I need recommendation for my Product Profitability Balancing
Posted: Sun Apr 04, 2021 10:44 am
This is Manufacturing.DBF(RealWorld Mod by Piermario) + my Columns(the Colored ones).
And It would be somewhat different from original RealWorld Mod(But That is not main issue.)
[Colored Columns]
Sales per Cycle means :: (Standard Price + RD Premium) x Quantity per one Manufacturing Cycle.
Cost per Cycle 1~3 means :: Each Input price x Quantity per one Manufacturing Cycle.
Gross Cost per Cycle means :: Sum of the Input 1, 2, 3's Cost
Profit per Cycler means :: Sales per Cycle - Gross Cost per Cycle
Profitability means :: (Sales per Cycle - Gross Cost per Cycle) / Sales per Cycle
As you can see, Profitability is far higher than real world. so I'm willing to adjust it.
(And as you know, what I say 'Profit' means 'Gross Profit' in accounting.)
Q1) Which one should I adjust for balancing
:: (1) Reducing Output Quantity or (2) Increasing Input Quantity.
Q2) How much profitability would be appropriate?
I would set 30% in industry like Fastfood, Bake, energy, etc
I would set 40% in industry like Food, Beverage, auto etc
I would set 50% in industry like Bodycare, Alcholic, etc
I would set 60% in industry like Drugs, Computer, Commun, etc
but I don't know how cost process works exactly in CapLab.
Is it fine to set like this considering all the other cost like freight, Labor, Plant in CapLab?