Page
Finance
Completion requirements
View
Financial procedures are crucial to determine whether the organisation is profitable and managed in a responsible and accountable manner.
The following example will be illustrated according to “Determining areas where budget cuts can be suggested” for a small-sized Coffee Shop.
|
Input |
Collect information on the costs of all raw materials over a period of 3 months. Gather information on all the packaging materials, rent, usage for electricity and water, replacement of appliances and crockery. Also, include set salaries and other set expenses. |
|
Processing |
Analyze all the information to determine a relation between the cost of for example a scone with jam and cheese and the actual cost of purchasing, preparing and delivering it to the customer at the table. Determine which products are the best sellers and evaluate each product’s profit margin. |
|
Storage |
Conclusions, deductions and adjustments must be made immediately. Information must be stored, only after it has immediately been applied. The storage of this information is for tax purposes and future planning. |
|
Output |
The profitability of the coffee shop must increase to keep it viable. Marketing strategies need to be put in place to support this. |
|
Feedback |
Verbal feedback from customers regarding the quality of the beverages and the prices thereof must be noted. Quality control and friendly services should be encouraged while the necessity of a price increase can be explained to customers that enquire about it. |
|
Control |
Monitor the average bill of each customer. Monitor whether more customers still visit the Coffee Shop or whether there is a decline in numbers. Also control the purchasing price of suppliers, since an increase in purchasing price will have a direct influence on the prices of products. |