Utilizing Excel to Prepare Budgets & Forecasts

Presented by:

Automotive Services Group

Amper, Politziner & Mattia, LLP

Seminar Objectives

• Enable attendee to become pro-active in preparing budgets

• Allow attendee to compare budget to actual analysis in a dealer financial format

• Benchmark historical results to assist in determining strengths and weaknesses of dealership

Seminar Objectives - Continued

• Allow dealership to prepare “What if” analysis• Assist dealership in determining break-even analysis• Provide a template for your use

How Budgets are Effective

• Invaluable business tool for management

• Allow management to plan for future direction of dealership.

• Assist in recognizing factors that are affecting the actual to anticipated results

How Budgets are Effective

• Allows for financial information to be accessible to all managers of departments & assist them in growing their department.

• Allows dealer to hold managers accountable for their department.

• Helps the dealer to monitor expenditures throughout the year.

Forecasts

• A forecast is a “what if” exercise

• Assist with acquisition

• Assist with financing negotiations

• Helps with cash flow analysis

Dealerships and Budgets

• Are Budgets frequently prepared at dealerships?

• Why not?

Reasons for Not Budgeting

• I’m too busy• No one follows up and compares actual to budget• The dealer statement is too large to perform budget• There is no reward or ramification for achieving or not

achieving budget results• The department managers do not take the process

seriously

The Template Solution

• Template is built to mirror the dealer statement to assist management

• Allows for 6 different scenarios– Same as last year (2)– Percentage increase over prior year– Expenses as Other % of Gross Profit (ie 20 Group /

Financial institution)– Expenses as NADA Benchmark of Gross Profit– Expenses as same % of Gross– Other input amount

Worksheets Within Template

• Dealer set-up• Projection scenarios• Projection input (this worksheet is the driving force behind

the template)• Projected P&L ( Various sheets relating to page #’s of

Dealer Financial)• Prior year Financial statement (Same various Sheets

relating to Dealer Financial)

Keys to Changes

• Column Q within Projection input– @if Function

• Gross Profit % columns – Enter your own benchmarks

Keys to Changes

• Other Input– Known expenses

• Rent• Depreciation• Contributions

• Why no Departmental breakdown?

Let’s Experiment

• One Major Rule of the Experimental Phase of the Seminar.

• If you have a question ASK

• There are individuals present to assist.

Let’s Experiment - Continued

• Project new vehicle sales to be 15% lower than previous year.

• What about Gross?• Project Customer Pay Labor to increase 10% from prior

year.• Any Questions so far??

Let’s Experiment - Continued

• New Telephone contract? Let’s cut telephone expense by 2%.

• Interest rates rising.!!! What to anticipate with a rate increase. Increase Floor Plan Interest by 3%

• Any More Questions ??

Let’s Experiment - Continued

• What would you like to change?

• Open discussion and questions.

Thank You!

Chuck Diegelcdiegel@amper.com215-881-8882

Dawn Rosoff drosoff@amper.com 215-881-8871

Sam Longoslongo@amper.com215-881-8854

Jerry Shinfeldjshinfeld@amper.com215-881-8875

“The material contained in this presentation is for general information and should not be acted upon

without prior professional consultation.”

“The material contained in this presentation is for general

information and should not be acted upon without prior

professional consultation.”