Creating Positive Cashflow With An Open To Buy

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Inventory control for small business utilizing an Excel chart created by Tom Shay www.profitsplus.org

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Creating Positive Cashflow With An Open To Buy

  1. 1. Presented by Tom Shay of Profits Plus Solutions 727-464-2182 tomshay@profitsplus.orgwww.profitsplus.org
  2. 2. www.profitsplus.org
  3. 3. www.profitsplus.org
  4. 4. 12/31 ASSETS Current Assets: Cash on hand $1,500.00 Checking Account $17,500.00 Savings Account $3,050.00 Accounts Receivable $14,215.87 Bank Card Receivable $1,340.34 Inventory $275,654.23 Total Current Assets: $313,260.44 Investments: Cooperative Stock $23,125.46 Cooperative Notes $12,597.47 Total Investments: $35,722.93 Long Term Assets: Property and Equipment: Fixtures and Equipment $126,245.11 Building $325,465.88 Total Property and Equipment: $451,710.99 Accumulated Depreciation: $207,950.25 Total Net Property and Equipment: $117,515.63 Other Assets: Utility Deposits $1,700.00 Total Other Assets: $1,700.00 Total Assets: $468,199.00 LIABILITIES AND EQUITY Current Liabilities: Accounts Payable $47,850.00 Building mortage - current $24,000.00 Note payable - current $45,000.00 Long Term Liabilites: Building mortgage $62,000.00 Note payable $84,000.00 Total Liabilities: $262,850.00 Stockholders' Equity Capital Stock $65,000.00 Retained Earnings $114,664.00 Current Income $25,685.00 Total Stockholders' Equity $205,349.00 Total Liabilities and Equity $468,199.00 Cash: $1,500.00 Inventory $275,654.73 Inventory turns: 3.51 www.profitsplus.org
  5. 5. www.profitsplus.org
  6. 6. 12/31 ASSETS Current Assets: Cash on hand $16,500.00 Checking Account $17,500.00 Savings Account $3,050.00 Accounts Receivable $14,215.87 Bank Card Receivable $1,340.34 Inventory $260,654.23 Total Current Assets: $313,260.44 Investments: Cooperative Stock $23,125.46 Cooperative Notes $12,597.47 Total Investments: $35,722.93 Long Term Assets: Property and Equipment: Fixtures and Equipment $126,245.11 Building $325,465.88 Total Property and Equipment: $451,710.99 Accumulated Depreciation: $207,950.25 Total Net Property and Equipment: $117,515.63 Other Assets: Utility Deposits $1,700.00 Total Other Assets: $1,700.00 Total Assets: $468,199.00 LIABILITIES AND EQUITY Current Liabilities: Accounts Payable $47,850.00 Building mortage - current $24,000.00 Note payable - current $45,000.00 Long Term Liabilites: Building mortgage $62,000.00 Note payable $84,000.00 Total Liabilities: $262,850.00 Stockholders' Equity Capital Stock $65,000.00 Retained Earnings $114,664.00 Current Income $25,685.00 Total Stockholders' Equity $205,349.00 Total Liabilities and Equity $468,199.00 Cash: $16,500.00 Inventory $260,654.73 Inventory turns: 3.65 www.profitsplus.org
  7. 7. www.profitsplus.org
  8. 8. www.profitsplus.org
  9. 9. www.profitsplus.org
  10. 10. www.profitsplus.org
  11. 11. Inventory levels per month
  12. 12. Sales percentage per month
  13. 13. Put the two side by side
  14. 14. www.profitsplus.org
  15. 15. If you were to create a plan to match the two
  16. 16. 1 Profits+Plus Open to Buy © Month 1 Month 2 Month 3 Month 4 2 Inventory - Beginning of Month E/P $155,000 $149,250 $151,930 $156,880 3 Anticipated Sales E $47,000 $48,000 $50,000 $50,000 4 P.O. # P.O. Written To: 5 Purchase Order #1 E $1,000 $2,000 $2,500 $1,000 35 Purchase Order #31 E 36 Purchase Order #32 E 37 Purchase Order #33 E 38 Total Purchases P $24,800 $33,400 $37,200 $32,000 39 40 Inventory Available for Sale P $179,800 $182,650 $189,130 $188,880 41 42 Gross Margin E 35.00% 36.00% 35.50% 37.00% 43 Cost of Goods Sold P $30,550 $30,720 $32,250 $31,500 44 45 Inventory (Actual)- End of Month P $149,250 $151,930 $156,880 $157,380 46 47 Desired Inventory - End of Month E $150,000 $152,000 $157,000 $157,000 48 49 Open to Buy for this Month P $750 $70 $120 -$380
  17. 17. 1 Profits+Plus Open to Buy © Month 1 Month 2 Month 3 Month 4 2 Inventory - Beginning of Month E/P $155,000 $149,250 $151,930 $156,880 3 Anticipated Sales E $47,000 $48,000 $50,000 $50,000
  18. 18. 1 Profits+Plus Open to Buy © Month 1 Month 2 Month 3 Month 4 42 Gross Margin E 35.00% 36.00% 35.50% 37.00% 43 Cost of Goods Sold P $30,550 $30,720 $32,250 $31,500 44 45 Inventory (Actual)- End of Month P $149,250 $151,930 $156,880 $157,380 46 47 Desired Inventory - End of Month E $150,000 $152,000 $157,000 $157,000
  19. 19.    1 Profits+Plus Open to Buy © B C Month 1 Month 2 Month 3 Month 4 4 P.O. # P.O. Written To: 5 Purchase Order #1 E $1,000 $2,000 $2,500 $1,000 6 Purchase Order #2 E $3,500 $5,500 $8,000 $5,500 7 Purchase Order #3 E $2,000 $3,900 $3,700 $3,000 8 Purchase Order #4 E $3,000 $7,000 $4,700 $8,000 9 Purchase Order #5 E $2,000 $6,000 $5,500 $4,500 10 Purchase Order #6 E $4,500 $2,500 $8,000 $5,000
  20. 20. 1 Profits+Plus Open to Buy © Month 1 Month 2 Month 3 Month 4 2 Inventory - Beginning of Month E/P $155,000 $149,250 $151,930 $156,880 3 Anticipated Sales E $47,000 $48,000 $50,000 $50,000
  21. 21. 1 Profits+Plus Open to Buy © Month 1 Month 2 Month 3 Month 4 35 Purchase Order #31 E 36 Purchase Order #32 E 37 Purchase Order #33 E 38 Total Purchases P $24,800 $33,400 $37,200 $32,000
  22. 22. 1 Profits+Plus Open to Buy © Month 1 Month 2 Month 3 Month 4 42 Gross Margin E 35.00% 36.00% 35.50% 37.00% 43 Cost of Goods Sold P $30,550 $30,720 $32,250 $31,500 44 45 Inventory (Actual)- End of Month P $149,250 $151,930 $156,880 $157,380 46 47 Desired Inventory - End of Month E $150,000 $152,000 $157,000 $157,000 48 49 Open to Buy for this Month P $750 $70 $120 -$380
  23. 23. www.profitsplus.org
  24. 24. www.profitsplus.org
  25. 25. 1 Profits+Plus Open to Buy © Month 1 Month 2 Month 3 Month 4 42 Gross Margin E 35.00% 36.00% 35.50% 37.00% 43 Cost of Goods Sold P $30,550 $30,720 $32,250 $31,500 44 45 Inventory (Actual)- End of Month P $149,250 $151,930 $156,880 $157,380 46 47 Desired Inventory - End of Month E $150,000 $152,000 $157,000 $157,000 48 49 Open to Buy for this Month P $750 $70 $120 -$380
  26. 26. Sales increase Sales decrease You under spend one month You over spend one month www.profitsplus.org
  27. 27. Your margin increases Your margin decreases You take mark downs You take additional mark ups www.profitsplus.org
  28. 28. You decide you want to increase inventory You decide you want to decrease inventory www.profitsplus.org
  29. 29. on in www.profitsplus.org
  30. 30. If you are always putting out fires in your business, you may be the person carrying the matches! www.profitsplus.org
  31. 31. www.profitsplus.org

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