Pricing goods and services at the right level to make a profit was the subject of a breakfast seminar hosted by the Bermuda Economic Development Corporation (BEDC).

Representatives from PwC Bermuda, the BEDC and local entrepreneur David Zuill gave guidance to business owners and those considering starting up in business.

Ray Jones, BEDC finance director gave an overview of the costs that needed to be considered when figuring out how to price goods and services. He said many start-ups do not factor in some of the compulsory costs new businesses face, such as business formation costs, payroll taxes, social insurance, health insurance and private pension.

Starting last week’s event, Mr Jones stated that the seminar would include an overview of how to properly create a business plan with presentations from PwC and a testimony from entrepreneur, David Zuill owner of David Rose Jewelry about how to properly keep track of the cash flow for your business.

Anton Schmitz, advisory senior manager at PwC Bermuda spoke about business planning.

“Business planning is an essential tool for success,” Mr Schmitz said. “It acts as a road map to grow your business. Without one you are setting yourself up for failure.”

Kristen Palmer, advisory senior consultant at PwC Bermuda, then explained what is needed in a business plan,

Details include goal-setting, figuring out target customers and industry, marketing, day-to-day operations, and financial projections.

“One reason for the inability to get a new business off the ground is the lack of a properly written and thought out business plan,” Ms Palmer said. “A good business plan can be a blueprint for success.”

Analyn Toledo, PwC assurance and accounting services senior manager, explained how to properly budget and forecast for business to helps stay ahead of situations and monitor business performance.

Mr Jones accompanied by Maryem Biadillah, managing director of Dragon Fly Ink Ltd, presented a Pricing and Budgeting Case Study in which the attendees participated. This case study allowed participants to work with each other in groups of five or six people to put into practice the information that the presenters had shared.

With support from PwC as well as the other accountants in the room, attendees delved into the case study for a taste of what it takes to handle the finances of a business to keep it up and running.

One group member said: “The case study exercise was helpful because it allowed me to get the support from others when I may not have understood if trying to figure it out on my own.”

Ms Biadillah said: “The purpose of the case study was to get people talking about the numbers. So often many business owners are experts at what they do, but avoid the numbers because it can be confusing. This case study was designed to expose attendees to some basic principles that hopefully they can apply in their respective businesses.”

David Zuill, owner of DavidRose Jewellery shared his own experiences as an entrepreneur with regard to managing his finances.

His experiences helped him learn the importance of pricing his goods to cover his cost of operations. He had to make sure he knew every expense so he in order to factor into his prices.

He said he used a cash flow sheet to help him keep track of his revenue against expenses and it was because of this tool that he was able to notice that his electricity bill was trending higher than it had in the past. With further research David learned that he was being charged for two electricity bills.

He encouraged participants to “keep a watchful eye on all of your finances and if you need to hire someone to help you put a process in place to ensure that you are covering all of your costs of operations when pricing your products”.

Closing the seminar, newly appointed BEDC executive director Erica Smith reassured the attendees that it was not the intent to scare them away from entrepreneurship by identifying what it takes to price your business but instead to educate them on the benefits of accurate pricing.

For more information on this seminar and our upcoming seminars, please contact BEDC at info@bedc.bm or visit the BEDC website at www.bedc.bm.