Wondering how you can cut down on your organization’s costs? Well, it may be that your company is going through a difficult phase. It may be that you are experience possible closure in the future if you don’t make any drastic changes. In such a case there are some things that you can do. Like for instance, changing the product, changing the design of the product, penetrating new market and in most cases cutting down on existing costs. Cutting down on costs is not easy, but you may be forced to try out some of these methods.
Read below to find out!
Your first thought would be to cut down on your employees. But once you start making employees redundant, the others working in the company will not be with you for long too. They will look for other places to move to. And you may even lose your good employees. Also the fear of when they will be made redundant will not allow them to work properly. Plus there will be legal implications when it comes to cutting down costs by removing employees. You may want to resort to making employees redundant after all other methods fail you.
You can think of shifting to either a smaller place or something like a business centre admiralty http://asahibiz.com/en/home/, that is a workplace where several employees work together but all may not belong to the same organization. In most cases, such options are way cheaper and what’s more they have the furniture provided and services like security, parking and reception are most of the time provided by them itself. This will be a great cost saver for you and you will also be able to enjoy many benefits if you shift to such a place.
Credit periods and Debit periods
Whether you rent serviced offices or not this is one major point that you will need to keep in mind. Although this doesn’t technically help you cut down on costs, you are able to prolong the cost periods. You should always keep in mind to extend your own credit periods from suppliers. That will give you time to pay later and you can look at the immediate costs that need to be paid. And you should then reduce the debtors’ credit period that you provide. You may either explain to both stakeholder parties of your situation or you could simply tell them you bought in a new policy. This will help you stabilize your trade activities.
Other fixed and direct costs will need to be taken in consideration. For instance, cost of raw materials, cost of transport and even petty cost. These costs may be reduced of extra scrutiny is taken. You may be able to find a manufacturer of the same raw material that you require at the same quality but a lower cost. Ten you can either bargain with your supplier or simply shift to this supplier. You will be surprised to find how much you can save by cutting down on petty costs!