The Company's Planned Operations
Budget & Sales Projections
The company has analyzed its estimated operating expenses and has designed a projected budget for the first year of operations. Expenses are heavily devoted to marketing, while operating and administrative expenses are limited. Below is the proposed budget.
Budget
| Use | Amount ($) |
| Salary and Taxes (agents) | 4,800 |
| Salary and Taxes (officers) | 2,400 |
| Rent | 400 |
| Utilities and Telephone | 500 |
| Internet Advertising | 3,750 |
| Public Relations/Promotions | 750 |
| Insurance | 50 |
| Miscellaneous Expenses | 632 |
| Total | 13,832 |
Notes:
- Salaries assume two agents and one officer.
- Internet advertising includes funds for the Infoseek search engine banner plus other banner and Internet advertising.
- Miscellaneous is a 5 percent of expenses reserve for unanticipated expenses items.
Sales Projections
MLC's sales projections have been conservatively calculated based upon the following assumptions:
- Commission of 10 percent per booked cruise
- Average cruise price of $3,000
- 100 sales per month for the first quarter
- 25 percent increase per quarter for the first year
- 25 percent yearly increases in the second and third year
Based on these assumptions sales for the first year are calculated to be $518,906. Sales for the second and third year are projected to be $648,632 and $810,790.
