Executive Summary
Overview: The Dog Café provides a relaxing and enjoyable environment for both people and dogs, away from overcrowded shelters that may cause fear and hostility in adoptable pets. Play with puppies while getting your coffee, or catch up with friends over lattes while hugging lap pets. We provide those who cannot have pets of their own the chance to spend quality time with furry companions (and vice versa) without the commitment of adoption.
Mission: The Dog Café’s mission is to change the way individuals engage with dogs in need of homes, revolutionizing dog adoption.
Vision: To create the art of happiness by using dogs as a stress reliever.
Industry Overview: Dog cafés are technically animal cafés, with the first one opening in Taiwan in 1998 and becoming famous in Japan. Animal cafés became popular around the globe after that. You may now go to animal cafés and touch and snuggle with animals. Because of the nature of dogs, dog cafés are often considered to be noisier than typical animal cafés. Because dogs are significantly larger than most animals featured in previous animal cafés, the café will be substantially larger.
Financial Overview
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Financial Highlights
| Liquidity | 2020A | 2021A | 2022F | 2023F | 2024F |
| Current ratio | 6 | 12 | 23 | 32 | 42 |
| Quick ratio | 6 | 11 | 22 | 31 | 40 |
| DSO | 8 | 8 | 8 | 8 | 8 |
| Solvency | |||||
| Interest coverage ratio | 8.2 | 11.1 | 14.2 | ||
| Debt to asset ratio | 0.01 | 0.01 | 0.2 | 0.18 | 0.16 |
| Profitability | |||||
| Gross profit margin | 51% | 51% | 53% | 53% | 53% |
| EBITDA margin | 12% | 14% | 21% | 22% | 22% |
| Return on asset | 5% | 6% | 13% | 14% | 14% |
| Return on equity | 5% | 6% | 16% | 17% | 17% |
FUND USAGE
Industry Analysis
The Dog Café aims to make it easier for individuals to spend their leisure time with their dogs by providing a space where they can socialize with friends or family while their pets do the same. Hours turn into weeks in a flash at Dog Cafe; this is a must-visit location for every dog owner.
Dog Cafe is a great location to meet new people, mingle, and learn about their interests Customers pay to spend time with domesticated dogs for amusement and relaxation at a dog café. Other services, such as food and drinks, may be available in such cafés. Dog cafés (while not as common as cat cafés) are a popular sort of animal café. You pay a fee to enter and then get to play with and pet a range of different dog breeds. Adoption services are available at several dog cafés so that you can find your future pet there!
While it differs every café, several urge clients, to adopt the dogs on the premises. Some dog cafés may have adoption events when customers may adopt one of the café’s dogs. Other cafés may enable you to adopt their dogs on a case-by-case basis, depending on how interested you are. You’d almost certainly have to go through the usual adoption procedures, such as filling out paperwork and demonstrating that your house is a dog-friendly environment, among other things.
The canines that dwell at the dog café have previously been saved from a life in a shelter because the café took them in. As a result, you may still feel good about your choice to adopt a dog from a dog café rather than a shelter.
Coffee shops exist in various shapes and sizes, but they are often facilities that serve freshly brewed coffee, tea, and other hot drinks. Recently, many coffee shops have added baked goods, sandwiches, salads, and other snack products to compete with restaurants in the quick-service sector. In 2020/2021, global coffee consumption was estimated to be at 166.63 million 60kg bags. The United States is one nation that stands out as a beverage consumer. The coffee market in the United States generated over 82 billion dollars in sales in 2019. Despite the fact that coffee users may be found all across the nation, overall coffee per capita consumption in the United States differed by location in 2020. The Northeast was the most coffee-consuming area, with an average of 1.97 cups per inhabitant per day. Meanwhile, the South drank the least coffee that year, averaging roughly 1.8 cups per day.
In 2022, the global pet care industry will be worth $261 billion, up from $245 billion in 2021. A 6.1 % compound annual growth rate is expected. By 2027, the compound annual growth rate (CAGR) is expected to increase to $350 billion. Despite the fact that North America and Western Europe are mature markets, there is still room for consumer spending to grow compared to global growth.
The global pet care industry is estimated to reach USD 202.6 billion by 2025. Pet adoption is predicted to increase demand for high-end pet care items.
Boarding, grooming, and training services are becoming more accessible to owners because of technological advancements. According to Wakefield Research, Sixty-nine percent of millennials are likely to use technology to follow their pets. Health behaviors, dietary intake, and playtime may all be tracked using apps. Pet care service providers offer regular care, and built-in calendars remind owners of it. Pet cameras and automatic feeds are becoming more popular among millennials and others. Pet walkers and sitters may be found via Wag and DogVacay on mobile devices. Finding Rover matches missing dogs with their owners using face recognition technology. Continued innovation is expected in the services business.
Pet product and retail service sales in the United States hit $107 billion in 2020, up 9% from the previous year, owing to a COVID-19-driven increase in the pet population. All pet and veterinary business trends now intersect with retail channel buying patterns, from how and why we acquire new pets to which pet care services we utilize and where.
Several reasons, including the pet sector’s re-confirmed recession resiliency, indicate a highly favorable short- and long-term prognosis for the pet business. Throughout the Christmas/Winter Holidays 2020, there was a boom in pet purchasing and adoption across all pet categories. And, notwithstanding COVID, most pet care expenditure is discretionary after pets are adopted, as seen by solid pet product sales and veterinarian service revenues. Furthermore, the pandemic’s stay-at-home and work-from-home dynamics have strengthened human-animal ties, encouraging pet owners and “pet parents” to spend lavishly on pet care items and services in order to keep their dogs (and themselves) healthy and happy.
Marketing Plan
Dog Events: To attract customers’ attention, we create events for dogs and encourage dog owners to join.
Online Advertisement: Following the trend of surfing the Internet every second of customers, Online advertisement has become a blatant tool used by every business. The Dog Café will be promoted on Facebook, Instagram, and other social media platform.
Gifts & Vouchers: The Dog Café presents gifts and vouchers to our customers to show our appreciation for your contribution to our success.
Word of Mouth: Nowadays, word of mouth is a powerful tool that contributes an essential part to success or failure. By excellently treating every customer with our conscientiousness, we expect our positive service to be spread.
Promotional Brochure: A brochure with The Dog Café logo will be distributed, and the leaflet contains thorough information about The Dog Café.
Organogram
Financial Plan
Earnings:
Break-Even Analysis:
Income Statement:
| 2020A | 2021A | 2022F | 2023F | 2024F | |
| ANNUAL REVENUE | |||||
| Item 1 | 9,217 | 59,117 | 175,410 | 415,277 | 781,357 |
| Item 2 | 34,701 | 222,558 | 660,368 | 1,563,394 | 2,941,580 |
| Item 3 | 4,067 | 19,561 | 46,432 | 78,519 | 114,905 |
| Total annual revenue | 47,985 | 301,236 | 882,211 | 2,057,189 | 3,837,842 |
| % increase | 528% | 193% | 133% | 87% | |
| COST of REVENUE | |||||
| Item 1 | 360 | 2,259 | 6,617 | 15,429 | 28,784 |
| Item 2 | 480 | 3,012 | 8,822 | 20,572 | 38,378 |
| Item 3 | 52,000 | 65,000 | 78,000 | 91,000 | 104,000 |
| Item 4 | 720 | 3,615 | 8,822 | 16,458 | 23,027 |
| Item 5 | 140,000 | 336,000 | 560,000 | 840,000 | 1,120,000 |
| Item 6 | 60,000 | 144,000 | 240,000 | 360,000 | 480,000 |
| Item 7 | 32,000 | 61,333 | 85,533 | 112,153 | 141,435 |
| Total Cost of Revenue | 285,560 | 615,220 | 987,794 | 1,455,612 | 1,935,625 |
| as % of revenue | 595% | 204% | 112% | 71% | 50% |
| Gross Profit | -237,575 | -313,984 | -105,583 | 601,578 | 1,902,218 |
| SELLING & ADMIN EXPENSES | |||||
| Item 1 | 28,000 | 96,800 | 154,880 | 175,692 | 193,261 |
| Item 2 | 75,000 | 105,000 | 120,000 | 120,000 | 120,000 |
| Item 3 | 36,000 | 96,000 | 108,000 | 120,000 | 120,000 |
| Item 4 | 8,000 | 12,000 | 12,000 | 12,000 | 12,000 |
| Item 5 | 3,839 | 18,074 | 44,111 | 61,716 | 115,135 |
| Item 6 | 3,359 | 12,049 | 26,466 | 41,144 | 76,757 |
| Item 7 | 5,600 | 10,000 | 12,904 | 15,034 | 17,376 |
| Item 8 | 6,667 | 14,000 | 22,067 | 30,940 | 40,701 |
| Total selling & admin expenses | 166,464 | 363,924 | 500,428 | 576,525 | 695,230 |
| as % of revenue | 347% | 121% | 57% | 28% | 18% |
| Net profit | -404,039 | -677,907 | -606,011 | 25,052 | 1,206,987 |
| Accumulated net profit | -404,039 | -1,081,947 | -1,687,957 | -1,662,905 | -455,918 |
Cash Flow Statement:
| 2020A | 2021A | 2022F | 2023F | 2024F | |
| CASH FLOW from OPERATING ACTIVITIES | |||||
| Net profit before tax | -$404,039 | -$677,907 | -$606,011 | $25,052 | $1,206,987 |
| Depreciation | $44,267 | $85,333 | $120,504 | $158,127 | $199,512 |
| Payables | |||||
| Item 1 | $4,333 | $5,417 | $6,500 | $7,583 | $8,667 |
| Item 2 | $11,667 | $28,000 | $46,667 | $70,000 | $93,333 |
| Item 3 | $6,250 | $8,750 | $10,000 | $10,000 | $10,000 |
| Item 4 | $3,000 | $8,000 | $9,000 | $10,000 | $10,000 |
| Item 5 | $667 | $1,000 | $1,000 | $1,000 | $1,000 |
| Total payables | $25,917 | $51,167 | $73,167 | $98,583 | $123,000 |
| change in payables | $25,917 | $25,250 | $22,000 | $25,417 | $24,417 |
| Receivables | |||||
| Item 1 | $320 | $1,506 | $3,676 | $5,143 | $9,595 |
| Item 2 | $360 | $1,807 | $4,411 | $8,229 | $11,514 |
| Total receivables | $680 | $3,314 | $8,087 | $13,372 | $21,108 |
| change in receivables | -$680 | -$2,634 | -$4,773 | -$5,285 | -$7,736 |
| Net cash flow from operating activities | -$334,536 | -$569,958 | -$468,280 | $203,311 | $1,423,180 |
| CASH FLOW from INVESTING ACTIVITIES | |||||
| Item 1 | $16,000 | $13,200 | $14,520 | $15,972 | $17,569 |
| Item 2 | $20,000 | $22,000 | $24,200 | $26,620 | $29,282 |
| Item 3 | $28,000 | $22,000 | $14,520 | $10,648 | $11,713 |
| Item 4 | $96,000 | $88,000 | $72,600 | $79,860 | $87,846 |
| Item 5 | $20,000 | $22,000 | $24,200 | $26,620 | $29,282 |
| Net cash flow/ (outflow) from investing activities | -$180,000 | -$167,200 | -$150,040 | -$159,720 | -$175,692 |
| CASH FLOW from FINANCING ACTIVITIES | |||||
| Equity | $400,000 | $440,000 | $484,000 | $532,400 | $585,640 |
| Net cash flow from financing activities | $400,000 | $440,000 | $484,000 | $532,400 | $585,640 |
| Net (decrease)/ increase in cash/ cash equivalents | -$114,536 | -$297,158 | -$134,320 | $575,991 | $1,833,128 |
| Cash and cash equivalents at the beginning of the year | – | -$114,536 | -$411,693 | -$546,014 | $29,978 |
| Cash & cash equivalents at the end of the year | -$114,536 | -$411,693 | -$546,014 | $29,978 | $1,863,105 |
Balance Sheet:
| 2020A | 2021A | 2022F | 2023F | 2024F | |
| NON-CURRENT ASSETS | |||||
| Item 1 | $16,000 | $29,200 | $43,720 | $59,692 | $77,261 |
| Item 2 | $20,000 | $42,000 | $66,200 | $92,820 | $122,102 |
| Item 3 | $28,000 | $50,000 | $64,520 | $75,168 | $86,881 |
| Item 4 | $96,000 | $184,000 | $256,600 | $336,460 | $424,306 |
| Item 5 | $20,000 | $42,000 | $66,200 | $92,820 | $122,102 |
| Total | $180,000 | $347,200 | $497,240 | $656,960 | $832,652 |
| Accumulated depreciation | $44,267 | $129,600 | $250,104 | $408,231 | $607,743 |
| Net non-current assets | $135,733 | $217,600 | $247,136 | $248,729 | $224,909 |
| CURRENT ASSETS | |||||
| Cash | -$114,536 | -$411,693 | -$546,014 | $29,978 | $1,863,105 |
| Accounts receivables | $680 | $3,314 | $8,087 | $13,372 | $21,108 |
| Total current assets | -$113,856 | -$408,380 | -$537,927 | $43,349 | $1,884,214 |
| Total Assets | $21,878 | -$190,780 | -$290,791 | $292,078 | $2,109,122 |
| LIABILITIES | |||||
| Account payables | $25,917 | $51,167 | $73,167 | $98,583 | $123,000 |
| Total liabilities | $25,917 | $51,167 | $73,167 | $98,583 | $123,000 |
| EQUITIES | |||||
| Owner’s equity | $400,000 | $840,000 | $1,324,000 | $1,856,400 | $2,442,040 |
| Accumulated net profit | -$404,039 | -$1,081,947 | -$1,687,957 | -$1,662,905 | -$455,918 |
| Total equities | -$4,039 | -$241,947 | -$363,957 | $193,495 | $1,986,122 |
| Total liabilities & equities | $21,878 | -$190,780 | -$290,791 | $292,078 | $2,109,122 |
