INTRO: After looking at the operational capacity and marketability of Chipotle

Mexican Grill, we now proceed to its financial feasibility. Here are our assumptions
that support our financial projections:
<SLIDE 1> As for the sales, we expect that, at an average, at any hour of the day,
Chipotle has 40 customers. This includes both dine-in and takeout orders. Each
customer would be spending Php180. And that Chipotle Mexican Grill would be
operating at a 12-hour service period. This combined together would give us daily
sales of Php76, 000 exclusive of 12% VAT and annual sales of Php27.4M.
<SLIDE 2> For the cost structure, cost of goods sold is expected to be 38% of
gross sales. For salaries, wages and employee benefits, we use the prevailing
statutory labor provisions and computational tables. Each restaurant staff would
receive a daily wage of 481 pesos. On the other hand, the store supervisor would
receive a fixed monthly salary of 20000 pesos. 0.50% of gross sales would go for
promotional activities while 0.10% is allocated for miscellaneous expenses. Repairs
and maintenance is projected to be at 2% of net fixed assets.
<SLIDE 3> Combining these figures, we have: 27.4 M sales, 17M gross profit,
6.09M operating profit and a net profit of 4.14M arriving at net profit margin of
15.13%. We also compute breakeven point in sales and margin of safety ratio.
Breakeven point in sales is estimated to be at 16.76M and a margin of safety ratio
of 38.76% suggesting that current sales must decrease by this percentage before
we reach a net loss.
<SLIDE 4> For the financial position, we projected a total assets of 13.73M that
would be financed by 2.39M total liabilities and 11.34M total shareholders equity.
This gives us a 4.02 current ratio suggesting companys ability to cover debt
obligations. On the other hand, return on assets is expected to be at 30.16% and
return on CS equity at 57.51%.
<SLIDE 5> With a net profit of 4.14M pesos and total capital outlay of 6.83M pesos,
we expect a payback period of 1.65 years or 19.8 months.
<SLIDE 6> Lastly, we also conducted a sensitivity analysis to show the effects of
variations on sales level to net profit margin and payback period. A 10% increase in
sales equivalent to 30.11M would result to a net profit margin of 17%. On the other
hand, a 10% decrease in sales would result to net profit margin of 12% and a
payback period of 2.22 years.