Budget for New Franchise Project $(2023-2026)$

$2023202420252026$ Total

Discount Factors $(\%)0\mathrm{.}920\mathrm{.}880\mathrm{.}850\mathrm{.}8$

Variable Rate $(\%)7\mathrm{.}26\mathrm{.}565\mathrm{.}7$

Rate $7766$

Expenses $($Millions$)$

Franchise Fees $$1\mathrm{.}50$ $$1\mathrm{.}60$ $$1\mathrm{.}80$ $$2\mathrm{.}20$ $$7\mathrm{.}10$

Legal and Licensing $$0\mathrm{.}80$ $$0\mathrm{.}90$ $$1\mathrm{.}00$ $$1\mathrm{.}20$ $$3\mathrm{.}90$

Initial Marketing $$1\mathrm{.}20$ $$1\mathrm{.}30$ $$1\mathrm{.}50$ $$1\mathrm{.}80$ $$5\mathrm{.}80$

Lease Payments $$2\mathrm{.}00$ $$2\mathrm{.}20$ $$2\mathrm{.}50$ $$3\mathrm{.}00$ $$9\mathrm{.}70$

Interior Design $$0\mathrm{.}50$ $$0\mathrm{.}60$ $$0\mathrm{.}70$ $$0\mathrm{.}90$ $$2\mathrm{.}70$

Initial Inventory $$1\mathrm{.}00$ $$1\mathrm{.}20$ $$1\mathrm{.}20$ $$1\mathrm{.}50$ $$4\mathrm{.}90$

Utilities $$0\mathrm{.}20$ $$0\mathrm{.}30$ $$0\mathrm{.}30$ $$0\mathrm{.}40$ $$1\mathrm{.}20$

Staff Wages $$2\mathrm{.}50$ $$2\mathrm{.}70$ $$2\mathrm{.}80$ $$3\mathrm{.}20$ $$11\mathrm{.}20$

Marketing Materials $$0\mathrm{.}30$ $$0\mathrm{.}40$ $$0\mathrm{.}40$ $$0\mathrm{.}50$ $$1\mathrm{.}60$

Point of Sale Systems $$0\mathrm{.}50$ $$0\mathrm{.}60$ $$0\mathrm{.}60$ $$0\mathrm{.}70$ $$2\mathrm{.}40$

Inventory Management Software $$0\mathrm{.}30$ $$0\mathrm{.}40$ $$0\mathrm{.}40$ $$0\mathrm{.}50$ $$1\mathrm{.}60$

Staff Training $$0\mathrm{.}20$ $$0\mathrm{.}30$ $$0\mathrm{.}30$ $$0\mathrm{.}40$ $$1\mathrm{.}20$

Advertising Campaign $$1\mathrm{.}00$ $$1\mathrm{.}20$ $$1\mathrm{.}20$ $$1\mathrm{.}50$ $$4\mathrm{.}90$

Promotional Events $$0\mathrm{.}50$ $$0\mathrm{.}60$ $$0\mathrm{.}60$ $$0\mathrm{.}80$ $$2\mathrm{.}50$

Community Outreach $$0\mathrm{.}30$ $$0\mathrm{.}40$ $$0\mathrm{.}40$ $$0\mathrm{.}60$ $$1\mathrm{.}70$

Total $$12\mathrm{.}80$ $$14\mathrm{.}70$ $$15\mathrm{.}70$ $$19\mathrm{.}20$ $$62\mathrm{.}40$

BASEDDiscounted Cost $$11\mathrm{.}78$ $$12\mathrm{.}94$ $$13\mathrm{.}35$ $$15\mathrm{.}36$ $$53\mathrm{.}42$Zprepare a financial evaluation report.

$2.$ The report should include the following sections:

a$.$ Purpose: Briefly describe the purpose of the report.

b$.$ Background: Provide background information on the selected project, such as the industry, the current situation, and the objectives of the proposed project.

c$.$ Alternatives: List three alternatives: $($i$)$ The proposed project, $($ii$)$ delay the proposed project by $1$ year, and $($iii$)$ do nothing $($i$.$e$.,$ invest the estimated cost of the project in a safe investment$).$ For each alternative, calculate the NPV$.$

d$.$ Alternatives Analysis: Analyze the three alternatives and provide a comparison of their NPV$.$ Identify the strengths and weaknesses of each alternative.

e$.$ Risk Analysis: Perform a sensitivity analysis of key cost components, including full time labor, part$-$time labor, equipment, IT$,$ and overhead. Analyze how changes in these cost components will affect the project's NPV$.$

f$.$ Recommendation: Based on the analysis, make a one$-$sentence recommendation on the proposed project

g$.$ Assumptions: List the assumptions made in the analysis, including the key information and sources of information. A minimum of $10$ assumptions is expected.

$3.$ The Proposed Project estimate in Excel should Include all typical cost categories a company would have in a project, such as but not limited to: full$-$time labor, part$-$time labor, equipment, IT$,$ overhead, marketing and advertising, research and development, administrative expenses, legal and consulting fees, and any other applicable cost categories. The analysis should include a detailed breakdown of each cost category and the associated costs.

$4.$ The report should be no more than $8$ pages, double$-$spaced, and in $12-$point font

$5.$ The report must be written in professional business language and adhere to appropriate formatting and citation standards

$6.$ The report must include an Excel spreadsheet that shows the calculations for the NPV$.$ Budget for New Franchise Project $(2023-2026)$

$2023202420252026$ Total

Discount Factors $(\%)0\mathrm{.}920\mathrm{.}880\mathrm{.}850\mathrm{.}8$

Variable Rate $(\%)7\mathrm{.}26\mathrm{.}565\mathrm{.}7$

Rate $7766$

Expenses $($Millions$)$

Franchise Fees $$1\mathrm{.}50$ $$1\mathrm{.}60$ $$1\mathrm{.}80$ $$2\mathrm{.}20$ $$7\mathrm{.}10$

Legal and Licensing $$0\mathrm{.}80$ $$0\mathrm{.}90$ $$1\mathrm{.}00$ $$1\mathrm{.}20$ $$3\mathrm{.}90$

Initial Marketing $$1\mathrm{.}20$ $$1\mathrm{.}30$ $$1\mathrm{.}50$ $$1\mathrm{.}80$ $$5\mathrm{.}80$

Lease Payments $$2\mathrm{.}00$ $$2\mathrm{.}20$ $$2\mathrm{.}50$ $$3\mathrm{.}00$ $$9\mathrm{.}70$

Interior Design $$0\mathrm{.}50$ $$0\mathrm{.}60$ $$0\mathrm{.}70$ $$0\mathrm{.}90$ $$2\mathrm{.}70$

Initial Inventory $$1\mathrm{.}00$ $$1\mathrm{.}20$ $$1\mathrm{.}20$ $$1\mathrm{.}50$ $$4\mathrm{.}90$

Utilities $$0\mathrm{.}20$ $$0\mathrm{.}30$ $$0\mathrm{.}30$ $$0\mathrm{.}40$ $$1\mathrm{.}20$

Staff Wages $$2\mathrm{.}50$ $$2\mathrm{.}70$ $$2\mathrm{.}80$ $$3\mathrm{.}20$ $$11\mathrm{.}20$

Marketing Materials $$0\mathrm{.}30$ $$0\mathrm{.}40$ $$0\mathrm{.}40$ $$0\mathrm{.}50$ $$1\mathrm{.}60$

Point of Sale Systems $$0\mathrm{.}50$ $$0\mathrm{.}60$ $$0\mathrm{.}60$ $$0\mathrm{.}70$ $$2\mathrm{.}40$

Inventory Management Software $$0\mathrm{.}30$ $$0\mathrm{.}40$ $$0\mathrm{.}40$ $$0\mathrm{.}50$ $$1\mathrm{.}60$

Staff Training $$0\mathrm{.}20$ $$0\mathrm{.}30$ $$0\mathrm{.}30$ $$0\mathrm{.}40$ $$1\mathrm{.}20$

Advertising Campaign $$1\mathrm{.}00$ $$1\mathrm{.}20$ $$1\mathrm{.}20$ $$1\mathrm{.}50$ $$4\mathrm{.}90$

Promotional Events $$0\mathrm{.}50$ $$0\mathrm{.}60$ $$0\mathrm{.}60$ $$0\mathrm{.}80$ $$2\mathrm{.}50$

Community Outreach $$0\mathrm{.}30$ $$0\mathrm{.}40$ $$0\mathrm{.}40$ $$0\mathrm{.}60$ $$1\mathrm{.}70$

Total $$12\mathrm{.}80$ $$14\mathrm{.}70$ $$15\mathrm{.}70$ $$19\mathrm{.}20$ $$62\mathrm{.}40$

Discounted Cost $$11\mathrm{.}78$ $$12\mathrm{.}94$ $$13\mathrm{.}35$ $$15\mathrm{.}36$ $$53\mathrm{.}42$