The calculation of the economic effect of the proposed activities is carried out in order to determine the feasibility of financing a particular project, the essence of which is to make a profit.

Types of economic effect

Assumes the investment of capital in order to generate additional profit to achieve In the second case, the economic effect cannot be calculated, since the social effect does not imply a profit.

The economic effect can be positive and negative. To achieve a positive effect, it is enough to make a profit. In other words, the amount of the investor's income must be higher than the amount of the investment. This effect is called profit. The second way to get a positive effect is not through investments that increase the volume of income, but through savings in production costs. The most profitable way to get a positive effect is to increase revenues and reduce production costs.

A negative positive effect is achieved when the costs of the proposed activity exceed the income. In this case, the economic effect will be called a loss.

Methodology for calculating the economic effect

The classic formula for calculating the economic effect is as follows:

Eph \u003d D - W * K, Where

Ef - economic effect;

D - income or savings from events;

C - the cost of events;

TO - normative coefficient.

Regulatory coefficient

In addition to the concept of "economic effect" there is another term that is used to determine the feasibility of investing. This is economic efficiency. It also requires a standard coefficient. It shows the minimum acceptable efficiency investment project, which should be achieved for the state and society.

The normative coefficient is a constant. Its meaning varies depending on the industry in which it is used. The value of this index ranges from 0.1 to 0.33. The highest value of the parameter is in the chemical industry, and the lowest is in the transport industry. In the industrial sector, the standard coefficient is 0.16; in the sphere of trade - 0.25.

Feasibility of calculating the economic effect of the proposed measures

The economic effect can be calculated for any period of time. It depends on how long the events are. The calculation of the annual economic effect is carried out in cases where activities requiring investments are carried out or can be carried out during the year. An example is the payment of bonuses to employees for increasing sales volumes by months. So no better way understand the expediency of bonuses, how to calculate the economic effect for the year. The formula for calculating the economic effect of the proposed measures in this case will look like this:

Er \u003d (D1 - D0) * Z * K, where

• Er - annual effect;
• D1 - income after the events;
• D2 - income before events;
• Z - costs;
• K - normative coefficient.

Example

In order to more clearly understand how the expediency of an investment project is determined, it is necessary to consider an example of calculating the economic effect.

The company is engaged in the manufacture and sale of furniture. The management decided to give bonuses to employees if they can improve the quality of products. As a result of the measures taken to improve the quality of the goods, the company was able to earn 100 thousand dollars, which is 15 thousand more than before the implementation of the measures. 8 thousand dollars were invested, and the standard coefficient is 0.25. Accordingly, the economic effect is calculated as follows:

Eph \u003d 15 - 0.25 * 8 \u003d 13.

Long term investment

In cases where the investment will be carried out over a long period of time, the economic effect indicator will not be able to reflect the feasibility of financing. Opportunity costs must always be taken into account. They appear when an investor makes one or another choice in the presence of another alternative. In this situation opportunity cost the unearned profit that the entrepreneur could have earned if he had chosen another option for investing his funds is considered.

There is always at least one alternative investment option, and it must be taken into account in order to get a more complete picture when calculating the economic effect of the proposed activities. This alternative is a bank deposit. In this case, it is necessary to take into account the percentage of the deposit and discount income and expenses.

In this situation, the net value will act as an economic effect. However, if the calculation percentage was not taken into account when calculating the classical economic effect, and a positive effect was achieved when revenues exceeded costs, then in the case of a net present value, even its negative value can indicate that the costs are greater than the costs.

The thing is that not always a negative value of the net present value means the excess of expenses over income. If a calculation percentage is included in the calculation, for example, 5%, then a positive value means that the return on investment is more than 5%. If the NPV is 0, then the investment is profitable by exactly 5%.

To understand how cost-effective the proposed activities are when less than zero, you need to calculate the internal percentage. A positive value indicates the profitability of the project, and a negative value indicates its unprofitability. If the internal interest is 2 at a calculation rate of 5%, then the investment paid off by 2 percent, but with an alternative use of these funds, they could return 3% more. Thus, in contrast to the economic efficiency ratio, it is a more suitable solution for calculating the financing of measures to improve the enterprise, designed for the long term.

Before making any investment, investors in without fail trying to find out when the investment will start to make a profit.

For this, such financial ratio as payback period.

concept

Depending on the purpose of financial investments, one can distinguish some basic concepts of payback period.

For investment

The payback period is the period of time after which the amount of invested funds will be equal to the amount of income received. In other words, in this case, the coefficient shows, what time will be required in order to return the invested money and start making a profit.

Often the indicator is used to select one of the alternative projects for investment. For the investor, the project with the lower coefficient value will be more preferable. This is due to the fact that it will become profitable faster.

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For capital investments

This indicator allows you to evaluate efficiency reconstruction, modernization of production. In this case, this indicator reflects the period during which the resulting savings and additional profit will exceed the amount spent on capital investments.

Often, such calculations are used to assess the effectiveness and feasibility of investments. If the value of the coefficient is too high, you may have to abandon such investments.

Equipment

The payback period of the equipment allows you to calculate how long the funds invested in this production unit will be returned at the expense of the profit received from its use.

Calculation methods

Depending on whether the change in cost is taken into account when calculating the payback period Money over time or not, traditionally allocate 2 calculation methods this ratio:

1. simple;
2. dynamic (or discounted).

Easy way to calculate is one of the oldest. It allows you to calculate the period that will pass from the moment of investment to the moment of their payback.

Using in process financial analysis this indicator, it is important to understand that it will be informative enough only if following conditions:

• in the case of comparing several alternative projects, they must have an equal life;
• investments are made at a time at the beginning of the project;
• income from the invested funds comes in approximately equal parts.

The popularity of this calculation technique is due to its simplicity, as well as complete clarity for understanding.

In addition, a simple payback period is quite informative as investment risk indicator. That is, its greater value allows us to judge the riskiness of the project. At the same time, a lower value means that immediately after the start of its implementation, the investor will receive consistently large income, which allows maintaining the level of the company at the proper level.

However, in addition to these advantages, a simple calculation method has a number of shortcomings. This is because in this case not taken into account the following important factors:

• the value of cash changes significantly over time;
• after the project has achieved payback, it can continue to be profitable.

That is why the calculation of the dynamic indicator is used.

Dynamic or discounted payback period The project is called the duration of the period that passes from the beginning of investments to the time of its payback, taking into account discounting. It is understood as the onset of a moment when the net present value becomes non-negative and remains so in the future.

It is important to know that the dynamic payback period will always be longer than the static one. This is due to the fact that in this case, the change in the value of cash over time is taken into account.

Next, consider the formulas used in calculating the payback period in two ways. However, it is important to remember that if the cash flow or receipts of various sizes, it is most convenient to use calculations using tables and graphs.

Method for calculating the simple payback period

When calculating, a formula of the form is used:

Example 1

Suppose that a certain project requires investments in the amount of 150,000 rubles. It is expected that the annual proceeds from its implementation will amount to 50,000 rubles. It is necessary to calculate the payback period.

Substitute the data we have into the formula:

RR = 150,000 / 50,000 = 3 years

Thus, the investment is expected to pay off within three years.

The formula proposed above does not take into account that in the process of project implementation, not only the inflow of funds, but also their outflow can occur. In this case, it is useful to use the modified formula:

RR = K0 / FCsg, where

PChsg - received on average per year. It is calculated as the difference between average income and expenses.

Example 2

In our example, we will additionally introduce the condition that in the process of project implementation there are annual costs in the amount of 20,000 rubles.

Then the calculation will change as follows:

PP = 150,000 / (50,000 - 20,000) = 5 years

As you can see, the payback period when taking into account costs turned out to be longer.

Similar calculation formulas are acceptable in cases where revenues are the same over the years. In practice, this rarely occurs. Much more often the amount of inflow changes from period to period.

In this case, the calculation of the payback period is carried out somewhat differently. There are several steps in this process:

1. there is an integer number of years for which the amount of income will be as close as possible to the amount of investment;
2. find the amount of investments that are not yet covered by inflows;
3. considering that investments during the year go evenly, they find the number of months required to achieve the full payback of the project.

Example 3

The amount of investment in the project is 150,000 rubles. During the first year, an income of 30,000 rubles is expected, the second - 50,000, the third - 40,000, the fourth - 60,000.

Thus, for the first three years, the amount of income will be:

30 000 + 50 000 + 40 000 = 120 000

For 4 years:

30 000 + 50 000 + 40 000 + 60 000 = 180 000

That is, the payback period is more than three years, but less than four.

Let's find the fractional part. To do this, calculate the uncovered balance after the third year:

150 000 – 120 000 = 30 000

30,000 / 60,000 = 0.5 years

We get that the return on investment is 3.5 years.

Calculation of the dynamic payback period

Unlike simple, this indicator takes into account the change in the value of cash over time. For this, the concept of discount rate is introduced.

The formula takes the following form:

Example

In the previous example, we introduce one more condition: the annual discount rate is 1%.

Calculate the discounted income for each year:

30,000 / (1 + 0.01) = 29,702.97 rubles

50,000 / (1 + 0.01) 2 = 49,014.80 rubles

40,000 / (1 + 0.01) 3 \u003d 38,823.61 rubles

60,000 / (1 + 0.01) 4 \u003d 57,658.82 rubles

We get that for the first 3 years of receipts will be:

29,702.97 + 49,014.80 + 38,823.61 = 117,541.38 rubles

For 4 years:

29,702.97 + 49,014.80 + 38,823.61 + 57,658.82 = 175,200.20 rubles

As with a simple payback, the project pays off in more than 3 years, but less than 4. Let's calculate the fractional part.

After the third year, the uncovered balance will be:

150 000 – 117 541,38 = 32 458,62

That is, until the full payback period is not enough:

32,458.62 / 57,658.82 = 0.56 years

Thus, the return on investment will be 3.56 years. In our example, this is not much more than with easy way payback. However, the discount rate we adopted was too low: only 1%. In practice, it is about 10%.

Payback period is an important financial indicator. It helps the investor to assess how expedient the investment in a particular project.

The next video lecture is devoted to the basics financial planning, investment plan and payback period:

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Department of Education of the City of Moscow

State educational institution

Secondary vocational education

Construction College No. 41

Course work

On the topic: Determination of the economic effect and payback period of capital investments in the development of production.

By discipline: Economics of the organization.

Specialty: Management (by industry).

Performed by Nekrasova V.S. 2nd year student

Groups 2v - 06k

Accepted by the teacher Safronova Zh.P.

Moscow - 2010

Introduction

1. Initial data

2. Drawing up a cost estimate for the production of products

3. Drawing up a cost estimate

4. Product pricing

5. Formation and distribution of profit

6. Capital investments in the development of production

7. Reducing the cost of production

8. Calculation of the annual economic effect

9. Calculation of economic efficiency and payback period of investments in the development of production

conclusions

Bibliography

Introduction

The economy covers all aspects of human life without exception. There is no real economy divorced from material production. In conditions market relations the enterprise is the main link in the economy, since it is at the enterprise that the commodities and means of production necessary for society are created. In the presence of competition in the market, the enterprise needs to introduce new equipment and technology into production in order to reduce the cost of producing products (provision of services), increasing profitability. Success factors in the market become a condition for the survival of the enterprise, which in turn are determined by the professionalism of specialists. A specialist must be able to competently and competently organize production, determine market requirements, be able to calculate both planned production volumes and product price costs that affect the profitability of an enterprise. Investing in the development of production is necessary, but it must be economically feasible. Economic feasibility is determined by indicators of economic efficiency and the payback period of additional capital investments in the development of production.

1. Initial data

Table No. 1 Production costs in the 1st half of the year

Table No. 2 Consumption of material resources

1) Pm = HPM? VP

Pm \u003d 0.19? 1180 + 0.15? 1980 = 521.2 tons

2) Pt = NRT? VP

RT \u003d 0.04? 1180 + 0.008? 1980 = 63.04 tons

3) Re = NRE? VP

Re = 390? 1180 + 235? 1980 = 925500 kW

Table No. 3 Status of fixed assets

The entire amount of depreciation for half a year and 40% net profit aimed at developing production in the second half of the year. As a result of the implementation of scientific and technical progress Since the second half of the year, metal consumption rates have decreased by 5%. The volume of production and, accordingly, labor productivity increased by 1.2 times, without an increase in the number of employees. Wages increased by 6%. Conditionally - fixed costs increased by 3%

Table No. 4 Financial indicators enterprise work

Indicators	Absolute value
Other expenses in % of the accounting amount.
Number of employees
Average monthly salary	3200 rub./person
Payroll deduction
Rental income (monthly)	40 thousand rubles
Dividends on securities (quarterly)	80 thousand rubles
Priority payments to the budget from profit (quarterly)
Income tax rate, including rent
Tax rate on income from securities

Determine: 1) Savings from reducing the cost of production for the second half of the year and for the year. a) Annual economic effect. b) Payback period for investments in scientific and technological progress

2. Drawing up a budgetproduction costs

The cost price is everything that the company spent on the production and sale of the ruble. Classification of costs by economic elements. This type of classification involves the division of costs into groups according to their economic name. The cost of material costs is determined on the basis of the prices for the acquisition of material resources and the amount of material resources spent fund Z. pl. calculated on the basis of the average monthly salary/p. Depreciation charges are determined based on the value of fixed assets.

Table No. 5 Cost estimates for the first half of the year.

1) ZM = 521.2? 1440 \u003d 750528 rubles.

2) ST = 63.04? 1200 = 75648 rubles

3) ZE = 925500? 2, 11 \u003d 1952805 rubles.

4) ZP = 3200? 100 ? 6 = 1920t.rub

5) OZP = 1920? 26? 100 \u003d 499200 rubles.

6) Ag \u003d 2000000? 2 + 3000000 ? 12 ? 100 = 400,000 rubles/year

3. Drawing up a cost estimate

The practical purpose of costs for costing items to calculate the cost of each separate species production, for this all costs are divided into direct and indirect.

Direct costs - variable, they decrease or increase with the volume of output.

Fixed costs - do not change with the volume of output.

The cost of material costs for technological needs is determined on the basis of the consumption rates of material, fuel, energy and their prices. return on investment cost estimate

The wages of production workers are determined on the basis of piece rates.

Deductions from salaries are the norm and amount to 35.6%

The amount of conditionally fixed (overhead) costs is calculated as the difference between the total amount costs according to the estimate and size variable costs by calculation.

Overhead costs are distributed by type of product in accordance with the complexity of manufacturing the product, which is displayed in wages (piece rate), the coefficient or percentage of overhead costs is determined by the formula.

To inc. "B" = K incl. "A"

Table number 6. Calculation of the cost of products "A" and "B" for the first half of the year

cost of expenses	Product "A"	Product "B"
				The cost of the entire issue.	Consumption rate per unit			The cost of the entire issue.	The sum of "A" and "B"
Metal for technical needs.
Fuel for technical needs.
Electricity for technical needs.
Wages of production workers
Deductions from wages
total variable costs.
Overheads
Total total cost.

ZM \u003d 0.19? 1140 \u003d 273.6 rubles / ed.

273.6? 1180 = 322848 rubles

ZM \u003d 0.15? 1140 \u003d 216 rubles / ed.

216? 1980 =427680 rub.

322848 + 427680 = 750528 rubles

ST = 0.04? 1200 = 48 rubles/ed.

48? 1180 = 56640 rubles

ST = 0.008? 1200 \u003d 9.6 rubles / ed.

9.6? 1980 = 19008 rubles

56640 + 19008 = 75648 rubles

SE = 390 ? 2.11 \u003d 822.9 rubles / ed.

822.9? 1180 = 971022 rubles

SE = 235 ? 2.11 \u003d 495.85 rubles / ed.

495.85? 1980 = 981783 rubles.

971022 + 981783 = 1952805 rubles

ZP "A" = 225 rubles / ed.

ZP "A" vp \u003d 225? 1180 = 265500 rubles.

ZP "B" = 238 rubles / ed.

ZP "B" vp \u003d 238? 1980 = 471240 rubles.

OZP "A" = = 58.5 rubles / ed.

OZP "A" \u003d 58.5? 1180 \u003d 69030 rubles.

OZP "B" = = 61.88 rubles / ed.

OZP "B" = 61.88? 1980 = 122522.4 rubles

HP \u003d 5722071 - 3707273.4 \u003d 2014797.6 rubles.

To inc. "A" = 0.4859 or 48.59%

To inc. "B" = = 0.5140 or 51.40%

HP "A" \u003d \u003d 978990.15 rubles / VP.

HP "B" \u003d 1035605.9 rubles.

SE "A" = = 829.65 rubles / ed.

SE "B" = = 523.033 rubles / piece.

4. Product pricing

The wholesale price of the enterprise (C.o pr.), is determined for each type of product

C.o pr. = () ? from [rub./ed.] where

P - product profitability%

C - the cost of the product rub./ed.

The volume of sales in wholesale prices of the enterprise or revenue (BP) is determined by the formula.

BP \u003d (C.o pr. "A" ? n "A") + (C.o pr. "B" ? n "B"),

where n "A" and n "B" respectively, the sale of products in physical terms.

C.o pr. "A" \u003d () ? 2257.65 \u003d 2934.94 rubles / ed.

C.o pr. "B" = () ? 1544.36 \u003d 1945.89 rubles / ed.

BP = 2934.94? 1180 + 1945.89? 1980 = 3463229 + 3852862 = 7316091 rubles

5. Formation and distribution of profit

Profit is the difference between the income and expenses of a business.

There are balance sheet (total) and net profit.

Balance sheet profit is the profit received from all types of activities: (products, services, commercial activities.)

Net profit - remains at the disposal of the enterprise.

P.clean > accumulation fund and consumption fund

Pb. = Ex. + Pvrd. (rub.),

Pb - book profit

Etc. - profit from the sale of products

Pvrd. - profit from non-operating activities.

BP \u003d 7316091 rubles / half a year

Sp "A" + "B" = 5722071 (rubles/semi-half)

Pb \u003d 7316091 - 5722071 \u003d 1594020 rubles / half a year

P.ar = 40000 ? 6 \u003d 240,000 rubles / half.

Ptsen. boom = 80000 ? 2 \u003d 160,000 rubles / half a year

P.gen. \u003d 1594020 - (90000 × 2) \u003d 1814020 rubles / half a year

Tax on rental income (NA)

ON = 240000 ? 0.3 \u003d 72,000 rubles / received.

Income tax on securities

N c.b. = 160000? 0.15 \u003d 24,000 rubles / received.

Tax on the main activity

N o.d. = (1814020 - 240000 - 160000) ? 0.3 \u003d 424206 rubles / received

Taxes = 72000 + 24000 + 424206 = 520206

Pch \u003d 1814020 - 520206 \u003d 1293814 rubles / received.

6. Investments in the development of productionA

According to the condition, the entire amount of depreciation deductions for the half year and 40% of net profit are invested in the development of production in the second half of the year. Calculation of the amount of depreciation.

The annual amount of depreciation charges (Ag) is calculated based on the cost and depreciation rates by type of fixed assets.

Ar = + = [ruble/year]

To zd. and K rev. - investments respectively in buildings and equipment.

ON THE. zd and NA. about - the rate of depreciation deductions, respectively, for buildings and equipment.

Net profit for the six months is determined, we find 40% of it. The amount of investment in the development of production (K)

K \u003d (Ar? 0.5) + (P? 0.4) [rub.]

Ar = + = 400,000 rubles / year.

K \u003d (400000 × 0.5) + (1293814 × 0.4) \u003d 717525.6 [rubles]

7. Reducing the cost of production

Reducing the cost of production by saving materials

Calculated for each type according to the formula,

%? S.m \u003d (1 - K r.c.m? K cm. n.r.m)? ? 100%

%? S.m reduction in the cost of the product due to savings in materials.

K r.ts.m - the coefficient of growth in prices for materials.

K cm.n.r.m - coefficient of material consumption rate for products

HP m.ud - material consumption rate for products.

With p.ud - the total cost of the product.

%? S.m "A" \u003d (1 - 1.0500.92) ? ? 100%

%? S.m "B" \u003d (1 - 1.05 × 0.92)? ? 100%

%? S.m "A" \u003d (1 - 1.05 × 0.92)? ? 100 = 0.000299%

%? S.m "B" \u003d (1 - 1.05 × 0.92)? ? 100 = 0.00033%

Cost reduction due to savings on wages, taking into account deductions from wages.

%? With zp. = (1) ? ? 100%

%? With zp. - this is the percentage of reduction in the cost of the product due to the RFP and its deductions.

Kr.zp - coefficient of salary growth.

Kr.vp - coefficient of output growth

ZP. oud - wage per unit ed.

WIP. beats - deductions from salary per unit. ed.

%? With zp. "A" \u003d (1 ? ? 100%

%? With zp. "B" \u003d (1 -)? ? 100%

%? With zp. "A" \u003d (1? ? 100 \u003d 1.465%

%? With zp. "B" \u003d (1 ? ? 100 \u003d 2.265%

Savings on conditionally fixed costs

Cost reduction due to conditionally fixed costs is calculated for each type of product using the formula:

%? mustache fast. = (1 -) ? ? 100% where

%? mustache fast. - the percentage of reduction in the cost of production due to conditionally fixed costs.

Kr.us-post - the growth rate of conditionally - fixed costs.

R us.post.ud - expenses are conditionally - constant per unit. products

%? mustache fast. "A" = (1-) ? ? 100 = 5.2035%

%? mustache fast. "B" = (1-) ? ? 100 = 4.7956%

8. Go calculationdovotheconomicWowEffectA

The annual economic effect is the amount of savings that the enterprise receives by reducing the cost as a result of additional capital investments in the development of production.

Eg \u003d (Sp. beats 1 - Sp. beats 2)? n2 (ruble/year)

Sp. beats 1 and Sp. beats 2 - respectively, the cost of the product before and after the implementation of the measure n2 - the annual output of products after the implementation of the measure in physical terms.

To determine Sp. beat "A" and Sp. ud "B" after the implementation of the measure, it is necessary to add up the percentages of cost reduction for three factors and for each type of product:

?%? Sp. beats "A" \u003d%? See "A" + %? With ZP "A" +%? S. Oud - post "A"

?%? Sp. beats "B" \u003d%? See "B" + %? With ZP "B" +%? S. Oud - post "B"

To determine the annual output, you need the output for the second half of the year, multiply by 2.

Calculations of the annual economic effect:

Sp. beats "A" 1 \u003d 2257.65 rubles / ed.

Sp. beats "B" 1 = 1544.36 rubles / ed.

?%? Sp. beats "A" \u003d 0.00029 + 1.465 + 5.2035 \u003d 6.66879%? 6.67%

?%? Sp. beats "B" \u003d 0.00033 + 2.265 + 4.7956 \u003d 7.06093%? 7.1%

Sp. beats "A" 2 \u003d 2257.65? 0.9333 \u003d 2107.06 rubles / ed.

(100 - 6,67 = 93,33%)

Sp. beats "B" 2 \u003d 1544.36? 0.929 \u003d 1434.7 rubles / ed.

(100 - 7,1 = 92,9%)

In the first half of the year:

VP "A" \u003d 1180 pcs.

VP "B" = 1980 pcs.

In the second half of the year:

VP "A" \u003d 1180? 1.2 = 1416 pcs.

VP "B" = 1980? 1.2 = 2376 pcs.

VP "A" \u003d 1416? 2 = 2832 pieces/year.

VP "B" = 2376? 2 = 4752 pieces/year.

EG = (2257.65 - 2107.06) ? 2832 + (1544.36 - 1434.7) ? 4752 \u003d 947575.2 pieces / year.

9. Calculation of economic efficiency and payback periodinvestment

The economic efficiency of capital investments is the ratio of economic effect and costs (capital investments)

The coefficient of economic efficiency of investments (E) is determined by the formula:

The value reciprocal to the coefficient of economic efficiency determines the payback period (To) of capital investments:

That = (year.)

E = = 1.32 rubles.

That = = 0.76 year.

Conclusion

Investment in the development of production is economically feasible, because. efficiency ratio 1.32 rubles. (the efficiency standard for the industry is 0.2 rubles). The return on investment is 0.68 years, which is much less than the standard payback period (Tn = 5 years).

Bibliography

1. V.P. Gruzinov Enterprise Economics (textbook, M. Finance and Statistics. 2002)

2. A. I Mikhailushkin Economics (workshop, M. graduate School 2001)

3. V.A. Shvandara Economics of the enterprise (tests, tasks, situation, M. Unity. 2001)

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Calculation of annual reduced costs, economic effect. Determination of the coefficient of economic efficiency of capital investments, the payback period of options, selection and justification of the optimal project. Calculation of investments in the improvement of equipment.

test, added 01/24/2014


Calculation of the amount of consumption of material resources. Condition of fixed assets. Financial performance of the enterprise. Stages of calculation. The cost of material costs for technological needs. Salary of the main production workers.

term paper, added 01/19/2009


Calculation of the cost price, sales volumes of the enterprise's products in the first half of the year. Determining the amount of net profit from the sale of manufactured products, the payback period for capital investments in the development of production. Evaluation of trends in indicators.

As a rule, the return on investment invested in a corporate website (ROI - Return on Investment) is largely associated with the professionalism of web developers. This material discusses one of the foundations of the professionalism of a web developer - the ability to economically justify a customer's investment in a website.

Will the money invested in the corporate website return? This is the question leaders ask themselves. commercial directors and IT specialists of companies who make decisions about the development of a corporate website.

The question is very important and, perhaps, the key to making a decision. Despite the fact that it is rather difficult to accurately assess the effect of creating and maintaining a site for a particular enterprise, this task can be decomposed into components. This approach will make it easy to determine whether the site will pay off or not and what is the payback period.

Corporate website: main effects

Payback can be determined by calculating additional income brought by the site - this can be both a direct income for the company and cost savings. So, the company receives the following economic effects, thanks to the site.

1. Attracting customers and partners, direct sales.
Usually, this function of the site is given key importance, since the effect of direct sales is visible immediately. Based on it, the easiest way to calculate the return on investment in a website. However, it is wrong to consider only direct access from it as the only effect of creating and maintaining a website. In this case, other benefits that this business tool brings are not taken into account.

2. Brand promotion.
The website is the face of the company. The opinion of a large number of partners is formed under the impression of visiting the corporate website. Also in this part of the effect of the site can be attributed to the optimization of work with the media.

3. Information Support clients and partners.
Posting additional information about the company, product on the site, opening systematic consultations on your web resource, etc. Partner support is good business practice. It not only disposes them to itself, but also remains one of the integral components professional work modern company.

4. Supplier search.
For many large enterprises the issue of supply optimization is relevant. A fairly convenient means of solving this problem is the placement of information about the needs of the company on the corporate website. Often, suppliers themselves find such sections and constantly monitor them.

5. Attracting new employees and streamlining the hiring process.
If a company has its own website, it significantly increases the chances of attracting a qualified employee to work. It also opens up the opportunity to post a list of specific vacancies, key requirements and recruitment criteria, resume forms and even test tasks.

6. Bringing the client part of the company's business logic to the site.
Goods ordering systems, online stores, ticket or product reservation systems, consultations and questions to specialists can serve as an example of such solutions.

7. Impact on internal corporate relations. The section of the site intended for employees helps to solve tasks to increase labor motivation, unites the team with a single idea, and makes work more harmonious.

8. Bringing the internal part of the business logic to the site
This item opens up wide scope for solutions that are united under the general name intraservers. Intraserver is the general name of an intracorporate web server, the main functions of which are as follows: publication of company news, orders on the company, articles useful in work, organization of a geographically distributed document management system, requests for transport and Consumables, corporate communication systems, distributed customer relationship management (CRM) systems, removal of part of the functions of internal accounting system(for example, you can issue invoices remotely in 1C), - integration with almost any internal information component of the company is possible here.

The main benefits of the site are listed above. But how to evaluate their economic effect? It is obvious that the customer components are directly related to the quantity and quality of website visitors. And here great importance acquires the “representativeness” of the site, that is, its appearance, quality of design, ease of use, availability of useful features and useful information.

How to evaluate the effectiveness in terms of money?

The intra-corporate effect can be assessed as a kind of savings or Additional income. It is most convenient here for the person responsible for the economy of this area of ​​work, for example, the business logic of sales, to evaluate the effect of the site in the same rubles per month. And so - for each section of the optimized business logic.

Conventionally, the monthly return on the website can be calculated using the formula below. The calculations of its first part can be carried out in two ways.

The 1st method is related to the price of attracting the attention of a partner:

The 2nd method is associated with the economic effect of the increase in sales:

Thus, we get the amount that the website earns per month. Next, we move on to the costly part of creating a website.

Website-related costs include:

1. one-time costs for creating a website;

2. ongoing technical costs for maintaining the site;

3. current expenses to update and promote the site.

Obviously, the site is paid back if the monthly income from it is more than the cost of maintaining it. This difference can be called the "net income of the site." The named ratio should be analyzed first of all, and one should be very careful about the fact that the costs of updating and promotion increase the flow of site visitors. This, in turn, multiplies the effect of the site - each additional site visitor, according to the laws of advertising, is more expensive for site owners than the previous one. Therefore, it is necessary to choose the optimal investment/attendance balance.

Here we come to the concept of the payback period of the site. As you know, this is the date when the amount of net income from the site will cover the costs of its creation. To simplify the calculations, we did not use the reduction of these amounts to values ​​calculated on the basis of interest rates and so on. Let's take a simple amount of the site's net income: "payback period in months = the amount of one-time costs for creating the site / the site's net income per month."

What payback periods for investments in projects can be considered acceptable? This question is answered differently in different industries and companies: for example, in construction it can be 3-7 years, in production - 2-4 years, in the IT sector - 1-2 years.

As an example, consider the analysis of investments in the website of the company "A", operating in the territory Altai Territory, which is described by the following conditions (price relevance - 2004):

1. staff - 30 people;

2. monthly revenue of 1.5 million rubles;

3. the company produces goods and delivers it to its region (20%), nearby regions (60%) and distant regions (20%);

4. the site can increase sales to distant regions by 50%, to nearby regions - by 20% and "nearby" sales - by 5%;

5. the company is ready to pay intermediaries 3% of the price of the goods for increasing sales by the same amount;

6. the price of attracting the attention of a potential client is 20 rubles;

7. planned site traffic - 1500 visitors per month, of which 800 are unique "industry workers";

8. economic effect from the optimization of the sales process 1000 rubles/month;

9. economic effect of optimization personnel work 300 rubles/month;

10. economic effect from optimizing the process of information support for customers 2000 rubles / month;

11. economic effect of saving on others advertising media 700 rubles/month;

12. website development costs 35,000 rubles;

13. technical maintenance 350 rubles/month;

14. Costs for website promotion and information update 3000 rubles/month.

Calculation: The effect of increasing sales (we save on intermediaries) \u003d ((1500000 × 20% * 50%) + (1500000 × 60% * 20%) + (1500000 × 20% * 5%)) * 3% \u003d 10350 rubles. /month

Or the price of attracting attention = (20 rubles * 800 visitors * 1) = 16,000 rubles / month. Average value from 2 calculation methods = (10350 + 16000) / 2 = 13175 rubles. The sum of other effects = 4000 rubles / month.

Monthly site effect 17175 rubles. net income site \u003d 17175 - 3000 - 350 \u003d 13825 rubles. per month Payback period of the site = 35000 / 13825 = 2.53 months.

As you can see from this example, a company of this size gets a significant economic benefit and returns the money invested fairly quickly.. At the same time, a site that does not pay off is a mistake that was made at the design stage and the result of an incorrectly built business model. The guarantor of return on investment can only be the professionalism of the developer and the customer in assessing the economic effect of the site. In this case, the developer plays an important role, since only he can predict many of the effects of the website. When choosing a developer, you should make sure of his professionalism and pay special attention to his interest in making the resource in which investments will be made profitable. This will help to establish and maintain permanent and mutually beneficial cooperation.

Thus, the main conclusions are as follows:

• site payback can be predicted and calculated;
• before making a decision on the development of the site, it is necessary to calculate it economic efficiency and payback;
• the website developer must be competent in the economic issues of web resources and must treat the client as a reliable and long-term partner, even if the order is one-time.

Most often, managers perceive the effectiveness of the implementation of CRM at the level of common sense. Indeed, the importance of such effects as the growth of sales productivity, customer satisfaction and retention is clear even to a non-specialist. Difficulties with the assessment appear when trying to accurately assess the ratio of investments to the return on investment (ROI), since there is no specific universal formula for such an assessment.

Today, many people understand that the effectiveness information system is determined by its content and the quality of implementation - the “correctness” of structures and processes, etc. In other words, the result of CRM implementation is determined by the quality of the business model. At the same time, in practice, the implementation of CRM is often implemented purely as automation existing processes with existing staff. If the existing quality of the business model is satisfactory, then this approach is quite conscious. In this case, we can talk about such effects from implementation as an increase in staff productivity, an increase in the speed of service, and the elimination of losses and duplication of information. Here, the return on costs for the purchase of an applied CRM system and its implementation is evaluated in accordance with existing processes. Therefore, we can say that when implementing CRM as software product, automating processes based on it, companies receive direct effects of the category of cost reduction and some indirect effects obtained through the support of the existing business model.

In a comprehensive project for the implementation of a client-oriented strategy and creating a system sales, you can get a much larger number of effects - both cost reduction category effects and effects of a different order.

Various sources (META Group, Gartner Group, ISM, etc.) distinguish the following main categories of effects from the implementation of CRM:

This qualification is quite descriptive and shows the main categories of effects obtained. However, it does not take into account such (at first glance, implicit) effects as risk reduction. For example, in business there is an expression "winner takes all". In some markets, the loss of a competitive position can be fatal, and in this case it is no longer just a matter of a simple increase in income. Therefore, for completeness of the classification, we will also talk about the effects of reducing (or increasing) risks from the implementation of CRM.

The nature and possibility of a direct assessment of the effect obtained differ. From this point of view, we will be interested in the categories of direct economic effects and indirect economic effects.

So, we divide the economic effects into three conditional categories:

1) direct economic effects;

2) indirect economic effects;

3) risk reduction effects.

Direct economic effects

This category includes direct effects that affect the profitability of the company. The table below describes the changes made in the framework of the project to implement a customer-oriented strategy and create a sales system and the resulting short- and long-term economic effects.

Status before implementation	Changes	Short-term effects after implementation	Long-term effects after implementation
There is no unified database of clients. Possibilities of segmentation by different indicators (including dynamic ones) are absent	Customer segmentation	Growth in sales by focusing on profitable/profitable customers	Increasing the company's revenue by identifying the most profitable segments and offering them the best customer value Increasing company revenue through cross-selling
Products are promoted without analyzing the effectiveness of interactions along the chain		Cost reduction in channels and promotion chains	Increasing the company's revenue by choosing the optimal channel in terms of value for us and value for the client / cost Increasing revenue by increasing the satisfaction of participants in promotion channels
Functional structure of the organization, no responsibility for customer relations		Improving the quality of customer service	through relationship management Increasing the company's income by improving the quality of service and optimizing org. structures
The personnel motivation system is not focused on the goals of the company's client strategy.		Increasing staff productivity	Increasing company revenue by increasing cross-selling, increasing life cycle client or achieving other goals depending on the chosen strategy
Staff not provided information media and not trained in customer interaction	Staff training		Increasing customer satisfaction
Customer data is not systematized, employees do not have access to the knowledge base		Improving the quality and speed of customer service Improvement of information support of processes	Increasing customer satisfaction Increasing staff satisfaction
No tools for planning and forecasting sales		Increasing the yield (profitability) of current sales	Improving the quality of management Increasing the company's income due to the possibility of more timely and high-quality control actions
Management decisions are made without taking into account indicators for working with clients		Improving the quality and speed of customer service	Improving customer satisfaction by focusing processes and their results on improving customer experience
No process management tools		Increasing sales efficiency Improving the quality and speed of customer service	Increasing the company's revenue by increasing the percentage of successful transactions
Processing of contacts and applications is carried out manually		Increasing employee productivity	Increasing company revenue by reducing transaction costs Increasing the company's income due to the possibility of increasing the number of potential and current customers served (for example, through the organization of active sales)
Employees and customers have little idea of ​​the status of order fulfillment	Automation of the order fulfillment process	Reduction of order execution time	Increasing revenue by improving customer satisfaction
Employees receive information from disparate sources and spend significant effort to obtain it.	Maintaining a single database of current and potential customers	Reduced time to find new potential customers Reducing the time to search for information on customers	Increasing revenue by being able to serve more customers Increasing revenue by improving employee satisfaction

Indirect economic effects

For example, these include the growth in the value of shares on the stock exchange as a result of increased transparency of processes, increased manageability, which is important for attracting the interest of third-party shareholders. Possible effects of this kind are shown in the figure below.

Risk reduction

The table below describes the main risks mitigated by the implementation of a CRM system.

Changes	Risks that are mitigating
Customer segmentation	Risk of losing the most profitable/profitable clients
Choice of channels and optimal chain of promotion	The risk of deterioration in relations with partners, the risk of not conveying customer value to customers
Organizational structure optimization	The risk of reducing the flexibility of the organization, the risk of deteriorating customer relationships
Creation new system staff motivation	The risk of personnel activities as opposed to the overall goals of the company
Staff training	The risk of reducing staff motivation, the risk of worsening customer relations
Creation of a single database, knowledge base	Risk of deterioration in customer relationships
Sales planning and forecasting	Risk of failure to meet revenue and/or profitability plans
Customer Performance Management	Risk of loss of competitiveness
Business process automation	Risk of reduced productivity, process efficiency
Automation of processing contacts and requests, creation of a self-service system

At the same time, the introduction of CRM can also lead to the emergence of new risks, such as a decrease in employee productivity at the initial stage of system operation, rejection of the system by a number of employees.

Evaluation of the effect of the implementation of CRM

The main approaches to assessing the economic effect of the implementation of CRM

It is obvious that the achievement of all the performance indicators given above within the framework of a separate project is impossible due to limited resources (time, financial, and others). Therefore, the CRM implementation project should include the stage of goal setting. The objectives of the project should be logically related to the strategic objectives of the enterprise. In particular, using the system balanced scorecard(BSC) it is possible to decompose the overall goals into the goals of the "lower" levels - client, operational, personnel and technology.

To assess the effect of the introduction of CRM, the method of analysis of several key indicators before and after (as well as during) changes. These are the dimensions by which the company will further evaluate the effectiveness of its relationships with customers. Some of these indicators can be determined by most companies before the start of the project. Several indicators characteristic of the company are selected, for example:

• the percentage of response of potential customers to marketing messages (audience reaction);
• increase in new customers (rate of return);
• purchase price;
• share of successful transactions;
• duration of the sales cycle;
• average time to solve typical problems by the service department, etc.

The metrics are usually aggregated by business process groups or CRM subsystems.

The paradox of the situation lies in the fact that for a formalized assessment of the effectiveness of CRM implementation, non-financial data from periods prior to the implementation of the CRM system are needed, and this data is not available, since they need to collect ... a CRM system. Yes, it is possible to estimate the dry balance - the growth of the company's income in different periods of time, but is it caused by the introduction of a CRM system? To answer this question, you need to be able to analyze the structure of the client base, the efficiency of managers, the growth of customer base loyalty, and much more that can be done using the CRM system itself. Therefore, in order to obtain a reasonable assessment, the selected indicators (both in kind and in value terms) are already monitored as the relevant processes are reorganized and the components of the information system are introduced. Can be matched monetary value effects of the reorganization and related costs to assess the payback period of investment in CRM.

Another problem in evaluating the effectiveness: certain economic effects from the implementation of a CRM system for each specific company can affect in their own way. Without ready-made tools, many give rough estimates with a significant variation, for example, “customer retention increased by 5-10%, which gave a 20-30% increase in profits, automation of a lot of manual operations almost doubled staff productivity” and others like that. Such evaluations taken from practice, of course, are also valuable.

How to evaluate the effects of the possible introduction of CRM before the start of the project? This can be done based on the particular business model being implemented. In fact, this model should be developed in the early stages of the CRM implementation project, and later it already serves as a model that verifies the achievement of the indicators laid down in it. The issues of constructing and formalizing such a model are beyond the scope of this article. Let's look at some examples here.

5.2. An example of assessing the direct economic effect obtained by increasing the productivity of employees.

Take the sales department of a large company. Selling costs are made up of two components:

• fixed costs (salary, office maintenance, administrative expenses, etc.);
• variable expenses (bonuses, travel expenses, communications, consumables, and others).

Let's assume that there is the following current structure of expenses and incomes of the department (for the year):

Assume that a 15% increase in productivity per year is achieved through implementation. This means that sales people have 15% more time to do their sales duties, which they can spend on acquiring new customers. Let's assume that this leads to a proportional increase in income, 15%. At the same time, the variable part of expenses will increase, while the fixed part of expenses will increase slightly. As a result, we have the following indicators of the department after increasing the productivity of employees:

	Index	It became, million $
	Variable costs
	fixed costs
	Profit department

Thus, the direct economic effect of the increase in employee productivity: $ 15 million with a 30% increase in profits.

An example of assessing the indirect economic effect obtained by increasing customer loyalty.

For companies operating in a constrained and high cost environment financial resources, the client strategy is to increase the productivity of interaction with the most profitable existing customers. Accordingly, suppose that the company has set a goal - to increase sales, despite the stagnation of the market. To do this, we determine that it is necessary to increase the average profitability of customers by 10% within one year. To do this, you need to achieve an increase in the customer retention rate. Segmentation, analysis of the client base is carried out and a business model is created that would support the achievement of these indicators at all levels of the company: operational, technological, in terms of personnel training and others.

Let's single out two segments and their indicators:

	Segment	Number of clients	The cost of attracting one client, thousand $	Total profit for the year, million $	Average LTV, thousand $	Average LTP, thousand $
	Large companies with a turnover of over $100 million
	Medium-sized companies with a turnover of 10 to 100 million dollars

Here LTV / LTP (Lifetime Value, Lifetime Profit) - "lifetime" value (of the client) - income / profit brought by the client during the period (life cycle) of his purchasing activity. These indicators are defined as follows:

LTV = (Length of relationship / Average time between purchases) ´ average cost purchases;

LTP = (Length of relationship /Average time between purchases) ´ Average profitability of a purchase.

1) For large companies without increasing customer retention, total segment LTV = 20 × ((24m/12m) × $100K) × 1.2= $4800K

2) For large companies with an increase in customer retention, the total LTV of the segment = 20 × (((24 months × 1.1) / 12 months) × 100 thousand dollars) × 1.2 = 5280 thousand dollars

Thus, the expected effect of measures to improve customer retention within the framework of a CRM project in the segment of medium-sized companies: an increase in income of $ 4.8 million, achieved in two years. Obviously this is not a profit, as the project will incur costs depending on the specific measures within the project, but this figure will allow us to determine how much we can spend on measures to increase customer retention (including the implementation of a CRM system) of this segment during 2 years old. If we calculate the economic effects over a longer time frame, we can see that even a 5% increase in retention can generate a profit increase of about 50% after 5 years.

The importance of the CRM methodology and tools also lies in the fact that with its help we can quickly track the achievement of established goals at intermediate stages and take reasonable management decisions for timely adjustment of the company's development.

As we can see from the LTV/LTP indicators, the growth of revenues and profits of segments can be achieved not only by increasing the duration of the life cycle. This is also possible by reducing the average time between purchases (for example, by organizing cross-selling), as well as by increasing the value (profit) of individual purchases (for example, by creating additional consumer value).

One can also compare the productivity effects of the first example with the profitability effects of the existing customer base of the second example and realize that the combined effect can be even greater.

Here we looked at examples of evaluating two effects from creating a sales system based on CRM methodology. As shown earlier, there can be many more such effects. As you can see, the effects of CRM implementation are multifaceted and complex nature and there are no universal formulas for calculating return on investment. However, most of the effects are amenable to approximate quantification based on a pre-developed business model, which should be built as part of a project to implement a client-oriented strategy and implement a CRM system.