Organizational Business Plan

In fact, within the operations plan you'll develop the next set of financial tables that will supply the foundation for the "Financial Components" section.

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In order to determine the number of employees you'll need to meet the goals you've set for your business, you'll need to apply the following equation to each department listed in your organizational structure: C ÷ S = PIn this equation, C represents the total number of customers, S represents the total number of customers that can be served by each employee, and P represents the personnel requirements.

For instance, if the number of customers for first year sales is projected at 10,110 and one marketing employee is required for every 200 customers, you would need 51 employees within the marketing department.10,110 ÷ 200 = 51Once you calculate the number of employees that you'll need for your organization, you'll need to determine the labor expense.

In order to generate the capital requirements table, you first have to establish the various elements within the business that will require capital investment.

For service businesses, capital is usually tied to the various pieces of equipment used to service customers.

These are usually referred to as overhead expenses.

Overhead expenses refer to all non-labor expenses required to operate the business.If you multiply the cost of equipment by the number of customers it can support in terms of sales, it would result in the capital requirements for that particular equipment element.Therefore, you can use an equation in which capital requirements (CR) equals sales (S) divided by number of customers (NC) supported by each equipment element, multiplied by the average sale (AS), which is then multiplied by the capital cost (CC) of the equipment element.Establish the function of each task and how it will relate to the generation of revenue within the company.Once you have structured your business, however, you need to consider your overall goals and the number of personnel required to reach those goals.Expenses can be divided into (or semivariable) -- those which change according to the amount of business.Overhead expenses usually include the following:*Travel*Maintenance and repair*Equipment leases*Rent*Advertising & promotion*Supplies*Utilities*Packaging & shipping*Payroll taxes and benefits*Uncollectible receivables*Professional services*Insurance*Loan payments*Depreciation In order to develop the overhead expenses for the expense table used in this portion of the business plan, you need to multiply the number of employees by the expenses associated with each employee.In fact, every business is different, and each one must be structured according to its own requirements and goals. Mc Garty in his book, , lists four stages for organizing a business:1.Establish a list of the tasks using the broadest of classifications possible.2.The factors that need to be considered when calculating labor expense (LE) are the personnel requirements (P) for each department multiplied by the employee salary level (SL).Therefore, the equation would be: P × SL = LEUsing the marketing example from above, the labor expense for that department would be:51 × ,000 = ,040,000Once the organization's operations have been planned, the expenses associated with the operation of the business can be developed.


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