Cannabis Cultivation Business Plan Template

CannaCult
BUSINESS PLAN TEMPLATE
Category: Cannabis Cultivation
Date Created:
00.00.2017
Date Issued:
00.00.2017
Description
CannaCult is
applying for a
cultivation license
and will be
conducting
business from a
3,600 sq. ft. facility
in California.
Company will have
the ability to
vegetate up to 500
plants and flowers
concurrently, will
grow up to 11
different strains of
marijuana, and will
have the ability to
grow from
seedling to
finished product.

CannaCult is a new company which is intending to penetrate into the cannabis cultivation market in
California. CannaCult is applying for a Class B license and intends to start with one greenhouse 3,600 sq. ft.
California.
Main Goals:
✓ Own and operate a cannabis cultivation facility in the state of California.
✓ To build a successful commercial cultivation facility and build a recognizable brand in a rapidly
growing industry.
✓ To be fully compliant with all state and local municipalities and be primed and ready for national
expansion as federal laws adjust and evolve to the benefit of the cannabis industry.
✓ To be supplying one of the best high-grade cannabis wholesale in the state of California to the
dispensaries and manufacturers.
Mission:
✓ To grow one of the best medical cannabis products for patients that need this type of medicine in
California.
Main Objective:
✓ Getting the California Cannabis Grower license, keeping on point with the company goal, acting as a
guide line for us to follow as we grow larger.
Change the charts below (Income statement and Cash flow projections).
Executive Summary
Executive Summary
-
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
-
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
Year 1 Year 2 Year 3 Year 4 Year 5
Cash Flow Forecast, $000
Operational Cash Flow Ending Period Cash Flow
(2,000)
-
2,000
4,000
6,000
8,000
10,000
Revenue & Profit Forecast, $000
Gross Profit Operating Expense Net Income

CANNABIS CULTIVATION
Business Plan
2
Market Opportunities
Nearly 60% of the U.S. population now lives in states that have legalized some form of cannabis use and
sales, illustrating the rising acceptance of cannabis nationwide and highlighting the industry’s immense
potential for future growth.
Arcview Market Research, in partnership with New Frontier Data, have released a special update to the
official Arcview Market Research growth
projections in light of victories from 8 of the 9
cannabis ballot initiatives. The passage of
initiatives in California, Nevada, Massachusetts,
Maine, Florida, Arkansas, Montana, and North
Dakota will add $7.4 billion to the 2020 market
forecast bringing the overall market projection for
legal adult-use and medical sales in the U.S. to
$21.2 billion by 2020. That brings the compound
annual growth rate (CAGR) to 28%.
In 2015, California lawmakers and the governor
approved legislation creating the Medical
Cannabis Regulation and Safety Act (MCRSA) to
regulate the state’s MMJ industry, which has been
governed by a patchwork of local rules. The
MCRSA took effect in January 2016, and the
government has until Jan. 1, 2018, to develop
statewide rules.
8 November 2016 California voters have approved cannabis for recreational use. The vote means that
cannabis will become legal for use from December 15, and cannabis shops can open in 2018.
California’s cannabis industry reported $2,692 million in retail sales via nearly 2,800 dispensaries in 2016,
that is 10% more than all other MMJ states combined as of 2016 according to Arcview Market Research.
Over the next five years they project the total California market to grow at a compounded annual rate of
18.5% to $5.6 billion by 2020.
California
38%
Washingt
on
13%
Colorado
11%
Florida
15%
Massachusetts
8%
Ohio
8%
Pennsylvania
7%
Figure 1. Total cannabis sales, including medical and recreational, top 2025

Company Summary
CannaCult intends to start its growing business from July 2017.
Location
CannaCult premises will be located in …
Products & Services
Company will produce up to 2 strains within 5 months of becoming a licensed cultivator. Company will
have the ability to vegetate up to 500 plants and flowers concurrently, will grow up to 11 different strains
of marijuana, and will have the ability to grow from seedling to finished product.
CannaCult will dry and process all cannabis flowers into labeled/inventoried vacuum sealed bags before
delivery to compassion centers.
Management
…
Objectives
Year 1: Securing the license to start cultivation in state California.
Year 3: Brand and distribute our product line throughout California.
Year 5: The CannaCult brand is now a trusted and consistent brand, while securing licensing in other states.
Year 7: CannaCult is now available in 5 states and we intend to secure manufacture license.
Executive Summary

Business Plan
4
Start-up Summary
The total investment required for the first year that the business starts operating is approximately
$250,000. Initial investments would cover start-up costs and fixed expenses until profit stability is achieved
during first year.
Change figures in the table below (OPEX and CAPEX assumptions).
Table 1. Start-up expenses, $
Expenses Quarter 1 Quarter 2 Quarter 3 Quarter 4
CAPEX
Land & Development 70,000 0 0 0
Security Equipment 30,000 0 0 0
Office Equipment 10,000 0 0 0
CO2 extraction equipment 0 0 0 0
Green Houses 100,000 0 0 0
Building for MIP Equipment 0 0 0 0
Office building 0 0 0 0
Hoop house 0 0 0 0
TOTAL 210,000 0 0 0
OPEX
Direct Costs 0 294,708 2,289,554 3,584,880
Legal Fees & Licensing 30,000 0 0 0
Building maintenance 0 3,000 3,000 3,000
Equipment maintenance 0 0 0 0
Administrative expenses 3,000 3,000 3,000 3,000
Administrative Salaries 30,000 30,000 30,000 30,000
Marketing Campaign 3,000 3,000 3,000 3,000
Brokers and Sellers Fees 0 13,440 120,960 211,200
Community Service, Improvements 0 0 6,000 9,000
Misc. 0 15,000 15,000 15,000
TOTAL 66,000 362,148 2,470,514 3,859,080

Executive Summary 1
Market Opportunities 2
Company Summary 3
Start-up Summary 4
Market Overview 6
Target Market 9
Pricing Benchmarks 10
SWOT Analyses 11
Online Advertising Obstacles 13
Marketing Plan 13
Sales Forecast 15
Operating Plan 16
Cultivation 17
Greenhouse and Cultivation Design 19
Physical Security Plan 20
Video Surveillance 21
Organizational Structure 22
Ownership 24
Financial Plan 25
Profit & Loss Forecast 26
Cash Flow Statement 27
Balance Sheet 28
Main Ratios 29
Appendix 30
Financial Statements, monthly 31
Table of Contents

6
Business Plan
Market Overview

Although the federal government still considers the use of cannabis a criminal offence, more than half
the states of America have legalized it in some form. Most states sell it only for medical purposes, often
broadly defined. But eight states – Alaska, California, Colorado, Maine, Nevada, Massachusetts, Oregon
and Washington – and the country's capital have gone further, legalizing the recreational use. Legal
weed is more high-priced than the black market variety, but it is better value: three times more potent
and only about 50% more expensive1.
The size of the market for legal marijuana in the United States is projected to grow to $8.1 billion in
2017 and to $11.2 billion in 2018, that represents 21% and 38% growth over the previous years, driven
largely by adult recreational sales of cannabis, the researchers found. The passage of initiatives in
California, Nevada, Massachusetts, Maine, Florida, Arkansas, Montana, and North Dakota will add $7.4
billion to the 2020 market forecast.
According to the 5th edition of Cannabis Market research, the overall market projection for legal adult-
use and medical sales in the U.S. will reach $22.6 billion by 2021. That brings the compound annual
growth rate (CAGR) to 28%2.
1 http://www.economist.com/blogs/graphicdetail/2016/02/daily-chart-10
2 http://www.arcviewmarketresearch.com/
4.3 4.9 5.6
7.0 7.0 7.3 7.7
1.4
1.8
2.5
4.2
7.6
10.7
14.9
0
5
10
15
20
25
2015 2016 2017
(projected)
2018
(projected)
2019
(projected)
2020
(projected)
2021
(projected)
Market Overview
Figure 2. Medical and recreational cannabis sales forecast, billion $

8
Business Plan
Twenty-eight states and the District of Columbia currently have laws legalizing marijuana in some form.
Nearly 60% of the U.S. population now lives in states that have legalized some form of cannabis use and
sales, illustrating the rising acceptance of cannabis nationwide and highlighting the industry’s immense
potential for future growth.
9 November 2016 three new states approved cannabis medical using: Arkansas, Florida and North
Dakota. Four others that already had medical cannabis laws, legalized recreational. New markets could
create $7 billion to $8 billion in additional retail revenue for the industry, according to estimates by
Marijuana Business Daily

Target Market
In 1996, California became the first state to
allow for medical marijuana use. State voters
approved Proposition 215, the law that made it
legal for doctors to recommend cannabis to
patients.
California has 482 cities and 58 counties, all
with the power to govern their own medical
marijuana industries. The methods they
choose vary throughout the state. Some local
governments have rules limiting the number of
dispensaries and where they can open. Others
passed ordinances banning all marijuana
cultivation.
In California, the weather conditions are ideal
for cultivating cannabis outside, while a lot of
marijuana is also grown indoors in massive
warehouses. The state's marketplace is also known for its decades-long experience developing cannabis
strains. Third-generation growers and breeders have some unparalleled knowledge of the plant and of
the related regulatory environment compared to other states.
In the years since medical legalization, consumers have become more educated and sophisticated about
products, and the state's medical market is relatively saturated. Consumers have high expectations for
quality, according to ArcView research.
In 2015 Gov. Jerry Brown signed three bills that toughened regulations for medical cannabis businesses
and sought standards for documentation and testing. The bills are known as the Medical Marijuana
Regulation and Safety Act, or MMRSA for short. Collectively, the legislation also paved the way for
medical cannabis businesses to turn a profit. The legislation is impacting marijuana business models in
other ways. The laws have eliminated the idea of home-based dispensaries.
8 November 2016 California voters have approved cannabis for recreational use. The vote means that
cannabis will become legal for use from December 15, and cannabis shops can open in 2018.
California’s cannabis industry reported $2,692 million in retail sales via nearly 2,800 dispensaries in
2016, that is 10% more than all other MMJ states combined as of 2016 according to Arcview Market
Research. Over the next five years they project the total California market to grow at a compounded
annual rate of 18.5% to $5.6 billion by 2020.
California
2,692
Washington
1,431
Colorado
1,339
Oregon
571
Michigan
500 Arizona
281
Figure 3. Medical and recreational cannabis sales in top states, 2016
Market Overview

10
Business Plan
Pricing Benchmarks
The simple average (non-volume weighted) price decreased $18 to $1,789 per pound, with 68% of
transactions (one standard deviation)
in the $1,059 to $2,518 per pound
range. The average deal size decreased
8.8% to 6.5 pounds this week, from 7.1
pounds last week. In grams, the Spot
price was $3.65, and the simple average
price was $3.94.
Indoor flower spanned from $800 to
$6,400 per pound; the median price
was $2,000/lb.
Greenhouse flower spanned from $987
to $3,200 per pound; the median price
was $1,305/lb.
Outdoor flower spanned from $725 to
$2,000 per pound; the median price
was $1,400/lb.
✓ Deal sizes for indoor flower ranged from 0.5 to 100 pounds.
✓ Deal sizes for greenhouse flower ranged from 1 to 320 pounds.
✓ Deal sizes for outdoor flower ranged from 1 to 200 pounds.
After several weeks of charting largely parallel courses, the movement of pricing for medical and adult-
use product diverged this week, with the former rising and the latter experiencing an over 4% week-
over-week decline. This week’s premium of $414 commanded by flower designated for sale in medical
markets was the second-largest observed this year, behind a $427 premium documented in early
February. Pricing for product in adult-use markets has not exceeded that of medical flower since early
December 2016.
1000
1100
1200
1300
1400
1500
1600
1700
1800
$/pound
Figure 4. Cannabis flower prices, $

SWOT Analyses
S
• In California the
weather
conditions are
ideal for
cultivating
cannabis outside
• Diversification of
greenhouse
cultivation and
outdoor
cultivation
• Greenhouses will
alow
significantely
decrease
electricity bills
and increase
profit while
competitive
prices
W
• Product liability /
legal issues
• Enhanced risk of
banking /
financial / IRS
scrutiny
• Crop loss
possibility due to
pests, heat,
human error, etc.
• Difficulties with
finding
employees.
Location is a bit
remote and not
much depth in
local workforce
• High energy
consumption
O
• High growth
industry
• Trend toward
greater cannabis
legalization,
including the use
of cannabis for
recreational
purposes
• Global Market
T
• A significant drop
in wholesale
pricing
• Enforcement of
federal law
• Possible
California law
changing
• Indicators of a
slowed global
economy
Market Overview

12
Business Plan
Marketing & Sales
Strategy

Online Advertising Obstacles
Because cannabis is illegal under federal law, state governments and online advertising platforms are
placing strict rules on how companies can market their products.
Google, Facebook and Twitter all have advertising policies that restrict the promotion of the sale of
cannabis. Google’s policy prohibits ads that promote “substances that alter mental state for the purpose
of recreation.” Facebook restricts any “illegal, prescription, or recreational drugs.” And Twitter bans
“illegal drugs” as well as substances that cause “legal highs.” Instagram and Facebook have decided to
go a step further by removing pages of cannabis related businesses.
Marketing Plan
Marketing and advertising campaign includes:
- Meeting with whole buyers and
dispensaries management
- E-mail Marketing
- Promotional directly through special
platforms, including:
o weedmaps.com
o leafly.com
o stickyguide.com
o www.cannasaver.com
o cannabiscouponcodes.com
o weedealio.com
- Advertising and articles in the thematic
Magazines, including:
o Dope
o Cannabis Now
o 420 Magazine
o Marijuana Venture
o MG Magazine
- Business events and conferences
- Business and industry associations
- Website development, Branding
appearance development, including mission
statement, logo, colors, brochures etc. SEO
optimization, focusing on:
o Keywords
o Adding fresh content
o Improving link popularity.
Marketing Strategy

14
Business Plan
- AdWords. Testing various keywords to select familiar to topic and at the same time acceptable by Google’s
algorithm: green, medicine, 502, infused, relaxing, stimulating, enhanced, alternative therapies,
alternative medicine, natural, and others.
- Mantis, 420 Network, 420 Click.
Table 2. Cannabis business directories
WEEDMAP
https://weedmaps.com/
Marijuana dispensary finder on the
planet. With over 7,750 listings
throughout the U.S., Canada, and
Europe.
WeedMaps has 2.8 million
unique visitors each month.
LEAFY
https://www.leafly.com/
Leafy is a cannabis information
resource for finding the right
strains and products. Services
include: cannabis finder, online
store, branding, doctors’ portal.
49,950 unique visitors per
day.
https://www.stickyguide.com/ Medical marijuana dispensary,
doctor and medicine directory with
reviews.
360,000 unique visitors
each month.
https://www.cannasaver.com/ Canna-Saver is website for cannabis
and related coupons, devoted to
medical marijuana deals and
savings. Offers a constant flow of
deals and savings from the top
cannabis and medical marijuana
retailers.
12,000 unique visitors each
month.
http://cannabiscouponcodes.com/ Website with cannabis coupon
codes.
month.
https://www.weedealio.com/ Weedealio is one of the known
companies in providing the best of
the deals related to Marijuana,
weed deals and other cannabis
products.
month.

Sales Forecast
Assumptions
As growing stage will
start from January
2018, sales are
projected to be started
from the 2018 summer
and they will
significantly increase
from the second year.
Company intends to
mix outdoor
cultivation from April
to October period and
all around year greenhouse cultivation.
Growth rate for revenue is about 550% for the second year and about 10% for the third year.
Change figures in the table below and in the chart above (Growing and Revenue assumptions).
Table 3. Sales Forecast for first three years, $ 000
1 M 2 M 3 M 4 M 5 M 6 M 7 M 8 M 9 M 10 M 11 M 12 M
Year 1 0 0 0 0 0 0 0 0 0 0 112 112
Year 2 224 112 112 112 112 112 112 112 112 112 112 112
Year 3 336 112 112 112 112 112 112 112 112 112 112 112
224,000
1,344,000 1,344,000 1,344,000 1,344,000
-
112,000 224,000 280,000 280,000
-
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
1,800,000
Outdoor
Greenhouse
Sales Strategy
Figure 5. Sales forecast, $

16
Business Plan
Operating Plan

While most businesses in any industry try to keep startup costs as low as possible, that isn’t necessarily
the best way to proceed when opening a grow. Creating a cost-efficient cultivation site often involves
investing in technology and processes that may result in a big near-term hit.
Cultivation
The three primary methods of cultivation - outdoor, greenhouse and indoor - have different production
profiles.
Outdoor cultivators produce one harvest per year in the fall, whereas indoor cultivators produce year-
round and can generate between 4 and 6 harvests per year. Greenhouse cultivators combine elements
of both - exploiting natural light, while leveraging infrastructure and technology - to produce between 1
and 4 harvests per year, though sophisticated, well-equipped greenhouses can run year-round on
schedules analogous to indoor production. The result of this mix of cultivation methods is that growers
approach the market differently at different times of the year. Since outdoor cultivators produce one
large harvest in the fall, which drives prices down, they tend to release product into the market in a
controlled manner - selling enough in the fall to generate cash flow to cover expenses, but holding back
inventory to release later in the year as prices rise. Thus, outdoor cultivators - in general - are price
setters in the fall and price takers in late spring and early summer. As noted in the chart, sellers of
outdoor grown flower sold lots averaging 33 pounds in January as they were recouping expenses, and
then reduced lot sizes to optimize revenue ahead of the next outdoor harvest. What happened next was
not characteristic of prior years, and changed the status-quo. Outdoor growers - encumbered with
more inventory than in years past - began to sell larger quantities in June and July, as it became
apparent that large quantities of greenhouse grown flower from the first light deprived harvests would
Operating Plan

18
Business Plan
be coming to market, potentially creating an oversupply situation. While it remains to be seen if last
year’s fall harvest has been fully liquidated, the race by outdoor cultivators to preserve value drove
prices down as the first light-deprivation harvests of the year hit the market; the average greenhouse
deal size nearly doubled from June to July. The average deal size for indoor growers appears to reflect
the conventional experience of reduced yields in the late spring and summer, as cooling and humidity
control costs increase and growers shutter portions of their operations until conditions for 100%
capacity utilization return, generally in September.
The Cons of outdoor growing include:
▪ Growing location is government regulated
▪ Dry season requires more effort in watering
▪ Deer like to eat and destroy if not tended
Main indoor cons include:
▪ Maintaining proper ventilation is difficult
▪ Higher household energy costs
▪ Pumped with fertilizers
Due to the high-energy costs and difficulties with water supplying Company intend to develop
marijuana growing business in greenhouses. Those structures are showing an average cost savings of
33% - electric costs for growing marijuana for that way can drop to about $350 a pound.
We plan to build xxx greenhouses 3600 sq. ft. each during first 2 years.
November
2016
February
2017
June
2017
October
2017
February
2018
June
2018
Greenhouses
Include your assumptions.
Company intends to start with small indoor space, equipped with white-blue vegging light bulbs, for
vegetative growth from January 2017 to get first outdoor summer harvest.

Greenhouse and Cultivation Design
Greenhouses combine the latest technology in HVAC, light deprivation, environmental controls,
irrigation, insect exclusion, benching systems, hybrid techniques, and much more to create a systematic
and efficient growing approach:
1. The biggest advantage Greenhouse Marijuana Growers have is the abundance of natural light coming into
the greenhouse.
2. While cannabis likes long daylight during the vegetative stage, a good blackout system is required for the
best flowering production.
3. Heating and Cooling Systems are an important component of the marijuana greenhouse.
4. CO2 is essential for maximizing the quality and production of Marijuana.
5. Ventilation is essential as with all greenhouse crops, however marijuana legislation, and local
municipality requirements may also impose strict requirements for eliminating exhaust odors. Our
integrated growing solutions will include air filtration systems where required.
6. A nutrient management system is essential for maximizing the production yield of the cannabis plants
and ensuring consistent and reliable quality.
7. The brains of the complete marijuana growing system whether a greenhouse production facility or a
warehouse grow up is our environmental computer. The computer control systems for a marijuana
greenhouse controls and monitor all the nutrients, lights, blackout, air circulation, CO2 and irrigation
needs of the plants, it is designed to maintain the exact environment needed for as many different
growing zones as you want and can handle different environments for propagation, cloning, flowering
and for as many different varieties as you want to control.
Company will use rolling benches / growing
tables which are highly recommended for
any commercial cannabis grow operation.
They provide up to 50% more plant space
by eliminating the need for a dedicated aisle.
With a crop as valuable as marijuana, this
directly equates to much higher profits and
maximum space efficiency.
Main features:
▪ Aluminum extruded sides and ends
▪ Miter cut corners
▪ Hot dipped galvanized steel stands
▪ Aluminum cross members
▪ Snap together fittings
▪ Threaded rods for adjustment up to 12"
▪ Top quality plastic or aluminum flood trays
▪ 13 gauge expanded metal bench tops
▪ 2" diameter rolling tubes
Operating Plan

20
Business Plan
During regular business hours, our premises will be accessible on request to an identified inspector.
Outside of regular business hours, our premises will be accessible on request to an identified inspector
who has reason to believe a violation has occurred.
Physical Security Plan
Premises Access
▪ All external doors and gates will be secured by commercial locks rated to ANSI grade 1 or
▪ similar standards and materials will be available on-site for inspection to verify the security
▪ rating.
▪ During not operating hours, all usable marijuana, harvested plants, and finished product will be
stored indoors on the premises in a secure area with all entries secured with a steel door in a steel
frame or the equivalent and commercial locks.
▪ When not operating, all exterior doors, windows, or other points of ingress/egress will be locked.
Premises Alarm & Monitoring
▪ The premises will have an alarm system programmed to activate upon unauthorized breach of
any door, window, or other point of entry.
▪ The alarm system will be capable of detecting unauthorized access to any portion of the premises,
including any unenclosed portion of an outdoor production operation.
▪ The alarm system will provide notification to an authorized representative in the event of any
unauthorized entry to any portion of the premises.
▪ The alarm system will provide a mechanism to contact law enforce by one or more of the
following methods:
o At least two “panic buttons” are installed on the premises that can trigger the alarm
system and immediately notify a security company or law enforcement.
o Mobile “panic buttons” are carried by all license representatives on the premises that can
trigger the alarm system and immediately notify a security company or law enforcement.
o An operational landline telephone is present at all times within the limited access area
that is capable of contacting security or law enforcement.

Video Surveillance
1. The premises will be equipped with a video surveillance system.
2. Cameras will cover all areas where any marijuana items (including plants and waste) will be
present at any time including pathways where product will be moved, without any “blind spots”
3. Cameras will cover all areas within 15 feet of all points of entry/exit from the licensed premises
in all directions.
4. All cameras will record continuously 24 hours a day at a resolution of 1280 x 720 pixels or better
in all lighting conditions.
5. All cameras will cover areas where marijuana items will be present and all cameras covering the
surveillance area record at a minimum of 10 frames per second.
6. All cameras will cover exterior non-limited access areas record at a minimum of 5 frames per
second.
7. The surveillance room will contain a list of personnel authorized to access the surveillance
system.
8. We will keep a log of all maintenance activity for the surveillance equipment including name of
the individual, date and time of access, and reason for access.
9. The surveillance system will include a monitor capable of viewing video from any camera, a digital
archiving device, and a printer.
10. The surveillance system will have a backup battery that will provide at least one hour of
continuous recording in event of any power failure.
11. An authorized representative will receive immediate notification within one hour of the failure of
any security camera or portion of the surveillance system.
12. All required recordings, including the backups of the surveillance area recordings kept for 90 days
with a method to store video longer than 90 days if requested.
Operating Plan

22
Business Plan
Organizational Structure

CannaCult is a business that will be built on a solid foundation. From the outset, we have decided to
recruit only qualified people to man various job positions in our company. We are quite aware of the
rules and regulations governing the cannabis industry of which medical marijuana growing falls under
which is why we decided to recruit experienced and qualify employees as foundational staff of the
organization. We hope to leverage on their expertise to build our business brand to be well accepted in
the United States.
These are the positions that will be available at CannaCult:
Managing Director
Greenhouse Growers
Outdoor Growers
Trimmers
Packaging Assistants
Sales Representatives
Correct the figures according to your plans.
Table 4. Personnel plan
Q1 Y1 Q2 Y1 Q3 Y1 Q4 Y1 Year 1 Year 2 Year 3
Cultivation
People 0 4 8 8 4-8 6-10 10
Salaries, $ 0 40,000 110,000 120,000 270,000 490,000 600,000
Board
Head Cultivator
Assistant
Trimmers/Packagers
General Manager
Maintenance &
General Labor
Sales
Representatives
Organizational Structure
Figure 6. Organizational structure

24
Business Plan
Ownership
…

26
Business Plan
Profit & Loss Forecast
Copy and Paste the tables from your business pro forma statements.
Business’s revenue is projected to grow significantly during first two years’ timeframe. The yearly
projections are in the table below:
Table 5. Income Statement, $
YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5
Revenue 690,188 1,441,125 1,522,125 1,603,125 1,684,125
Direct Costs 361,738 651,450 651,450 651,450 651,450
Gross Profit 328,450 789,675 870,675 951,675 1,032,675
% of revenue 48% 55% 57% 59% 61%
Operating Expense
Initial & General Costs 85,000 35,000 35,000 35,000 35,000
Operating Expenses (cultivation business) 12,000 12,000 12,000 12,000 12,000
Total Sales & Marketing Expenses 23,255 42,028 44,053 46,078 48,103
Total Senior Management Salaries & Benefits 0 0 0 0 0
Total IT Salaries & Benefits 0 0 0 0 0
Total Other Salaries & Benefits 0 0 0 0 0
Misc. 6,000 6,000 6,000 6,000 6,000
Total Operating Expense 126,255 95,028 97,053 99,078 101,103
Operating Income (EBITDA) 202,195 694,647 773,622 852,597 931,572
% of revenue 29% 48% 51% 53% 55%
Depreciation and Amortization 19,800 19,800 19,800 19,800 19,800
Earnings Before Interest & Taxes (EBIT) 182,395 674,847 753,822 832,797 911,772
Interest Expense 0 0 0 0 0
Earnings Before Taxes (EBT) 182,395 674,847 753,822 832,797 911,772
Income Tax 72,958 269,939 301,529 333,119 364,709
Net Income 109,437 404,908 452,293 499,678 547,063
% of revenue 16% 28% 30% 31% 32%

Cash Flow Statement
The cash flow projections show that business will have sufficient cash to support the activity. The
following table presents a view of projected cash flow of the business.
Table 6. Cash Flow Statement, $
Net Income 109,437 404,908 452,293 499,678 547,063
Cash Flow from Operations
Depreciation 19,800 19,800 19,800 19,800 19,800
Change in Receivables (77,625) (4,500) (4,500) (4,500) (4,500)
Change in Inventory 0 0 0 0 0
Change in Accounts Payable 0 0 0 0 0
Change in Accrued Expenses 0 0 0 0 0
Total Cash Flow from Operations 51,612 420,208 467,593 514,978 562,363
Cash Flow from Investing
Capital Expenditures (CAPX) (198,000) 0 0 0 0
Other 0 0 0 0 0
Total Cash Flow from Investing (198,000) 0 0 0 0
Cash Flow from Financing
Revolver Issuance / (Repayment) 0 0 0 0 0
Long-Term Debt Issuance / (Repayment) 0 0 0 0 0
New Equity Investments 358,000 0 0 0 0
Dividends 0 0 0 0 0
Total Cash Flow from Financing 358,000 0 0 0 0
Total Change in Cash 211,612 420,208 467,593 514,978 562,363
Beginning Period Cash 0 211,612 631,820 1,099,413 1,614,392
Ending Period Cash 211,612 631,820 1,099,413 1,614,392 2,176,755
Financial Plan

28
Business Plan
Balance Sheet
The balance sheet shows healthy growth of net worth and strong financial position.
Table 7. Balance Sheet, $
Assets
Current Assets
Cash 211,612 631,820 1,099,413 1,614,392 2,176,755
Receivables 77,625 82,125 86,625 91,125 95,625
Inventory 0 0 0 0 0
Total Current Assets 289,237 713,945 1,186,038 1,705,517 2,272,380
Long Term Assets
Property Plant & Equipment (PPE), gross 198,000 198,000 198,000 198,000 198,000
Accumulated Depreciation of PPE (19,800) (39,600) (59,400) (79,200) (99,000)
PP&E, net 178,200 158,400 138,600 118,800 99,000
Total Assets 467,437 872,345 1,324,638 1,824,317 2,371,380
Liabilities
Current Liabilities 0 0 0 0 0
Long Term Liabilities 0 0 0 0 0
Total Liabilities 0 0 0 0 0
Equity
Founder Common Stock 0 0 0 0 0
Preferred Stock 0 0 0 0 0
Current Period Net Income 467,437 872,345 1,324,638 1,824,317 2,371,380
Plus: Prior Period Retained Earnings 0 0 0 0 0
Current Period Retained Earnings 467,437 872,345 1,324,638 1,824,317 2,371,380
Total Equity 467,437 872,345 1,324,638 1,824,317 2,371,380
Total Liabilities and Equity 467,437 872,345 1,324,638 1,824,317 2,371,380

Main Ratios
The return on equity ratio (ROE) measures how much the owner and investors earn for their
investment in the company. The higher the ratio percentage, the better return is. In general, financial
analysts consider return on equity ratios in the 15-20% range as representing attractive levels of
investment quality. As we can see ROE for our project is higher and in average draw up 40%.
Return on assets (ROA) gives an idea as to how efficient management is at using its assets to generate
earnings.
Profitability ratios are a class of financial metrics that are used to assess a business's ability to generate
earnings as compared to its expenses and other relevant costs incurred during a specific period of time.
Table 8. Main Ratios for five years
Ratio Analysis Year 2 Year 3 Year 4 Year 5 Avg.
Return on Equity 60.4% 41.2% 31.7% 26.1% 39.9%
Return on Assets
Return on Sales 28.1% 29.7% 31.2% 32.5% 30.4%
Asset turnover 2.15 1.39 1.02 0.80 1.34
Profitability
Gross Margin 54.8% 57.2% 59.4% 61.3% 58.2%
SG&A as % of Sales 6.6% 6.4% 6.2% 6.0% 6.3%
Operating Margin 46.8% 49.5% 51.9% 54.1% 50.6%
Correct the figures with the figures from the spreadsheet “Main Ratios”.
Financial Plan

30
Business Plan
Appendix
Appendix

Cannabis Cultivation Business Plan Template

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Similar to Cannabis Cultivation Business Plan Template

Similar to Cannabis Cultivation Business Plan Template (20)

Recently uploaded

Recently uploaded (20)

Cannabis Cultivation Business Plan Template