Operating Profit Model Template

One thing is clear – timely delivery of goods or services with a realistic profit margin is key to beating your competition. How do we help you accomplish this? Startup Connection’s Operating Profit Model Template. This special tool lets you understand in a simple manner how different factors interact to affect profits. We are able to deliver your executable (you will use this!) profit model in about 48 hours. Our goal is to help you get better results, avoid mistakes, operate with greater efficiency and become profitable in less time!

Briefly review the model in the attachment below and don’t worry if you are uncomfortable developing some of the parameters. It minimally helps you to establish some preliminary assumptions. I then personally work with you, (for free initially), to develop and test this customized model to evaluate the potential of your business. Call me at (914) 632-6977 to start the process.

Bert Shlensky’s Quick Business Analysis System


“Will I raise, and make enough money to survive and be profitable?”

 

operating profit

In the 3,000-plus startups and small businesses that I’ve mentored over the years, this is everyone’s big question.

Startups frequently have excellent ideas, enthusiasm, uniqueness, and energy, but lack the understanding and programs to execute, and which will make money.

To address that specific issue, I have developed a pretty right-on and flexible evaluation system that quickly establishes a number of “base projections” (AKA, early stats of profits and losses) for startup and small businesses. These projections are more realistic, doable, useful, and, best of all, refreshing in the eyes of investors. Keeping in mind that it can be customized, this evaluation system covers the following key points:

  • The sales volume goals.
  • The average selling price by product and distribution channel.
  • The cost to produce one unit.
  • The marketing costs to achieve the desired volume.
  • The costs for labor and administrative functions.
  • The profit over different time frames.

These estimates have been integrated into a simple and flexible model. The model provides evaluation of alternatives, an understanding of what drives sales and profits, and ways to develop effective strategies to modify estimates in order to develop a more viable business. It is also designed to be simple to use. For example, it avoids the complexity of many accounting-based models by using general industry standards for expenses and keeping the focus on the basics.

Startup Connection has also developed 50 or so templates which can be used for different businesses and which focus on variables like multiple products, distribution channels, marketing efforts, cost structures, selling direct (Amazon versus your own web site).

Timing is Everything!

The turnaround time for your personalized model is not months, or weeks, but typically within 2 business days. I can do so because of my years of careful research, and particular expertise.

The following is one of our simplest examples, and the most useful. It’s tailored for entrepreneurs who bill by the hour or project. It shows how variances in “hourly rate” and “hours worked,” and other costs, affect income.

Annual Earnings for Service Professionals

Earnings chart for a 38 hour work week over 48 weeks per year. You can change the percentage of dollars per hour and total annual hours as you see fit.

OPMT_chart1

Example:

at 1,459 hours (80%) based on $150 p/h you will earn about $ 218,880

*1,824 is the average number of hours per year (40 hours for 48 weeks)

Another key advantage of the model is the ability to analyze alternative volume, marketing and pricing components. It allows clients to view the consequences of various alternatives when there’s a great deal of uncertainty.

To summarize, we consider the system to be Startup Connection’s secret weapon. It’s an easy to understand model that focuses on key parameters that affect sales and profit. However, the real secret is that it is also customized; we work hand in hand to help business owners understand the parameters, potential and challenges their business faces. The system can also estimate parameters and immediately see what might work, and what might not. Finally, after a little help, the client can easily take over and modify and test any changes.

Please Download this Excel Spreadsheet as part of this lesson:

Bert Shlenskys Quick Business Analysis Worksheet.xls

 Feeling stumped or overwhelmed?
 Contact Bert at (914) 632-6977 or bshlensky@startupconnection.net to start the process. Thanks!

 

Summary
Article Name
Operating Profit Model Template
Description
The Operating Profit Model Template is a valuable tool to analyze the total impact of various productions and cost variables on total profit.
Author