GE401- Innovative Product Design & Development I

Expenditure Plan
12/15/2011

Team 2 Seydi Afin nl Emirhan Akdemir Cansu Acar Melodi Trkili Onur entre Engin yidoan

Version: 1.0

Contents Introduction ............................................................................................ 3 Expenditure Results of Year 1 ............................................................... 4 Expenditure Results of Year 2 ............................................................... 6 Expenditure Results of Year 3 ............................................................... 8

Introduction
The expenditure report basically defines the key expenses of the company. As the expected expenses are different for each year, we have examined the following three years. In order to define expenditures in a more structured way, we have collected all the parts in three main titles including ordered vending machine, total marketing expense and total operational expense. Since we are producing our vending machines according to orders, the cost of one ordered product is the cost of all parts which are basically Arduino Uno, 6xStepper Motors, Internal Metallic Components, Keypad, LCD, Steel Case, Cooling System and Packaging. As we cannot obtain economies of scale due to the limited sales in the first years, the prices of each component will remain same. According to the marketing plan that is already written, the marketing expenditures are brochures, banner ads, exhibition and brochures. Even though we use the same strategy each year, the frequency differs. The third one is the operations total expense which consists the rental costs, salaries and other expenses related to operations.

Expenditure Results of Year 1

In the first year, we need to keep the marketing and operational expenses as minimum as possible. We will work with home office system for the first year. We are going to send 1000 brochures, to have banner ads 5 times and to be sponsor for 1 event. We assume that we will sell 40 vending machines in the first year so our expense will be 40 times the cost of whole components.

Expenditure Results Year 1

Ordered Vending Machine Total Marketing Expense Total Operations Expense

17%

4%

79%

EXPENSE
COST Product Equipments Arduino Uno 6 x Stepper Motors Internal Metallic Components Bill Validator Electrical Components (Motor drivers, sensors) Keypad LCD Steel Case Cooling System Packaging Transportation Per Vending Machine Ordered Vending Machine Marketing Brochures Banner Ads Exhibition Sponsorship Total Marketing Expense Operations Rental of the Factory Office Rent Utilities Salary of Managers Salary of Employees Salary of Labors Rental of the Sales Car SG&A Other Expenses Total Operations Expense TOTAL EXPENSES 3 TL 400 TL 1.000 TL 7.000 TL 1000 5 3 1 3.000 TL 2.000 TL 3.000 TL 7.000 TL 15.000 TL 60 TL 60 TL 150 TL 520 TL 60 TL 10 TL 10 TL 90 TL 180 TL 100 TL 200 TL NUMBER TOTAL COST 1 6 1 1 1 1 1 1 1 1 1 40 60 TL 360 TL 150 TL 520 TL 60 TL 10 TL 10 TL 90 TL 180 TL 100 TL 200 TL 1.740 TL 69.600 TL

4.000 TL 0 TL 2.000 TL 2.000 TL 1.000 TL 1.000 TL 1.000 TL 2.000 TL 1.600 TL

12 12 12 72 24 24 12 12 12

48.000 TL 0 TL 24.000 TL 144.000 TL 24.000 TL 24.000 TL 12.000 TL 24.000 TL 19.200 TL 319.200 TL 403.800 TL

Expenditure Results of Year 2

In the second year, we need to keep the marketing and operational expenses low again. However we need to invest more on the marketing part since our selling aim is becoming more aggressive. We will move in our office. We are going to send 1000 brochures, to have banner ads 10 times and to be sponsor for 2 events. We assume that we will sell 50 vending machines in the first year so our expense will be 50 times the cost of whole components.

Expenditure Results Year 2

Ordered Vending Machine Total Marketing Expense Total Operations Expense

19% 7%

74%

EXPENSE
COST Product Equipments Arduino Uno 6 x Stepper Motors Internal Metallic Components Bill Validator Electrical Components (Motor drivers, sensors) Keypad LCD Steel Case Cooling System Packaging Transportation Per Vending Machine Ordered Vending Machine Marketing Brochures Banner Ads Exhibition Sponsorship Total Marketing Expense Operations Rental of the Factory Office Rent Utilities Salary of Managers Salary of Employees Salary of Labors Rental of the Sales Car SG&A Other Expenses Total Operations Expense TOTAL EXPENSES 4 TL 400 TL 1.000 TL 10.000 TL 1000 10 3 2 4.000 TL 4.000 TL 3.000 TL 20.000 TL 31.000 TL 60 TL 60 TL 150 TL 520 TL 60 TL 10 TL 10 TL 90 TL 180 TL 100 TL 200 TL NUMBER TOTAL COST 1 6 1 1 1 1 1 1 1 1 1 50 60 TL 360 TL 150 TL 520 TL 60 TL 10 TL 10 TL 90 TL 180 TL 100 TL 200 TL 1.740 TL 87.000 TL

4.000 TL 1.000 TL 2.000 TL 2.000 TL 1.000 TL 1.000 TL 1.000 TL 2.000 TL 1.600 TL

12 12 12 72 24 24 12 12 12

48.000 TL 12.000 TL 24.000 TL 144.000 TL 24.000 TL 24.000 TL 12.000 TL 24.000 TL 19.200 TL 331.200 TL 449.200 TL

Expenditure Results of Year 3

In the third year, we need to keep the marketing and operational expenses low again to make preparation for the following year in which we will increase our sales force and marketing power. We assume that we will sell 60 vending machines in the first year so our expense will be 60 times the cost of whole components. Since the total marketing and operations costs are increasing while the ordered vending machine cost remains same, the percentage of the ordered vending machine cost decreases.

Expenditure Results Year 3

Ordered Vending Machine Total Marketing Expense Total Operations Expense

20%

13% 67%

EXPENSE
COST Product Equipments Arduino Uno 6 x Stepper Motors Internal Metallic Components Bill Validator Electrical Components (Motor drivers, sensors) Keypad LCD Steel Case Cooling System Packaging Transportation Per Vending Machine Ordered Vending Machine Marketing Brochures Banner Ads Exhibition Sponsorship Total Marketing Expense Operations Rental of the Factory Office Rent Utilities Salary of Managers Salary of Employees Salary of Labors Rental of the Sales Car SG&A Other Expenses Total Operations Expense TOTAL EXPENSES 4 TL 400 TL 1.000 TL 10.000 TL 3000 10 5 5 12.000 TL 4.000 TL 5.000 TL 50.000 TL 71.000 TL 60 TL 60 TL 150 TL 520 TL 60 TL 10 TL 10 TL 90 TL 180 TL 100 TL 200 TL NUMBER TOTAL COST 1 6 1 1 1 1 1 1 1 1 1 60 60 TL 360 TL 150 TL 520 TL 60 TL 10 TL 10 TL 90 TL 180 TL 100 TL 200 TL 1.740 TL 104.400 TL

4.000 TL 1.000 TL 2.000 TL 2.000 TL 1.000 TL 1.000 TL 2.000 TL 2.000 TL 3.200 TL

12 12 12 72 24 24 12 12 12

48.000 TL 12.000 TL 24.000 TL 144.000 TL 24.000 TL 24.000 TL 24.000 TL 24.000 TL 38.400 TL 362.400 TL 537.800 TL