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Hairdressing Unit 2- Revision

Hairdressing Unit 2- Revision . Please watch this video. Write down all the costs you can think of when running a barber shop. http://barberconnect.co.uk (video on homepage). What is a cost?. http:// www.salonsdirect.com. What is a cost?.

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Hairdressing Unit 2- Revision

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  1. Hairdressing Unit 2- Revision

  2. Please watch this video • Write down all the costs you can think of when running a barber shop. http://barberconnect.co.uk (video on homepage)

  3. What is a cost? http://www.salonsdirect.com

  4. What is a cost?

  5. TASK- Imagine a new Hairdressers is going to open in Wickford • Please list the start-up costs and Running costs this hairdresser may have. • Electricity bills • Shelving and shop fittings, • Staff wages • Cleaning materials, • A sign for the shop • Hairdryers • Clippers • Gel .

  6. What is Revenue?

  7. Discuss; What ways do Hairdressers earn revenue? What items do they sell?

  8. Which of the below is revenue for a Hairdresser? •  Staff wages • Advertising • Cutting clients hair

  9. Task- Are the items fixed or variable costs? Rent Razor Blades Barber Chairs Shampoo Staff wages Electricity

  10. Task Super Cutz various clients hair in their shops. Below are the estimated monthly costs if they cut 400 clients hair. Total fixed costs = £100,000 Variable costs = £1 per haircut a) Work out the fixed costs, variable costs and total costs below

  11. TASK-Supercutz cut clients hair through a walk in service. The price of a haircut £12. • The business has cut 850 clients hair last month. Work out the total revenue Supercutz receive from cutting hair? Type in your answer in the box £ Show your workings

  12. TASK-Give the correct formula for calculating profit. Please drag and drop the correct items into the formula. Revenue Number of Sales Inflows Fixed Costs Expenditure Variable Costs Profit

  13. Match the keywords to the definitions • Total costs = • Revenue = • Profit = • Gross profit = • Net profit = • Cash inflows are often called… • Cash outflows are often called… revenue – expenditure number of sales x price per unit Payments receipts gross profit – expenditure fixed costs + variable costs revenue – cost of sales

  14. TASK – complete the Profit and Loss account below.This is based on Supercutz in Basildon • Revenue is £10,000 per month from cutting hair and selling hair products • Cost of sales (directly linked to cutting hair) is £1000 per month • Salaries are £2,500 per month • Rent is £2,400 per month

  15. What is the difference between Gross Profit and Net Profit?

  16. Identify two ways Hairdresser can improve its Net Profit in 2012? Please type your answers

  17. What is breakeven?

  18. Add the items onto the graph correctly • Label the diagram below. Drag and drop all items. Please put the on the breakeven point Loss Fixed Costs Profit Total Revenue Variable costs Margin of safety

  19. Add the items onto the graph correctly Total Revenue • Label the diagram below. Drag and drop all items. Please put the on the breakeven point Profit Variable costs Loss Fixed Costs Margin of safety Task- How many units do I need to sell to breakeven?

  20. Add the items onto the graph correctly Total Revenue • Label the diagram below. Drag and drop all items. Please put the on the breakeven point Profit Variable costs Loss Fixed Costs Margin of safety TASK-What is the total revenue if the business sells 1000 units?

  21. Task • How many Haircuts would Supercutz need to cut to breakeven? (cover costs) Type your answer in the box

  22. Why is it important for Supercutz to know their Break-even point? Breakeven is important because

  23. Importance of Breakeven analysis to business when planning success • It is needed to identify and track costs (both fixed and variable costs) • It is needed to highlight the margin of safety • It can help businesses identify where they can change their costs, for example, buying cheaper materials or finding a cheaper supplier

  24. CASHFLOW FORECASTING TASK- Which of the items above are cash inflows? Please drag and drop them below Electricity bill Monthly rent Haircuts Staff wages L'Oreal shampoo sales Telephone bill Share Capital Which of the items above are cash inflows? Please drag and drop them below

  25. Please work complete the cashflow table below 2012.

  26. BUDGETING • Why is it important that a hairdresser budgets? • Considers its ….

  27. What items could a hairdresser own? (Asset) • Own for a short long amount of time? (Long term liabilities) • Own (ASSET) for a short amount of time? (current asset)

  28. Who could a hairdresser owe money to? (Liability) • Own for a short long amount of time? • Own for a short amount of time?

  29. Balance sheetWhat items could a Barber own? • ASSETS • LIABILITIES -What the business OWNS to others including current liabilities and long term liabilities -What the business OWES to others including current liabilities and long term liabilities

  30. Balance sheet • ADD in TASK

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