Business Transition
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Transcript of Business Transition
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1
TRANSITION PLANNING: HOW DO I TRANSITION MY BUSINESS?
THE BRIJ_IT COLLABORATION MODEL:
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Transition Plan
Expansion = New Store
Base = Current Store
Startup Segment = Product C
Brij_IT Models for Transition Planning
Chan
nels
OEM
(Gro
wer
)Ch
anne
ls D
irect
Chan
nels
Ret
aile
rCh
anne
ls W
hole
sale
r
Product Line A: Boxes and Planters•OEM (Grower)•Wholesaler
Product Line B: Lawn and Beds•OEM (Grower)•Direct (Distributor)
Product Line C: Garden and Fixtures•Retailer (Store)•Wholesaler
Local Service: Landscaping•Greenhouse (Store)• Landscaping
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TRANSITION STAGING
42010 42010 Product A Sale--Boxes & Planters Revenue Revenue: Sale 1 OEM
42020 42020 Product B Sale--Lawn & Beds Revenue Revenue: Sale 1 OEM
42040 42040 Product D Sale- Landscaping Services Revenue Revenue: Services 1 SERVICE
42010 42010 Product A Sale--Boxes & Planters Revenue Revenue: Sale 1 WHOLES
42020 42020 Product B Sale--Lawn & Beds Revenue Revenue: Sale 1 DIRECT
42010 42010 Product A Sale--Boxes & Planters Revenue Revenue: Sale 2 OEM 42020 42020 Product B Sale--Lawn & Beds Revenue Revenue: Sale 2 OEM 42040 42040 Product D Sale- Landscaping Services Revenue Revenue: Services 2 SERVICE 42010 42010 Product A Sale--Boxes & Planters Revenue Revenue: Sale 2 WHOLES 42020 42020 Product B Sale--Lawn & Beds Revenue Revenue: Sale 2 DIRECT
42030 42030 Product C Sale - Garden and Fixture Revenue Revenue: Sale 1 RETAIL 42030 42030 Product C Sale - Garden and Fixture Revenue Revenue: Sale 1 WHOLES 42030 42030 Product C Sale - Garden and Fixture Revenue Revenue: Sale 2 RETAIL 42030 42030 Product C Sale - Garden and Fixture Revenue Revenue: Sale 2 WHOLES
ACCOUNT DESCRIPTION MAJOR MINOR STORE CHANNEL
ACCOUNT DESCRIPTION MAJOR MINOR STORE CHANNEL
ACCOUNT DESCRIPTION MAJOR MINOR STORE CHANNEL
Expansion
Startup Segment
Base
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estimated units per hour
0.03
PRICING AND COSTINGOverall Plan
LINES SET PRICE VOLUME SET MIX SALES WTD COST
PRODUCT A LINE 250.00 340 4% 85,000 4%
PRODUCT B LINE 2,500.00 160 18% 400,000 18%
PRODUCT C LINE 3,500.00 200 33% 700,000 33%
PRODUCT D LINE 4,500.00 280 45% 1,260,000 45%
PRODUCT RESALE 100 74,490.00
2,494.90 1080.00 2,519,490.00 1,712,713.91
reconversion 0.03
PRODUCT A LINE 68,508.56 16,491.44
PRODUCT B LINE 308,288.50 91,711.50
PRODUCT C LINE 565,195.59 134,804.41
PRODUCT D LINE 770,721.26 489,278.74
PRODUCT RESALE 38,200.00 36,290.00
STARTUP 25,000.00 (25,000.00)
1,775,913.91 743,576.09
A
B
C
D
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TRANSITION PLAN BASE STARTUP SEGMENT EXPANSION
ORIGINAL STORE SEGMENT C NEW STORE TOTAL
UNITS 683 500 597 1,780
SALES 930,667 774,490 814,333 2,519,490
VARIABLE COSTS (749,371) (175,593) (637,650) (1,562,613) CONTRIBUTION MARGIN 181,296 598,898 176,684 956,877 19% 77% 22% 38%
FIXED COSTS (54,909) (82,942) (75,450) (213,301) NET INCOME BT 126,387 515,956 101,234 743,576 14% 67% 12% 30% WITH PRODUCT C STORE 1 STORE 2 TOTAL PLAN
UNITS 896 884 1,780
SALES 1,304,000 1,215,490 2,519,490
VARIABLE COSTS (843,020) (719,593) (1,562,613) CONTRIBUTION MARGIN 460,980 495,897 956,877 35% 41% 38%
FIXED COSTS (99,145) (114,156) (213,301) NET INCOME BT 361,835 381,741 743,576
28% 31% 30%
ExpansionStartup SegmentBase ALL
A
B
C
D
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PRODUCT PLAN CM%
PRODUCT LINE TYPE STORE CHANNEL REVENUES CONTR. MARGIN $ CM % PRICE QUANTITY
C: Garden and Fixture segment 1 RETAIL
280,000
216,518 77%
3,500 80
C: Garden and Fixture segment 2 RETAIL/FIXTURE
74,490
57,602 77% 745 100
C: Garden and Fixture segment 2 RETAIL
245,000
189,454 77%
3,500 70
C: Garden and Fixture segment 1 WHOLESALE
93,333
72,173 77%
3,500 27
C: Garden and Fixture segment 2 WHOLESALE
81,667
63,151 77%
3,500 23
A: Boxes & Planters base 1 OEM
22,667
4,416 19% 250 91
A: Boxes & Planters base 1 WHOLESALE
22,667
4,416 19% 250 91
A: Boxes & Planters expansion 2 OEM
19,833
4,303 22% 250 79
A: Boxes & Planters expansion 2 WHOLESALE
19,833
4,303 22% 250 79
B: Lawn & Beds base 1 DIRECT
106,667
20,779 19%
2,500 43
B: Lawn & Beds base 1 OEM
106,667
20,779 19%
2,500 43
B: Lawn & Beds expansion 2 DIRECT
93,333
20,250 22%
2,500 37
B: Lawn & Beds expansion 2 OEM
93,333
20,250 22%
2,500 37
D: Landscaping Services base 1 SERVICE
672,000
130,907 19%
4,500 149
D: Landscaping Services expansion 2 SERVICE
588,000
127,577 22%
4,500 131
TOTAL
2,519,490
956,877 38%
2,333 1,080
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TYPE (All)
ValuesRow Labels Sum of REVENUES Sum of CONTR. MARGIN $
Garden and Fixture 774,490 598,898
RETAIL 599,490 463,574
WHOLESALE 175,000 135,324
Boxes & Planters 85,000 17,437
OEM 42,500 8,719
WHOLESALE 42,500 8,719
Landscaping Services 1,260,000 258,484
SERVICE 1,260,000 258,484
Lawn & Beds 400,000 82,058
DIRECT 200,000 41,029
OEM 200,000 41,029
Grand Total 2,519,490 956,877
TYPE EXPANSION
Values
Row Labels Sum of REVENUES Sum of CONTR. MARGIN $
Boxes & Planters 39,667 8,606
OEM 19,833 4,303
WHOLESALE 19,833 4,303
Landscaping Services 588,000 127,577
SERVICE 588,000 127,577
Lawn & Beds 186,667 40,501
DIRECT 93,333 20,250
OEM 93,333 20,250
Grand Total 814,333 176,684
TYPE BASE
Values
Row Labels Sum of REVENUES Sum of CONTR. MARGIN $
Boxes & Planters 45,333 8,831
OEM 22,667 4,416
WHOLESALE 22,667 4,416
Landscaping Services 672,000 130,907
SERVICE 672,000 130,907
Lawn & Beds 213,333 41,558
DIRECT 106,667 20,779
OEM 106,667 20,779
Grand Total 930,667 181,296
TYPE SEGMENT
Values
Row Labels Sum of REVENUES Sum of CONTR. MARGIN $
Garden and Fixture 774,490 598,898
RETAIL 599,490 463,574
WHOLESALE 175,000 135,324
Grand Total 774,490 598,898
FIXED COSTS
STARTUP SEGMENT 82,942
EXPANSION 75,450
SUM $ 158,392
EXPANSION COSTS STARTUP SEGMENT 7100
EXPANSION 2500032100
ORIGINAL STORE 22000
$ 54,100 $ 212,492 INVESTMENT 216,188
Transition View of Investment
31% 63%
37% 19%
32% 18%
100%
Expansion
Startup Segment
BaseALL
Investment
Winning Proposition:
½ of Segment C Contr. Margin >
Investment = STORE 1
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Return by Store and in TotalA review of the planned financial performance after the transition. With the sale of Product Line C, Store 1 is capable of covering the total investment and making a profit without Store 2.