Keeping tabs on bottom line
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Christchurch Press
02 April 2002
Carol Webb |
As business environments get tougher, margins become all
important – whether the item being sold is a $2 bread roll
or a $20,000 car.
"It's surprising how many businesses don't know the costs
associated with what they're selling, and as a result they
regularly sell some products at a loss," said Shane
Breckon, business manager of Christchurch software house
Indigo Technologies.
Indigo has probed the businesses of baking and car
reselling, and has come up with software packages that
deliver the information that firms – from "mom and pop"
bakeries to multi-yard car dealerships – need to be able
to get their pricing right.
BakePro is the result of a collaboration between Indigo
and an award-winning baker who saw the need for a
comprehensive bakery management package to track
ingredients, costs, margins – and even record recipes.
"A lot of bakeries use recipes from the Edmonds Cookbook,"
said Mr Breckon. "BakePro provides the information they
need to scale up recipes for commercial quantities. It can
convert cookbook-type measures like teaspoons and cups to
standard units of weight, and cost them accordingly.
"Intermediate ingredients, like pizza bases, are also
tracked and included in the final costings."
Bakeries adopting the system are likely to be in for a few
surprises. "A lot of bakeries lose money on some products
simply because they don't know how much it is costing to
produce those items," he said. The BakePro margins report
shows up loss-makers in "red ink", alerting owners to the
need to review their pricing. By contrast, other products
might be grossly overpriced.
Margin-conscious owners can also determine the gross
profit they want to make on any item and price it
accordingly.
Mr Breckon said indications are that bakery owners are
likely to run BakePro on their home computers and update
their records at the end of the day, while printing out
recipes and other information for the next day's
production.
He said Indigo was also beta testing a car dealership
management package available in three versions and planned
for distribution on a monthly lease basis. Like BakePro,
it has been developed in Visual Basic and runs on SQL
Server. Indigo, a Microsoft Certified Partner, is moving
towards Visual Studio . NET as its primary development
environment.
A Web-only version of Motorcentral enables dealers to
easily update their websites while more feature-rich
versions track costs, sales, and shipping information for
single or multi-yard operations.
Vehicle importers can record details of cars at the time
of purchase overseas, and based on the vehicles' condition
report and initial cost, can then decide how much to spend
getting it ready for sale. This information is available
to anyone working on the vehicle, and helps prevent
margins being squandered while recording all expenditure.
A variety of reports, which can be customised to suit
individual dealerships, are available. They include a full
record of sales for any given day, or period, and sales by
individual staff members. Details required to be shown on
vehicles standing in the yard can be extracted and printed
out on pre-printed display cards.
Mr Breckon said that sales staff presented with an offer
below the list price of a vehicle can quickly check the
total cost of getting the vehicle ready for sale. "That
way, they know what the bottom line is for that vehicle."
And has Mr Breckon any tips for car buyers? "Wait till a
car has been on the yard for a while. Dealers like to turn
over their stock, so you're more likely to have your offer
accepted."
Source: Christchurch Press - 02 April 2002
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