NCCET Webinar - Finance Essentials for Corporate and Continuing Education Leaders

Finance Essentials for Corporate & Continuing Education Leaders Dr. Kathy Walton, Executive Director, Customized Training Austin Community College [email_address] (512) 223-7213 Rob Clancey, Director, Corporate College Polk State College [email_address] (863) 669-2321

Agenda

Business Model

Financial Goals

Sources of Revenue

Pricing Strategies

Accountability

It’s OK to Make $$$

Business Model

Staffing

Sales

Educators vs Sales People

Curriculum Development

Vendors vs “DIY”

Implementation

Marketing and Sales

Community Dynamics

Financial Tracking

Financial Goals It’s OK to Make $

Current Information

Review Financial Records

Track Sales

Establish Profit Margin

~40-50%

Set Annual Revenue Goal

Revenue Sources It’s OK to Make $$

Sales

Direct

Passive

RFPs

Stimulus Act

Workforce Boards

State/County/City Agencies

Grants

Pricing Strategies It’s OK to Make $$$

Focus on Value Proposition

PCC Pricing Model

Flat Price $235.00/hour + materials

Instructors: $26.95-$85.00/hour

Minimum margin 64%

Benefits

Client Expectations Met

Fast—no delay in sales cycle

Pricing Strategies It’s OK to Make $$$$

ACC Pricing Model

Factor in all costs

Instructors: $36-$100/hour

Include profit & bonus

Averages $250/hour

Benefits

Consistent

Profit included in model insures results

Negotiations & Exceptions

Company: Course Title: Interviewing Skills Price Quote to Client (Sales REVENUE ) 3,400 Price per person 227 #DIV/0! #DIV/0! Assumptions: No. of Different Modules 1 Hours per Module 8 No. times module(s) to be delivered 1 Number of Trainees 15 Course Contact Hrs 8 0 0 Instructor Rate/Hour $50 Textbook Cost Each Workbook Cost Each $100 Eligible for CE enrollment? Y/N y WECM Rate if applicable $4.01 Cost of Meal / breaks $8.00 Direct Expenses: Total Instructor Wages incld fringe @ 2.75% 411 0 0 Workbook Total Cost 1,500 0 0 Additional Course Materials 0 Supplies Provided Equipment / Software to be Purchased Other, Customization, Design, or Contract Labor Subtotal Direct Expenses for Markup 1,911 0 0 Other Direct Expenses Textbook Total Cost 0 0 0 Total ACC Overhead Rate x Total Contact Hrs 240 0 0 Subtotal Other Direct Expenses 240 0 0 Total Direct Expenses 2,151 0 0 Calculating Target Price 1. Multiply desired markup X subtotal direct expenses for markup 3,058 0 0 2. Enter -- Subtotal Other Direct Expenses 240 0 0 3. Markup Price = sum of #1 + #2 above 3,298 0 0 4. Bonus 165 0 0 5. Catering Arrangements: Number of Days for Meals & Breaks Total Dining Costs $0.00 $0.00 $0.00 6. Target Price (Sum of #3, #4 & #5 above) $3,297.60 $0.00 $0.00 Surplus Revenue aka Profit (Quoted Price - Total Direct Expenses) $1,084.12 $0.00 $0.00 Financial Ratio for Comparison Gross Margin Percentage or Profit Margin = (Profit / Price) x 100 32% #DIV/0! #DIV/0! GOAL: 30-40% To Include WECM Contributions for Your Records:

Accountability It’s OK to Make $$$$

Performance: Track Team/Individual Goals

Track contracts, financial records

Pipeline Report

Monthly/quarterly Trends

Track Sales per Individual

Institutional Records (Revenues, expenses, Profit)

Reconcile Results

Rewards

What gets measured, gets managed!

May--2009 Sales By Account Executive Top Sales Executive: Marie!!! @ $35,950 Total May Sales: $125,748 Accumulative Sales: $826,834 Current Status: 167% of monthly Goal 91.8% of annual Goal (75% of time) Team Monthly Goal: $75,000 Ind Monthly Goal: $25,000 Annual Goal: $900,000 % of Goal Goal

Conclusion

Business Model

Financial Goals

Sources of Revenue

Pricing Strategies

Accountability

It’s OK to Make $$$$

Finance Essentials for Corporate & Continuing Education Leaders Q & A

Finance Essentials for Corporate & Continuing Education Leaders Dr. Kathy Walton, Executive Director, Customized Training Austin Community College [email_address] (512) 223-7213 Rob Clancey, Director, Corporate College Polk State College [email_address] (863) 669-2321