Posted by Karen Upright on January 17, 1998 at 23:08:58:
In Reply to: Business Plan posted by Michael on January 14, 1998 at 20:37:59:
: Trying to help a friend with budget numbers for a business plan. The concept is
: home meal replacement, cafe coffee shop, bread bakery.
: If any one can help, please e-mail. Thanks for your help.
: 1. Reasonable % of total sales is spent on direct materials.
Depends on how labor-intensive the product is. I have a different percentage for different types of items, ex. hors d'oeuvres can be inexpensive, but take all day. Beef tenderloin is expensive product, high waste factor, but low labor. Most people try to keep it under 30%, I think. I can afford to run a little higher than that because my rent is dirt cheap and I eat all of my meals at work.
: 2. % packageing costs for take outs and storage at home.
You can keep this under control by training staff well. My paper/take out goods run about 3%. I may be high because I'm not great at controlling these costs.
: 3. Rent or mortgage as a % of sales
Rent is a fixed expense, not a percentage of sales. You have to figure how much space you need and what is the price per square foot in your area. Percentage only comes in when you calculate your breakeven point. (Unless your lease requires a percentage of gross.)
: 4. Utilities as a % of sale
Again, truly a fixed expense, although it is somewhat variable with volume. I figure it as a fixed, with a moderate variable increase for sales.
Hope I helped a little.
Karen