BSA Performance Analysis Report (PAR) Bri Brian Davis an Davis Vice President B&D Industrial Vice President Bearing Specialists Association
It Was Another Era: 1967-1969 • Typical Sales Volume: $1.5 Million • Owner’s Compensation: $54,000 • Outside Sales Compensation: $12,000
The Financial Situation Has Changed And Not Necessarily For The Better 1967-1969 2013-2015 Profit Margin 3.1 2.7 (Profit Before Taxes Net Sales ) Ass et Turnover 3.2 2.4 (Net Sales Total Ass ets) Return on Ass ets 10.0 6.5 (Profit Before Taxes Total
The Financial Situation Has Changed And Not Necessarily For The Better 1967-1969 2013-2015 Profit Margin 3.1 2.7 (Profit Before Taxes Net Sales ) Les s Profit on Every Sale Ass et Turnover 3.2 2.4 (Net Sales Total Ass ets) Return on Ass ets 10.0 6.5 (Profit Before Taxes Total
The Financial Situation Has Changed And Not Necessarily For The Better 1967-1969 2013-2015 Profit Margin 3.1 2.7 (Profit Before Taxes Net Sales ) Ass et Turnover 3.2 2.4 (Net Sales Total Ass ets) More Inves tment to Support Sales Return on Ass ets 10.0 6.5 (Profit Before Taxes Total
The Financial Situation Has Changed And Not Necessarily For The Better 1967-1969 2013-2015 Profit Margin 3.1 2.7 (Profit Before Taxes Net Sales ) Ass et Turnover 3.2 2.4 (Net Sales Total Ass ets) Return on Ass ets 10.0 6.5 (Profit Before Taxes Total Very Good Return on Inves tment to an Okay One
The Pressure on Collections and Payments
The Pressure on Collections and Payments Being Paid Slower
The Pressure on Collections and Payments Paying Suppliers Quicker
The Pressure on Collections and Payments Significant change in working capital requirements
The Pressure on the Income Statement Side of Life
The Pressure on the Income Statement Side of Life The Well-Documented Margin Squeeze: Small but Critical
The Pressure on the Income Statement Side of Life A Small Offset On Expenses
The Expense Realities
The Structure of Payroll Expenses
The Structure of Payroll Expenses A Mini-Explosion In Fringe Benefits
One Final Ratio Of Real Concern Then Now PPR 56.5 62.0 (Payroll as a Percent of Gros s
BSA Performance Analysis Report (PAR) Par Task Force: • S implified Reporting • Elimination of unnecessary questions • Elimination of the Distributor Report
BSA Performance Analysis Report (PAR) 65% of BSA members participate
BSA Performance Analysis Report (PAR) Participants are grouped: • Under $50 million • $50 million to $200 million • Over $200 million
Critical Profit Variables Typical High BSA Dist. Profit BSA Sales per Employee $480,374 $604,804 Measures employee productivity Gros s Margin Percentage 26.0% 26.0% Reflects the ability to manage GOGS Operating Expens e Percentage 23.2% 20.7% Focuses on expense control Inventory Turnover (times) 3.3 2.8 Reflects how well inventory is managed
Critical Profit Variables Typical High BSA Dist. Profit BSA Average Collection Period (days) 44.9 44.9 Reflects accounts receivable collection practices Profit Before Taxes 2.7% 5.4% Return on Ass ets (pre-Tax) 6.7% 18.4% Return on Net Work (pre-tax %) 12.7 33.1
Executive Summary Typical High BSA Dist. Profit BSA Return on Ass ets (pre-tax %) 6.7 18.4
Executive Summary Typical High BSA Dist. Profit BSA Return on Ass ets (pre-tax %) 6.7 18.4 Return on Net Worth (pre-tax %) 12.7 33.1
BSA Performance Analysis Report (PAR)
Product Sales (% of sales) Typical High BSA Dist. Profit BSA Mechanical Power Trans mis s ion 26.0 23.5 Bearings 35.2 42.3 Hydraulic and Pneumatic 6.8 3.6 Electrical/Electronic 8.4 12.2 Motion Control 4.0 3.2 Safety/Personal Protection Equipment (PPE) 1.5 0.8 Material Handling/Conveyor Components 5.1 5.0 Services (repair, etc.) 1.3 1.3 Training 0.1 0.0 Other Products (tools & lubricants, etc.) 11.6 8.1
Employee Turnover % Typical High BSA Dis t. Profit BSA 5.5 2.9
Workforce Age (% of employees) Typical High BSA Dist. Profit BSA 18 to 24 $480,374 $604,804 25 to 34 26.0% 26.0% 35 to 44 23.2% 20.7% 45 to 54 3.3 2.8 55 to 64 44.9 44.9 65 and older 2.7% 5.4%
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