Financial Proforma
Sources of income:
- Enterprise listing (5% per item)
- Sales commission (10% per transaction)
- Membership fees ($50 per year for interior designers)
Below are our financial projections for the app for the first 3 years: (click here for Excel version)
| Year 1 | Year 2 | Year 3 | Total | |
| Gross Income | ||||
| Enterprise listing charge (5% per item) | $375,000 | $750,000 | $1,500,000 | $2,625,000 |
| Sales commission (10% per item) | $500,000 | $1,000,000 | $1,500,000 | $3,000,000 |
| Interior designer annual membership fee ($50 per year) | $250,000 | $375,000 | $500,000 | $1,125,000 |
| Total Income | $1,125,000 | $2,125,000 | $3,500,000 | $6,750,000 |
| Expenses | ||||
| App Creation Project Fees: | ||||
| Planning (Scope definition) | $7,740 | $0 | $0 | $7,740 |
| Design (wireframe,visual, user experience designs) | $19,995 | $0 | $0 | $19,995 |
| Functionality (i.e., user login, payments, etc.) | $25,000 | $0 | $0 | $25,000 |
| Testing | $19,350 | $0 | $0 | $19,350 |
| Deployment (liscensing, distribution, etc.) | $1,419 | $0 | $0 | $1,419 |
| Ongoing Costs: | ||||
| Sales, marketing & advertising | $3,000 | $6,000 | $12,000 | $21,000 |
| Salaries, wages & taxes | $200,000 | $300,000 | $400,000 | $900,000 |
| Cloud data storage | $50,000 | $80,000 | $110,000 | $240,000 |
| App maintanence developer fees | $10,000 | $20,000 | $30,000 | $60,000 |
| Total Expenses | $336,504 | $406,000 | $552,000 | $1,294,504 |
| Net Income | $788,496 | $1,719,000 | $2,948,000 | $5,455,496 |
| Calculations: | ||||
| (75,000 items x $100 avg. price x 5%) | ||||
| (150,000 items x $100 avg. price x 5%) | ||||
| (300,000 items x $100 avg. price x 5%) | ||||
| (50,000 items x $100 avg. price x 10%) | ||||
| (100,000 items x $100 avg. price x 10%) | ||||
| (150,000 items x $100 avg. price x 10%) | ||||
| Notes: | ||||
| Items listed by retailers and individuals are expected to be approximately equal (1st year: 75,000 items each, 2nd year: 150,000 items each, 3rd year: 300,000 items each) |