Budget Sales Sales
. At this point, the price of the product / service plays a key role because it is a determinant of turnover, so it should be explained briefly how he has defined. The plan must show estimates sales for a period of at least one year. It is important to explain how to evolve the sales of the product / service over time and why (regular sale, seasonal or occasional).
need to know the income and expenses of our future business. For this I have to do some estimates, the price of my products and the amount of products I sell. This is why the revenue side. On the expenditure side is easier. We have determined the quantities to sell and therefore produce.
is very rare that a business has only one product or service you sell. Therefore, when making an estimate of the revenue we group them by category or by product line. That is, when we have many products in the business we can group them by "families" and work with sales averages.
In every business there is a "star" product. It is the best selling and most bring to the business. Many times it can be justified only work with certain products and the "star" product. If you do not create many distortions, can eliminate some products from the analysis.
In every business there is a "star" product. It is the best selling and most bring to the business. Many times it can be justified only work with certain products and the "star" product. If you do not create many distortions, can eliminate some products from the analysis.
Revenue Budget
To find the total revenue we must first determine the price of our (s) product (s). Prices may be determined by competition. If not, please justify how you set the price.
to fix the price of my flagship product must:
to fix the price of my flagship product must:
- Calculate the cost of production. Find
- competitive prices.
- determine to whom they sell the product.
- Determine how much I want to win.
If the prices of our products are multiplied by the amount we expect to sell, will the revenues from our production:
Investment Budget
Budget Physical Infrastructure Investment
Expenses can be grouped into three categories:
- pre Expenses operation, which are all those performed before starting the business, such as studies, preparation of business plan, payments to consultants, installation costs, legal expenses of incorporation of the company and other similar expenses. Here again the decision to start the company has not been taken.
- The investment expenses are which is spent on the purchase of tools, equipment, machinery, furniture, houses, and other "assets."
- The operating expenses, sales and administration, that is, all those necessary to implement the business or enterprise.
The
Investment Expenditures Investment Expenditures are of two kinds: investment in fixed assets and investments in working capital
.
Investments in Fixed Assets
Investments in fixed assets are easy to determine, since we can request an estimate of the land, buildings, machinery, equipment and tools used or new. Use the telephone directory as a source of information for questions and quotes.
Investment Expenditures Investment Expenditures are of two kinds: investment in fixed assets and investments in working capital
.
Investments in Fixed Assets
Investments in fixed assets are easy to determine, since we can request an estimate of the land, buildings, machinery, equipment and tools used or new. Use the telephone directory as a source of information for questions and quotes.
Determination of Working Capital
Working capital is the additional financial resources other than the initial investment required to start the company.
Working Capital consists of the costs to be incurred during the first months of operation of the business. Every business must have sufficient liquidity to cover these expenses until you can solve them with revenue generated by sales. Ie we must have a working capital that allows us to have our first revenue.
Your initial costs may include staff salaries, rent, advertising, monthly phone bills, utilities, insurance, interest payments, loan amortization, professional fees and other advisors. It also includes purchases of supplies and raw materials to produce products.
The calculation of how much we need to do is the working capital they need is a function of which require funding ttiieempo my production. If sales are cash can then be short periods. It also depends on the aaccttiivviidaad. It is not like finance a growing bakery rice. The first funding needs less time than the latter.
To estimate your down payment operations, we must calculate how long it will afford the expenses with the revenues generated by sales. Usually this takes the first three months for a trading business. In the case of services may be the longest time, and for further crops and industries. We have enough initial capital to pay operating costs during this period. Otherwise it is very dangerous. We will run out of fuel.
Your initial costs may include staff salaries, rent, advertising, monthly phone bills, utilities, insurance, interest payments, loan amortization, professional fees and other advisors. It also includes purchases of supplies and raw materials to produce products.
The calculation of how much we need to do is the working capital they need is a function of which require funding ttiieempo my production. If sales are cash can then be short periods. It also depends on the aaccttiivviidaad. It is not like finance a growing bakery rice. The first funding needs less time than the latter.
To estimate your down payment operations, we must calculate how long it will afford the expenses with the revenues generated by sales. Usually this takes the first three months for a trading business. In the case of services may be the longest time, and for further crops and industries. We have enough initial capital to pay operating costs during this period. Otherwise it is very dangerous. We will run out of fuel.
Note: If necessary can only produce special tables for materials, raw materials, wages and salaries.
is, if I anticipate that sales will sustain from the fourth month, for example, I cover the first three months of production. Working capital is the sum of working capital needed for the three months (or more or less). Everything depends on the type of business you have.
is, if I anticipate that sales will sustain from the fourth month, for example, I cover the first three months of production. Working capital is the sum of working capital needed for the three months (or more or less). Everything depends on the type of business you have.
Operating Expenses Budget, Management and Sales.
The operating expenses, administration and sales are all those expenses and costs that allow us to produce goods and services. As we see in the list presented as a model we can group as follows:
Now we project the costs of administration and sales for several periods (weeks, months, quarters, and so on. In our example, months)
Breakeven
is the amount of products / services to be sold for the company did not earn or lose money, is another worthwhile data to include in the plan, and to visualize the boundary between the area and the area loss of earnings.
To determine the balance point should be Consider the following:
First, make a list of equipment, tools, materials, sales costs, expenses
administration, salaries and wages, taxes, interest, supplies and all costs, expenses and investments necessary for the preparation or implementation of what you intend to produce and sell . What you need to produce and begin operating the business or enterprise.
not forget any of them for more small.
administration, salaries and wages, taxes, interest, supplies and all costs, expenses and investments necessary for the preparation or implementation of what you intend to produce and sell . What you need to produce and begin operating the business or enterprise.
not forget any of them for more small.
Fixed Costs are those that remain invar regardless of the level of production and you must separate your sales. The determination of fixed costs is essential for analyzing the economic viability of your project.
The determination of the fixed costs will also be required for the calculation of the impasse.
For example, local rents, insurance, administrative expenses, payment of municipal taxes, payment of interest on a debt, maintenance of offices, a rate of payment water and electricity, depreciation, salaries of permanent staff, among others.
If you produce 20 to 100 shirts, pay the guard the company will be the same. The watchman's salary is fixed because it does not vary with production shirts.
Variable costs are those which vary depending on the volume of activity, increase with increasing the volume of activity and are less at the time that it decreases.
The main variable costs are: labor force employed in the production of goods or services directly, direct materials, containers, packaging, labels, sales commissions, travel expenses, among others.
The main variable costs are: labor force employed in the production of goods or services directly, direct materials, containers, packaging, labels, sales commissions, travel expenses, among others.
For example the cost and the amount of fabric not be the same if you produce 20 or if you produce 100 shirts. A more shirts need more material and therefore the cost varies with output.
unit variable costs are the costs of producing one unit of product. For example, if your business is producing sandwiches unit variable costs are:
unit variable costs are the costs of producing one unit of product. For example, if your business is producing sandwiches unit variable costs are:
unit cost of bread.
sausage unit cost. Cost
seasoning unit (what you use mustard, ketchup and others in a single sandwiches).
Cost of deliveries per napkin sandwiches.
And so, all costs relating to the unit produced and vary with production.
Now, to see if we are winning we must determine the balance point.
sausage unit cost. Cost
seasoning unit (what you use mustard, ketchup and others in a single sandwiches).
Cost of deliveries per napkin sandwiches.
And so, all costs relating to the unit produced and vary with production.
Now, to see if we are winning we must determine the balance point.
For this I set the price of my product star.
Where:
P: Price of the property.
Q: Quantities produced from the well.
Sm: price equilibrium.
Qeq Amount point balance.
I: Income
TC: Total costs.
CVU: Variable costs per unit. CF
Fixed Cost.
The explanation is as follows. In the axes represent sales in domestic and the other axis
quantities. As fixed costs are "fixed" the curve represents must be a line parallel to the y-axis. The revenue and cost curves are variables that vary with the units sold and produced. The total cost curve is the sum unit variable costs and fixed costs.
With the graph can develop various scenarios: What happens to the equilibrium point if total fixed costs decrease? How shifts the revenue if the product price decreases ? How shifts the variable cost per unit if they increase ?
P: Price of the property.
Q: Quantities produced from the well.
Sm: price equilibrium.
Qeq Amount point balance.
I: Income
TC: Total costs.
CVU: Variable costs per unit. CF
Fixed Cost.
The explanation is as follows. In the axes represent sales in domestic and the other axis
quantities. As fixed costs are "fixed" the curve represents must be a line parallel to the y-axis. The revenue and cost curves are variables that vary with the units sold and produced. The total cost curve is the sum unit variable costs and fixed costs.
With the graph can develop various scenarios: What happens to the equilibrium point if total fixed costs decrease? How shifts the revenue if the product price decreases ? How shifts the variable cost per unit if they increase ?
Remember The sum of variable costs and fixed costs results in total costs.
Source
- Course: Business Plans
Training Center Entrepreneur
- A Guide to Developing a Business Plan Business Activity Guides
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