When planning the release of products, for example, in the construction industry, one has to take into account the additional costs of reconstruction, replacement of tooling and equipment, its readjustment, and the development of new types of products. Such expenses often require attracting investments. To correctly determine the amount of funds raised, special calculations will be required.
Instructions
Step 1
Analyze the financial support for the release of new products. If analysis shows that such collateral is not enough, increase the amount of borrowed funds.
Step 2
Estimate the level of the expected return on invested capital and the level of profitability of the enterprise for the release of new products. In case of insufficiently high rates, investing in new products should be recognized as inexpedient.
Step 3
Consider the company's own funds as a source of investment: reserves, receipts of proceeds from already manufactured products, and so on.
Step 4
Determine the provided volume of new products by the formula: Q = (Fr + Fc + Td + Fconst) / Vc; where Q is the estimated volume of production of new types of products; Fr is the company's own reserve funds; Fc is credit funds; Td is the gross income from the sale of manufactured products; Fconst is the fixed costs of the company attributable to finished products; Vc is the variable costs per unit of new products.
Step 5
Calculate the size of attracted third-party investments, sources of which, for example, can be private investors and credit institutions. Use the formula for calculations: Fcr = (Q * Vc + Fconst) - (Fr + Td), where Fcr is the amount of funds raised; Q is the volume of production of new types of products; Fr is the company's own reserve funds; Vc is variable costs per new product unit; Fconst - fixed costs of the enterprise; Td - gross income from product sales.
Step 6
In the case when it is planned to purchase or improve technological equipment for the production of new types of products, when calculating additional financing, take into account the cost of new equipment and the cost of modernizing existing ones. Also make allowances for the costs associated with making changes to the production process (product development, preparation, etc.).
