70
CASE STUDY 05 – WASHKING
PART III
Projected construction (toilet units) Funding sources
2020
2021
2022 0
World Bank-GAMA
200
0
Philanthropic Foundation
120
380
0
36
72
72
World Bank-Kumasi initiative
0
0
240
Other Programs
0
0
188
356
452
500
Siemens Stiftung (Pay-as-you use model)
Total
Figure 84: WASHKing projections- unit construction
Composition of WASHKing’s expenses Cost of goods sold: Among the four components of cost structure, direct material is the most significant element of the cost structure followed by labor costs. – Historically, direct material costs account for about two thirds of revenue. However, in the projection period, WASHKing has altered the allocation of direct material costs to exclude contingencies and commissions. As a result, the share of direct material costs has dropped to just over half. – Direct labor costs have also come down over time as WASHKing has been able to obtain operational efficiencies and utilize its labor force more effectively. WASHKing also intends to further optimize its cost structure by having a better mix of high-cost sanitary artisans and lower-cost sanitary workers. – A key reason for the increase in “other expenses” is the indirect selling costs associated with mobilization of customers. As WASHKing is expected to venture more in to direct customer mobilization, there will be substantial indirect selling costs. 70
% OF TOTAL COST
60 50 40 30 20 10 0
2017 Material
2018 Labour
2019 Transport
2020 Others
Figure 85: WASHKing Cost structure trends (% of total cost)
2021
2022
