1. Crepescape Group Meeting Report
Recorded by Yeli
Subject: Suggestions on financial management
Meeting Time: Sep 23, 5:00 – 6:00 PM
Participants: Dr. Lin, Cui, Stephane and Yeli
Items discussed:
1. Business description (Serve time: breakfast, lunch and dinner; Target: students
and faculties.Local customers should also be considered because they are more
willing to pay regardless the price.)
2. Start with estimationon sales volume. (Weekly, compare with Jimmy Johns,
Panera and etc.)
3. Do market survey: How many people are interested? What’s their budget? Then
to define price range including breakfast and dinner. (Face-to-face survey is
better than questionnaire to reflect real thoughts.)
4. Estimate numbers of customers per day, the average price to pay.
5. For preparing financial reports, start with income statement. Income statement
needs to be very detail-oriented. Defining Direct Cost and Indirect Cost.
6. Then work on balance sheet: assets, inventory (food), current assets (account
receivable, cash), fixed assets (equipment);Liabilities: How much to pay?
(Accounts payable, Credit), emergency borrowing, short-term loans. Long-term
liability: loan from bank (PCB: small business loan). Equity: How much equity to
invest? Initial settings.
7. Last but the most important is to prepare cash flow. Statement of cash flow
(weekly or monthly) is important to get funding from bank.
8. Principles on estimation: Create detailed scenario, extreme situations (best and
worst). Then compare between the best and worst to calculate average level.
9. For ownership, there are proprietorship and partnership to choose from. We
need to consider corporate tax (eligible or to be waived), liability (limited or
unlimited), and business insurance (protect personal bankruptcy).
10. Be aware of the gap of credit paying. Make sure there’s enough cash flow. (Use
business credit card to delay payment, or gift card to get cash in advance)
11. Pricing strategy. Which dish is the most profitable? (Beverage? Sides?)
12. Prepare to exit. Prepare for the worst situation to quit, and plan to arrange
these capitals. (Buy second-hand equipment or lease is safer than buy new.)