Economic view on R&D results

Transcription

1 Knowledge Transfer Price Calculations Economic view on R&D results 24 September 2014 Ivan Chodak jr. Slovenj Gradec ACCURATIO

2 Outline View of a scientist and an investor The most important questions to ask Success factors Product Price calculations and strategies Our approach to financial modelling 2

3 View of a scientist... x.000 for research budgt The Scientist of the Year! 3

4 ... Practical application... 4

5 ... Practical application... 5

6 View of an investor... Scientist of the Year x.000 for research budgt EV/Sales Margin 6

7 ... might be different 7

8 Can they work together? We believe... YES! 8

9 Public and private R&D financing (% of GDP) Source: EU Commission

10 Important questions to ask Area Key questions What is your product (or service / value) what the customer actually shall pay for? Who are your customers (companies B2B, retail B2C, public sector...)? Where are your customers (country, CEE, Europe, Globe...)? Product What is a market potential (000, millions, billions / how many l/kg/tons/pcs)? Is already a market out there? Is there a competition and what will be competition once we do product placement? Can we effectively protect our product (patent, license, technology)?

11 Important questions to ask Area Key questions Can we do it do we have material? Can we do it do we have technology? What are the main competition advantages? Strategy Structure Necessary investments for a product launch? What are necessary operating conditions? What is expected profitability and payback period (10% p.a., 50% p.a., 10 months / 10 years)? Who can pay for it (my rich uncle, myself, EU funds, R&D budget, bank, customers via advance payments, investors)

12 Research Idea Commercial production Don t you thing we are missing something here? 12

13 Success Factors Product Team Successful Project Business plan Market

14 Team Product People who will finalize the Research Team Successful Project Business plan People who will Execute and Manage the project Market Not the same persons different skills & experience Committed team = 50% of success in fund raising

15 Product / Technology Product Better protection = better chances for success Team Successful Project Business plan More sophisticated technology does not neccessary Market mean success something can go wrong Clear definition of the product / technology / servis

16 Market Product You can develop one even if there is no at the moment All expectations need some logic behind Market moves in time Team Successful Project Market Business plan

17 Business plan Product Answers for key questions Team Successful Project Business plan Financial calculations and plan is a must Market Compass for next steps Might be at helicopter view in the beginning, but as the time flows it gathers more and more details

18 Factors Influencing Price Costs all costs need to be covered Positioning low price neccessary for discount product but killer for luxury one Demand Curve how sensitive the customer is Environmental factors legal or other constraints Short-term profit maximisation is this what you want? What about long-term profits? Revenue maximisation Quantity maximisation (e.g. penetration) Profit margin maximisation 18

19 Price Calculations 19

20 Product Pricing Strategies Cost plus margin pricing based on sum of variable costs + fixed costs (on current production level) + desired (market) margin / markup. If calculated corectly (all costs included) then always profitable. Target return pricing based on costs and desired profit Value based pricing price based on value it brings to its customers. If the product is worth 100 for customers, you can charge 100 even if production costs are only 45. Psychological pricing includes psychology e.g. of Bata pricing model = 9.99 is much cheaper then Positioning pricing based on competitors level and your marketing strategy (mass product vs. luxury product) 20

21 From Idea to Product Long Trip Idea / Prototype Business plan Investor Execution Patent / IP analysis Market research Resources identification (people, money, space) Key risks identification (legal, technical, financial, managerial ) Product definition Market analysis Financial analysis and plan Marketing strategy Organization and management plan Structure for execution and financing Identification of investors (and/or soft money) Presentation First contact Due diligence (full contact) Business terms / contract Execution and project implementation Interim monitoring Active / operational execution and management Additional financing Inputs for business plan Feasibility Study Business plan Investor /money In Product Out

22 Our Approach to financial modelling #REF! ,60% 0,16 0,32 0,48 0,64 0,80 1,20 1,60 2,40 3,20 4,00 4,80 5,60 6,40 7,20 8,00 1,50% 0,15 0,30 0,45 0,60 0,75 1,13 1,50 2,25 3,00 3,75 4,50 5,25 6,00 6,75 7,50 1,40% 0,14 0,28 0,42 0,56 0,70 1,05 1,40 2,10 2,80 3,50 4,20 4,90 5,60 6,30 7,00 1,30% 0,13 0,26 0,39 0,52 0,65 0,98 1,30 1,95 2,60 3,25 3,90 4,55 5,20 5,85 6,50 1,20% 0,12 0,24 0,36 0,48 0,60 0,90 1,20 1,80 2,40 3,00 3,60 4,20 4,80 5,40 6,00 1,10% 0,11 0,22 0,33 0,44 0,55 0,83 1,10 1,65 2,20 2,75 3,30 3,85 4,40 4,95 5,50 1,00% 0,10 0,20 0,30 0,40 0,50 0,75 1,00 1,50 2,00 2,50 3,00 3,50 4,00 4,50 5,00 0,90% 0,09 0,18 0,27 0,36 0,45 0,68 0,90 1,35 1,80 2,25 2,70 3,15 3,60 4,05 4,50 0,80% 0,08 0,16 0,24 0,32 0,40 0,60 0,80 1,20 1,60 2,00 2,40 2,80 3,20 3,60 4,00 0,70% 0,07 0,14 0,21 0,28 0,35 0,52 0,70 1,05 1,40 1,75 2,10 2,45 2,80 3,15 3,50 0,60% 0,06 0,12 0,18 0,24 0,30 0,45 0,60 0,90 1,20 1,50 1,80 2,10 2,40 2,70 3,00 0,50% 0,05 0,10 0,15 0,20 0,25 0,38 0,50 0,75 1,00 1,25 1,50 1,75 2,00 2,25 2,50 0,40% 0,04 0,08 0,12 0,16 0,20 0,30 0,40 0,60 0,80 1,00 1,20 1,40 1,60 1,80 2,00 0,30% 0,03 0,06 0,09 0,12 0,15 0,22 0,30 0,45 0,60 0,75 0,90 1,05 1,20 1,35 1,50 0,20% 0,02 0,04 0,06 0,08 0,10 0,15 0,20 0,30 0,40 0,50 0,60 0,70 0,80 0,90 1,00 Technology Input analysis Financial model 22

23 Financial model Revenues Sales Costs Material Material Transportation Production Warehousing Packaging Logistics Rental costs Other operating costs Admin and overheads Model needs to reflect the case. Never vice versa! Depreciation Cost of financing Income Tax Net Income 23

24 Scalable inputs First year of the business plan Personal costs inflation Other costs inflation Price per unit Price per unit (larger package) Other costs / person Space requirements / person Retntal costs / sqm Scalable parameters Definition of own All inputs based on existing data and assumptions 24

25 View by different segments Revenues Variable costs Raw Material Ingrediences Transport Production Warehousing Packaging Logistics Total Variable Fixed costs Personal costs Marketing Rental Other opex Financial model covers all aspects of business plan Structured financial analysis on different levels Analysis of key factors 25

26 Input production costs analysis Model develops more details Separate product, groups and segment analysis possible 26

27 Sensitivity Money Maps Sensitivity on two parameters #REF! ,60% 0,16 0,32 0,48 0,64 0,80 1,20 1,60 2,40 3,20 4,00 4,80 5,60 6,40 7,20 8,00 1,50% 0,15 0,30 0,45 0,60 0,75 1,13 1,50 2,25 3,00 3,75 4,50 5,25 6,00 6,75 7,50 1,40% 0,14 0,28 0,42 0,56 0,70 1,05 1,40 2,10 2,80 3,50 4,20 4,90 5,60 6,30 7,00 1,30% 0,13 0,26 0,39 0,52 0,65 0,98 1,30 1,95 2,60 3,25 3,90 4,55 5,20 5,85 6,50 1,20% 0,12 0,24 0,36 0,48 0,60 0,90 1,20 1,80 2,40 3,00 3,60 4,20 4,80 5,40 6,00 1,10% 0,11 0,22 0,33 0,44 0,55 0,83 1,10 1,65 2,20 2,75 3,30 3,85 4,40 4,95 5,50 1,00% 0,10 0,20 0,30 0,40 0,50 0,75 1,00 1,50 2,00 2,50 3,00 3,50 4,00 4,50 5,00 0,90% 0,09 0,18 0,27 0,36 0,45 0,68 0,90 1,35 1,80 2,25 2,70 3,15 3,60 4,05 4,50 0,80% 0,08 0,16 0,24 0,32 0,40 0,60 0,80 1,20 1,60 2,00 2,40 2,80 3,20 3,60 4,00 0,70% 0,07 0,14 0,21 0,28 0,35 0,52 0,70 1,05 1,40 1,75 2,10 2,45 2,80 3,15 3,50 0,60% 0,06 0,12 0,18 0,24 0,30 0,45 Sensitivity 0,60 0,90 1,20 Analysis 1,50 1,80 2,10 ideal 2,40 2,70 3,00 0,50% 0,05 0,10 0,15 0,20 0,25 0,38 0,50 0,75 1,00 1,25 1,50 1,75 2,00 2,25 2,50 0,40% 0,04 0,08 0,12 0,16 0,20 0,30 managerial 0,40 0,60 0,80 and 1,00 decision 1,20 1,40 making 1,60 1,80 2,00 0,30% 0,03 0,06 0,09 0,12 0,15 0,22 0,30 0,45 0,60 0,75 0,90 1,05 1,20 1,35 1,50 0,20% 0,02 0,04 0,06 0,08 0,10 0,15 tool 0,20 0,30 0,40 0,50 0,60 0,70 0,80 0,90 1,00 27

28 Thank you for your attention! Ivan Chodák 28