Any commercial enterprise is created for the purpose of making a profit, and all processes occurring within the company are ultimately aimed at achieving profitability. The company develops a business strategy with the obligatory inclusion of a profit planning tool in it. Let's consider what problems profit planning allows us to solve, how it happens in practice, and what results a company can get in the end.
You will learn:
- Why is Profit Planning Important?
- What principles should the organization's profit planning comply with?
- What are the types of profit planning.
- What methods of profit planning are used.
- What are the steps in the profit planning process?
- What activities allow you to improve profit planning.
Why profit planning is essential for an enterprise
Profit - the income of the enterprise minus all expenses in the form of costs for the manufacture of goods, related costs and taxes.
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In the article you will find a formula that will help you not to make mistakes when calculating the volume of sales per future period, and you can download the sales plan template.
Profit planning is a key point in the strategy of any commercial enterprise operating in market economy. Profit planning is the process of forming an action plan and tasks that need to be implemented and completed in order to make a profit in accordance with the enterprise development strategy for a certain upcoming period of time.
When developing and planning profit, it is necessary to take into account many factors that ultimately affect the result: market conditions, current and expected capabilities of the enterprise, external factors and circumstances, enterprise competitiveness, strengths and weak sides competitors, the ability to predict the behavior and development of the market and the most promising areas of the enterprise, its strengths.
Profit planning is an integral part of financial planning for the enterprise as a whole. At the same time, in stable economic conditions, planning is carried out with a perspective of three to five years, but quarterly, semi-annual and annual profit plans are also drawn up.
If an enterprise is engaged in various types of activities, profit planning is also carried out separately for all types of activities: from the sale of goods, from the sale of services, from the sale of fixed assets and other property, from non-operating income.
Profit planning tasks are similar to standard tasks, while planning must be comprehensive, and methods must be rational. For the most effective planning, the system of managing the goals of the enterprise is mainly taken into account. The planning function is directly related to the accounting function, but planning is not limited to accounting, as it requires an integrated approach that takes into account all business functions.
What principles should the organization's profit planning comply with?
For the most effective profit planning in the enterprise, a solid foundation for this function should be laid, based on the following principles:
- Profit planning is the process of making management decisions by managers, thanks to which the variables that directly affect profit are operated. Basically, the level of income, expenses and investments depends on the decisions of the management.
- Profit planning is directly related to the competence and experience of management. If the management sets realistic tasks and goals for the organization, developing and implementing effective methods and means to achieve these goals, then profit planning becomes the simplest and most effective process - an integral part of the financial planning of the enterprise.
- A comprehensive profit planning program affects all levels of the company's management - from lower management to top managers.
Main types of profit planning
The planned profit should be such an indicator that fully meets the needs of the enterprise and guarantees the fulfillment of the obligations that the company assumes. The planned profit should also ensure the successful implementation of the enterprise's plan for development and increase in profits, providing the enterprise with a stable growth dynamics.
Since profits for different types of activities are classified separately on various grounds, profits are also planned separately. The most applicable division of profit planning by type of activity of the company:
- Sale of goods (manufactured or resold).
- Provision of services, production of works.
- Sale or lease of enterprise funds.
- Sale of intangible assets (copyrights, property rights, etc.).
- non-operating transactions.
In the process of profit planning, it is necessary to take into account what expenses and income will accompany commercial activities. Knowing these indicators, you can plan the following types of profit:
- Accounting - is formed from the amount of revenue when subtracting from it the costs and expenses for production, to which are added in the case of income and deducted in the event of a loss of funds for non-operating activities.
- Economic - the cost is deducted from the income received.
- Net - funds that remain with the enterprise after all mandatory, including fiscal, payments.
Excise payments and value added tax are not taken into account when planning profits, since they are deducted from the company's income even before the profit is formed.
Profit planning is distinguished by periods: operational and current. The most accurate is operational planning, since the calendar quarter is taken into account. Thanks to quarterly profit planning, it is possible to achieve maximum accuracy in the calculations. A longer period is dangerous with errors in calculations, a shorter one will not provide sufficient data for a full-fledged process.
Current planning is used quite often. The company's budgeting is based on the indicators of the previous year, as well as the expected and markets, and takes into account the data of the analysis of the planned indicators of financial and economic activity. Budgeting involves the distribution of funds for the next calendar year: income and expenses.
It is possible to predict the planned profit when the cost of production and plans for the volume of its implementation are determined.
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Effective methods of enterprise profit planning
Method 1 Direct account.
In practice, various methods are used to calculate the planned profit, the direct account method is most often used.
This method is used in most modern enterprises. However, it is most convenient with a small range of products. The essence of the method is that when selling, VAT and excises are first deducted from the proceeds, and then the full cost of production. Thus, the profit is calculated according to the following formula:
P \u003d (O × C)–(O × C),
where O is the volume of output in the planned period in physical terms;
C - price per unit of production (net of VAT and excises);
C is the total cost of a unit of production.
Calculation of profit on commercial output (Ptp) is planned on the basis of cost estimates for the production and sale of products. This cost estimate determines the cost of output of goods for the planned period:
Ptp = Tstp–stp,
where Ctp is the cost of commodity output of the planned period in current selling prices (excluding VAT, excises, trade and sales discounts);
Stp - the full cost of marketable products of the planned period.
When calculating, it is necessary to distinguish the planned profit per commercial output from the profit planned for the volume of products sold. In this case, the volume of goods sold may be less than the planned output. Accordingly, the estimated profit may differ.
Profit on sales (PRP) in general view calculated by the formula:
Prp = Vrp–srp,
where Vrp is the planned revenue from the sale of products in current prices (excluding VAT, excises, trade and marketing discounts);
CRP - the full cost of products sold in the coming period.
More precisely, the profit from the volume of products sold in the planned period is calculated by the formula:
Prp = Mon + Ptp–Pok,
where Mon - the amount of profit of the balance of unsold products at the beginning of the planning period;
Ptp - profit from the volume of output of marketable products in the planned period;
Pok - profit from the balance of unsold products at the end of the planning period.
This calculation method planned profit applicable when it is easy to predict the volume of sales of products, the prices of which are stable and the cost is calculated quite simply.
One of the options for direct calculation of the planned profit is the assortment calculation, when the profit is calculated separately for each item from the enterprise's product range, after which all individual calculations are summarized. To this value is added the planned profit from the rest of the entire range finished products not realized at the beginning of the billing period.
Method 2 Studying the limit of profitability.
There are alternative methods for calculating planned profit, one of which is the profitability limit method.
Usually, the study of the profitability limit begins with the construction of graphs that make it possible to visually assess the dependence of the planned profit on the elasticity of the company in relation to changes in the company's expenses during the turnover of its financial resources.
With this method of calculation, it is very important to see the difference between the planned turnover and the minimum turnover required by the company to cover costs and achieve profitability. This difference shows how flexible a company can plan its profit and build financial forecasts for its activities.
Method 3 Forecasting profitability.
Forecasting the return on invested capital is based on the analysis of the ratios of the following values:
- working resources + capital investments = invested capital;
- capital turnover index = working resources / invested capital;
- profit index = turnover of capital / cost;
- return on equity index = profit / turnover of capital;
- return on equity = (turnover of capital / invested capital) * (profit / turnover of capital) * 100.
This method of calculation is based on establishing the minimum volume required for the company to reach a level that maintains its liquidity. The calculation methodology takes into account the financial costs of the company, as well as depreciation costs.
Profit planning is also possible with the help of standards. This technique as such standards most often implies:
- capital (own);
- company assets;
- unit of products sold;
- invested capital (invested).
This method of calculation is convenient to apply at the stage of a technical project, when its economic argument is needed. Also, this method is used when calculating for short periods of time. The method has difficulties, the main of which is the need to develop standards, their qualitative and quantitative calculation and justification.
This extrapolation method involves collecting data, analyzing and identifying the dynamics of the company's performance over several previous years of work.
Method 4 Analytical.
The analytical method is one of the most complex, since many factors of the enterprise's activity are taken into account. The method is based on the creation of multifactorial models of the development of the situation, in which many indicators play an important role.
Analysis of the ratio of costs, sales and profits. The break-even point for the sale of products in the planning period is set:
ORtb \u003d (PostR * 100) / (PUchd - PUpr),
where ORtb is the value of sold products, which ensures the achievement of the break-even point in the planned period;
PostR - the estimated value of fixed costs (in percent);
PUchd - the estimated amount of profit in the total income from the sale of products (in percent);
VPpr - the estimated value of variable costs in the total volume of sales of products (in percent).
PP \u003d ((ORp - ORtb) * (PUchd - PUpr)) / 100,
where PP is the planned value of profit from sales;
ORp - the planned size of the implementation;
ORtb - the amount of sales at the breakeven point;
PUchd - the expected amount of profit in the total income from the sale of products (in percent);
PUpr - the estimated amount of variable costs in total production (in percent).
The planned value of marginal profit is determined by the formulas:
MP \u003d (ORp (PUchd - PUpr)) / 100,
MP = PP + PostR.
Calculation of net profit:
PE \u003d (PP * (100 - Snp)) / 100,
where SNP is the average rate of tax payments on account of profit.
This method allows us to consider all possible options for calculating the planned profit and indicators of the company, while depending on the factors taken into account, the forecast can be both optimistic and extremely pessimistic. The method allows you to take into account many indicators: the volume of sales of goods, estimated prices and their dynamics, production costs, production costs. The more factors are taken into account, the more difficult the calculation becomes.
Method 5 Target.
The target calculation method helps to link the planned values with the strategic objectives of regulating the profit of the enterprise for the billing period. The method is based on determining the necessary need for the financial resources of the company, formed from profit. For each element of the need, its own calculations are carried out. The target amount in the calculation is the financial need, which is formed from the net profit of the enterprise.
Based on the target amount of net profit, a target profit from sales is set, as well as marginal profit:
PP \u003d (PE * 100) / (100 - SNP),
MP = PP + PostR.
The resulting values become the base for the enterprise and are used to calculate other planned financial indicators.
The financial flow is predicted on the basis of the calculation of the planned receipt and expenditure of the enterprise's financial resources.
Method 6 Combined calculation.
The combined method, as the name implies, includes the method of direct counting and the method of analytical calculation of the company's planned profit.
For example, with such a calculation method, the cost of goods in the prices of the billing period and the cost of production are calculated by the direct method, and the analytical method takes into account changes in the price of goods in the planning period, changes in cost, and expansion of the range.
In itself, obtaining a certain amount of profit characterizes the efficiency of production, but it does not characterize the efficiency of the enterprise. To obtain more accurate information, it is necessary to correlate the mass of profits with the costs incurred by the company, while obtaining an indicator of the profitability of the company as a whole.
Profitability of production is a conditional and relative indicator that characterizes the degree of return on costs and the use of resources. Profitability is expressed as a percentage. Most often, profitability is calculated by the ratio of net profit to costs. In this case, profitability can be calculated by the ratio of net profit to sales proceeds or to the assets of the enterprise.
Profit Ratios Show Efficiency financial activities enterprises.
The main groups into which profitability indicators can be divided are shown in the table.
|
Profitability indicators |
Calculation formulas |
Purpose |
|
Profitability certain types products, all commercial products and production |
Profit per unit of production / Unit cost × 100% Profit per commercial output / Cost of commercial products × 100% |
Characterizes profitability various kinds products, all marketable products and the profitability (profitability) of the enterprise. |
|
Balance sheet (net) profit / Amount of principal production assets and inventories × 100% |
Serves as the basis for setting prices |
|
|
Return on sales (sales) |
Profit from product sales / Sales revenue × 100% |
Shows what percentage of profit the company receives from each ruble of sales. |
|
Balance sheet profit / (Net sales proceeds + Income from other sales and non-operating transactions) × 100% |
Serves as the basis for the choice of the range of products |
|
|
Return on assets (capital) Return on current assets Profitability net assets |
Profit / Total Assets × 100% Profit / Current Assets × 100% |
These comprehensive indicators characterize the return that falls on the ruble of the respective assets. |
|
Profit / Net Assets × 100% |
Reflects the effectiveness of the funds invested in the enterprise |
|
|
Profitability equity |
Net income / Equity × 100% |
It characterizes the profit that falls on the ruble of equity after paying interest on loans and taxes. Characterizes the return or profitability of own funds |
The most commonly used indicators are return on assets (capital), return on net assets, return on equity and return on sales.
Often, when calculating profitability, the total amount of assets is replaced by the value of current assets and the profitability of using the latter is analyzed.
Depending on the type of activity and the conditions in which the enterprise operates, various indicators of profit from ordinary activities to are used.
In foreign practice, profit before tax is most often used as a numerator, and some organizations take net profit into account.
As assets (the denominator of the formula) can be used:
- balance sheet value of assets;
- the value of assets on the balance sheet plus depreciation amounts on depreciable assets;
- operating assets;
- working capital plus non-current assets.
How to choose the best profit planning method
The calculation methods for planning profits presented above allow you to most accurately predict profits and get reliable numbers.
When choosing a method of calculation when planning profit, it is necessary to focus on the criteria proposed by the personnel of the enterprise, experts: accountants, managers, financiers and administration. For the most successful choice the method of calculating the planned profit, it is necessary to involve the largest number of company personnel competent in this matter.
The choice of the optimal calculation method should be based on the following criteria:
- Ease of calculation. The chosen calculation method should not be complicated and require more resources and time for data collection and analysis than the practical benefit and efficiency will be obtained from this collection method.
- Relevance. When choosing a method for calculating planned profit, it is worth considering not only those factors that affect economic indicators in this moment and the current period, but also to foresee the economic factors and circumstances that may arise in the process of implementing the plan.
- Practicality. The choice of method should be made in accordance with the internal factors of the enterprise. The qualifications of specialists, the document management system and the provision of the company with resources must correspond to the chosen calculation method and allow it to be carried out.
- Data accuracy. The result that will be obtained in the course of calculating the planned profit should correspond as much as possible to market realities and the state of affairs in the market, the greatest accuracy in the methods of calculation with reference to the current and expected market will give the minimum discrepancy between the planned profit and the real profit.
You should not rely only on this calculation system when planning profits. For each specific enterprise, it is necessary to take into account all kinds of circumstances and adjust the methods for calculating the planned profit in accordance with the type of activity of the company, its economic parameters, opportunities and market position. This system of criteria can be modernized by specialists and brought to the conditions that are most suitable for each specific organization. Individual priorities also play an important role - each specialist has to focus on the problem, taking into account their individual perception and management decisions.
Having all the necessary criteria, it is important to give them an objective assessment, and then proceed to the choice of calculation method, giving each method a score from 1 to 5 points. Having thus chosen the most suitable method, you can proceed to the calculation of the planned profit.
It should be borne in mind that the data on the planned profit obtained during the calculation are not absolute, they are only forecasted indicators that may change depending on the changes taking place in the market. To clarify and adjust the planned profit, you should always monitor all changes in the market and promptly correct the data.
Profit Planning Process: Key Steps
Stage 1. Goal setting.
At this stage, the planned profit should be based on a realistic forecast in accordance with the capabilities and resources of the enterprise. At the same time, the planned profit should correspond to the strategic plan of the enterprise.
Stage 2. Calculation of the expected sales volume.
At this stage, it is necessary to objectively assess the position and capabilities of the enterprise in the market, predict the behavior of competitors, conduct a complete analysis of the capabilities of competitors, and evaluate the behavior of customers. Given these and many more factors, you can predict the volume of sales, which directly affects the amount of profit.
Stage 3. Cost analysis.
In accordance with the planned sales volumes, an assessment is made of the costs that the company will incur in the production of goods. Expenses can be based on data from the previous period of the enterprise, but taking into account data on projected sales volumes, which may be higher or lower than in the previous period. If the enterprise is new, then the calculation can be based on data from another company in the same industry, if, of course, it is possible to obtain these data, which is very difficult in today's competitive market.
Stage 4. Profit calculation.
Based on the data obtained at the previous stages, it is possible to make the final calculation of the planned profit of the enterprise for the coming period.
Profit calculation formulas:
- Planned Gross Profit = Planned Sales Revenue - Cost of Sales.
- Planned Operating Profit = Planned Gross Profit - Operating Costs.
- Planned net income = Planned operating income - Interest on loans - Taxes.
- Retained earnings = Planned net income - Dividends.
The sequence of planning profit from the sale of products
Consider the sequence when planning profit from sales.
- Sales volume planning. The most important indicator is the planned sales volume, it is he who affects the final result of profit planning. The planned sales volume also affects the formation of warehouse stocks, the movement of material assets, the distribution of goods according to retail outlets networks. However, it should be borne in mind that when demand exceeds the capabilities of the enterprise's production capacities, it is worth taking into account precisely the capabilities of the enterprise, that is, the volume of goods that it can produce for certain period time.
- Development of the production program. At the moment when the volume of sales is determined and contracts for the supply of goods are concluded, a production program is developed. This takes into account the volume of goods already in the warehouses of the enterprise, as well as the goods that will have to remain in the warehouse in the form of stock after the volume of goods included in the program is produced. This stage also affects the calculation of the enterprise's needs for resources, labor, energy carriers, since the planned program production volume directly affects the needs of the enterprise.
- Planning of the main production costs. In this calculation, it is necessary to take into account not only the final volume of products that must be produced for the planned period, but also the amount of costs that the enterprise will incur in the production process. At the same time, the stocks of material assets and raw materials already available in the warehouses from which the goods will be produced must be taken into account, the volumes of material assets and raw materials necessary for the purchase for the production of the planned volume of production and the stocks of raw materials and funds that will have to remain in the warehouses must be added to them. at the end of the planning period. It also takes into account the costs in the form of deductions to state and insurance funds, cash for payment wages employees, maintenance costs of production equipment, unplanned expenses. It is necessary to calculate the normalization of working time and costs for the production of one unit of output.
- Overhead Planning. An estimate of the overhead costs included in the cost of production is compiled. The amount of costs depends on their composition and nature relative to the volume of production. These costs are divided into fixed and variable. As a result of the calculation of incurred production costs, the production cost of a unit of sold products is formed. In this case, the balances of finished products at the beginning and end of the settlement planning period are taken into account.
- Planning of administrative and commercial expenses. At this stage, expenses are planned for the administration and maintenance of production, the costs of promoting goods and marketing, and commissions for sales representatives. At the same stage, a plan for making a profit from sales is formed.
- Planning of other income and expenses.
Upon completion of these stages, the company will have data on the planned profit, while it should be borne in mind that the profit will be taxable.
Based on the known indicators of the price and cost of output of marketable products, as well as the balance of finished products at the beginning and end of the planning period, it is possible to calculate the planned amount of profit:
Ppl \u003d Mon + Ptp + Pok,
where Pon - profit in the balance of finished products at the beginning of the planning period; Ptp - profit from the release of marketable products in the planned period; Pok - profit in the balance of finished products at the end of the planning period.
The following factors influence the change in profit:
- Dependence of profit change on sales volumes. With a high share of fixed costs in the cost of one unit of production, an increase in sales volumes will lead to a decrease in the share of costs and, accordingly, to an increase in profits. Thus, with an increase in production volumes, fixed costs do not change, but variables increase, in general, this has the effect of reducing production costs and increasing profits from the sale of a unit of goods.
- Rising prices and reducing production costs i.e. cost reduction. With inflation in the market, an increase in profits is due to an increase in the price of goods. If the market is highly competitive, then the price of the goods cannot rise, and the manufacturer is limited in the possibilities of increasing the price of his products. At the same time, the increase in profits is influenced by the reduction in production costs. It can be achieved in various ways: saving raw materials, increasing the energy efficiency of equipment, optimizing the use of material labor resources, reducing deductions for depreciation of equipment and means of production. But it should be borne in mind that a reduction in production costs is possible only to the extent that product quality is maintained, since the deterioration in product quality will certainly be followed by a drop in demand and sales volumes, and after them - production volumes. It is necessary to optimize production costs by reducing the cost of production very carefully.
- Competent organization of management accounting, through which it is possible to control the costs of the enterprise. The principle of budgeting plays an important role in this. The budget cycle usually consists of the following parts: planning the activities of the organization and its departments, developing a draft budget, reviewing plan options and calculating them, adjusting, final planning and design feedback taking into account changes in the market.
- Updating the range and nomenclature of products. The products of almost any enterprise undergo a certain life cycle: design, development, launch into production, production, market saturation as a result of serial production. After saturation, there is a decrease in sales volumes, and products can become obsolete over time and demand for them will steadily fall. In this case, product modernization can help, the main thing is to catch the moment when such modernization is really required. At the same time, it is worth calculating what impact the modernization of products will have on increasing profits, and whether there will be demand for improved products at all. Therefore, to proceed with the modernization and development of production new products costs in advance, when profits are still growing, so that by the time the market requires a new, modernized product, the enterprise would have reached the break-even point and could provide the market with modernized products.
Practitioner tells
It is not necessary to fulfill the plan 100%
Vladimir Mozhenkov,
head of the Moscow organization "Audi Center Taganka"
Seven years ago, our company adopted a strategy according to which only the plan, the implementation of which reached the target of 95-110 percent, is considered completed. Thus, we have received an effective system of stimulating employees, keeping them in constant good shape. However, as we managed to find out, if employees try to overfulfill the plan and achieve an indicator greater than 110%, then losses in the quality of the work performed begin. So we set the minimum and maximum values for the development of the plan.
For example, last year we managed to sell 1,000 cars, so when talking about plans for next year I told the head of the profit department: "You did a great job last year, I think this year you will be able to sell 1500 cars!". To which my interlocutor replied: “How can we do this, because this is 50% more than we sold last year, this is unrealistic, because we could hardly sell 1000 cars!” After our conversation, he will be indignant, but will remember him and sooner or later come to the conclusion that by increasing sales, he will be able to increase the income of the company, and hence his salary.
Next, I wait for the moment when the employee realizes the reality of the implementation of such large-scale plans, when he comes up with ways to achieve such an ambitious result. Even if an employee fulfills the plan by 95% or 105%, I praise him, because even the implementation of the plan by 95% leads to positive trends in the company's financial performance.
If the specialist fulfills the plan by 94%, he also receives all the promised bonuses and bonuses, but when the plan is fulfilled by 80-94%, the bonus is still reduced, and at rates below 80%, the bonus is not paid at all.
As practice shows, such a strategy gives excellent results, motivates employees to fulfill plans, and the company achieves the planned indicators. Thanks to excellent motivation, employees see that they can achieve high performance and fulfill even the most ambitious plans, and they themselves begin to look for and find ways to solve the tasks assigned to them.
Activities aimed at improving profit planning
An action plan and a profit increase program should be on every commercial enterprise and include the following steps:
- Increase in production volumes.
- Improving product quality.
- Selling unused equipment or renting it out.
- reduction due to various factors.
- Expansion of the range of products and reorientation of sales markets.
Additional methods to increase profits:
- Strict observance of the concluded contracts for the performance of work.
- Carrying out large-scale work on personnel training; acceleration of capital turnover; reduction in product inventories.
- Reduction of non-manufacturing costs and defects in production.
- Introduction to production modern technologies and innovation.
Expert opinion
How to automate the calculation of the planned profit
Pavel Goncharov,
CEO and owner of the Nevsky Nebosvod company, St. Petersburg
After the launch of the business, our company quickly tripled its turnover, which required some effort on the part of management to optimize and automate work.
Stage 1. Choice of program and method of work.
On the advice of acquaintances of entrepreneurs, I chose as the main work program"1C: Management small firm". At the very beginning, we could not buy a server, so we had to use the services of cloud servers. It took almost 2 months to train the staff, and in general it did not cause any problems and was easy. When we could afford to buy a server, we bought it and 10 software licenses. Thus, having our own server and licensed software, we were able to build local network and use the program even from laptops - it was enough just to connect to the network and enter your login and password.
Stage 2. Adaptation of the program for our business.
To begin with, we worked according to the standard schemes already included in the program - this is how the installers advised us. As a result of the work, we were able to understand exactly what schemes of work we needed and adjusted the software specifically for our company. At the very beginning, the employees joylessly accepted the new schemes of work and software in general, so I, as a manager, took on some of the work myself: filled out customer cards, made calculations, organized installers and worked with customers. In general, the first months of work helped us understand what specific features of the program we need.
Here are two important objects that we have finalized:
- Added CRM module. The program has the ability to create an individual card for each customer. However, taking into account the specifics of our business, we have finalized this tool, having received a document in which it is possible to record in detail all the stages of interaction with the customer: from the moment of his first call to the delivery of the finished result. In the card, you can change the status of the order, for example, the status can be as follows: “payment received” or “ordered to leave the measurer at home”. The modified client card allows us to track all stages of the order, and changing the status and attributes of the order allows us to accurately and promptly supply the installation team with the necessary components and expendable materials. After that, the order card can be sent for reporting to the complex software"1c accounting". Thus, the data is entered into the program once, and then adjusted depending on the stage at which the order is currently located.
- Established the calculation of the gross profit from the order to its fulfillment. The program "1C: Small Business Management" contains an algorithm for calculating the cost, but the exact value can be seen only after the work has been completed and the order has been completed. I wanted to see what the gross profit from the order would be already in advance, even before it was completed. To do this, we have optimized the program in such a way as to immediately receive, although not perfectly accurate, but close to real profit values. We have created an algorithm that takes into account the cost of more than a hundred items, thanks to which the system can immediately calculate how much profit we will receive from the order. To do this, simply enter the data on the order: how much material and components will be required, what is the complexity of the work. As a result, a document was created, which we called "Cost calculation". After the measurement, the installers entered all the data into it, at the output we received a calculation of the profit that we will have from this order. Thanks to the optimization of the software, taking into account the needs and specifics of our company, we were able to obtain an excellent tool for calculating profits and were able to plan it for certain prospects.
Information about experts
Pavel Goncharov, General Director and owner of the Nevsky Nebosvod company, St. Petersburg. Pavel Goncharov studies at St. Petersburg State University of Railway Engineering with a degree in economics and management in construction. He worked as a foreman of a construction team, carrying out private orders for construction and decoration. Deciding to choose a specialization in the field of decoration, in 2009 he founded the company for the installation of stretch ceilings "Nevsky Sky". OOO Nevsky Nebosvod. Field of activity: installation of stretch ceilings. Number of personnel: 15 (including 12 on staff). The area of mounted stretch ceilings: more than 16 thousand square meters. m (in 2013). Annual turnover: 14.8 million rubles. (in 2013).
important place in financial planning occupies the profit planning stage. This part of planning uses all the parameters of the business plan and is decisive in determining the financial result from all the activities of the organization (enterprise).
Approaches to profit planning depend on the parameters of the production, economic and financial activities of the organization (enterprise).
Profit is carried out separately for all types of activities of the organization (enterprise). Separate due to differences in the methodology for calculating and taxing profits from various activities. In the process of developing financial plans, all factors affecting the amount of profit are taken into account, and financial results are modeled from the adoption of various management decisions.
Profit planning uses the following methods:
- direct account;
- analytical;
- on the basis of the effect of production (operational) leverage;
- based on budgeting.
direct account
It is based on assortment calculation of profit from the production and sale of products. A simpler version of this method is an aggregated calculation by plan items.
Example.
Table 3.2. Data for profit calculation, thousand rubles
| Index | Sum |
|
Planned sales volume: B) at full cost |
313 516 197 764 |
|
Operating income: From another implementation Rental payments |
500 |
|
Operating expenses: For other implementation |
89 |
|
Non-operating income: Exchange differences Income from securities |
2000 610 |
|
Non-operating expenses: Exchange differences Property tax |
1700 500 |
1st step. Calculate the profit from the sale (realization) of products.
Profit \u003d Revenue - \u003d 313,516 - 197,764 - 115,752 thousand rubles.
2nd step. Calculate the profit (loss) of the planned year:
Profit (loss) = Profit from sale + Operating income -
Operating expenses + Non-operating income -
Non-operating expenses =
115 752 + (500 + 800) – (89+200) + (2 000 + 2 500 + 610 + 510) –
- (1,700 + 500 + 100) = 120,083 thousand rubles.
Analytical Method
This method is used for minor changes in the range of products. It is used in the absence of inflationary growth in prices and costs.
When using the analytical method, the calculation is carried out separately for comparable and incomparable commercial products. Comparable products are produced in the base year that precedes the planned one, so their actual full cost and output are known. Based on these data, you can determine the basic Rho:
where To is the expected profit (profit is calculated at the end of the base
year, when the exact amount of profit is not yet known);
Cpp - the full cost of marketable products of the base year.
Table 3.3. Calculation of the organization's profit for the year, thousand rubles.
| Index | Sum |
|
Planned sales volume: A) at the selling price of the enterprise B) at full cost |
313 516 197 764 |
|
|
| 3. Operating income: From another implementation Rental payments |
500 |
| 4. Operating expenses: For other implementation Depreciation and maintenance of leased property |
89 |
| 5. Non-operating income: Receipt in compensation for losses caused to the enterprise Exchange differences Income from securities Income from equity participation in the activities of other enterprises |
2000 2500 610 |
|
Non-operating expenses: Exchange differences Property tax |
1700 500 |
|
120 083 |
The calculation is carried out in a certain sequence.
- With the help of basic profitability, the profit of the planned year is roughly calculated for the volume of marketable output of the planned year, but at the basic cost.
- The change (+, -) of the cost of production in the planned year is calculated.
- The influence of changes in the assortment, quality, grade of products is determined. Such calculations are performed in special tables based on planned data on the range of products, their quality, and grade.
- After substantiating the price of finished products of the planned year, the effect of price increases (or decreases) is determined.
- The impact on profit of all these factors is summed up. Profit from the production of comparable products in the planned year is determined taking into account the profit calculated at stage 1 and subsequent stages.
- Further, the change in profit in unsold balances of finished products at the beginning and end of the planning period is taken into account.
The analytical method has the advantage that it shows the influence of various factors on the amount of profit, but this is manifested mainly only in the presence of stable business conditions.
The most important role of profit, which increases with the development of entrepreneurship, determines the need for its correct calculation. The successful financial and economic activity of the organization will depend on how reliably the planned profit is determined.
The calculation of the planned profit should be economically justified, which will allow for timely and full financing of investments, an increase in own working capital, appropriate payments to workers and employees, as well as timely settlements with the budget, banks and suppliers. Consequently, proper profit planning at enterprises is of key importance not only for entrepreneurs, but also for the national economy as a whole.
It is planned to profit separately by type: from the sale of marketable products, from the sale of other products and services of a non-commercial nature, from the sale of fixed assets and other property, and from non-operating income and expenses.
Consider the main methods of planning profit from the sale of marketable products. The main ones are the method of direct counting and analytical.
The direct counting method is most widely used in organizations in modern conditions management. It is used, as a rule, with a small assortment of products. Its essence lies in the fact that profit is calculated as the difference between the proceeds from the sale of products at the appropriate prices and its full cost, minus VAT and excises.
The calculation is carried out according to the formula: P \u003d (V C) - (V C),
where P - planned profit;
B - release of marketable products in the planned period in physical terms;
C - price per unit of production (net of VAT and excises);
C is the total cost of a unit of production.
The calculation of profit is preceded by determining the release of comparable and incomparable marketable products in the planned year at full cost and in prices, as well as the balance of finished products in the warehouse and goods shipped at the beginning and end of the planned year.
An example of calculating profit by the direct account method is given in Table. 4.1.
Calculation of profit by the direct account method is simple and accessible. However, it does not reveal the influence individual factors on the planned profit and with a large range of products is very laborious.
The analytical method of profit planning is used for a large range of products, and also as an addition to the direct method in order to verify and control it. The advantage of this method is that it allows you to determine the influence of individual factors on the planned profit. With the analytical method, profit is determined not for each type of product manufactured in the coming year, but for all comparable products as a whole. The calculation of profit by the analytical method consists of three successive stages.
Definition of the underlying profitability as a quotient of the expected profit per reporting year at the full cost of comparable commercial products for the same period.
Calculation of the volume of marketable products in the planning period at the cost of the reporting year and determination of profit on marketable products based on the basic profitability.
Accounting for the impact on the planned profit of various factors: reducing (increasing) the cost of comparable products, improving its quality and grade, changing the assortment, prices, etc.
Under this method, the profit for incomparable products is determined separately.
The profit plan for the next year is developed at the end of the reporting period. Therefore, to determine the underlying profitability, reporting data for the elapsed time (usually for nine months) and the expected fulfillment of the plan for the period remaining until the end of the year (for the fourth quarter) are used.
Profit in the reporting period is taken in accordance with the level of prices in force at the end of the year. Therefore, if during the past year there were changes in prices or rates of value added tax and excises that affected the amount of profit, then they are taken into account when determining the expected profit for the entire reporting period, regardless of the time of the changes. If, for example, prices were increased from October 1 of the reporting year, then this increase should be extended to the entire period and until October 1, since otherwise the level of profitability of the reporting year will not be able to serve as the base for the planned one.
On the basis of the level of basic profitability found in this way and the planned volume of marketable output at the cost of the reporting year, the profit of the planned year is calculated taking into account the influence of one factor - changes in the volume of comparable marketable output.
Since the planned level of profitability differs from the base one as a result of changes in the cost price, prices, assortment, grade, then at the next stage of planning, the influence of these factors on the planned profit is determined. For the final calculation of the planned profit from the sale of products, the profit on the balance of finished products and goods shipped at the beginning and end of the planned year is taken into account.
Consider an example of calculating profit by the analytical method.
The basic profitability is determined, i.e. the ratio of expected profit to the total cost of comparable marketable products (Table 4.2).
In the coming year, this example assumes a 10% increase in comparable marketable output. The output of these products at the cost of the reporting year will be 903,553 rubles.
((821412 110)/100).
Profit on comparable marketable products of the planned year, based on the basic level of profitability, will be equal to 382,202.9 rubles. ((903 553 42.3)/100).
In this example, incomparable marketable products of the planned year were accepted at the planned full cost in the amount of 272,000 rubles, and in current prices (minus VAT and excises) - 320,045.7 rubles. Consequently, the profit on incomparable marketable products in the coming year will be 48,045.7 rubles. (320,045.7 - 272,000).
At the third stage of calculations, the influence of individual factors on the amount of planned profit is taken into account.
The impact of cost changes is determined as follows. The output of comparable marketable products in the coming year at the cost of the previous year was calculated in the amount of 903,553 rubles. The same comparable products, but at the full cost of the coming year, is determined in the amount of 1,406,340 rubles. (see Table 4.1, column 6).
Hence, the increase in the cost of comparable marketable products is 502,787 rubles. (1 406 340 - 903 553), which will lead to a decrease in the planned profit.
The planned change in the product range causes an increase or decrease in the planned profit. In order to determine the impact of assortment shifts on profit, the share of each product in the total volume of comparable marketable products is calculated at full cost in the past and coming year. Then the share of each product in the reporting and planning year is multiplied by the reported profitability of this product (calculated as the ratio of profit to the total cost of the product), adopted at the level of expected performance. The sums of the coefficients obtained reflect average level profitability in the past and next year.
The difference between them shows the impact of assortment shifts on the planned profit (Table 4.3).
The average profitability in the planned year increases by 0.45% (35.68 - 35.23) compared to the reporting year. Thus, a change in the range of products in the planned year will lead to an increase in the planned profit by 4,066 rubles. ((903553 0.45) /100).
The size of the planned profit is also affected by price changes in the planned period. If prices decrease or increase, then the estimated percentage of the decrease or increase should be calculated from the volume of the relevant product. The amount received from a decrease or increase in prices will affect the decrease or increase in the planned profit.
Let us assume that prices for all marketable products sold are expected to increase by 21.89153% in the coming year. Then profit will be received only due to this factor in the amount of 361,512.4 rubles. (1,651,380 (see Table 4.1, page 5) 21.89153)/100.
Thus, the analytical method of profit planning in this example confirmed the method of direct counting, i.e. in both cases, the planned profit from the sale of marketable products is determined in the amount of 392,038.7 rubles. (see Table 4.1 and Table 4.4).
It should be emphasized that with the direct method, the planned profit is determined as the total amount without identifying specific reasons that affect its value, and with the analytical method, both positive and negative factors affecting profit are identified.
First of all, the increase in the cost price significantly reduces the planned profit (by 502,787 rubles), which can be explained by an increase in prices for consumed inventory items, an increase in wages due to an increase in the minimum monthly wage. Profit increases slightly (by 4,066 rubles) due to a change in the range of products in the direction of increasing the share of the most profitable products (see Table 4.3). A significant increase in profit (by 361,512.4 rubles) is planned due to the expected increase in prices for products sold, which is due to inflationary processes. Therefore, despite the increase in profits due to rising prices, this factor cannot be considered as positive.
In addition to the above reasons affecting the planned profit, it includes the amount of profit on comparable marketable products based on basic profitability, as well as on incomparable marketable products put into production in the planned year. Profit is also taken into account in the balance of finished products in the warehouse and in goods shipped at the beginning and end of the coming year.
In addition to profit from the sale of marketable products, gross profit, as noted, takes into account profit from the sale of other products and services of a non-commodity nature, profit from the sale of fixed assets and other property, as well as planned non-operating income and expenses.
Profit from other sales (products and services of ancillary farms, car fleets, non-industrial services - for capital construction, overhaul, etc.) is planned using the direct account method. Only with an insignificant share of these products (services) the profit from sales is determined on the basis of its planned volume in the coming year and the profitability of the previous year.
The result from other implementation can be both positive and negative. Suppose, in our example, profit from other sales is planned in the amount of 30 rubles, and losses - 288 rubles.
Profit (losses) from traditional items of non-operating income and expenses (fines, penalties, forfeits, etc.) is determined, as a rule, based on the experience of past years. As for such items as income from equity participation in the activities of other enterprises, from the lease of property, dividends, interest on shares, bonds and other securities owned by the enterprise, they are planned depending on the development forecasts entrepreneurial activity this business entity.
For example, income from non-sales operations is planned in the amount of 2,798 rubles, and expenses from these operations - in the amount of 9,000 rubles.
So, in the considered example, the total amount of profit will be 394,866.7 rubles. (392,038.7 +30 + 2798), and losses - 9,288 rubles. The gross profit of the enterprise is determined in the amount of 385,578.7 rubles. (394,866.7 - 9,288).
In addition to the methods of profit planning outlined - direct counting and analytical methods - there is the so-called combined calculation method. In this case, elements of the first and second methods are applied. Thus, the cost of marketable products in the prices of the planned year and at the cost of the past year is determined by the direct calculation method, and the impact on the planned profit of such factors as changes in cost, quality improvement, changes in assortment, prices is revealed using the analytical method.
Calculation of the optimal amount of profit becomes the most important element of business planning at the present stage of management. To predict the maximum possible profit in the planned year, it is advisable based on foreign experience compare the proceeds from the sale of products with the total amount of costs, divided into variable, fixed and mixed. As you know, variable costs include the costs of raw materials, materials, electricity, transport and others. These costs change in proportion to the change in the volume of production.
Fixed costs are those that do not change with an increase or decrease in output. These include depreciation, wages management personnel, administrative expenses and others.
Mixed costs include both variable and fixed costs. Such, for example, are postal and telegraph expenses, carrying out current repair equipment and others.
Due to the small proportion of mixed costs, we will focus on variable and fixed costs and try to identify the impact of their change on the amount of profit. The increase in profit depends on the relative decrease in variable or fixed costs.
The following calculations allow us to determine the so-called effect production lever(a term taken from Western business practice). The effect of the production lever is called such a phenomenon when, with a change in proceeds from the sale of products, a more intensive change in profit occurs in one direction or another.
Let's say that the proceeds from the sale of products in 1998 is 1,820,616 rubles, including variable costs - 1,238,200 rubles, and fixed costs - 197,554 rubles. Thus, with a total cost of 1,435,754 rubles. profit is 384,862 rubles. (1 820 616 - 1 435 754). If in 1999 revenue increases by 10%, which will amount to 2,002,677.6 rubles. ((1,826,616,110) / 100), then variable costs will also increase by 10% and will be equal to 1,362,020 rubles. ((1 238 200 110) / 100). At the same time, fixed costs remain unchanged, i.e. RUB 197,554 In this case, the total costs will amount to 1,559,574 rubles. (1,362,020 + 197,554), and the profit is 443,103.6 rubles. (2,002,677.6 - 1,559,574). At the same time, profit will increase by 15% compared to the previous year (((443,103.6,100)/ 384,862) - 100).
Therefore, with an increase in sales revenue by 10%, profit will increase by 15%.
Looking for opportunities to increase profits, it is advisable to check the impact on its growth not only variable, but also fixed costs.
So, if variable costs increase by 10% (1,362,020 rubles), and fixed costs - by 2% (201,505.1 rubles = (197,554,102) / 100), the total amount of all costs will be 1,563,525, 1 rub. (1,362,020 + 201,505.1).
Profit in this case will be determined in the amount of 439,152.5 rubles. (2,002,677.6 - 1,563,525.1) and, therefore, will increase by 14.1% compared to the previous year ((439,152.5,100) / 384,862), and not by 15%.
If further fixed costs increase by 4% and amount to 205,456.2 rubles. ((197,554,104) / 100), then with a 10% increase in variable costs, the total amount of all costs is 1,567,476.2 rubles. (1,362,020 + 205,456.2). Profit in this case is reduced to the amount of 435,201.4 rubles. (2,002,677.6 - 1,567,476.2), i.e. increases only by 13.1% (((435,201.4,100)/384,862) - 100).
It is obvious that as fixed costs increase with other equal conditions earnings growth is declining.
The above calculations make it possible to determine the strength of the impact of the production lever. To do this, exclude variable costs from the total amount of proceeds from the sale of products, and divide the result by the amount of profit.
In our example, the impact force of the production lever in 1998 will be determined as follows: (1,820,616 rubles - 1,238,200 rubles) / 384,862 rubles. = 1.5.
The indicator of the effect of production leverage has an important practical value. If the revenue from the sale of products increases, for example, by 4%, then, using the indicator of the strength of the impact of the production lever, it can be determined in advance that the profit will increase by 6% (4% 1.5).
In the event of a decrease in revenue from product sales by 8%, profit will decrease by 12%.
A 10% increase in sales revenue results in a 15% increase in profits. As a result, we are back to the beginning of the example.
Based on the strength of the impact of the production lever, we can conclude: the higher the share of fixed costs and, accordingly, the lower the share of variable costs with a constant amount of revenue from product sales, the stronger the impact of the production lever. However, this does not mean that it is possible to increase fixed costs uncontrollably, since if this reduces the proceeds from the sale of products, then the company will suffer large losses in profits.
So, the above examples of profit maximization by changing the share of variable and fixed costs open up the opportunity for entrepreneurs to plan for the future the size of profit growth depending on economic success in the production of competitive products and take appropriate measures in advance to change the value of variable and fixed costs in one direction or another. Estimated profit calculations are important not only for the enterprises themselves and organizations that produce and sell products (services), but also for shareholders, investors, suppliers, creditors, banks associated with the activities of this entrepreneur, participating with their own funds in the formation of its authorized capital. Therefore, planning the optimal amount of profit in modern economic conditions is the most important factor in the successful entrepreneurial activity of enterprises and organizations.
More on the topic 4.4. DETERMINATION OF PLANNED PROFIT:
- 3. Management of the formation of operating profit based on the system "Relationship between costs, sales volume and profit"
- 5.4 DETERMINATION OF PLANNED PROFIT - STARTING POINT OF BUSINESS ACTIVITIES
- Establishment of principles for determining the part of the profit of a state enterprise to be transferred to the budget in the form of the owner's income from the use of property, and the procedure for such transfer.
- 3.6.4. Planning the profit of the organization (enterprise) and entrepreneurial profit
- Chapter 2 FEATURES OF THE BEHAVIOR OF ENTERPRISES AT DIFFERENT STAGES OF THE EVOLUTION OF A PLANNED ECONOMY
- Copyright Law - Advocacy - Administrative Law - Administrative Procedure - Antimonopoly and Competition Law -
Profit planning is an important factor in the success of the company. Let's talk about the methods of profit planning in the enterprise and how to choose the most suitable one.
Why plan for profit
Profit is the result of the company's activities, equal to the sum of all income received in the reporting period, minus all expenses incurred. Profit planning is the definition of all the activities that the company must perform in order to obtain the highest possible profit. You can plan profit for the short term, for example, a quarter, half a year, a year, or a long-term period - three years, five years, ten years, or another period.
Profit should be planned for each type of activity separately, as this will allow you to understand what activity brings the organization more money and for what reason, as well as, if necessary, liquidate unprofitable segments of the company or engage in business planning for their restoration and further development. .
Principles of preparing a plan to increase company profits
- All tasks to increase profits must be set by the competent management of the company, which has the necessary authority for this, as well as the necessary knowledge and experience. The competence and experience of management is the key to making successful effective management decisions.
- All management decisions and objectives in the field of profit maximization should relate to all income and expenses of the company, tk. the amount of profit received directly depends on them. .
- Effective planning should be carried out at all levels of the company and concern all employees from CEO to an ordinary employee.
Types of profit planning
Based on the principles described above, it is customary to distinguish the following types of profit planning:
- Current planning is carried out for a period of 1 calendar year. At the same time, management takes into account data on profit, income and expenses of the previous period, and often several years in a row. It is also necessary to consider what kind of strategy the company's management adheres to - whether it aims to expand activities or production, conquer new markets, launch new products, open new branches or enter new regions. An approximate budget of the company for the year is drawn up, the management determines the approximate volume of products, the amount of expected income and expenses.
- Operational planning is carried out for a shorter period - usually a quarter or six months, less often - a month. Such a plan is more accurate, and the forecast of income and expenses, profits is as close to reality as possible.
Important! It often makes no sense to make a plan for a period of more than 1 year, since the data will be unpredictable, and in planning for a shorter period it does not provide the necessary information.
Profit types for planning
Profit is usually divided by type of activity. The most relevant division into:
- profit from the main activity;
- return on investment;
- profit from the provision of services (if the company is engaged in such activities along with production);
- profit from the provision of related services or work (transportation, labeling, etc.);
- profit from the sale of assets or their lease, etc.
In the statement of financial results, there are such types of profit:
- Gross profit is defined as the difference between the revenue received for the period from production activities and the cost of production;
- We will receive profit from sales, if we subtract all business expenses(costs of the company for the sale and marketing of products) and management costs (costs for administrative and managerial personnel, utility costs and other general business and general production costs);
- Balance sheet (or economic profit) is obtained from the profit from sales, taking into account other income and other expenses;
- Net profit - for its calculation all taxes, fees and other fiscal payments are deducted from the balance sheet profit. It is this type of profit that the owners are most interested in, since it is used to develop the business, pay dividends, etc.
How to increase revenue to get the planned profit
Edition "Systems CFO» prepared recommendations that will help increase revenue in order to achieve the planned profit. See how to understand the reasons for the drop in revenue and what measures to take to quickly correct the situation and reach the targets.
Profit planning methods
Let's consider profit planning methods.
direct method
The most common profit planning method is the direct or direct count method. . It consists in excluding all commodity taxes (value added tax and excises) from the estimated revenue, and then all expenses that make up the cost of production.
The calculation formula is as follows:
Profit = Volume of production * (Unit cost - Unit cost).
This method is very convenient for those companies that have a limited range of goods, otherwise, when calculating profits, the labor costs of the settlement department will be very high.
Analytical Method
This method is the most difficult because it depends on many indicators, all or most of which are important for making a profit. It is based on the development of multi-factor business development models that will allow you to get the maximum profit.
1. First you need to determine the break-even point.
TB = Fixed costs / (revenue - variable costs) * 100%
2. The next step is to determine the profit according to the plan:
PlanProfit = (Sales (target) - Sales in TB) / (forecast profit - forecast variable costs)
Estimated net income = Estimated income - projected tax payments - contributions to funds
The calculation itself is very complicated, since the final result depends on a number of factors - on the cost of production, fixed and variable costs, the price of the final product, and the forecast volume of production.
target method
The method is to predict the required profit of the company depending on the required tasks. For example, the management set the task of updating the production and technical base. As a result, there is a need for a certain amount financial resources. Therefore, this amount as net profit should be planned to be received in the billing period. The planned profit is calculated as the company's net income, taking into account all forecast tax payments, as well as all the company's fixed expenses for this period.
Planning for profit and profitability
There are also two alternative methods based on the rate of return. The first is the study of the profitability limit. Several graphs are constructed showing the dependence of the planned profit and the elasticity of the company in relation to various changes in the company's expense items, taking into account the turnover of financial resources. The difference between how many products a company plans to produce and the minimum amount of production that will allow it to reach the break-even point is important. The greater this difference, the more favorable the forecast of the organization's activities.
The second method is based on forecasting profitability, while calculating the minimum size turnover of capital, which maintains the liquidity of the company. The following relations are important for the study:
Invested capital = capital investments + working resources
Profit index = Turnover of capital / cost
Return on equity = (Turnover of capital / Capital invested) / (Profit / Turnover of capital)
Return on equity index = Profit / Capital turnover
Capital turnover index \u003d Working resources / invested capital
The calculation is more convenient to make in dynamics for several previous years, but its results are relevant for short-term periods. The complexity of the method lies in the fact that it is necessary to develop several standards, most often it is the rate of return on the company's assets, equity capital, invested capital, unit of output.
Which method to choose
The optimal method for the company will be the one that, in the first place, will be easy to calculate. The more complex the calculation and the more data it requires, the lower the efficiency. The accuracy of the data will allow you to calculate the planned profit as close as possible to the real one. Also, companies choose the method that is most relevant taking into account production factors, scope of activity and other factors and is practical in terms of internal factors company (available resources, experience of employees of the settlement department, etc.).
The planning process includes several stages and begins with setting specific goals in relation to the level of planned profit, taking into account the available resources of the enterprise. Then it is necessary to determine the required production volume and product prices, as well as plan all possible expenses of the enterprise. Based on the data obtained, it is necessary to predict the amount of profit that can be obtained using the method chosen from the above methods.
Is it realistic to plan profit and fulfill the plan?
Let's think about how important it is to correctly and realistically set profit planning goals in order to achieve it. Is it realistic to achieve the plan by 100%? As practice shows, it is necessary to draw up a real plan for making a profit so that the company's employees have every opportunity to fulfill it. In this case, they will work with maximum efficiency. Well, do not forget about the system of stimulation and encouragement in the form of bonuses and bonuses. It is desirable to develop in such a way that the achievement of the plan even by 85-100% is rewarded. For exceeding the plan - an additional reward. But remember - the more employees try to exceed the plan, the more the quality of the products or services provided suffers.
conclusions
In conclusion, we will determine what factors and actions at the enterprise can affect the increase in profits for the reporting period:
- production growth (increasing volumes, a new line of business, expanding the range of products);
- improving product quality while maintaining the size of costs (for example, minimizing scrap);
- use of production assets to the maximum (avoid downtime, breakdowns, timely repair or sale of unused equipment);
- reducing the cost of production while maintaining the level of prices for goods;
- timely update production equipment, which will reduce costs and production costs.
is the main purpose of any business. All business processes occurring in the organization are aimed at the final result - profitability, profitability, profitability. This means that they need a specific policy developed by the organization, which includes planning, management and adjustment activities.
Let's consider, for the solution of what problems it is necessary to plan future profit, and also we will analyze the methods operating in economic practice for this process.
Importance of accounting for potential profit
Profit- the net income of the organization from various types of its activities, “exempted” from the costs of manufacturing and selling, as well as spending on various mandatory payments in the form of taxes and contributions to social funds. If we subtract all the costs incurred from the income received, we get the amount that makes up the profit. That is what needs to be planned to solve the main business problems.
Profit planning is a rather complicated process, not limited to “the more the better”. Estimation of projected income should be objective. It directly depends on:
- the issue of timely and sufficient supply of raw materials, materials, tools and other means of production;
- the possibility of adjusting the wages of hired personnel;
- trends in relationships with counterparties;
- prospects for modernization of production, increase in the range, dynamics technological processes and other innovations;
- regulation of prices for products (works, services);
- assessment of the ratio of perceived risks and potential "bonuses".
REFERENCE! At the macroeconomic level, profit planning allows you to influence the country's economy as a whole.
Types of planned profit
Planned profit- this is an economically justified indicator, the level of which is designed to provide in sufficient quantities all the needs and obligations of the enterprise, as well as the dynamics in its development.
Since the profit itself can be classified for different reasons, it is also planned separately. The most common is the division by type of activity of the organization. Separately, profit is taken into account:
- from the sale of goods (produced in the company or resold);
- from the provision of services, production of works and other "non-commodity" sales;
- from the sale or lease of fixed assets of the organization;
- from the sale of intangible assets (copyrights, property rights, etc.);
- for non-operating transactions.
Depending on what income and expenses are taken into account, you can consider (and therefore plan) the following types of profit:
- accounting- represents the amount of revenue minus production costs, to which are added in the case of income or deducted in the event of a loss of funds for non-operating operations;
- economic- earned income minus cost;
- clean- funds remaining at the disposal of the enterprise after all due payments, including tax payments.
IMPORTANT! When planning profits, excise payments and value added tax are not taken into account, because they are deducted even before the amount of profit is formed.
Planning period
It is considered optimal operational(quarterly) planning arrived. A longer deadline will inevitably affect the accuracy of forecasts, while a shorter one will not give room for the necessary economic maneuvers.
Often also used ongoing planning(budgeting), involving the distribution of funds for the calendar year. It is based on previous indicators, as well as on the analysis and forecast of the financial and economic activities of the company. The result of budgeting will be a plan of current expenses and income.
It is recommended to start forecasting potential profits after the approximate and planned implementation norms have been determined.
Methods used for profit planning
Economic practice has developed a number of approaches to the implementation of planning future profits.
- direct counting method. Is the simplest and enough effective way establishing potential income for the future period. It is advisable to use it if the range of products produced is relatively small, and the prices for it and the level of sales are quite stable. In this case, it is relatively easy to calculate the difference between the cost of production and potential revenue. For this, the following formula is applied:
PP \u003d (P r + P od + P vr) - N
- PP - the projected profit of the organization;
- P r - profit from sales activities;
- P od - profit from operating activities;
- P vr - profit from non-sales operations (or loss, then the value will be negative);
- H - taxes (excise and VAT).
The direct counting method is quite accurate and objective, but can be time consuming to use with a variety of products. Using this method, you can plan profit depending on the number of products produced and on sales volume.
The monetary expression of commodity output provides for accounting for the cost and estimated costs of implementation:
P V issue. = ∑ c.r. – SS
- P V issue. - profit from the volume of goods released for a certain period;
- ∑ c.r. - the amount that is planned to be earned at selling prices;
- CC is the total cost of this volume of production.
To plan profit from goods sold, you need to take into account the current price level and cost, as well as the cost of products that remain unsold:
P V p. = ∑ c.v. - SS - ∑ about.
- P V r - the planned profit from the volume of sales;
- ∑ c.v. - the amount of planned revenue;
- CC - cost;
- ∑ about. - the amount that makes up the value of unrealized balances.
- the rate of return on the organization's assets;
- the rate of profit per unit of goods sold;
- the rate of return per unit of equity, etc.
This method is quite accurate and gives great opportunities in forecasting, but it is relevant only when production is stable and we can talk about a more or less constant price level.
- basic profitability - this parameter is calculated by comparing the forecasted profit with the full cost for the same period;
- based on the previous indicator, the volume of production for production in the accounting period is determined, and from here profit is planned for this volume;
- multivariate analysis: taking into account the market situation, price fluctuations, falling or growing demand, changes in technology, quality, product varieties, etc.