Govers has a unique method tot evaluate the performance of companies based on their numbers. In short the method works as follows.
The analysis starts with determining the value creation in the year that is being analysed. We call this the added value.
Added value is the keyfactor in out analysis model. We think that added value (also knows as gross profit) is more important than revenue. But added value is also a keyfactor because we pay special attention to the proportion the most important costs in the business and the added value.
In the business preformance catogory we catogarize all business costs into three different cost sorts:
1. Personnel costs (the total cost of the most important assset of the company)
2. HAR capital costs (rent, lease, depreciation and interest)
3. Other costs
The personell costs, other costs and HAR capital costs are expressed in percentages of the added value. We use an indicative maximum percantage of, respectively, 60%, 20% and 20%.
The power of the HARR-analysis is that:
And this all can be done on the back of an envelope.
To empahsize that this all can be done on the back of an envelope we developed a set of eight beer mats that show the essence of the HARR-analysis.
Interested? Mail your name and adress to Paul Mencke (email@example.com) and we will sent you a set of these beer mats.
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