How to Write a Cigar Lounge Business Plan?
Key Takeaways
1. Location Selection:
- Choose a prime location with high foot traffic and easy accessibility for cigar enthusiasts.
- Ensure the space meets local zoning and licensing requirements for a cigar lounge.
- Consider factors like parking availability, nearby amenities, and potential competition.
2. Equipment Requirements:
- Invest in high-quality humidors to maintain the freshness and quality of your cigars.
- Provide comfortable seating and lighting to create a relaxing and inviting atmosphere.
- Incorporate modern technology like point-of-sale systems and inventory management software.
3. Operational Automation:
- Utilize inventory management software to track sales, monitor stock levels, and automate ordering.
- Implement a customer loyalty program to encourage repeat business and gather valuable data.
- Explore online ordering and delivery options to reach a wider customer base.
4. Market Analysis:
- Research the local cigar enthusiast demographic, including their preferences, spending habits, and potential growth.
- Identify your target market and understand their needs, preferences, and pain points.
- Analyze the competition and differentiate your business through unique offerings or exceptional customer service.
5. Financial Projections:
- Develop a detailed financial plan, including start-up costs, ongoing operational expenses, and revenue projections.
- Determine pricing strategies that balance profitability and customer value.
- Explore funding options, such as loans or investor partnerships, to support your business growth.
6. Regulatory Compliance:
- Familiarize yourself with local and state regulations regarding the sale and consumption of cigars.
- Obtain the necessary licenses and permits, including a tobacco retail license and a liquor license (if applicable).
- Ensure compliance with fire safety, health, and other relevant codes and regulations.
How to Write a Cigar Lounge Business Plan?
Executive Summary:
The executive summary should provide a concise overview of the key elements of the business plan. It should highlight the company's mission, products/services, target market, competitive advantages, financial projections, and growth strategies.
Financial Highlights:
This section should present the company's financial projections, including revenue, expenses, profitability, and cash flow. It should also include any funding requirements and a breakdown of how the funds will be used.
Business Description:
Provide a detailed description of the premium cigars and lounges business, including the products and services offered, the unique value proposition, and the competitive landscape.
Organizational Overview:
Outline the company's organizational structure, management team, and key personnel. Highlight their relevant experience and expertise in the premium cigars and lounges industry.
Industry Analysis:
Conduct a thorough analysis of the premium cigars and lounges industry, including market size, growth trends, customer demographics, and competitive factors. Identify any industry-specific regulations or challenges.
Marketing Plan:
Develop a comprehensive marketing strategy that outlines the target customer segments, pricing, distribution channels, promotional activities, and sales strategies. Explain how the company will position its premium cigars and lounges to stand out in the market.
Financials:
Include detailed financial projections, such as income statements, balance sheets, and cash flow statements, for at least the next three to five years. Provide assumptions and supporting data to justify the financial forecasts.
Executive Summary
California Cigar Lounge is a premium cigar establishment founded by Thomson James in San Francisco, California. The lounge offers premium cigar sales, private cigar lockers, and members-only lounge access. The lounge provides a sophisticated and exclusive atmosphere for cigar enthusiasts to enjoy their favorite smokes in a comfortable and welcoming environment.
Mission
To provide California's cigar enthusiasts with a premium, comfortable, and convenient lounge experience, offering access to a curated selection of quality cigars, reliable service, and a clean, relaxing atmosphere that exceeds customer expectations.
Vision
To be the premier destination for cigar enthusiasts, offering a luxurious and sophisticated experience that celebrates the art of cigar-smoking. To provide a haven where individuals can savor the finest premium cigars, relax in a comfortable and well-appointed lounge, and engage in meaningful conversations with like-minded aficionados. To foster a community that appreciates the rich history and culture of cigar-smoking, while promoting responsible enjoyment and camaraderie.
Industry Overview
The premium cigar and lounge industry in San Francisco, California is a niche market with significant growth potential. As of 2021, there are over 25 cigar lounges and specialty shops operating in the city, catering to a discerning customer base.
The industry generates an estimated $35 million in annual revenue, with an average customer spend of $75 per visit. The most popular cigar brands sold in San Francisco include Arturo Fuente, Davidoff, and Padron, which account for over 60% of total sales.
Industry trends point to a shift towards premium, hand-rolled cigars, with a growing emphasis on craft and artisanal products. Cigar lounges are also evolving to offer a more immersive experience, with upscale amenities like fine dining, whiskey bars, and cigar-themed events.
Looking ahead, the San Francisco premium cigar and lounge industry is projected to grow by 8-10% annually over the next five years, driven by the city's affluent population and its reputation as a hub for luxury experiences.
Financial Highlights
Revenue Sources
[Write the revenue sources of the company. Write in bullet points]
Cost Breakdown
[Divide the costs of the company into two parts; variable and fixed cost. Mention the variable and fixed costs in bullet points]
Break- Even Analysis
This is the intersection of your total revenue and total cost. The point at which both meet is the point of break-even where your revenue becomes equal to cost. Your business becomes profitable beyond this point. Learn more about break-even analysis.
Ask
The California Cigar Lounge is seeking $500,000 and is planning to spend the amount in the following way:
Investment & Capital Expenditure Breakdown
This involves capital investment through debt or equity. Capital expenditure includes the acquisition of fixed assets and intangible assets. You can explore Capital Expenditure (CapEx) Definition, Formula, and Examples.
[Mention about sample investment on the California Cigar Lounge based on the premium cigar lounge industry. Mention how much debt and how much equity will be invested. Keep in mind about $500,000 while mentioning the total investment. Write in simple words.]
[Mention about CapEx on the [California Cigar Lounge]]
Business Valuation
The following valuation has been done using the DCF method.
Business Description
Business Name: California Cigar Lounge
Founder: Thomson James
Management Team:
Name
Designation
Thomson James
CEO
Sophia Martinez
Operations Manager
Benjamin Johnson
Finance Manager
Legal Structure: LLC
Location: San Francisco, California
Goals:
[mention [company] goals in bullet points]
Products:
Premium Cigar Sales
Private Cigar Lockers
Members-Only Lounge Access
Cigar Tasting Events
Expert Cigar Education
Luxury Smoking Accessories
Business Model
Key Partners:
- Cigar suppliers for premium cigars
- Furniture and equipment suppliers for cigar lounges
- Maintenance and cleaning services for lounge facilities
Key Activities:
- Sourcing and curating premium cigar selection
- Maintaining comfortable and well-equipped cigar lounges
- Providing exceptional customer service and experience
Value Proposition:
- Offer a premium and convenient cigar-smoking experience in San Francisco
- Cater to both individual retail customers and businesses/events
Customer Relationships:
- Cultivate loyalty through personalized service and exclusive membership programs
- Engage with customers through social media and community events
Customer Segments:
- Retail customers: cigar enthusiasts and aficionados
- Businesses: corporate events, private parties, and celebrations
- Local and visiting events: weddings, conferences, and special occasions
Key Resources:
- Skilled and knowledgeable staff for cigar expertise and customer service
- Well-designed and maintained cigar lounges with high-quality amenities
- Reliable supply chain for premium cigar inventory
Channels:
- Direct sales through the cigar lounge locations
- Online presence for e-commerce and reservations
- Partnerships with local businesses and event organizers
Costs:
- Rent and maintenance of cigar lounge facilities
- Inventory and procurement of premium cigars
- Staffing and training of customer service personnel
Revenue:
- Cigar sales (both in-lounge and online)
- Membership and subscription fees for the cigar lounge
- Event hosting and private party rentals
SWOT
Strengths:
- Established brand reputation for high-quality premium cigars
- Strategically located in San Francisco, a hub for cigar enthusiasts
- Offers a luxurious and comfortable lounge experience
- Knowledgeable staff with expertise in cigar selection and pairing
Weaknesses:
- Limited outdoor seating options due to space constraints
- Potential high operating costs in the San Francisco market
- Reliance on a niche customer base in a changing social climate
Opportunities:
- Expanding the online/e-commerce presence to reach a wider audience
- Diversifying the product line to include complementary luxury items
- Collaborating with local businesses to host exclusive events and experiences
Threats:
- Increasing regulations and restrictions on smoking in public spaces
- Competition from other premium cigar lounges and online retailers
- Changing consumer preferences towards alternative tobacco products
Organizational Overview
Founder
Thomson James
Thomson James is the founder and CEO of California Cigar Lounge. California Cigar Lounge was established in 2022 and headquartered in San Francisco, California. Thomson James brings valuable expertise to his role with over a decade of experience in the industry.
Thomson James established California Cigar Lounge to address challenges in the rapidly evolving field. The business has been able to leverage the latest technologies such as the use of AI to streamline operations.
Thomson James leadership style emphasizes collaboration and continuous learning. Thomson James actively fosters a company culture that encourages creativity and innovation amongst team members. Strategic decision-making and ability to adapt to market changes have been key factors in the company's early success.
Organogram
Salaries
The General Manager of the California Cigar Lounge will be responsible for overseeing the overall operations of the business. They will manage the staff, ensure customer satisfaction, and make strategic decisions to drive the company's growth. The salary for this position will be $80,000 to $100,000 per year.
The Cigar Sommelier will be responsible for curating the cigar selection, providing recommendations to customers, and ensuring the proper storage and maintenance of the cigars. They will also be responsible for educating the staff on the various cigar brands and types. The salary for this position will be $50,000 to $60,000 per year.
The Bartender will be responsible for mixing and serving a variety of cocktails, as well as providing excellent customer service. They will need to have a strong knowledge of mixology and be able to recommend drink pairings for the different cigar offerings. The salary for this position will be $35,000 to $45,000 per year.
The Lounge Attendant will be responsible for maintaining the cleanliness and ambiance of the cigar lounge. They will greet customers, assist with seating, and ensure that the lounge is well-stocked with amenities. The salary for this position will be $30,000 to $35,000 per year.
The Marketing and Events Coordinator will be responsible for developing and implementing marketing strategies to attract new customers and promote the California Cigar Lounge brand. They will also be responsible for organizing and hosting events, such as cigar tastings and live music performances. The salary for this position will be $45,000 to $55,000 per year.
By offering competitive salaries and clear job responsibilities, the California Cigar Lounge can attract and retain top talent to ensure the success of the business.
Industry Analysis
The premium cigars and lounges industry in Boston offers a sophisticated experience for cigar enthusiasts. Cigar lounges provide a comfortable space to enjoy high-quality cigars, often paired with premium drinks. These establishments cater to a discerning clientele, offering a wide selection of premium cigar brands and a relaxed atmosphere. Boston's cigar lounges are popular destinations for business meetings, social gatherings, and those seeking a refined cigar-smoking experience. The industry reflects the city's vibrant culture and attracts both local aficionados and visitors seeking a taste of Boston's cigar scene.
Global Market Size
Industry Trends
The premium cigar and lounge industry in San Francisco has seen some notable trends in recent years. Many cigar lounges have embraced technology to enhance the customer experience. Some have implemented digital menus and order systems, allowing customers to browse and order from their phones. Others have added high-tech humidors and climate control systems to ensure the perfect conditions for their cigar collections.
Sustainability has also become a focus for some premium cigar lounges in the city. Some have switched to eco-friendly materials for their furniture and decor, while others have implemented recycling programs for cigar butts and packaging. A few even source their cigars from sustainable tobacco farms.
Customer preferences in the San Francisco premium cigar market have evolved as well. There is a growing demand for boutique and craft cigars, as well as for cigar blends that highlight local or regional tobacco. Customers also seek out lounges with a unique ambiance, such as those with outdoor patio spaces or that offer craft cocktails and gourmet food pairings.
Additionally, many San Francisco cigar enthusiasts are interested in the health and wellness aspects of cigar smoking. Some lounges have responded by offering premium, low-nicotine cigar options and providing educational resources on proper cigar etiquette and responsible consumption.
Overall, the premium cigar and lounge industry in San Francisco is adapting to the changing preferences and expectations of its discerning customer base. By embracing technology, sustainability, and a focus on unique experiences, these businesses are working to stay relevant and appealing in the competitive local market.
Market Segmentation
Geographic Segmentation: The premium cigars and lounges industry in San Francisco, California, and its surrounding areas can be geographically segmented as follows:
The Financial District and the nearby Jackson Square area are home to several upscale cigar lounges catering to the city's business elite. The Castro neighborhood is known for its more relaxed, community-oriented cigar clubs. In the Mission District, you'll find a mix of casual lounges and specialty shops serving a diverse clientele. The Marina District is popular for its chic, contemporary cigar bars frequented by a younger, trendier crowd.
Moving outward, the East Bay cities of Oakland and Berkeley offer a more laid-back, artisanal vibe, with boutique cigar shops and intimate lounges. In the South Bay, the Silicon Valley hub of San Jose has a growing number of cigar-friendly establishments catering to the tech industry. Further north, the Marin County communities across the Golden Gate Bridge provide a scenic, upscale setting for premium cigar enthusiasts.Demographic Segmentation: The premium cigars and lounges industry in San Francisco, California caters to a specific demographic. The target audience is primarily affluent individuals, often professionals and executives, who appreciate the luxury and exclusivity of premium cigar experiences.
In San Francisco, the demographic for this industry tends to be predominantly male, with a median age range of 35 to 55 years old. These individuals typically have a high level of disposable income and are willing to invest in premium cigar products and services.
The premium cigar lounges in San Francisco offer a range of services to cater to this demographic. These include private cigar lockers, members-only lounge access, cigar tasting events, and expert cigar education. Customers can also purchase luxury smoking accessories to complement their cigar-smoking experience.
The premium cigar industry in San Francisco is focused on providing a high-end, exclusive experience for its clientele. The lounges often feature sophisticated decor, comfortable seating, and a curated selection of premium cigars from around the world. This caters to the discerning tastes and preferences of the affluent San Francisco residents who seek a refined and sophisticated cigar-smoking experience.
Psychographic Segmentation: Premium cigar smokers in San Francisco are often affluent professionals. They enjoy the sophisticated experience of smoking high-quality cigars in dedicated lounges. These lounges cater to their need for a luxurious, relaxing environment. Customers seek out lounges with a wide selection of premium cigars, comfortable seating, and a social atmosphere. They value the ritual and exclusivity associated with premium cigar smoking. Lounges that provide exceptional service, knowledgeable staff, and a refined ambiance tend to attract this discerning clientele. Location and accessibility are also important factors for these urban cigar enthusiasts.
Behavioral Segmentation: Premium cigar smokers in San Francisco can be segmented by their behavior. Some enjoy cigars socially, gathering in lounges to smoke and converse. Others prefer a more private experience, smoking at home or in exclusive clubs. Enthusiasts may collect rare or limited-edition cigars, while occasional smokers seek a more casual indulgence. Younger adults often experiment with flavored or smaller-format cigars, while older connoisseurs favor traditional full-bodied blends. Cigar lounges cater to diverse preferences, offering comfortable settings, knowledgeable staff, and curated cigar selections to meet the needs of their distinct customer segments.
Market Size
Industry Outlook
The premium cigars and lounges industry in San Francisco is thriving, with a growing number of high-end establishments catering to cigar enthusiasts. Recent industry trends have seen a greater emphasis on eco-friendly practices and digital integration.
Eco-friendly practices have become increasingly important for San Francisco's premium cigar lounges. Many establishments now use energy-efficient lighting, implement recycling programs, and source their cigars from sustainable tobacco farms. This shift towards sustainability reflects the city's broader commitment to environmental stewardship.
Digital integration has also transformed the premium cigar experience in San Francisco. Lounges have embraced technology, offering mobile apps that allow customers to browse their cigar selection, place orders, and even make reservations. Some lounges have even incorporated virtual humidors, enabling patrons to explore their inventory and make purchases remotely.
The rise of social media has also played a significant role in the industry's evolution. Cigar enthusiasts in San Francisco are actively engaged on platforms like Instagram, sharing their experiences and discoveries with a wider community. Lounges, in turn, have leveraged social media to promote their offerings, host events, and connect with their customers.
Despite the challenges posed by the COVID-19 pandemic, the premium cigar and lounge industry in San Francisco has demonstrated resilience. Many establishments have adapted by implementing strict safety protocols, offering outdoor seating, and even providing curbside pickup and delivery services.
As the city continues to recover, the premium cigar and lounge industry in San Francisco is poised for further growth, driven by a discerning clientele and a commitment to innovation and sustainability.
Marketing Plan
Overview
The marketing plan for the premium cigars and lounges in San Francisco, California, will focus on two key areas: local community engagement and digital presence.
Local community engagement will be a cornerstone of the strategy. The company will partner with local organizations and host events that cater to the interests of the San Francisco community. This could include collaborations with art galleries, live music venues, and cigar enthusiast clubs. By fostering these connections, the brand will establish itself as a valued member of the local community.
The digital presence will be equally important. The company will maintain a strong online platform, including a user-friendly website and active social media channels. The content will highlight the unique offerings of the lounges, such as rare cigar selections and expertly crafted cocktails. Additionally, the digital strategy will include targeted advertising and influencer collaborations to reach the right audience.
By combining local community engagement and a robust digital presence, the premium cigars and lounges in San Francisco will create a well-rounded marketing approach that resonates with both the local community and a wider audience.
Annual Marketing Budget
Promotional Channel Budgets
2025F
2026F
2027F
2028F
2029F
In-person Marketing
$1,750
$1,250
$1,250
$1,250
$1,250
Social Media
$735
$525
$525
$525
$525
Google Ads
$560
$400
$400
$400
$400
Email Marketing
$455
$325
$325
$325
$325
Total Budget
$3,500
$2,500
$2,500
$2,500
$2,500
Marketing Channels
California Cigar Lounge is a premium cigar lounge located in the heart of downtown. To attract and retain customers, the business will focus on location-based advertising, partnerships with local businesses, mobile app integration, and seasonal promotions.
Location-based advertising will be a key component of the marketing plan. The lounge will use geofencing technology to target potential customers within a specific radius of the business. Ads will be displayed on their mobile devices, highlighting the lounge's offerings and special events.
Partnerships with local businesses will also be a priority. The lounge will collaborate with nearby restaurants, bars, and hotels to cross-promote each other's services. This will help increase foot traffic and exposure for all involved.
To enhance the customer experience, the lounge will develop a mobile app that allows customers to view the menu, make reservations, and earn rewards for their visits. The app will also feature a social component, enabling customers to share their experiences and connect with fellow cigar enthusiasts.
Seasonal promotions will be used to generate excitement and drive sales throughout the year. For example, the lounge may offer special cigar pairings and discounts during the holiday season, or host cigar-rolling demonstrations during the summer months.
Digital marketing will play a crucial role in the overall strategy. The lounge will maintain an active presence on social media platforms, sharing content that resonates with its target audience. Additionally, the website will be optimized for search engines to improve visibility and drive traffic.
Local advertising, such as print ads in community publications and sponsorships of local events, will complement the digital efforts. This will help the lounge establish a strong presence within the community and reach potential customers who may not be as active online.
By implementing this comprehensive marketing plan, California Cigar Lounge will be well-positioned to attract and retain a loyal customer base, while also expanding its reach within the premium cigars and lounges industry.
Brand Management
Establish a premium cigar experience by maintaining exceptional ice quality. Ensure all ice machines are cleaned and maintained regularly, providing customers with chilled, crystal-clear ice to enhance their cigar enjoyment.
Prioritize machine cleanliness throughout the lounge. Implement a rigorous cleaning schedule for all equipment, from humidors to cutting devices, to uphold the highest standards of hygiene and provide a pristine environment for customers.
Deliver reliable, attentive service that caters to the unique needs of each customer. Train staff to be knowledgeable about the cigar selection, provide personalized recommendations, and ensure a seamless experience from start to finish.
Incorporate modern vending technology to elevate the customer experience. Invest in state-of-the-art cigar vending machines that offer a wide range of premium cigars, allowing customers to explore and discover new favorites with ease.
Continuously monitor customer feedback and adapt the brand strategy accordingly. Stay attuned to industry trends and evolving customer preferences to maintain a cutting-edge, premium cigar lounge that exceeds expectations.
GTM Strategy
California Cigar Lounge will offer a premium cigar experience with competitive pricing. The lounge will be strategically located in high-traffic areas, providing convenient access for customers. A mobile app will be developed, allowing customers to explore the lounge's selection, make reservations, and earn loyalty rewards.
The pricing strategy will be competitive within the premium cigar and lounge industry. Cigars will be priced at a slight premium compared to other local lounges, reflecting the high-quality products and exceptional service offered. Membership packages and loyalty programs will provide discounts and exclusive access to customers, incentivizing repeat visits.
The lounge's locations will be carefully selected to ensure maximum convenience for customers. The first location will be in a bustling downtown area, with ample parking and easy access from major roads. Future expansions will target other high-traffic areas, such as upscale shopping districts and business hubs, providing a premium cigar experience in convenient locations.
The mobile app will be a key feature of the California Cigar Lounge experience. Customers will be able to browse the lounge's cigar selection, make reservations, and earn loyalty points for each visit. The app will also offer exclusive content, such as cigar pairing recommendations and industry news, enhancing the customer's engagement with the brand.
The loyalty program will be designed to encourage repeat business and foster a sense of community among customers. Members will earn points for each visit, which can be redeemed for discounts, exclusive events, and special-edition cigars. The program will also offer tiered benefits, with higher-level members receiving additional perks and personalized services.
By combining competitive pricing, strategic locations, a user-friendly mobile app, and a rewarding loyalty program, California Cigar Lounge will provide a premium cigar experience that sets it apart from competitors in the industry.
Implementation & Timeline
Establish an online presence within 2 months:
- Create a website showcasing the lounge, product offerings, and events
- Set up social media accounts on platforms like Instagram and Facebook
- Develop a content strategy to engage with potential customers
Secure a prime location within 4 months:
- Research and evaluate potential sites in high-traffic areas
- Negotiate lease terms and finalize the location
Launch the lounge within 6 months:
- Outfit the space with premium furniture and amenities
- Curate a selection of high-quality cigars and spirits
- Hire and train a team of knowledgeable staff
Implement a marketing campaign within 8 months:
- Develop promotional materials, such as flyers and advertisements
- Collaborate with local cigar enthusiast groups and influencers
- Organize grand opening and ongoing special events
Establish partnerships within 12 months:
- Connect with local businesses for cross-promotional opportunities
- Explore partnerships with cigar brands and distributors
- Offer membership programs and loyalty rewards
Continuously refine and expand the business within the first year:
- Gather customer feedback to improve the lounge experience
- Introduce new product offerings and experiences
- Explore opportunities for growth, such as additional locations.
Contingency Plan
Regularly maintain equipment like humidors, air conditioning, and ventilation systems to ensure optimal cigar storage and customer comfort. Train staff to provide exceptional service, emphasizing product knowledge and attentive customer care. Conduct customer surveys to gather feedback and address any concerns promptly. Invest in creating a welcoming ambiance and fostering a sense of community among cigar enthusiasts. Offer a diverse selection of premium cigars and accessories to cater to various preferences. Collaborate with local cigar clubs and organize exclusive events to build brand loyalty. Leverage social media and targeted marketing campaigns to attract new customers while retaining existing ones. Stay up-to-date with industry trends and regulations to adapt your business strategies accordingly.
Financials
Income Statement
The California Cigar Lounge's Income Statement for the fiscal year ended December 31, 2022:
Revenue:
Cigar Sales: $1,200,000
Lounge Membership Fees: $300,000
Total Revenue: $1,500,000
Cost of Goods Sold:
Cigar Purchases: $600,000
Lounge Maintenance: $150,000
Total Cost of Goods Sold: $750,000
Gross Profit: $750,000
Operating Expenses:
Salaries and Wages: $300,000
Rent: $120,000
Utilities: $50,000
Marketing: $75,000
Insurance: $30,000
Depreciation: $40,000
Total Operating Expenses: $615,000
Operating Income: $135,000
Other Income (Expense):
Interest Income: $5,000
Interest Expense: $(10,000)
Total Other Income (Expense): $(5,000)
Net Income before Taxes: $130,000
Income Tax Expense: $39,000
Net Income: $91,000
Cash Flow Statement
The cash flow statement for California Cigar Lounge reflects the movement of cash in and out of the business. It is divided into three main sections: operating activities, investing activities, and financing activities.
In the operating activities section, the company may have cash inflows from selling premium cigars and providing lounge services, and cash outflows for purchasing inventory, paying employee salaries, and covering other operating expenses. For example, the company may have $500,000 in cash inflows from sales and $400,000 in cash outflows for expenses, resulting in a net cash flow from operations of $100,000.
The investing activities section may include cash outflows for purchasing new lounge equipment or investing in a new location. For instance, the company may have spent $50,000 on acquiring a new humidor system.
The financing activities section could involve cash inflows from taking out a loan or cash outflows for repaying debt or distributing dividends to shareholders. The company may have received $200,000 in a loan to finance the expansion of its lounge.
Balance Sheet
Assets:
Cash: $50,000
Accounts Receivable: $20,000
Inventory (Premium Cigars): $80,000
Property, Plant, and Equipment (Lounges): $500,000
Total Assets: $650,000
Liabilities:
Accounts Payable: $30,000
Loans Payable: $200,000
Total Liabilities: $230,000
Equity:
Paid-in Capital: $300,000
Retained Earnings: $120,000
Total Equity: $420,000
Total Liabilities and Equity: $650,000