Cost of Goods and Services Sold COGS The total cost of manufacturing and

Cost of goods and services sold cogs the total cost

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Cost of Goods and Services Sold (COGS) The total cost of manufacturing and delivering products and services. This includes labor, material, service and delivery expenses; this number can influence MSP pricing strategies, and provides helpful insight as to what it actually costs to deliver goods. This can be difficult to estimate in a services business, so make sure you’re tracking your technicians’ time closely so you can be more accurate in your COGS calculations. Calculation: Labor Costs + Material Costs + Service & Delivery Costs Gross Profitability An essential metric for any business, gross profit reveals how effectively an organization is balancing production and labor costs with pricing and service delivery. Calculation: Total Revenue – Cost of Goods Sold Client Contribution (CC) A great figure for MSPs, client contribution is an important metric in understanding the value that each of your customers generates, and helps in determining how you can grow your business. It can also help you find some clients that are unprofitable. It should reflect both the total number of dollars generated by each client as well as the cost of providing services and offerings to those clients. Calculation: Revenue per Customer – Cost of Goods and Services Sold to That Customer 5. Review its effectiveness Establishing a system to measure and monitor the effectiveness of your strategic planning can greatly enhance the impact of the process and lead to greater success. An effective measurement system enables management to address areas of non-
performance or underperformance by implementing corrective actions. Lessons learnt can also be fed into future planning activities to achieve improved outcomes. The following provides more information about how to review the strategic plan. There are many ways to review strategic planning. These include: consulting with key stakeholders distributing questionnaires or feedback performance debriefing before developing new strategic plans conducting a review meeting benchmarking with peers, departments or even competitors rating overall outcomes against objectives to identify areas for improvement

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