16 4.3 Competitor Analysis 16 4.4 SWOT Analysis 17 4.5 TOWS Strategy Development 18 V. Operational Plan 20 5.1 Production 20 5.2 Location 20 5.3 Inventories 20 5.4 Suppliers 20 5.5 Exit Strategies 21 IV. Management and Organization 22 6.1 Company Structure & Ownership 22 6.2 Core Management Personnel 22 6.3 Roles & Responsibilities 22 6.4 Salary Structure 23 6.5 Key Success Factors 23 VII. Personal Financial Statements 24 7.1 Personal Financial Statements 24 7.2 Details of Personal Financial Statements 25 VIII. Startup Expenses and Capitalization 27 8.1 Capitalization 27 8.2 Startup Expenses 27 IX. Financial Plan 29 9.1 Primary Assumptions 29 9.2 Summary of Financial Results 29 2
  3. 3. 9.3 12 Month Profit/Loss 29 9.4 3 Year Profit Projection 32 9.5 Opening Day Balance Sheet 32 9.6 Break Even Analysis 34 Appendices 35 Appendix 1: Supply Lists 35 Appendix 2: State & Local Requirements 40 Appendix 3: Business Ratios 41 Research Bibliography 43 3
  4. 4. I. Executive Summary Queen’s has been a successful Irish themed bar in the center of downtown Portland, Oregon for many years but is just now being purchased by Mr. John Milton. Recently Queen’s has seen a drop in its clientele due to the rise of microbreweries and micro-beer in the Portland area. In order to successfully compete with this new trend, Queen’s objectives are to create its own microbreweries on-site and to offer superior kinds of beers than that of these new competitors. Queen’s was established originally by Ms. Showalter and over the years has become a well trafficked venue in downtown Portland. Two years ago, Ms. Showalter put the tavern up for sale and Mr. Milton intends to purchase it. The company is licensed in the State of Oregon. Queen’s is located in one of the most outstanding downtown locations in Portland as it is strategically placed to attract the middle and upper middle-class working clientele during lunch and after work as well. The building itself is one of the oldest structures still standing in downtown Portland and has an old world style to it. Queen’s offers a wide variety of spirits and beers from domestic and imported to wines as well. Additionally, the tavern offers a limited menu of light food and snacks, and specialty items during the holidays. Once the onsite brewery begins production, Queen’s will concentrate on ale production including wheat beers, stouts, and porters as these include the more traditional types of Irish brews. The tavern intends to initially start with five different types of beer, eventually increasing to ten. All of the expected brews will have a different brand name. Mr. Milton is asking for a small business loan in the amount of 4
  5. 5. $150 thousand to purchase the tavern and also will assist with the microbrewery’s startup expenses. I. General Company Description 2.1 Overview Queen’s was established in 1982 by Ms. Showalter and over the years has become a recognized fixture in downtown Portland. This notoriety includes having articles written about the establishment in various travel magazines and recommended by the Portland Travel Bureau as one of the most popular drinking establishments in the city. Several years ago, Ms. Showalter started advertising the tavern as being for sale, citing poor health and lowering profits. Queen’s is now a sole proprietorship owned and operated by Ms. Showalter but is being purchased by Mr. Milton. The company is licensed in Oregon as a legal business entity. Queen’s has been a successful Irish bar in the heart of downtown Portland, Oregon for many years and as such has a high degree of visibility. However, recently Queen’s has seen a drop in its clientele due to the increase in popularity of microbreweries in the Portland area. In order to successfully compete with this new threat, Queen’s objectives, under the guidance of Mr. Milton are to create its own microbrewery onsite and to offer superior kinds of beers than that of these new competitors. 2.2 Legal Description Queen’s is listed under the official NAICS system as 722410 and is described as being a, “establishments known as bars, taverns, nightclubs, or drinking places primarily engaged in preparing and serving alcoholic beverages....”1 Additionally, the legal status 1 “2007 NAICS Definition.” U.S. Census Bureau.< http://www.census.gov/ eos/www/naics/> 5
  6. 6. of Queen’s is a subchapter "S" corporation. The company location is in Portland, Oregon. 2.3 Company Concept/History While Queen’s has been in operation for many years, Mr. Milton’s dream of owning a tavern began as a youth when he went to Europe and saw how the locals in each town or village all congregated in one or two local pubs. He has wanted to recreate this type of venue in his native Portland since that time and has been saving the money to do so. Rather than invest in a new startup, Mr. Milton perceives the opportunity to purchase Queen’s and to upgrade its operations with its own microbrewery operation as the best strategy to realize his dream. 2.4 Current Status Queen’s is located at the corner of Salmon St and SE 19th Avenue in Portland about four blocks from the city center and within walking distance of the city's business district. This is one of the most outstanding locations for a tavern in Portland as it is strategically located to attract the middle-class and upper middle-class working clientele as well as tourists who gather in the downtown area in the afternoon and evening to walk along the riverfront. The building itself is one of the oldest structures still standing in Portland and has an old world cachet about it. Presently the establishment can seat 96 customers simultaneously and Queen’s has secured the purchase of the adjacent storefront for its expansion, and with renovation, will have room for the brewery and another 24 customers. The current facilities, including two large bars and a fireplace, 6
  7. 7. kitchen, and plenty of room for games such as darts, pool, and other amusements make this an excellent local attraction. 2.5 Vision & Mission Statement Queen’s vision statement informs the consumer that this is a different kind of tavern with an emphasis on community and local cultural environment: “Queen’s will be the place where the locals hang out and visitors meet.” The mission of Queen’s will be to expand on its vision statement by offering a more concrete operating statement: “Queen’s will have a drink for everyone, whether they drink wine, liquor or beer and they’ll receive it with a smile.” 7
  8. 8. III. Products and Services 3.1 Product Description Queen’s will continue to offer a wide variety of spirits, concentrating on imports from Ireland such as Harps, Guinness, Erin's Rock, Murphy's Irish Stout, and Wild Irish Rouge on tap along with Baileys Irish Crème, St. Brendan's and other popular liguors. In addition, the tavern also offers domestic and other imported beers by the bottle and a full bar is stocked for all manner of mixed drinks. In the back the tavern has a small kitchen that offers a limited menu of such things as sandwiches, hamburgers, fish and chips, and other appetizers. While for holidays such as St. Patrick's Day, the tavern offers traditional favorites such as Irish stew, leek and potato soup, and corned beef and cabbage, and such things as turkey dinner and stuffing for Thanksgiving, among many other examples. Once the tavern begins production, Queen’s will concentrate on ale production including wheat beers, stouts, and porters as these include the more traditional types of international brews such as Irish brews. Queen’s intends to initially start with five different types of beer, eventually increasing to ten or more. All of Queen’s brews will have a different brand name. 3.2 Service Description 8
  9. 9. The service quality at Queen’s will be second to none. All wait, bar, and kitchen staff will receive a full day’s training on solely how to interact with clientele in a technique Mr. Milton refers to as the “Queen’s Way.” This is involves getting to know their names, making eye contact, and responding quickly and politely to all requests. IV. Marketing Plan 4.1 Industry Overview Queen’s operates in a highly competitive industry whose environment creates low margins due to the high amounts of pressure placed upon participants from customers, suppliers, other rivals, potential market entrants, and participants’ diverse products. Additionally, the competition around virtually any holiday makes this competitive profile intense year around. Currently, because traditional alcohol is fully associated with Thanksgiving, for example, all manner of alcoholic beverage makers are competing to develop a branded alcoholic beverage that becomes associated with this and other holidays.2 This has created a fragmented industry in which no one participant has a significant market share in almost every local or national market. Customers have a great deal of buyer power and influence in this industry since there are virtually no switching costs to move from one competitor to another, whether it is a tavern or a type of alcohol. Customers regularly go to more than one tavern or bar to socialize and drink. In addition, while this type of bar-hopping is very popular, the overall quality of the customer's life is unaffected if they choose to forgo pursuing it. Finally, even with the rise of microbreweries, many customers still find that most taverns have 2 Mullman, Jeremy. “Booze Makers Battle over Turkey Day.” Advertising Age, 78/43(2007): 4-57. 9
  10. 10. the products that they seek, making the visit itself undifferentiated from on establishment to the next. However, with the rise of microbreweries and the wide variety of microbrews, many tavern operators see an opportunity to differentiate based on the flavor and quality of their beers. Research indicates that this is increasingly an effective strategy since as recently as 2005, the volume of microbrews in the United States (US) market exceeded 750 thousand barrels and this figure is expected to continue to rise. 3 Furthermore, these suppliers also have a great deal of influence in relation to the taverns and their operations. Almost all suppliers are regional companies that have a wide variety of customers including grocery stores, liquor stores, restaurants, caterers, and similar. This means that any single customer of these distributors makes up a fraction of their sales and has little influence on their overall prices, quality and terms. Furthermore, while these distributors often sell a wide variety of products such as produce, poultry, meat products, tobacco, and other items, taverns are almost solely dependent upon the distributors for all of their merchandise and products. The only real strategy to offset this distributor's influence is to reverse-integrate into the supply industry itself by brewing and marketing an establishment’s own microbrew product. Since industry growth is relatively small, there is a strong push by all competitors to gain market share at the expense of other operators. The lack of a differentiated product or service by most taverns only makes this situation worse and yet, by venturing into microbrews, Queen’s can attain the same type of profitability other small breweries have where companies such as Metro Beverages, Inc. in Northern Indiana reached 3 “US Specialty Beer.” Beverage World, 126/7(2007): 18. 10
  11. 11. annual sales of $40 million based on a local market of only five counties.4 In this type of environment, each firm attempts to lower prices, increase services and products and cut costs. This in turn creates retaliation among rivals and leads to falling profits or even narrower margins. There are relatively few barriers to entry in the bar and tavern industry, making the threat of new entrants to the market very real. The capital costs of starting up a bar or taverns are relatively low and access to distribution channels is quite easy. Where firms seek advantages is in finding a favorable location, building brand equity through customer loyalty, creating a unique environment, or, alternatively, reverse-integration by producing unique products. 4.1.1 Market Size While the market for well kept taverns and bars is established, the concept of taverns and bars that contain their own microbrewery is a growing enterprise and industry. Research reveals that the overall beer industry is relatively flat, the microbrew industry is strong with almost 1400 unique craft brewers throughout the US, which includes those located in taverns and sales increased by 7% from 2003 to 2005 alone.5 With this kind of growth, taverns such as Queen’s should absolutely examine augmenting existing business with their own microbrew products and branding efforts. Additionally, the Portland, Oregon area is home to fairly significant population that is acclimated to local alcohol products since the area is also home to a healthy local wine industry as well. The most recent US census data reveal that the area has a population of 537 thousand that the population has grown by almost 20% since 1990.6 With this 4 Atkinson, William. “Working Smart.” Beverage World, 125/12(2006): 72. 5 Spaeder, Karen. “Heady Stuff.” Entrepreneur, 34/1(2006): 51. 6 “Portland, Oregon.” U.S. Census Bureau (online). <http://www.census.gov>. 11
  12. 12. kind of population growth expected to continue, Portland and the surrounding area can not only support another microbrew but require. According to the population density map of the Portland downtown area, Queen’s is located in one of the area’s most populated areas during the day due to the sheer number of workers who live and work in the surrounding areas:7 4.1.2 Target Market 7 “Persons Per Square Mile.” U.S. Census Bureau, (online). http://www.census.gov>. 12
  13. 13. The market segmentation for Queen’s target market is divided into the leading market segments for its industry. The division reflects the differences in marketing strategy that will be used to target each different market and they are as follows:  Middle to upper class white collar office workers from the downtown area. These are people seeking to have a drink or some quick food during lunchtime and sometimes want to take out-of-towners to see some of the local highlights. In addition, the tavern can expect to see these types of customers dropping in for some hours after work in order relax and discuss business in a less formal manner.  Late nighters and weekend partiers. These are the type of clientele that drop by and stay for many hours socializing and drinking for purely entertainment purposes. Growth of this segment is based on the estimated population growth of Portland itself viewed previously.  Brew or beer connoisseur. These customers are a relatively new type to the tavern scene and industry. Although there have been beer connoisseurs all over since beer was first invented, until recently government regulation was such that the industry was concentrated within a few national companies such as Anheuser Busch, Coors, and others that do not brew craft beer. These companies had few product lines and sought to produce large amounts of beer over very short time periods in a process that removes the artisan flavor and context from the industry. Since industry deregulation the industry has rapidly fragmented, allowing small brewers to compete against the larger established companies on a local and even national level. All this has inspired 13
  14. 14. new connoisseur in brewing that has revolutionized the industry. With so many new types and brands of beer available, the customer that wants to try new types is being wooed by all industry participants and Queen’s tap into this segment’s potential. Queen’s Market Analysis 2008 2009 2010 2011 2012 Potential Customers Growth CAGR professional workers 3% 75,000 77,250 79,568 81,955 84,414 3.00% Late nighters and weekend 3% 435,000 448,050 461,492 475,337 489,597 3.00% partiers Beer connoisseur 8% 120,000 129,600 139,968 151,165 163,258 8.00% Total 4.01% 630,000 654,900 681,028 708,457 737,269 4.01% 4.1.3 Marketing Objectives The following marketing objectives will guide the marketing strategy formulation and execution over the next 12 month period:  Meet all first years sales objectives  Increase sales by 10% monthly  Develop a local distribution network for the tavern’s craft beers  Brew five branded microbrews by the end of the first 12 month business cycle 4.2 Products/Services Queen’s will offer a wide variety of spirits, concentrating on imports from Ireland such as Harps, Guinness, Erin's Rock, Murphy's Irish Stout, and Wild Irish Rouge on tap along with Baileys Irish Crème, St. Brendan's and other popular liguors. In addition, the tavern also offers domestic and other imported beers by the bottle and a full bar is stocked for all manner of mixed drinks. In the back the tavern has a small kitchen that 14
  15. 15. offers a limited menu of such things as sandwiches, hamburgers, fish and chips, and other appetizers. While for holidays such as St. Patrick's Day, the tavern offers traditional favorites such as Irish stew, leek and potato soup, and corned beef and cabbage, and such things as turkey dinner and stuffing for Thanksgiving, among many other examples. Once the tavern begins production, Queen’s will concentrate on ale production including wheat beers, stouts, and porters as these include the more traditional types of international brews such as Irish brews. Queen’s intends to initially start with five different types of beer, eventually increasing to ten or more. All of Queen’s brews will have a different brand name. 4.2.1 Pricing Strategy Queen’s pricing strategy will be competitive. However, the tavern will not compete on price because this is not necessary in the microbrew industry. Rather, the tavern’s prices will be reasonable but its products will be exemplary: Small Mug $1.95 Medium Mug $2.95 Large Mug-the Queen’s Ransom $3.95 4.2.2 Promotion Strategy Queen’s intends to advertise its new brewery products through newspaper and magazine articles, focusing primarily on entertainment and lifestyle publications that are locally produced and printed. In addition the tavern will run ads in local journals and intends to erect four billboard advertisements. Past experience with other taverns and breweries indicates that radio is an especially useful tool to this industry and management plans to run ads with three of the local radio stations most listened to by 15
  16. 16. young professionals aged 25-40 with an emphasis on pop-radio. In order to ensure the maximum efficiency from this campaign, Queen’s has retained the services of an advertising consulting firm in the Portland area. Advertisements and articles are scheduled to begin approximately one month after the Mr. Milton takes full possession of the tavern. 4.2.3 Distribution/Placement Strategy Queen’s is located at the corner of Salmon St and SE 19th Avenue in Portland about four blocks from the city center and within walking distance of the city's business district. All of Queen’s operations will occur in this single location. 4.3 Competitor Analysis There are a wide variety of bars, restaurants, nightclubs and other direct and indirect competitors in the Portland downtown area. Some of the closest in terms of location and quality include the following bars, taverns and nightclubs: 1. Henry’s 12th Street Tavern. This tavern offers the largest threat to Queen’s as it has created an excellent reputation for its microbrews by regularly stocking a diverse supply of the area’s best as well as some of the best microbrews nationally. 2. Nob Hill Bar & Grill. This establishment is located close to Queen’s and it attracts a niche market of customers who gravitate to is locally recognized dishes as well as its long standing presence as one of downtown Portland’s most recognized fixtures. 16
  17. 17. 3. Berbati’s Pan Cafe. This is a restaurant/nightclub that attracts national level entertainers and huge crowds. Its popularity could be a threat to establishing market share for Queen’s. Competitor Profile Matrix Berbati’s Pan Henry’s 12th Queen’s (CPM) Café Street Tavern CRITICAL QUEEN’SIGH SUCCESS RATING SCORE RATING SCORE RATING SCORE T FACTORS Advertising 0.20 2 0.40 3 0.60 1 0.20 Product Quality 0.10 4 0.40 4 0.40 3 0.30 Price Competitivenes 0.10 1 0.10 3 0.30 2 0.20 s Management 0.10 3 0.40 4 0.40 2 0.20 Financial 0.15 3 0.60 2 0.30 4 0.60 Position Customer 0.10 4 0.40 2 0.20 3 0.30 Loyalty Brand Identity 0.20 2 0.40 2 0.40 4 0.80 Market Share 0.05 2 0.10 1 0.05 4 0.20 TOTAL 1.00 2.80 2.65 2.80 4.4 SWOT Analysis The greatest competitive opportunity in the tavern and bar industry is the growth projections that most analysts associate with the industry. This expected market growth over the next 3-5 years affords Queen’s its most tangible rationale for expanding in the Portland, Oregon market at this time. The following section outlines Queen’s strengths, weaknesses, opportunities and threats associated with its market entry: 17
  18. 18. Strengths. Queen’s is an established company but one with a fresh brand and an experienced owner/manager in Mr. Milton. Additionally, Queen’s has a strong business plan and access to ready capital. Weaknesses. Queen’s lacks an established identity for its microbrews in the loca market but its established presence in the market may counter this. Furthermore, although its focus on customer service and service delivery is an extremely strong attribute, customers must also be willing to pay for such service since it is not competing on price alone. Opportunities. The market growth over the next 3-5 years presents Queen’s with its most promising opportunity in the market. Also, the lack of any single dominant competitor in the industry over the next 12 months at least, ensures that Queen’s has the ideal scenario to establish itself as a recognized brand in local microbrew industry and market. Threat. Competitive threats form the nucleus of Queen’s most significant market threat. Some national beer brands have the operational skills and the capital to enter and quickly dominate the local market should they so desire. 4.5 TOWS Forward Strategy & Outlook Complete strengths, weaknesses, opportunities, and market threats are outlined below in order to establish a better understanding of its position in the marketplace as a new microbrewery competitor: STRENGTHS OPPORTUNITIES • Knowledgeable Executive • Fractured market • Professional management • Undifferentiated rival services • Quality Price Point • Portland market is attractive 18
  19. 19. • 7 Day a week Availability • Market growth expected in 2008 WEAKNESSES THREATS • Lack of brand recognition • Sustained price competition • New employees • Ongoing tavern market • Must learn microbrew processes competitiveness • Competitor entry into the local market These strengths, weaknesses, opportunities and threats then lead to the following TOWS chart that establishes the basis for an actionable strategy: External Opportunities External Threats Internal Strengths SO: Knowledgeable ST: Price Leadership w/Attractive competition/industry Portland market competitiveness Internal Weaknesses WO: Lack of brew industry WT: Lack of brew experience w/Market industry upturn in 2008 experience/ongoing competitive difficulties Complete competitive advantage will be based on the company’s large investment in human capital and in microbrewery equipment and processes. Complete success begins with a rigorous training program for new employees because while initially Mr. Milton will do most of the oversight himself, he would be unable to maintain effective marketing efforts while also trying to run all operations. Therefore, quality staff and well trained brew masters are the key to the company’s success. In fact, the human resource aspect is the company’s primary competitive differentiator because these are the staff that the customers interact with. 19
  20. 20. V. Operational Plan 5.1 Production All production of food and service delivery occur onsite. The microbrewery facility will be enclosed in the additional space that Mr. Milton is negotiating for and includes all necessary equipment such as vats, tubing, and storage for all ingredients such as hops and barley. However, a full list of equipment required for a small microbrewery can be found in appendix one. 5.2 Location All operations occur at the location in which the tavern is already situated. Queen’s is located at the corner of Salmon St and SE 19th Avenue in Portland about four blocks from the city center and within walking distance of the city's business district. All of Queen’s operations will occur in this single location. 5.3 Inventories Inventories of all fresh food will only be kept for a two day supply since they are delivered both daily as well as on an ad hoc basis. All dry goods will be inventoried for a period of seven days and beer will be brewed in advance of 30 days for both tavern and local distribution uses. 5.4 Suppliers Only local suppliers will be utilized, however, for the initial startup and setup of the microbrewery, an out of state supplier for the equipment and consulting will be used. This supplier is the Applied Beverage Technologies, Inc. company located in Chicago, Illinois at B.O. Box 267814, 60626. 20
  21. 21. 5.5 Exit Strategies Queen’s fully expects to stay operational and financially solvent however, at times this is not feasible due to market conditions or other unexpected events within the tavern and bar industry. In such circumstances, the company will adhere to several strategies that will allow it to liquidate its business and business assets in a fashion that best suits the particular circumstances:  Sale of Business to a 3rd party  Liquidation of assets including industry contacts  Bankruptcy through Chapter 13  Simple closure of business 21
  22. 22. VI. Management and Organization 6.1 Company Structure & Ownership The company is going to be licensed as a limited liability company or an LLC in order to limit the liability of the company’s individual employees and its owner against any potential legal exposure should such actions arise. The LLC structure calls its owners members and does not restrict the number of members that can be attached to an LLC and this includes the establishment of single member LLCs as Queen’s will be. 8 This ownership structure allows Mr. Miltion to take on additional investors should the need arise in order to facilitate future growth and expansion. 6.2 Core Management Personnel Mr. Milton: Mr. Milton is both the sole owner and manager of the Queen’s enterprise. Restaurant/Floor Manager: An individual with industry experience will be sourced to manage all food and service related operations. 6.3 Roles & Responsibilities Mr. Milton: Mr. Milton will manage the activities related to marketing, budgeting and scheduling of local entertainment. Additionally, he will oversee the branding and distribution processes related to Queen’s branded microbrews. 8 “Limited Liability Company.” Internal Revenue Service (online). http://www.irs.gov/ businesses/small/article/0,,id=98277,00.html 22
  23. 23. Restaurant/Floor Manager: This individual will manage and oversee all food related activities such as kitchen and food preparation, floor and wait staff scheduling, as well as customer service related concerns. 6.4 Salary Structure PERSONNEL PLAN YEARS 2008 2009 2010 RATIO% 0% 20% 22% OWNER $44,000 $58,800 $84,560 HOSTESS $19,600 $21,520 $23,824 FOOD MANAGER $33,600 $43,320 $53,184 TOTAL PERSONNEL TOTAL PAYROLL $97,200 $123,640 $161,568 6.5 Key Success Factors The following key success factors are critical to the company’s ongoing and long- term success in its industry:  Hiring talented and innovative employees to fill key roles within the organization  Maintaining a strict adherence to the company’s vision and mission statements  Attaining first year sales objectives  Meeting the company’s three year revenue projection  Executing the company’s 12 month and 3-year growth strategy 23
  24. 24. VII. Personal Financial Statements 7.1 Personal Financial Statements PERSONAL FINANCIAL STATEMENTS SECTION 1 – INDIVIDUAL INFORMATION (Type or Print) SECTION 2- OTHER PARTY INFORMATION (Type or Print) Name Name Residence Address Residence Address City, State, Zip City, State, Zip Position or Occupation Position or Occupation Business Name Business Name Business Address Business Address City, State, Zip City, State, Zip Res. Phone Bus. Phone Res. Phone Bus. Phone SECTION 3 – STATEMENT OF FINANCIAL CONDITION AS OF _________________________________________, 20___________ ASSETS In Dollars Liabilities In Dollars (Do not include Assets of doubtful value) (Omit Cents) (Omit Cents) Cash on hand and in banks Notes payable to banks – secured U.S. Gov’t & Marketable Securities – see Schedule Notes payable to banks – unsecured A Non-marketable Securities – see Schedule B Due to brokers Securities held by broker in margin accounts Amounts payable to others – secured Restricted or control stocks Amounts payable to others - unsecured Real Estate owned as personal residence Accounts and bills due See Schedule C Unpaid income taxes and interest Real Estate owned for investment purposes Real estate owned as personal residence See Schedule D (attached) Mortgages payable – see Schedule C Loans receivable Real estate owned for investment purposes Automobiles and other personal property mortgages payable – see Schedule D Cash value life insurance – see Schedule E Credit card/revolving debt Other assets – itemize Other debts – itemized TOTAL LIABILITIES TOTAL ASSETS NET WORTH = ASSETS – LIABILITIES TOTAL LIABILITIES & NET WORTH PERSONAL INFORMATION SOURCES OF INCOME FOR YEAR ENDED_____________________20______ Salary, bonuses & commissions $ Do you a will? No Yes if yes, name of executor Dividends Net real estate income Are you a partner or officer in any other venture? If so describe Other income (Alimony, child support, or separate maintenance Income need not be revealed if you do not wish to have it Are you obligated to pay alimony child support or separate considered as a basis for repaying this obligation) maintenance payments? If so, describe them 24
  25. 25. Are any assets pledged other than as described on the schedules? If so, describe TOTAL $ CONTINGENT LIABILITIES Do you have any contingent liabilities? If so, describe them Income tax settled through (date) ______________________ Are you a defendant in any suits or legal actions? As endorser, co-maker or guarantor $ Personal bank accounts carried at On leases or contracts $ Legal claims $ Other special debt $ Have you ever declared bankruptcy, personal or otherwise? If Amount of contested income tax liens $ so, describe 7.2 Details of Personal Financial Statements SCHEDULE A – U.S. GOVERNMENTS AND MARKETABLE SECURITIES Number of Shares Are These of Face Value (Bonds) Description In Name Of Pledged? Market Value SCHEDULE B – NON-MARKETABLE SECURITIES Are These Source of Number of Shares Description In Name Of Pledged? Value Value SCHEDULE C – REAL ESTATE OWNED Address & Type Of Title In % Of Date Property Name Of Ownershi Acquired Cost Market Value Mortgage Mortgage p Maturity Amount SCHEDULE D – LIFE INSURANCE CARRIED, INCLUDING GROUP INSURANCE Name of Owner of Policy Beneficiary Face Amount Policy Loans Cash Surrender Insurance Value Company 25
  26. 26. SCHEDULE E – BANKS OR FINANCE COMPANIES WHERE CREDIT HAS BEEN OBTAINED Name & Address of Credit In The Name Secured Or Original Date High Credit Current Balance Lender Of Unsecured The information contained in this statement is provided for the purpose of obtaining or maintaining a credit account, loan, small business loan or other financial transaction on behalf of the undersigned or persons, firms or corporations in whose behalf the undersigned may either severally or jointly with others, execute a guaranty in the issuer’s favor. Each undersigned understands that the issuer of such financial support is relying on the information provided herein (including the designation made as to ownership of property) in deciding to grant or continue such financial support or oversight as is being requested. Each undersigned represents and warrants that the information provided is true and complete and that the issuer or provider may consider this statement as continuing to be true and correct until a written notice of a change is given to it by the undersigned. The issuer or provider is authorized to make all inquiries deemed necessary to verify the accuracy of the statements made herein, and to determine applicant’s creditworthiness or financial health. Furthermore, the issuer/provider is authorized to ansQueen’sr questions about its financial experience with the undersigned party(s). Signature (Individual) S.S. No. Date of Birth Signature (Other party) S.S. No. Date of Birth Date Signed 20 26
  27. 27. VIII. Startup Expenses and Capitalization 8.1 Capitalization Mr. Milton is the sole investor related to the purchase of Queen’s as well as its expansion into the microbrew activities. He is investing $150 thousand of his own funds and seeking a small business loan for the same amount. 8.2 Startup Expenses The following startup expenses are an approximate cost estimate. Further estimates of material and supplies can be found in appendix 1. These startup expenses offer a detailed approximation of the costs associated with the daycare startup: QUEEN’S START-UP EXPENSES (REQUIREMENTS) BUSINESS START YEAR 2009 OFFICE SUPPLY/PAPER/FAX PAPER/PRINTER INKS $473 MARKETING/QUEEN’SB/BUSINESS CARDS/BROCHURES/ $1,305 ADS EQUIPMENT/POS/HARDWARE/SOFTWARE/PHONES/DESK $3,580 ARCHITECTURE/DECORATION/REMODELING $2,143 OTHERS-LEGAL (PERMITS/TRADEMARKS/CORPS) $870 RENT+SECURITY DEPOSIT $1,500 INSURANCE $300 OTHER A $4,100 OTHER B $700 OTHER C $2,500 OTHER D $1,000 FRANCHISE FEE (NONE) $0 BUSINESS FEE TRANSFER $0 TOTAL START-UP EXPENSES ($18,471) Start-up Assets Needed Cash Balance on Starting Date $8,700 Start-up Inventory $6,079 Other Current Assets $1,000 TOTAL CURRENT ASSETS $15,779 Long-term Assets $10,000 TOTAL ASSETS $25,779 Total Requirements $7,308 27
  28. 28. Funding & Investor INVESTOR 1 $30,000 INVESTOR 2 $0 OWNER 1 $0 OWNER 2 $0 BANK 1 $0 BANK 1 $0 TOTAL INVESTMENT $30,000 Current Liabilities Accounts Payable $1,000 Current Borrowing $0 Other Current Liabilities $0 CURRENT LIABILITIES $1,000 Long-term Liabilities $3,444 TOTAL LIABILITIES $3,444 LOSS AT START-UP $18,471 TOTAL CAPITAL $11,529 TOTAL CAPITAL & LIABILITIES $14,973 28
  29. 29. IX. Financial Plan 9.1 Primary Assumptions Cash Sales: Projected gross sales will be based on the average of the monthly revenues of recruitment and placement services originated from Queen’s single business location. Other Income: This income is generated through the provisions of services not directly related to daily tavern operations such as certain ad hoc marketing and service offerings as well as its outside distribution of its branded microbrews. Cost of Goods Sold: This figure is based on a figure of 35% of revenues which is the industry corporate standard. Payroll: This is figure is based on both full-time and part-time staff. 9.2 Summary of Financial Results 1st Year Sales COGS Net Profit 3rd Year Sales Net Profit $306,000 $92,000 $106,447 $564,570 $242,041 9.3 3-Year Profit/Loss The following table shows Queen’s expectations for Profit and Loss. The company will begin to make a better profit in its second year of operation. Queen’s Pro Forma Profit and Loss 2008 2009 2010 29
  30. 30. Sales $1,017,000 $1,307,000 $1,410,000 Direct Costs of Goods $457,650 $562,010 $578,100 Other $33,000 $38,000 $43,000 ------------ ------------ ------------ Cost of Goods Sold $490,650 $600,010 $621,100 Gross Margin $526,350 $706,990 $788,900 Gross Margin % 51.76% 54.09% 55.95% Expenses Payroll $202,800 $317,000 $353,000 Sales and Marketing and Other Expenses $70,925 $82,900 $102,000 Depreciation $36,000 $40,000 $45,000 Utilities $18,000 $18,000 $20,000 Insurance $18,000 $21,000 $23,000 Rent $72,000 $77,000 $80,000 Other $18,000 $6,300 $10,000 Payroll Taxes $24,336 $38,040 $42,360 Other $0 $0 $0 ------------ ------------ ------------ Total Operating Expenses $460,061 $600,240 $675,360 Profit Before Interest and Taxes $66,289 $106,750 $113,540 EBITDA $102,289 $146,750 $158,540 Interest Expense $39,000 $37,500 $32,250 Taxes Incurred $6,643 $17,313 $20,661 Net Profit $20,646 $51,938 $60,629 Net Profit/Sales 2.03% 3.97% 4.30% 9.4 3-Year Profit Projection 30
  31. 31. The following chart and table show the Projected Cash Flow for Queen’s: QUEEN’S Pro Forma Cash Flows 2008 2009 2010 Cash Received Cash from Operations Cash Sales $661,050 $849,550 $916,500 Cash from Receivables $340,853 $449,153 $490,553 Subtotal Cash from Operations $1,001,903 $1,298,703 $1,407,053 Additional Cash Received Sales Tax, VAT, HST/GST Received $0 $0 $0 New Current Borrowing $0 $0 $0 New Other Liabilities (interest-free) $0 $0 $0 Acquired Long-term Liabilities $0 $0 $0 Sales of Other Current Assets $0 $0 $0 Sales of Long-term Assets $0 $0 $0 New Investment Received $50,000 $0 $0 Subtotal Cash Received $1,051,903 $1,298,703 $1,407,053 31
  32. 32. Expenditures 2003 2004 2005 Expenditures from Operations Cash Spending $202,800 $317,000 $353,000 Bill Payments $790,606 $896,677 $949,161 Subtotal Spent on Operations $993,406 $1,213,677 $1,302,161 Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out $0 $0 $0 Principal Repayment of Current Borrowing $0 $0 $0 Other Liabilities Principal Repayment $0 $0 $0 Long-term Liabilities Principal Repayment $0 $30,000 $75,000 Purchase Other Current Assets $0 $0 $0 Purchase Long-term Assets $0 $0 $10,000 Dividends $0 $0 $25,000 Subtotal Cash Spent $993,406 $1,243,677 $1,412,161 Net Cash Flow $58,497 $55,026 ($5,108) Cash Balance $148,497 $203,523 $198,415 9.5 Opening Day Balance Sheet The following table is the Projected Balance Sheet for Queen’s and its new operations: QUEEN’S Pro Forma Balance Sheet 2008 2009 2010 Assets Current Assets Cash $148,497 $203,523 $198,415 Accounts Receivable $29,097 $37,394 $40,341 Inventory $42,570 $52,277 $53,774 Other Current Assets $4,000 $4,000 $4,000 32
  33. 33. Total Current Assets $224,164 $297,194 $296,530 Long-term Assets Long-term Assets $80,000 $80,000 $90,000 Accumulated Depreciation $36,000 $76,000 $121,000 Total Long-term Assets $44,000 $4,000 ($31,000) Total Assets $268,164 $301,194 $265,530 Liabilities and Capital 2003 2004 2005 Current Liabilities Accounts Payable $63,518 $74,611 $78,318 Current Borrowing $0 $0 $0 Other Current Liabilities $0 $0 $0 Subtotal Current Liabilities $63,518 $74,611 $78,318 Long-term Liabilities $390,000 $360,000 $285,000 Total Liabilities $453,518 $434,611 $363,318 Paid-in Capital $125,000 $125,000 $125,000 Retained Earnings ($331,000) ($310,354) ($283,417) Earnings $20,646 $51,938 $60,629 Total Capital ($185,354) ($133,417) ($97,788) Total Liabilities and Capital $268,164 $301,194 $265,530 Net Worth ($185,354) ($133,417) ($97,788) 9.6 Break Even Analysis The Break-even Analysis chart and table indicate that if the costs stay at the current, or relatively stable level that the tavern has maintained prior to Mr. Milton 33
  34. 34. acquiring it, Queen’s will be able to make an increased profit by the second year. The break-even point is approximately $70,000 per month: QUEEN’S Break-even Analysis Monthly Revenue Break-even $69,706 Assumptions: Average Percent Variable Cost 45% Estimated Monthly Fixed Cost $38,338 Appendices Appendix 1: Supply List 34
  35. 35. APPLIED 7 BARREL FULL MASH BREWERY SPECIFICATIONS ABT MALT CONVEYING SYSTEM * Malt auger,4 inch diameter with top mounted low RPM motor * 15 foot drive section * Flexible drop tube * Floor level hopper with hand guard * Delivers 32 lbs. per minute * 1/2 h.p. , 115/220 V, 1ø, TEFC motor ABT 7 BARREL SYSTEM HOT LIQUOR (WATER) TANK * Capacity : 5 bbls. working, 6.7 bbls. gross, to hold sparge water * 40" O.D., 5.4' overall height * Insulated and clad on sides * Dished top and bottom * Top fittings: manway and CIP ball with shaft * Side fittings: thermowell; liquid level gauge fittings (2); thermometer, 0-220°F * Bottom fittings: 1 1/2" coupling inlet / outlet; * 14" legs * Material: 12 gauge T304 stainless steel * Internal finish: 2B, welds ground and polished to 180 grit * External finish: 2B, brushed welds * Cladding:16 gauge stainless steel with #4 finish HOT LIQUOR (WATER) PUMP * Bronze head, centrifugal * 1" NPT discharge, 1 1/4" NPT inlet * 1 1/2 hp, TEFC motor,230V, 3ø, 5 amps. ACTIVATED CARBON WATER FILTER * Complete activated carbon water filter with 1.75 cu. ft. activated type PE natural carbon for removal of trace water contaminants and chlorine, 42 GPM flow rate max., 30 GPM recommended, 45 psi max. working pressure, 38"high x 21" wide, 1 1/2" inlet/ outlet, c/w bypass and on/off valve. ABT 7 BARREL MASH / LAUTER VESSEL * Capacity : 5.2 bbls. working, 9.5 bbls gross * 46" O.D., 8' overall height,10 ft. min. ceiling height, 35" floor to bottom of side manway * Max. grain capacity 475 lbs., .4 bbl. below false bottom plates, 24"-33" grain bed depth * 950 lbs. empty, 2900 lbs. working * Insulated and clad on sides * Top: flat and flanged * Large top opening 17" manway with handle and manway support bracket * Shallow cone bottom,160° included * Top fittings: CIP spray ball; sprayball shaft welded with arm to side, cap,clamp and gasket; 4" ferrule for premasher and sparge devices; 1 1/2" T/C ferrule for vapor outlet * Side fittings: Thermowell, 17" outward opening hinged manway for spent grain removal * Bottom: 1 1/2" tri-clamp ferrule outlet 35
  36. 36. * Polished stainless steel wedge wire two piece false bottom * Premasher and sparge devices with 3/4" MNPT nipples, clamp and gasket * 3/4" high temp. hose with quick disconnect set for above * Wort recycle fitting for CIP shaft * Legs with flat anchoring pads and shims for leveling * Material: 12 gauge 304 stainless steel * Internal finish: 2B, welds ground and 180 grit polished * External finish: 2B, brushed welds * Cladding: 16 gauge stainless steel, #4 finish GRANT PIPING SYSTEM * System designed to receive wort from mash tun side outlet and transfer it to the pump * Valentine arm produces uniform flow without clogging * Hi-Lo outlets allow reduced hydrostatic pressure across the false bottom and total draining * Clear top sight tube allows visible flow control and level detection * Includes stainless steel pipework, sight glass, valves, clamps, gaskets ABT 7 BARREL BREWKETTLE / WHIRLPOOL - GAS * Capacity : 7.7 bbls. working, 10 bbls. gross, 12" freeboard * 48" O.D., 7.6' overall height, 9 ft. min. working height * 1000 lbs. empty; 3,100 lbs. working * Insulated and S/S clad * Top: ASME shape dished and flanged head * Bottom: flat sloping, 3/16" plate, T316 stainless steel * Top fittings: CIP sprayball, welded shaft with 90° elbow to 1 1/2" T/C connection, 3/4" NPT water inlet coupling, 6" steam vent stub with condensate trap and 1/2" coupling, 17" outward opening top hinged manway * Side fittings: thermowell to fit thermocouple, 1 1/2" tangental whirlpool inlet, 4" tri- clamp ferrule for cleanout,1 1/2" tri-clamp ferrule for wort draw-off * Lower fire box, internal 2400°F insulation, burner flange, 6" I.D. , 8" O.D. exhaust outlet, insulated access manway * Material: 12 gauge 304 stainless steel * Internal finish: 2B, with welds ground and 180 grit polished * External finish: 2B, with brushed welds * Cladding: 18 gauge stainless steel with #4 finish KETTLE GAS BURNER * 200,000 BTU/hr. power gas burner * U.L. Listed ABT BURNER CONTROL PANEL - GAS * NEMA 4 watertight burner control panel for wall mounting with: Indicating temperature controller with temperature sensor; manual/auto(timer)/off switch and run light; 24 hour timer; fuse. * Hot liquor pump on/off switch and run light WORT PUMP and MOTOR * Stainless steel sanitary non overloading centrifugal pump * 1 1/2" x 1 1/2" tri-clamp inlet and outlets 36
  37. 37. * 3 1/2" open impeller, epdm O rings, replaceable rotating seal * 3600 rpm, 1 1/2 h.p., 220 V, 1ø, TEFC motor, 10 amps. * Mounted on stainless steel portable cart with four wheels * Nema 4 motor starter, cord and plug mounted on cart HEAT EXCHANGE/ WORT CHILLER * Single stage heat exchanger to cool wort to within 8°F of cooling liquid * All wort contact surfaces 316 stainless steel, nonclogging plate design * Painted mild steel frame ends * 1 1/2 inch tri-clamp product inlet and outlet * 1" water inlet and outlet WORT AERATING SYSTEM * 0°F to 210°F S/S thermometer * Sintered S/S aerating element on T/C cap * Air line quick disconnects * Sterile air filter, 0.01micron with stainless steel wall bracket * S/S fittings, clamps and gaskets ABT BREWHOUSE TRANSFER SYSTEM * All necessary multiposition butterfly valves, clamps, and gaskets * 50 ft. high temp. reinforced multiply brewers hose, orange, 1 1/2" I.D. * 6 - 1 1/2" T/C hose ends and S/S clamps ABT 7 BARREL FERMENTATION/CONDITIONING VESSELS * Capacity: 6.5 bbls. working, 7 bbls. gross, 5" freeboard * 42" O.D., 6' overall height, 6 1/4" floor to bottom outlet * 700 lbs. empty, 3500 lbs. working * Top and bottom: Dished and flanged heads * Jacketed, insulated & clad: - Jacketed - 3/4" S/S glycol inlet/outlet couplings - Insulated - 2" on side - Clad - #4 finish S/S on side * Internal volume calibrations * Top fittings: 3" triclamp fitting & 3/8" FNPT coupling in top lid; (2) sight glasses * Side fittings: Thermowell for temperature controller probe * Bottom fittings:1 1/2" triclamp drawoff ferrule; 1 1/2" triclamp totally draining center outlet and pipe to vessel side * Mild steel painted legs * Other: 1 - Top lid gasket and clamp 1 - 3" triclamp to grundy valve fitting adapter 1 - New grundy pressure relief/anti-vacuum valve with pressure gauge, bronze ball valve,CIP shaft and sprayball 1 - 1 1/2" triclamp x 1/2" MPT adapter for CIP inlet 1 - Sanitary S/S 1 1/2" T/C butterfly valve 1 - Set of quick disconnects 3/8"MNPT x 3/8" tubing-both auto closing 1 - One quick disconnect to fit tank disconnect x 3/8" hose barb, straight through- open 1 - 3" triclamp clamp and gasket 37
  38. 38. 4 - 1 1/2" triclamp clamps and hycar gaskets 2 - 1 1/2" triclamp caps GLYCOL CHILLER SYSTEM * Totally enclosed units for indoor or outdoor use * Sealed freon primary, secondard circulating glycol * Adjustable coolant temperature, set at 30°F * 2 h.p. compressor, 1/2 h.p. circulating pump, 15,000 BTU/hr. @30°F outlet temperature * Capacity to cool up to 28 bbls. from 60°F to 36°F in 24 hours and maintain 35 bbls. at 36°F and remove the heat of fermentation from 14 bbls. fermenting lager beer; 5,000 BTU/hr. excess cap. * 230/60/3ø, 20 amps * 1/2" NPT plumbing connections * 28" L x 25"W x 57"H; 450 lbs. working weight ABT TEMPERATURE CONTROLLERS * Digital LED temperature controllers indicate current temperature and set point * Thermowell probe and wire included * Housed in water tight wall mountable control box * Solenoid valves for glycol piping PLATE AND FRAME SHEET FILTER * 40 cm x 40 cm stainless steel plate and frame holds upto 24 sheets * 18 plates for 17 sheets * Filters 7-10 barrels per hour * Inlet/outlet valves - 1 1/2" tri-clamp * Stainless sanitary valves, pressure gauges, sample valve * Lower drain pan * Portable on wheels * 6 grades of filter pads available ABT 7 BARREL RECONDITIONED SERVING TANKS * Capacity: 7 bbls. working volume * 38" O.D., 6' overall height, 6 1/4" floor to bottom outlet * 700 lbs. empty, 3500 lbs. working * Single shell polished * Internal volume calibrations * Top: Dished and flanged, Grundy valve fitting, 3/8" NPT CO2 inlet coupling * Two top dish sight glasses * Grundy anti-vacuum pressure relief valve with pressure gauge, ball valve and 1 1/2" T/C to ball valve adapter for CIP, CIP sprayball and shaft * Bottom fittings: 1 1/2" T/C above bottom ferrule and sintered stainless steel carbonating element; 1 1/2" T/C triclamp bottom outlet * Sanitary S/S 1 1/2" T/C butterfly valve * Stainless steel 1/4" valve for carbonating stone inlet * Quick disconnect sets(2) for top fitting, carbonating stone, gas transfer * Three 1 1/2" T/C heavy duty clamps and gaskets * Mild steel painted legs 38
  39. 39. SERVING TANK OUTLETS * Stainless steel outlet manifolds for connecting three beer lines * Clamps, valves, gaskets, piping SET OF CELLAR EQUIPMENT * 100 ft. clear spiral reinforced suction transfer hose, 1 " I.D. * One set 3/8" NPT x 3/8" I.D. quick disconnect * 14 S/S hose clamps, 1 1/2" to 2" O.D. * Six - 1 1/2" hose ends * Six -heavy duty 1 1/2" T/C clamps * Two -1 1/2" T/C caps * Twenty -1 1/2" T/C hycar gaskets Appendix 2: State & Local Requirements 39
  40. 40. Appendix 3: Business Ratios 40
  41. 41. Standard business ratios are provided in the following table. The ratios show strong, yet safe growth for Queen’s in the mid to long-term. Industry Profile ratios are based on Standard Industrial Classification or the now more utilized NAICS codes 3873. Ratio Analysis Industry 2008 2009 2010 Profile Sales Growth 9.35% 28.52% 7.88% 1.90% Percent of Total Assets Accounts Receivable 10.85% 12.42% 15.19% 4.60% Inventory 15.87% 17.36% 20.25% 3.10% Other Current Assets 1.49% 1.33% 1.51% 44.60% Total Current Assets 83.59% 98.67% 111.67% 52.30% Long-term Assets 16.41% 1.33% -11.67% 47.70% Total Assets 100.00% 100.00% 100.00% 100.00% Current Liabilities 23.69% 24.77% 29.49% 28.20% Long-term Liabilities 145.43% 119.52% 107.33% 23.10% Total Liabilities 169.12% 144.30% 136.83% 51.30% Net Worth -69.12% -44.30% -36.83% 48.70% Percent of Sales Sales 100.00% 100.00% 100.00% 100.00% Gross Margin 51.76% 54.09% 55.95% 42.30% Selling, General & Administrative 49.74% 50.12% 51.63% 23.40% Expenses Advertising Expenses 3.54% 2.75% 2.84% 2.40% Profit Before Interest and Taxes 6.52% 8.17% 8.05% 2.80% Main Ratios Current 3.53 3.98 3.79 1.14 Quick 2.86 3.28 3.10 0.74 Total Debt to Total Assets 169.12% 144.30% 136.83% 51.30% Pre-tax Return on Net Worth -14.72% -51.90% -83.13% 5.20% Pre-tax Return on Assets 10.18% 22.99% 30.61% 10.60% 41
  42. 42. Additional Ratios 2003 2004 2005 Net Profit Margin 2.03% 3.97% 4.30% n.a Return on Equity 0.00% 0.00% 0.00% n.a Activity Ratios Accounts Receivable Turnover 12.23 12.23 12.23 n.a Collection Days 29 27 29 n.a Inventory Turnover 10.91 11.85 10.90 n.a Accounts Payable Turnover 12.42 12.17 12.17 n.a Payment Days 29 28 29 n.a Total Asset Turnover 3.79 4.34 5.31 n.a Debt Ratios Debt to Net Worth 0.00 0.00 0.00 n.a Current Liab. to Liab. 0.14 0.17 0.22 n.a Liquidity Ratios Net Working Capital $160,646 $222,583 $218,212 n.a Interest Coverage 1.70 2.85 3.52 n.a Additional Ratios Assets to Sales 0.26 0.23 0.19 n.a Current Debt/Total Assets 24% 25% 29% n.a Acid Test 2.40 2.78 2.58 n.a Sales/Net Worth 0.00 0.00 0.00 n.a Dividend Payout 0.00 0.00 0.41 n.a Research Bibliography “2007 NAICS Definition.” U.S. Census Bureau.< http://www.census.gov/ eos/www/naics/> 42
  43. 43. Atkinson, William. “Working Smart.” Beverage World, 125/12(2006): 72. “Limited Liability Company.” Internal Revenue Service (online). http://www.irs.gov/ businesses/small/article/0,,id=98277,00.html Mullman, Jeremy. “Booze Makers Battle over Turkey Day.” Advertising Age, 78/43(2007): 4-57. “Persons Per Square Mile.” U.S. Census Bureau, (online). http://www.census.gov>. “Portland, Oregon.” U.S. Census Bureau (online). <http://www.census.gov>. Spaeder, Karen. “Heady Stuff.” Entrepreneur, 34/1(2006): 51. “US Specialty Beer.” Beverage World, 126/7(2007): 18. 43

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