How to Use the Occupancy and Coverage Plan

Occupancy Plan

Based on the allocated budgets for all employees and all operations, you fill in the Occupancy Plan, a matrix in which you indicate who is expected to do what for the coming year. The result of the matrix is the man rates for all (direct and indirect) operations, with which you have covered the labor costs.

Initially, no operation fields are visible. All operations still need to be added in the view. You do this by right-clicking in the header (for example Description) and choosing 'Field Selector'. Then you get the option to add all fields for the machines and operations. In addition to the machines and operations, it is relevant to add the Productivity field. This measures the added value to the company.

The Occupancy Plan is a matrix, in which you link all employees to your operations based on the hours (with which the labor costs are allocated to the operations). The 'Total' column (header) contains the total number of hours per employee that must be divided between the direct and indirect operations. The hours are displayed per direct hours, indirect hours and absent hours. If all hours have been divided and closed, the 'Remainder' column only contains fields with the value '0'. The number of workable hours is determined on the basis of the BBO Administration table.

All operations can be found at the top of the other columns. For all operations, the Total (at the top) must match the value of the Required man-hours. These required man-hours are determined on the basis of the budgeted machine-hours and the man/machine ratio. In the table BBO Operation Budgets you enter the budgeted number of hours. The required man-hours are then subdivided per employee. At the bottom of the column, the total must match the total (at the top) of man-hours. Here too there is a check line Required Man-hours where the deviations are visible.

Budget Expected New Employees and Machines

Do you expect to hire people in the year? Then add one or more employees under the name 'Vacancy' to the Occupancy Plan. If you expect to start using a new machine in the year or if you write one off, please include this in the plan.

Man Part of the Hourly Rate

After the matrix has been completely filled and there are no remainders and required man-hours, the difference between the average net rate of the employees and the net rate of the function group, as set up during the processing, becomes clear. An overview is also created of the 'net man-hour rate' (at the bottom) based on allocation. This allocation is determined on the basis of the allocated gross salary and the total number of man-hours. In the table BBO Labor Costs you enter the labor costs of into the employee.

The man rates for all (direct and indirect) operations are now known, with which you have covered the labor costs. A possible adjustment of the function group may still be necessary.

Coverage Plan

You use the Coverage Plan to divide all costs, except labor costs, over the direct and indirect operations and to divide all indirect hours over the direct operations. The result of the matrix is an overview of the calculated hourly rate (man + machine) per machine-hour.

The Coverage Plan consists of a matrix in which you divide all expected costs based on the annual budget. The expected costs consist of the allocated labor costs, the direct costs per operation and the indirect costs that are divided over the direct operations. You must also add all fields for the machines and operations to the Coverage Plan.

Required Surface

The matrix contains the field Required Surface for each operation. This key figure ensures, among other things, that you can divide the rental costs much better, for example. In the BBO Operation Budgets table you enter the number of square meters per machine.

Allocated Labor Costs

The allocated labor costs form the first part of the Coverage Plan. You have already entered these costs in the Occupancy Plan and will be included in this overview.

Indirect Costs per Operation

The indirect costs form the second part of the Coverage Plan. In principle, you include all costs from category 4 (all operating costs). It is also possible that there are costs in category 6 or 7 that must be included. Try to determine for yourself which costs should be included.

The costs are manually added to the plan by taking the annual budget from the ledger budgets that you have determined. Then you divide via the Divide Budget

An important question to ask here is: Which costs do you choose and why?

Select one or more operations. You can then choose from the distribution methods 'Budget machine-hours' and 'm2'. If you have balanced all costs, the column 'Remaining budget' will contain the value '0'.

Indirect Operations

Dividing up the indirect operations (such as checking, tidying up and the office) forms the third part of the Coverage Plan. Costs are now also allocated to the indirect operations. The indirect operations are not invoiced, but must be earned back. In this block you put the indirect costs in the minus (-) and you add them positively for the direct operations.

Man Part + Machine Part of the Hourly Rate (bottom)

After the matrix has been completely filled and there are no leftovers, an overview of the calculated hourly rate (man + machine) per machine-hour is created. This calculated hourly rate is your cost price and you can now compare it with the net hourly rate, as it is currently used in MKG. You will also find the current billable hourly rate total that is now used in MKG (and therefore also your margin on an hourly rate).