1. Return on Investment and Budget Development for Reutilization Programs
Joy Kniskern, Georgia Dept. of Labor/Tools for Life
and
Sara Sack, Assistive Technology for Kansans

2. Source: www.cartoonstock.com

3. Always important to run an efficient, effective operation
Similar Discussion at ATIA in January—But Even More Important Now….Why?
Always important to run an efficient, effective operation
More likely to be asked to demonstrate your program’s effectiveness
Sept. 14, 2010 Sunshine Review report—Budgets for FY2011 are even more difficult than 2010
Yolanda Kodrzycki, an economist at the Federal Reserve Bank of Boston, told the National Governors Association meeting in July 2010 that budgeting for next year would be "just as tough" for state budget makers.

4. Cost Benefit, Simple ROI, ROI/Business Case: What Are We Talking About?
Similar but slightly different terms
Cost Benefits – a general list.
ROI – performance measure to compare efficiency of different investments.
ROI/Business Case – stated definitions and assumptions and yields some insights on how to improve business in the future.

5. Simple ROI Calculation
ROI = (Gains from investment – Cost of investments) divided by Cost of investment
Which is a better investment?
$1,000 that earns $50
$100 that earns $20

6. Simple ROI Calculation
$1,000 that earns $50
($ $1,000)/ $1000 = .05 or 5% ROI
$100 that earns $20
($120 - $100)/$100 = .20 or 20% ROI

7. Before You Start Your Calculations
1. List your costs
2. List your benefits
3. State your definitions and focus
4. Think about what a “good” return would be….
Kansas legislator when talking about another program was pleased with a $2 return
State your goal for a return

8. Kansas Reuse Program ROI

9. Simple ROI: Regional Data (3rd Q)

10. Simple ROI: Regional Data (4th Q)

11. Comparison of Quarterly ROI
3rd Q ROI $8.45

12. Collection Drive ROI

13. Collection Drive Adjusted ROI

14. Collection Drive Complex ROI
Assumptions/Benefits
Accept only lightly used, high cost or bariatric DME.
Increased DME provider and network partner involvement.
Increased public’s awareness of program resulting in increased donations and requests.

15. Collection Drive Complex ROI

16. Practice Calculating Simple ROI
ROI = (Gains from investment – Cost of investments) divided by Cost of investment A B C D
Total Expense
28,036
121,306
247,487
50,850
Net Income
(199)
Value
11,045
273,513
895,482
551,897
ROI
A= Benefit (11,045) minus $28,036 (skip income) divided by cost (28,036)= -.61
B = 273, ,306 =152,207 divided by cost (121,306)=$1.25
C = 895, ,487= 647,995 divided by cost (247,487) = $2.62
D = , = 501, divided by cost (50,850.25) = 9.85

17. ROI is a Useful Tool for:
ROI is a useful tool for making program decisions.
Consider conducting ROI for:
pickup and delivery,
shipping,
collection drives,
methods of cleaning and sanitization (volunteers, paid staff, contractor, purchase of sanitizing equipment)

18. Questions? Joy Kniskern, 404-638-0387 or joy.kniskern@dol.state.ga.us
Sara Sack, or

19. Thank You! Thank you for attending this session!
Please help us improve the quality of our conference by completing your session evaluation form.
Completed evaluation forms should be submitted as you exit or to staff at the registration desk.