Determine Monthly Sales

In most cases, organizations are uncertain about their marketing and sales team meeting the monthly sales goals. However, based on the past performance and future goals, it is important to develop confidence on the target you have set. The marketing team at Riviera Cleaners Company will determine monthly sales in the following ways. First, the company will determine its monthly sales based on the price it offers for household cleaning service. The company will charge a premium price for the service since the target groups are affluent. The company will charge customers $95/hour. Multiplying the price by the hours our professional team will take to finish the job will provide the daily quantity of sales. This will provide an estimate of what the company should expect at the end of the month. Similarly, we shall check with the sales team to determine the monthly revenue target.

Second, the company will use the number of customers to determine the monthly sales. The revenue generated per customer can be useful in determining the monthly customer goal. The company will provide services to the affluent market; therefore, finding out the number of customers needed per month will help in estimating the monthly sales. With a sales target of $22,800, the company will have to ensure that they receive customers every day. Regarding customer return rate, the company will aim for a customer return rate that is above 90%. The company expects to start a month with 100 customers. At the end of the month, we expect to remain with 110 customers. During the same period, we shall expect 15 customers to cancel their contract. Conversely, due to our quality services, we expect to attract 20 new customers. The company will base its sales forecast on the assumption that demand increases at a steady pace. That is, the company will get more customers as we continue to serve the existing ones.

Determining Expenses

The expenses that the company will incur include the following. First, the company will incur payroll expense. In the first year of operation, the company will pay its employees $129,600. In the second year, it will pay $267,500, and in the third year, employees will receive $303,500. Second, the company will incur sales and marketing expense. The company will incur $7,000, $6,500 and $6,550 as sales and marketing expenditures in the first, second and third year respectively. Third, the company will incur electricity and utility expense. We shall pay $1,300 for electricity and other utilities. The fourth expenses are chemicals and supplies. The company will require chemicals and supplies to provide service; therefore, the company will incur $1,750, $2,000 and $4,500 in the first, second and third year of operation respectively. The fifth expense is insurance. The company will pay $2,500 every year as insurance fees.

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