What the Profit Coordinator does
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Labor
hours : Your productive
Full-Time staff have only
so many hours in a year to produce your goods or services. They go on vacation,
have legislated days off, maternity leave, sick leave and other agreement
related or Government induced time for themselves.
Where you engage Contractors, Full-Time
Casuals staff or Part - Time Casual staff, the lost hours are generally included in the
price paid per hour. This calculation will assist you to compare the productive
hours you expect in a year against the hours provided by a Full-Time staff
member.
As the business grows, you require
assistance from your staff in areas that do not directly produce goods and
services. A supervisor directing staff may not be fully productive and a office
staff member will have no productive time at all.
This part of the Calculation presents these areas to you and gives you room to add or change items that are specific to your region or business.
Labor
costs : Your weekly pay rates to your
Full-Time productive staff will readily
come to mind. The costs directly related to them may not be so obvious. Such
items as Workers Compensation, Long service leave, tool allowances, Payroll
taxes, Superannuation, Social Service contributions and other Government or
agreement related charges will expand the payroll cost.
Contractors, Full-Time Casual staff and part-time casual staff may attract some or all of these Directly Related expenses. The program provides for them if necessary and a direct comparison with Full-Time staff is made.
Overtime may expand your business and is taken into account as is the Owner(s) of the business.
This part of the calculation presents these areas to you and gives you room to add or change items that are specific to your region or business.
Labor
Wage and Sales (Combined) Sometimes staff are charged out at different
rates. There may be many reasons why this is so. The objective of the
calculation is to arrive at suitable rates to achieve the required profit.
This part of the Calculation presents these areas to you.
Material
: Generally speaking, you are in business for a specific window of the
market place. This should result in the material purchases, as compared to the
productive labor force, remaining somewhat constant.
The Markup on material may vary. If the material cost is higher than the labor cost, it is probable that he markup is low. On the other hand, if the material cost is lower than the labor cost, the markup may be high.
This part of the calculation assists in arriving at a profitable conclusion.
Write
downs :
No business is perfect. There will be times when sales are not up to
expectations, difficulties are experienced with certain jobs, materials may not
be available and machinery breakdowns may occur.
Selecting a suitable write down percentage is the outcome of this part of the Calculation.
Overhead
expenses :
Costs that fall under this heading are necessary to the
efficient running of the business and ensure that the productive staff have a
clear run at production. It pays to have a good knowledge of these costs so that
they do not outstrip the production costs.
This part of the calculation assists in maintaining that balance
Profit
: Profit is hard to come by. Market forces will tell you the ceiling of your
business . This is an exercise in fine tuning you business and should highlight
areas to observe.
This part of the calculation draws together all the related parts of your business. You may move back and forth to examine all aspects that produce the Profit (or loss).
Rates per hour :
Quoting and assessment of services generally require rates per hour and material mark-up. Some useful calculations of your business are provided.