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Acme - Essay Example

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Summary
1345 MXN, and the difference in the cost of living between the two countries. In this budget plan, it is considered that the cost of living is cheaper in Mexico because most labor…
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Management Project Plan A Planning Budget for the Information System Management for Acme Home Improvement in Mexico DIRECT COST DESCRIPTION
SUBTOTALED AMOUNT
1.
Construction Materials
Temporary Rentals/Utilities
Fire System
Electrical-Lighting, Cabling, etc
Electrical Generators
Insulation
Cabinets
Hardware-Bolts, screws, cords, etc
Equipment rental
Safety Equipment
Other
Total Materials Cost
40% or USD 3.0 million
2.
Overheads and Other Costs
Personnel Salaries-Direct Project Workers
Consultants/Professionals
Administrative personnel
Accommodation
Utilities (Electricity, phone)
Construction Laborers
Trainers
Suppliers
Other
Total Overheads and Other Costs
20% or USD 1.5 million
3.
Inventory & Labor Costs
Loading and off loading
Products
Shipping
Truck rentals
Duties (Customs & Exercise)
Total Inventory Costs
40% or USD 3.0 million
Considerations
The USD estimates and the percentages are based on a USD 7.5 million budget.
Salary and wages may vary significantly, particularly with the current exchange rate of $1 = 11. 1345 MXN, and the difference in the cost of living between the two countries. In this budget plan, it is considered that the cost of living is cheaper in Mexico because most labor used will be local. It may also be lower than it is anticipated (Lewis & Slack, 2003).
It may be considered that the cost of inventory may vary from the above approximated budget because of: pressures and delays of delivery, but this is considered to lean more towards the increase (Lewis & Slack, 2003).
Assumptions
The total cost for construction materials is assumed to be derived from the size of the facility, which is to be built with most of the costs going to materials required for walls and foundation.
Personnel salaries and wages majorly top the total budget amount for the overheads, with most of the costs going to experts in charge of the information system management. The total number of employees required in this project sector is estimated to be sixty. This will be divided as follows;
(i) About forty for all construction and interior design.
(ii) About seven for landscaping duties,
(iii) And, approximately ten company IT professionals for the initial hiring and training of the new employees.
The items required for inventory will approximately cost as many dollars as the construction duties, or more, due to payment and handling of duties, and shipping (Lewis & Slack, 2003).
Reference
Lewis M, Slack N. (2003). Operations Management: Critical Perspectives on Business and Management. New York: Routledge. Read More
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