CB1 is an instrument of calculation; CB2 is a planning tool; CB3 is a monitoring tool. It helps management to track production cost for each SKU and every day.

Below is an explanation on how to use the downloadable CB3 Demonstration file.

Step 1. DATA COLLECTION

Step 2. DATA ENTRY

Step 3. DATA VERIFICATION

Step 4. DATA OUTPUT

Step 4. CREATION OF A DATABASE

Step 6. DATA ANALYSIS

Screen shot of CB3. This sheet F4 is the heart of CB3. In this sheet the cost of goods is calculated. It draws information from several data collection forms which are as much as possible standardized. The F4 screen is split in two: the upper part is for DATA ENTRY, the lower part shows MARGINS with RED, ORANGE or GREEN highlights.

Step 1: DATA COLLECTION

CB3 key information is collected on a one-page form containing information on:

• Raw material intake
• Production costs
• Finished goods

Form 1:    information on raw material intake (supplier, volume, price, quality characteristics).

Form 2:    calculates the price of cream and skimmed milk after separation of raw milk.

Form 3:    not currently in use

Form 4:    production cost of finished goods

Form 5:    cost of variable labor (optional for SME’s)

Form 6:    cost of processing (utilities, cleaning materials, meals for workers, consumables)

Form 7:    transport cost of raw material and of distributed finished goods (optional for SME’s)

Form 8:    cost of spare parts and repairs form (optional for SME’s)

Form 9:    all other costs (storage and distribution losses, taxes, fees, etc.)

The bold forms are always used, the other ones are optional. Where appropriate different forms are given for Dairy processing and for Fruit & Vegetable processing. Below examples of data entry forms for Dairy Processing.

Step 2: DATA ENTRY

Step 3: DATA VERIFICATION

While entering data, red lights will appear if mistakes are made or impossible results are obtained. If red lights appear, data entry must be changed.

1. Stock of finished products cannot be negative.
2. Stock of inputs cannot be negative
3. Data may not be entered in grey boxes. The grey box have been colored deliberately to exclude data entry: e.g. the technologist indicated that skimmed milk and cream are never used to produce Dutch cheese, only raw milk is used for that. So, the area has been greyed.
4. The weight sum of all raw materials and ingredients, including water, cannot be more than the weight of the finished product produced.

Step 4: DATA POUTPUT

CB3 produces 4 output tables automatically:

Output Table 1 - Technological analysis

Output Table 2 - Daily cost of goods and margins per SKU

Output Table 3 - Cost of goods and margins per SKU per kg

Output Table 4 -  Cost of goods as % of total variable cost per SKU

Step 5: CREATION OF A DATABASE

A database is created in a separate excel sheet F45-Database. In four steps:

5.1. Select the pre-defined range (see screen shot)

5.2. Copy this range

Step 6: DATA ANALYSIS

The database is ready for analysis using e.g. Pivot Tables. For assistance in analysis please contact one of the Certified Cigar Box Trainers (see Partners).