Development and substantiation of measures for cost reductions in the

company through international leasing

IuliiaGoloborodko

CHAPTER 1. THEORETICAL BASIS OF COST REDUCTION ENTERPRISE

CHAPTER 2. BUSINESS ANALYSIS OF DNIPROPETROVSK ASPHALT AND CONCRETE PLANT

CHAPTER 3. JUSTIFICATION AND DEVELOPMENT ACTIVITIES FOR CUTTING COSTS AT THE ENTERPRISE

Contents

The purpose of master's thesis is to develop and substantiate measures for spending cuts at the company.

The object of research master's thesis is "Dnepropetrovsk asphalt and concrete plant“.

The subject of study are the measures for spending cuts at the company.

The keys to successful implementation of the program of the measures of

costs reduction are: quality planning and execution of the project

of the costs reduction; independent examination of the activities

involving external experts and consultants; supporting personnel and high interest in

the management of the program; attraction of the reliable sources of funding

for the implementation of measures consumables.

Chapter 1

Analysis of the volume of production in physical terms

Chapter 2

Analysis of the volume of production in physical terms

Products 2013 2014 Deviation (kg)

Deviation (%)

Asphalt (t) 72414 84110 11696 16,1

• Analysis of production in value terms

Analysis of production in value terms

Release year 2013 2014 Deviation(тис.грн)

Deviation(%)

Asphalt(тис.грн)

46480 57258 10778 23,2

Analysis of the composition and structure of staff Analysis of the composition and structure of staff

  2013 2014 Deviation(чол)

Deviation(%)

Category of staff

       

working 120 121 1 0,8

leaders 7 7 0 0

specialists 7 7 0 0

non-industrial staff

2 2 0 0

All staff 136 137 1 0,7

Chapter 3To implement the manufacture of asphalt concrete mixture with the addition of rubber shavings, you need to purchase a special Elevator cost 87750 UAH, were also conducted research that the cost of repair of the pavement will be reduced by 15% starting from the second year. Planned repair costs in 2014 are - 3089,4 thousand UAH.Therefore you can calculate the cash flow for the years;2014 = 3089,4 – 3089,4 thousand UAH2015 – 3089,4*0.15 = 436,41 thousand UAH2016 = 436,41 thousand UAH2017 = 436, 42 thousand UAHSo we will calculate the NPV (net present value) = - 87, 75 + ( 0/1,2 + (436,41-377,2)/1,44 + (436,41-377,2)/1,72 + (436,42-377,2)/2,064) = -87,75 + 104,11 = 16,36 Profitability index = 104,11/87,75 = 1,2The payback period= 87,75/ (104,11/4) = 3,4 yearsSo positive NPV is an indicator of profitability of this event, and the costs will be repaid over 3.4 years, which also shows a positive trend.

Settings CREDIT LEASING

The term of consideration of documents

From 1 day to several weeks

With funding of up to 200 thousand euros – 2 business days, above 200 thousand

euros within 1 working week.

Advance payment On average 20% From 15%

The term of financing Up to 5 years 1 – 5 years

Additional mortgage of property

yes no

The number of documents required for evaluation

15-20 8-10

Required licenses for signature

The loan agreement, mortgage, purchase, insurance and so on

The lease agreement

Payments in the preparation of the financing agreement

10-15 (down payment, insurance payment, Bank

fee for credit, the Commission for currency

conversion, notary services, 3% pension Fund, road tax, registration in traffic police,

etc.)

2 (advance payment, the administrative Commission)

"Dnipropetrovsk asphalt plant" we need to buy:1.Mobile concrete plant Mekamix 100 = 1700000 USD.2.The trailer concrete pump Zoomlion = 300,000 USD.3. Truck MAN = 558000 USD.All equipment in the amount of: 2558000 USD.

So, we suggest to apply for renewal of fixed assets in operation, international financial leasing as one of the most progressive means to improve the system security of the enterprises of machinery and equipment.

LLC "Westling" The company "LD-LEASING

Advance payment – 20% Advance payment – 20%

Annual interest rate 16% Annual interest rate 11%

Conditions of leasing construction equipment – 3 years

Conditions of leasing construction equipment – 3 years

The cost of leasing object – 2558 thousand UAH.

The cost of leasing object – 2558 thousand UAH.

Quarterly payment Quarterly payment

Repayment of principal -1,02 mn. UAH Repayment of principal -1,3 mn. UAH

The amount of interest repayment - 776 thousand UAH

The amount of interest repayment - 488 thousand UAH

Total lease payment - 1800 thousand UAH

Total lease payment - 1800 thousand UAH