# The Daily Pour (T-00) — SBA Loan Financial Projection: Assumptions

**Companion to:** `daily-pour-sba-projection.csv` (24-month P&L)
**Entity:** SnS Hospitality Group LLC · **Purpose:** SBA 7(a) loan application (~$60,000, payment <$900/mo)
**Prepared:** 2026-08 · Format follows what an SBA lender expects ("numbers + assumptions — show your work")

> This is the "assumptions" document SBA lenders require alongside the projection. Every number in
> the CSV traces back to a stated assumption here. Figures are estimates from the business plan and
> industry benchmarks; actuals will vary.

---

## Revenue assumptions

- **Average ticket: $8.00** — blended across drip, espresso drinks, specialty drinks, and food add-ons
  (consistent with the business plan and the local market-needs analysis).
- **Operating days: 26/month** — 6 days/week (closed Sundays), ~312 days/year.
- **Revenue formula:** `Customers/Day × $8.00 × 26 days`.
- **Year 1 ramp (customers/day):** a new location builds a customer base — it does NOT open at full
  volume. Monthly ramp: 40 → 55 → 65 → 75 → 82 → 88 → 92 → 95 → 97 → 98 → 99 → 100. This reaches the
  business plan's **100/day target** by month 12. (A flat 100/day from day one would be non-credible
  to a lender; the ramp is the honest, defensible curve.)
- **Year 2:** hold **100 customers/day** and apply a **5% revenue lift** (modest price/traffic growth),
  → ~$21,840/month.

## Cost of Goods Sold (COGS)

- **15% of revenue** — coffee, milk, syrups, cups/lids, food. Supported by the ~6× (600%) markup grid
  in `purchase-pricing.csv` (e.g., espresso shot cost ~$0.35 → sells in a ~$4–5 drink). COGS scales
  with revenue (it is variable, not fixed).
- **Gross profit = Revenue − COGS** (≈ 85% gross margin).

## Operating expenses (monthly)

| Line | Amount | Assumption |
|------|--------|-----------|
| **Payroll (loaded)** | **$5,840** | Location Manager (FT, ~$18/hr loaded ≈ $2,880) + part-time staff ($2,240) + part-time marketing ($720). "Loaded" = includes employer payroll taxes. **Year 2: +3% cost-of-living raise** → $6,015. |
| Lot rent | $750 | Leased high-traffic parking spot ($500–750/mo range; using top of range). |
| Insurance | $330 | General liability + workers' comp. |
| Fuel / propane | $130 | Generator fuel + propane. |
| Water / waste | $200 | Fresh-water fill + gray/black tank pump-outs (~every 2–3 weeks). |
| Cellular / data | $75 | 4G/5G plan for POS + cameras + remote management. |
| **Square fees** | **2.7% of revenue** | Card processing — variable, scales with sales. |
| Misc / repairs | $300 | Maintenance reserve, small repairs, supplies. |

## Loan assumptions (the interest expense)

- **Amount: $60,000** SBA 7(a) — funds trailer + buildout + equipment + working-capital cushion.
  Sized so the payment stays **under $900/mo even at the worst realistic rate** (see below).
- **Rate: 12.75% APR** (variable; the small-loan rate *cap* = Prime ~6.75% + 6.0%). Modeled at the cap
  as the worst case; a well-qualified borrower may negotiate 11.5–12%, which lowers the payment further.
- **Term: 10 years (120 months), fully amortizing.** The 10-year term is what keeps ~$60K under $900/mo
  — a 7-year term would cap the loan near $51K for the same payment.
- **Monthly payment (P+I): ~$887.04** — **under the $900 ceiling, guaranteed at the rate cap.**
  Only the **interest** portion is tax-deductible; principal is not. Interest starts ~$638/mo, declining.
- **If staying under $900 is a hard limit:** ask the lender for a **fixed rate** — variable 7(a) rates
  rise if Prime rises, which could push a variable loan over $900 later. Fixed locks $60K under $900.
- **One-time SBA guaranty fee (~$1,000–1,500)** typically financed into the loan (not a monthly line).
- *Sizing rationale: max loan keeping payment <$900 is ~$60,900 at the 12.75% cap; $60,000 is the round,
  safe target (~$887/mo). Larger amounts ($63–65K) only fit under $900 at better-than-cap rates.*

## Results (from the CSV)

| Metric | Value |
|--------|-------|
| **Year 1 net profit** | **~$66,600** (ramping) |
| **Year 2 net profit** | **~$111,400** (steady 100/day) |
| Steady-state monthly net (100/day) | ~$8,600/month |
| **Break-even** | **~50 customers/day** (matches business plan's ~51) |
| Customers/day for ~$3,000/mo to Sam (85% share) | **~71/day** |
| **Loan payment** | **~$887/mo** ($60K, 10yr, 12.75% cap — under the $900 ceiling) |

## Key break-even & target notes

- **Break-even ≈ 50 customers/day** → covers all fixed costs + the loan payment. Below this, the trailer loses money.
- **~71 customers/day** → business nets ~$3,530/mo, so **Sam's 85% ≈ $3,000/mo** (before setting aside taxes). This is comfortably **below** the 100/day plan target.
- The **$3K profit floor is hit well before full ramp** — around month 4–5 of Year 1.
- **Tax reserve:** set aside ~35% of your 85% share for income taxes (separate from the payroll taxes already inside "Payroll"). Loan principal is NOT deductible; only interest is.

## For the lender packet, pair this with:
- The 24-month CSV (`daily-pour-sba-projection.csv`)
- Business plan (`business-plan.html`)
- Trailer/equipment quote + supplier list (`supplier-research.html`, `purchase-pricing.csv`)
- Owner equity contribution + personal financial statement (lenders require owner "skin in the game")

*Estimates for lender evaluation. Have an Indiana CPA confirm tax treatment for a multi-member LLC before finalizing.*