It also helps motivate staff members charged with implementing expense-reduction initiatives to stay on task and be creative. This helps to create a zero waste culture within your organization. Make people accountable for costs and establish appropriate rewards for employees who find ways to reduce expenses. For example, many companies are now using cloud computing systems as opposed to in-house hardware that can be relatively expensive to buy and maintain. Invest in technologyĮxplore new technologies that may help your business improve efficiency, increase productivity and reduce costs. “Whether it’s by putting out a request for proposal (RFP) or a less formal method, it’s important to send out the message that you are always watching your costs.” 6. “It’s good practice to get two or three quotes regularly,” Brison says. But you should periodically test the market to see if you can get a better deal from competing suppliers. People tend to become complacent about fixed costs because they are generally recurrent and often reflect long-standing relationships with suppliers. Historic percentages provide both a good indictor of potential future costs and a benchmark to use in keeping those costs in line with selling activity. Look at your company’s past variable expenses and calculate what percentage of sales they represent. “If you see you’re spending more in certain categories, then drill down, investigate why and take appropriate action to reduce those costs to industry norms.” 4. Benchmark against your industryĮstablish metrics that are meaningful to your business and comparable to those used by other companies in your industry. “Tracking your costs shouldn’t be an afterthought, it needs to be an integral part of your ongoing operations,” Brison says.
This requires gathering data in an effective and efficient way. You have to understand your historic costs before planning for the future. “For instance, if you intend to pursue a new market next year, you have to build the related expenses into your forecast,” Brison says. Growth & Transition Capital financing solutions Kauffman Fellows Program Partial Scholarship Venture Capital Catalyst Initiative (VCCI) Industrial, Clean and Energy Technology (ICE) Venture Fund
0 kommentar(er)
