TWO CAR BREWING COMPANYMarcus Schroeder

Two Car Brewing Company

When was the last time you enjoyed a locally brewed craft beer?

The Problem: Florida has a awful selection of microbrewed beers compared to other areas of the US.

The Facts: Florida ranks #41 nationwide in the number of breweries per capita.

Two Car Brewing Company

WE MAKE GREAT BEER! The Solution: Start a small microbrewery

in the my garage (two-car) that will provide an alternative to the mass-produced beer commonly available at local restaurants.

Two Car Brewery will begin by serving a handful of local restaurants, but has a powerful growth strategy to become a full scale microbrewery.

Two Car Brewing Company

The Industry Dogfish Head Brewery produced

74,600 barrels of beer and earned $28 million in revenue in 2009.

Dogfish Head only produces 0.0002% of the world’s beer.

The beer industry is HUGE!

Two Car Brewing Company

Target Market Two Car will initially target local craft

beer drinkers Craft beer currently accounts for

approximately 5% of the beer sold in the US.

Two Car Brewing Company will not target the “light lager” beer market. Huge, multinational corporations currently control 95% of this market.

Two Car Brewing Company

Top 3 Competitors Tampa Bay Brewing Company Dunedin Brewery Cigar City Brewing Company

Strengths Weaknesses Opportunities

Threats

Experience in making beer

New brand that is unknown

Creating a better product than the competition

The BIG beer companies

Two Car Brewing Company

Business Model Provide an alternative for local restaurants

who want to deliver choice to their customers.

Focus on product quality to compete in the craft beer market, not the mass beer market.

Start small and manage growth responsibly to keep equipment and production costs in line with sales revenues.

Two Car Brewing Company

Startup ExpensesLegal and Licensing Expenses $ 6,500 Raw Materials $ 1,800 Brewing Equipment $ 8,260 Packaging Materials $ 4,800 Insurance $ 1,000 Utilities and Misc. $ 1,500 Total Startup Cost $ 23,860

Two Car Brewing Company

Income StatementY1-Q1 Y1-Q2 Y1-Q3 Y1-Q4 Y2-Q1 Y2-Q2 Y2-Q3 Y2-Q4 Y3-Q1 Y3-Q2 Y3-Q3 Y3-Q4

Sales revenue: $ 6,611 $ 6,611 $ 6,611 $ 6,611 $ 8,263 $ 8,263 $ 8,263 $ 8,263 $ 9,503 $ 9,503 $ 9,503 $ 9,503

Cost of goods sold:

Raw materials (grain, hops, yeast) $ 906 $ 906 $ 906 $ 906 $ 1,132 $ 1,132 $ 1,132 $ 1,132 $ 1,302 $ 1,302 $ 1,302 $ 1,302

Packaging $ 232 $ 232 $ 232 $ 232 $ 1,160 $ 1,160 $ 1,160 $ 1,160 $ 1,334 $ 1,334 $ 1,334 $ 1,334

Gross profit $ 5,473 $ 5,473 $ 5,473 $ 5,473 $ 5,972 $ 5,972 $ 5,972 $ 5,972 $ 6,867 $ 6,867 $ 6,867 $ 6,867

Salaries:

Selling and admin. expenses $ 750 $ 750 $ 750 $ 750 $ 773 $ 773 $ 773 $ 773 $ 796 $ 796 $ 796 $ 796

Utility expense $ 700 $ 700 $ 700 $ 700 $ 875 $ 875 $ 875 $ 875 $ 1,006 $ 1,006 $ 1,006 $ 1,006

Depreciation expense $ 413 $ 413 $ 413 413 $ 661 $ 661 $ 661 660.8 $ 392 $ 392 $ 392 392.35

Total operating expense $ 1,863 $ 1,863 $ 1,863 $ 1,863 $ 2,308 $ 2,308 $ 2,308 $ 2,308 $ 2,194 $ 2,194 $ 2,194 $ 2,194

Operating profits (EBIT) $ 3,610 $ 3,610 $ 3,610 $ 3,610 $ 3,663 $ 3,663 $ 3,663 $ 3,663 $ 4,673 $ 4,673 $ 4,673 $ 4,673

Taxes (personal rate = 28%) $ 1,011 $ 1,011 $ 1,011 $ 1,011 $ 1,026 $ 1,026 $ 1,026 $ 1,026 $ 1,308 $ 1,308 $ 1,308 $ 1,308

Net profits after taxes $ 2,599 $ 2,599 $ 2,599 $ 2,599 $ 2,638 $ 2,638 $ 2,638 $ 2,638 $ 3,365 $ 3,365 $ 3,365 $ 3,365

Annual Profits $ 10,397 $ 10,550 $ 13,458

Two Car Brewing Company

Balance Sheet Liabilities

Assets Current LiabilitiesAccounts Payable $ 1,800

Current Assets Other Current Liabilities $ - Cash $ 10,000 Total Current Liabilities $ 1,800 Raw Materials $ 1,800 Packaging Materials $ 4,800 Long-Term LiabilitiesPrepaid Expenses $ 1,000 Long-Term Debt $ - Total Current Assets $ 17,600 Other Liabilities $ -

Total Long-Term Liabilities $ - Fixed Assets Total Liabilities $ 1,800 Brewing Equipment $ 5,260 Fermenting Equipment $ 1,800 Owner's EquityPacking Equipment $ 1,200 Common Stock $ 24,060 Total Fixed Assets $ 8,260 Retained Equity $ -

Total Owner's Equity $ 24,060

Total Assets $ 25,860 Total Liability & Owner's Equity $ 25,860

Cash Flow Statement2011 2012 2013

Net Income $ 10,397 $ 10,550 $ 13,458 Depreciation $ 1,652 $ 2,643 $ 1,569 Adjustments to Net Income $ - $ - $ - Changes in Inventory $ - $ (300) $ (480)Other Changes in Operating Activities $ (24,000)

Total Cash Flow from Operating Activities $ 14,060 $ 14,905 $ (7,440)

Investing Activities

Capital Expenditures $ (1,200) $ (2,600) $ (68,000)Investments $ - $ - $ -

Total Cash Flows from Investing Activities $ (1,200) $ (2,600) $ (68,000)

Financing ActivitiesDividends Paid $ - $ - $ - Sale/Purchase Stock $ - $ - $ 25,000 Net Borrowings $ - $ - $ 65,000 Total Cash Flows from Financing Activities $ - $ - $ 90,000

Change in Cash and Cash Equivalents $ 12,860 $ 12,305 $ 14,560

Two Car Brewing Company

Two Car Brewing Company

Key Financial Ratios Year 1 Year 2 Year 3Profitability Ratios

Gross Margin Percentage 0.83 0.83 0.83

Return on Equity 0.40 0.50 0.52

Net Operating Income 0.11 0.09 0.05

Net Profit Margin 0.39 0.39 0.51

Liquidity Ratios

Current Ratio 9.78 9.78 0.93

Quick Ratio 7.77 7.26 4.47

Leverage Ratios

Debt/Equity Ratio 0.07 0.07 0.59