To: The Board of Directors
Subject: PROPOSED SYSTEM OF INTERMENT AT HMMG HAMP, Mechanization and computation of ROE
cc: MRSS, HAMP
PLEASE READ WELL AND UNDERSTAND. La Union read you are next.
This post suggests and proposes:
Objective:
1. Make interment efficient;
2. Achieve better returns for investment
What
1. To mechanize the interment operations and base this at HAMP
1. Purchase a backhoe a PC 30: finance this internally
2. Hire a driver- operator for the backhoe and truck
3. Assisted by a helper
4. Backhoe and DT travel to
4. But vault manufactured in HMMG to save on wear and tear
2. Procedure and system:
1. We purchase these two machineries:
1. A pc 30 excavator (this is for cat, however another supplier Hadaam can provide at P700,000!
AZAAN - P870,000 with breaker and breaker points free delivery from Guaga P870,000.00
Finance internally, 30% dp, 70% ma P20,000 at 12% pa 36 months
We order the one with rubber track to save on concrete and grass; or use rubber tracks or have a trailer iwithin
DP 870,000 x 30% P261,000 (from SBU funds)
Balance 870,000 x 70% 609,000
MA 609.000 x 136/36 = 828.24/36 23,006
Interest 209,240.00
Total cost for the excavator . 1,079,740,00
2. A sino truck or howo bn DT with 5 cu meters capacity, 2.5 meters cargo door to accommodate a pc 30 , 35, o4 3excavator
Price 1,150,000 1,150,000
DP 30% 345,000
Balance 805,000 x 1.36/36 = 1,094,800/36 30,411.00
Interest expense: 289,800
Total 1,439,800.00
A sino 5 cubic meter DT will enable us to do the folloiwng:
1. Load the backhoe from HAMP for HMMG
2. Load a vault from HAMP to HMMG
3. Transport tent, chairs and personnel from HAMP and HMMG
Total cost of project 2,,519,540.00
MA for both:
Excavator 23,006
DT 30,411
53,417 x 12 641,004
Estimated savings P1,400/interment x 40 (a high for both HMMG and HAMP) since you can accept more
interments (vs predicted digging cost of P3,000 per)
Savings of 2 gt for HMMG 16k x 2 x 13 = 416,000
Total cost savings Total 1,057,400,00
2. Proposed system:
1. Vault forms will be provided for in HMMG - Assemble one set of vault form (Make a PO now) P30,000k?)
2. Contractor manufacture vault in HMMG 5-10
3. We purchase one big tent PO now how much? (P40,000?)
4. As back up we order 4 trailers (x 90,000 ?) 360,000
Total 430,000.00
5. Our expenses for the labor in backhoe is a driver operator say P700 - 800 per day
6. When there is interment in HAMP
WS is sent to the driver operator to operate backhoe: Lot number block number, somebody
trains him locate, or a supervisor points to the lot
Digging is done according to standard, There is a helper to remove stray soil being excavated
Maybe another GT or ISG on call
1/2 of digging is dumped at our designate dump site
1/2 of the digging remains at the dump truck They will be dumped back at the interment at end of ceremony
If there are additional interments, 1/2 of soil is dumped at plywood mixing board; to be picked up later by backhoe.
In excess of onte interment, the operator gets addiitional P250,00 thehelper P100.00
ISG focuses on the interment ceremonies.
7. When there is interment at HMMG
1. Driver operator is given a trip ticket to bring the excavator to HMMG, with designated block and lot number to dig;
2. Driver operator travels to HMMG In excess of onte interment, the operator gets additional P250,00 thehelper P100.00
3. Driver operator digs the hole; dumps 1/2 of soil at dumpsite, 1/2 remains.
4. ISG lowers the vault
5. When there isi no vault at HMMG (this preventable) we can load and transport vault to HMMG using the HOWO dt
4. ROI computation
1. Estimated total savings vs manual
1. Labor savings P1,400/interment x 40 (a high for both HMMG and HAMP) since you can accept more
interments (vs predicted digging cost of P3,000 per)
53,417 x 12 641,004
Savings of 2 gt for HMMG 16k x 2 x 13 = 416,000
Total cost savings Total 1,057,400,00
a. ROI for actual savings 1,057,400.00/ Total investment 2,519,400 = 41.96% pa
Rule of 72 72/41.9 = 1.7 years
b. ROI with depreciation Dep /year 2,519,000 /5 P503,800.00
Add to savings 1,057,400.00
Total savings = 1,561,200.00
ROI + Dep 1,561/ 2,519.4 = 61.9%
Rule of 72: 72/61.9 1.16 years
CONCLUSIONS;
1. This is really better than PHP in the bank this generates more PHP in the years to come, making intermrent more profitable
2. Thats why FL ordered 30 for its 43 branches; their excavators cost P2M each: Kato
3. We definitely should do this now. Make a reservation for Azaam or see Hamad with P700,000 for PC 30
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