I'm going to share an easy way to look at any account
to see if it's making money by using a simple Proft & Loss
(P&L;) Formula. Once you obtain all the percentages and
costs needed to insert into the form you should be able to
check any account, large or small, to see if it's proftable.
In the example form above, the imaginary account is
ABC Company providing sales of $65,000 per year with
one snack and two soda machines, one selling 12 ounce
and the other 20 ounce sodas. I used the same format to
check all of my accounts, even those doing over one hun-
dred thousand dollars a year in sales. The form should be
updated monthly to refect the different percentages and
costs needed to apply to the P&L; formula. Being able to
easily look at the small accounts is what provides the best
information. Was the account proftable? If not, how can
we make it proftable? Can we ask to lower the commis-
sion, and/or raise prices? And if those solutions wouldn't
work, do we stay or do we go?
Are You
Making
Money?
Create a simple proftability formula for
each vending account to fnd out.
By Dominic Finelli, Contributing Editor
D
800.524.5210
600 East Wayne Street
Celina, Ohio 45822
info@thiemantailgates.com
www.thiemantailgates.com
Raising
Performance
to New Levels
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Available from a
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Network
uring the everyday operation of your vending
business do you ever check to see if you are mak-
ing money at an individual account? Is it doing
what you thought it would do? Is it worth keep-
ing? You can't just look at sales and think that
everything is good.
26 Automatic Merchandiser VendingMarketWatch.com December 2014
ADVICE TAILORED TO THE 1 TO 4 ROUTE OPERATION
S M A L L O P
ACCOUNT PROFIT & LOSS WORKSHEET
***
ABC Company doing $5,000 in sales over 4 week period.
SALES
Snacks $2,500
12oz Sodas $1,000
20oz Sodas $1,500
TOTAL SALES $5,000
COST OF PRODUCT
Snacks at 19%
(from cost %- P&L;)
$475
12oz-units-1333 @.296 $394
20oz-units-1200 @.596 $715
TOTAL PRODUCT COST -$1,584
GROSS PROFIT $3,416
OTHER EXPENSES
Sales tax @ 6% $300
*Direct labor $501
**Indirect labor & Adm.
— 32.3%
$1,615
TOTAL EXPENSES ASSOCIATED
WITH ACCOUNT
- $2,416
INCOME FROM ACCOUNT $1,000
Add rebate % — 2% X Sales +100
TOTAL INCOME $1,100 or 22%
Less commission to account @10% of gross sales -$500
NET INCOME $600 or 12%
Notes about Product & Loss chart
*
Direct labor
For direct labor we took the route's total sales of $7,000 per week and
the driver's salary of $700 per week. Account ABC Co. generates $1,250