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One important principle here is to \u00a0that for the organisation to be viable, it has to be able to pay its bills. This may sound simplistic and obvious but it is a little bit different from a company which offers its goods for sale and hopes to sell enough to cover costs. In this case we are looking at planning the operation so that we meet\u00a0needs and meet expenses at the same time.<\/p>\n
Another principle is to remember that what you ostensibly pay for \u00a0doesn’t have to be in proportion to\u00a0costs. Most restaurants, for example, have a very high margin on their wine and other drinks, but a low margin on food. They make money on the wine whilst selling their food at a lower margin. Of course, patrons come to the restaurant for the food. In a commons operation all that matters is that the community\u00b4s bills are met and that member’s needs are met at the same time.<\/p>\n
So you do not need to calculate the margin on everything, just find a revenue model\u00a0that everyone can consent to. Having said that, keeping control of costs \u00a0and knowing where the money goes is paramount to good financial management.<\/p>\n
Having worked out the costs and \u00a0and frequency ( i.e. per week, month, annually or even daily) that figure needs to be matched to the total units of production and their types, remembering that you can set a unit price for some services higher than the unit cost and some lower.<\/p>\n
Another thing to remember is that taking micro payments for everything is in itself a cost\u00a0and requires people hours. The fewer times you take payment the more efficient it is. On the other hand, just having one set fee for everything can encourage waste if a service is “free” to use.<\/p>\n
There are no set ways to cover this, as long as everyone in the community accepts the approach you propose, it is fine.<\/p>\n
Types of revenue streams<\/strong><\/p>\n Pay per unit<\/p>\n Types of payment<\/p>\n At this point there are dependencies on what kind of legal structure you choose to manage your commons. If you choose a cooperative, membership fees that entitle to a standard share of the output might be complemented with payment for extra services.<\/p>\n \u00a0<\/strong>Putting \u00a0a price on Units<\/strong><\/p>\n In the earlier unit we met the idea of unitization. Now is the time to put a price on each unit to provide a revenue stream. Notice that the annual volumes are planned in advance and most is delivered pre-paid. This makes planning easier, and removes the need to borrow money in advance to purchase materials for the service.<\/p>\n <\/p>\n Some ideas are listed below about how to divide costs among community members in units and charges per unit. Remember that just having an organisation brings costs with it – for tax registration, bank charges, website fees, meeting rooms, etc. Be sure to bake these into your model.<\/p>\n or charged weekly by credit card 15 EURO<\/td>\n<\/tr>\n Access 355\/365 for commons members<\/td>\n + Diesel<\/td>\n 80 Euro<\/td>\n<\/tr>\n or included in membership<\/td>\n<\/tr>\n\n
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\n \u00a0Object<\/th>\n \u00a0\u00a0 \u00a0 Service Thinking<\/th>\n \u00a0\u00a0 \u00a0 Units<\/th>\n \u00a0Revenue stream ideas<\/th>\n<\/tr>\n \n Minibus<\/td>\n \u00a0Transport to local station two times a day forth and back<\/td>\n Commuter trips<\/td>\n Monthly fee<\/td>\n<\/tr>\n \n Vegetables<\/td>\n \u00a0Weekly food supplies year round<\/td>\n Weekly allotment<\/td>\n Annual subscription<\/td>\n<\/tr>\n \n Summer Cottage<\/td>\n \u00a0Access to place to stay with kitchen\/toilet over summer months<\/td>\n overnight stays<\/td>\n Included in membership fee<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n \n\n
\n TYPE OF UNIT<\/td>\n INPUT and PRODUCTION COSTS<\/td>\n REVENUE IDEAS<\/td>\n<\/tr>\n \n Vegetable box per week
\n21 Weeks of the year 50 people<\/td>\n15750\u00a0EURO<\/td>\n 50 quarterly subscriptions 197 EURO<\/p>\n \n Shared minibus<\/p>\n 4000<\/p>\n Annual fee as part of membership fee<\/p>\n \n Party room 3 Friday\/weekend days\/ year and 4 weekdays<\/td>\n 120 EUR0<\/td>\n pay per use<\/p>\n \n <\/td>\n <\/td>\n <\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n READ MORE<\/h4>\n