Profits

[Mesterh]

Lol I like the comments I was actually also going to put as the bottom line " I would spend nothing and pocket all the cash" and then forgot!

[Mark Bolam]

What about ' if I was doing that well I would take my Arbtalk buddies on a six month tall trees/lapdancing bars tour round the world. And surfing. And snowboarding. Etc.' It would be harsh not to give you top marks for that one!

[tommer9]

What is this "profits" of which you speak, and where can i get some........

[sean]

What about ' if I was doing that well I would take my Arbtalk buddies on a six month tall trees/lapdancing bars tour round the world. And surfing. And snowboarding. Etc.' It would be harsh not to give you top marks for that one!

 

Blimey.....that's some profit!!!

[Mark Bolam]

I have my new business plan in front of me my friend.

 

If every Arbtalk member can lend me about £15K I think we may be in business...

[Stephen Blair]

I have my new business plan in front of me my friend.

 

If every Arbtalk member can lend me about £15K I think we may be in business...

 

no bother mark, heres my donation k k k k k k k k k k k k k k k.:001_tongue:good luck sean, hope i havent seemed awkward, i just feel, there are so many different answers to your wide open question. not your fault. i would ask for more info from your tutor:001_smile:

[Simon Rotheram]

 

I think as long as your answer is logical and there is continued growth/proffit of the company it cannot be a wrong answer? There are obviously different routes for company owners to take dependant on type of work.

 

I would like to see a "model" answer on this one!

[Giles Hill]

I'm in the same boat as you Sean, so I've taken the opportunity to attempt an answer in full. I do work for myself, but most of the following is me trying to guess what an examiner is after rather than what is the definitive answer -and it's certainly not what I practice!

 

It might not score maximum points, but I reckon it'd pass.

 

Outline the options available to the contractor to invest the

profits towards the growth of the company.

 

1. Invest in kit

2. Invest in technology

3. Invest in staff

4. Invest in advertising & corporate image

5. Pay off existing debt

 

Give examples of how each option may affect

both the hourly rate charged by the contractor and the work output of the business.

 

1. Invest in kit - The kit would allow you to charge a premium hourly rate on certain jobs where the kit is essential and you're the only contractor with the kit. (did I mention 'kit' enough times?)

 

Increase efficiency on site, less time would be required to do work so you can charge a higher hourly rate and remain competitive with firms that are taking longer because they don't have the kit.

 

You'd be able to take on larger contracts and compete with larger firms and as such your hourly rate might increase and remain competitive with the larger firms

 

2. Invest in technology -

 

Office based tech - Make the office more efficient, to improve cash flow by staying on top of financial management and general admin, this would save time, meaning output would go up, and you wouldn't need to increase your hourly rate to increase your profit.

 

Site based tech - expand your range of services by investing in hi-tech kit such as air spades, tomograph, tree spades. You would increase your hourly charge because you're providing specialist services and also because your staff costs would be higher because your staff would be more speicialist. It would increase output of the business by allowing you to take on more varied work

 

3. Invest in staff - to operate and manage the above. Good management would increase efficiency and maintain staff morale . This would increase output and would allow and require an increased hourly rate to be charged.

 

4. Invest in advertising and corporate image - advertising would allow you to incrrease output by getting more work in. Corporate image would allow you to charge more.

 

5. Pay off existing debt - no direct effect on output, but would increase your profit without needing to increase your hourly rate.

Edited June 3, 2009 by Giles Hill

[Giles Hill]

Please feel free to criticise the above.

[arc]

I'm in the same boat as you Sean, so I've taken the opportunity to attempt an answer in full. I do work for myself, but most of the following is me trying to guess what an examiner is after rather than what is the definitive answer -and it's certainly not what I practice!

 

It might not score maximum points, but I reckon it'd pass.

 

 

 

1. Invest in kit

2. Invest in technology

3. Invest in staff

4. Invest in advertising & corporate image

5. Pay off existing debt

 

 

 

1. Invest in kit - The kit would allow you to charge a premium hourly rate on certain jobs where the kit is essential and you're the only contractor with the kit. (did I mention 'kit' enough times?)

 

Increase efficiency on site, less time would be required to do work so you can charge a higher hourly rate and remain competitive with firms that are taking longer because they don't have the kit.

 

You'd be able to take on larger contracts and compete with larger firms and as such your hourly rate might increase and remain competitive with the larger firms

 

2. Invest in technology -

 

Office based tech - Make the office more efficient, to improve cash flow by staying on top of financial management and general admin, this would save time, meaning output would go up, and you wouldn't need to increase your hourly rate to increase your profit.

 

Site based tech - expand your range of services by investing in hi-tech kit such as air spades, tomograph, tree spades. You would increase your hourly charge because you're providing specialist services and also because your staff costs would be higher because your staff would be more speicialist. It would increase output of the business by allowing you to take on more varied work

 

3. Invest in staff - to operate and manage the above. Good management would increase efficiency and maintain staff morale . This would increase output and would allow and require an increased hourly rate to be charged.

 

4. Invest in advertising and corporate image - advertising would allow you to incrrease output by getting more work in. Corporate image would allow you to charge more.

 

5. Pay off existing debt - no direct effect on output, but would increase your profit without needing to increase your hourly rate.

 

What he said