| ||Product Value Analysis for Excel (Product Profitability by ModelSheet) estimates the value generated by each product after accounting for revenue less cost of goods, royalties, operating expenses for development, marketing and customer support. Product value analysis is useful for capital allocation decision-making and profit optimization in many industries including manufacturing, distribution, services and software.|
The Product Value Analysis Excel template can be first customized online to meet specific business requirements before downloading. Flexible and granulated input parameters within the template then drive the analysis and include revenue drivers, cost of goods, royalties paid, marketing expenses, engineering expenses, and customer support expenses. Product value and profitability is estimated by a time dependent contribution margin.
Key features of Product Value Analysis for Excel include:
- Cost of goods and royalties paid can be defined by cost per unit, cost as a percentage of revenue, fixed costs for each product, or by any combination of methods.
- Marketing expenses evaluate marketing staff equivalent headcount allocated to each product, staff expense per head for several job levels, total expense of marketing staff for each product and marketing programs expense by program and by product.
- Product development expenses analyze equivalent number of development staff applied to each product (segmented by development groups and staff expense per head by job levels), development program expenses (segmented by program and product) and development overhead expenses.
- Customer support expenses track the number of support cases (segmented according to the amount of staff time applied to each case), staff expense per head by job level and utilization of support staff. The support expenses employ estimates of support activity and expense segmented by support issues (such as installation, maintenance and application assistance). Reporting expenses by support issues is a useful method for identifying opportunities to improve customer satisfaction and product value.