1 / 21

Business Cost Recovery Model (aka Social Cost Accounting Model)

Toronto Enterprise Fund provides funding and support to employment social enterprises (ESEs) in Peel, Toronto, and York Region. This cost recovery model helps ESEs at all stages of development, benefiting 3,500 individuals facing barriers to the labor market.

richardryan
Download Presentation

Business Cost Recovery Model (aka Social Cost Accounting Model)

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Building a future for employment social enterprise Business Cost Recovery Model (aka Social Cost Accounting Model)

  2. Toronto Enterprise Fund • Provides funding and support to employment social enterprises (ESEs) at all stages of development • Supported by United Way Greater Toronto, Province of Ontario, City of Toronto, Federal Government • Serves ESEs in Peel, Toronto and York Region • Has helped 3,500 people facing barriers to the labour market

  3. Pricing a product

  4. Pricing Pricing Use REDF pricing tool:

  5. Pricing Pricing What costs should you include: • Variable (change with volume of sales) • Direct labour • Materials • Other (shipping, transportation, etc.) • Fixed (don’t change with volume of sales) • Salaried staff • Rent & utilities • Other (advertising, insurance, bank fees, etc)

  6. Pricing Calculation methods: • Cost plus method • >, <, or = to competition method Impact of price: • Price – cost = Contribution • Contribution x volume = gross profit • Gross profit – operating costs = net profit

  7. Forecast monthly sales

  8. Sales Forecast • By average purchase • By product or contract • By percentage increase (after 1 year) • Decide on unit of sales, price per unit • Factor in seasonality or business cycle

  9. Sales Forecast Go to Financial Planning Worksheets/ Sales Forecast tab

  10. Calculate start-up costs & monthly cash flow

  11. Why Cash Flow Forecasting? • To calculate amount of start-up funds required • To set targets for your enterprise • To establish a foundation for your financial management system (to manage cash flow, track results and calculate BCR) • To improve hiring, scheduling, inventory purchasing and equipment acquisition

  12. Cash Flow Forecasting Go to Financial Planning Worksheets/ Cash Flow Forecast tab

  13. Social costs

  14. Social Costs Discussion What does/will your employment social enterprise do that is different than a regular business?

  15. Types of Social Costs • Extra staffing due to training, lower productivity, higher absenteeism • Higher materials usage due to training, or cognitive/mobility issues • Trainers, job coaches, social workers • Extra space for training or mobility • Special equipment

  16. Social Cost Case Study Café and catering business in a hospital; customers are staff, visitors and patients of hospital; employees are people living with mental illness Activities identified as social:  • Twice as many staff on shift compared to a regular business • 10% of more food wasted than regular business • Management (non-participant staff) spend 3 days out of 5 training, supervising and supporting staff, dealing with personal crises and workplace conflict • Cash shortage/overage is attributed issues of numeracy and other challenges • All other expenses are regular business

  17. Social Costs Case Study

  18. Social Costs Guidelines

  19. NEXT Steps

  20. Adopting Social Cost Accounting • Use TEF’s financial forecasting templates

  21. Contact Information • Stay in touch: • TEF website: http://torontoenterprisefund.ca • TEF Newsletter • Twitter: @tefca • Facebook: /TorontoEnterpriseFund Additional questions? ANNE JAMIESONSeniorManager, Toronto Enterprise FundP: 416-777-1444 ext 513E: ajamieson@uwgt.org BRONWYN OATLEYManager, Toronto Enterprise FundP: 416-275-6482E: boatley@uwgt.org

More Related