From the course: Financial Analysis: Making Business Projections

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Projecting fixed OPEX

Projecting fixed OPEX - Microsoft Excel Tutorial

From the course: Financial Analysis: Making Business Projections

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Projecting fixed OPEX

-To project fixed opex, we first need to start with the current expenditures. By current, I mean any expenditure that we have seen coming through during the previous year. Whether that is salary for administrative staff, rent, or general office expenditures, all those expenditures need to be listed with their monthly details for the previous year. For sales staff, there is usually a fixed part of their salary plus a commission that is larger or smaller based on their performance and more generally, on the performance of the company. A fixed element of their salary can be taken into consideration as fixed opex. The first step to projecting fixed opex, after having listed all the current expenditures, is to decide which of those expenditures will remain as is for the coming year and which will be discontinued or expanded? For example, you could decide that you need people in the finance department. Those guys are so useful. You plan to keep the same salary budget and to add to it the…

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