Thursday 18 September 2008

Business Cost Reduction.

Why try to reduce costs in a business?

If we want to make a good amount of money, the best way is by saving it and reducing the costs. No matter what, do no waste money on things you thought is necessary. Do keep an eye on competition of the business market to work out how to reduce the costs in a business.

There are some factors have been discussed during Business lesson yesterday.
  • Increase productivity, so you can make employees REDUNDANT

If fewer the employees, then fewer wage a business have to pay!

  • Change supplier and/or the material
  • Reduce wastage
  • Replace some workers with machines ----> [Mechanisation]

It's the same meaning with redundancy, but this is more like a profitable service by replacing employees by machines.

  • Reduce expenditure on advertising

If it costs lots just for an advertisement, why not save all these money for further investments or some other purposes? Such as qualities improving, quantities increasing...etc.


We always need a good financial plan that can help us with a whole Business management. Therefore, I think reduction in costs is a crucial event to prevent unnecessary money loss.

1 comment:

chris sivewright said...

How can you advertise for FREE?

Would OUTSOURCING reduce your costs?

Is there a problem with quality if you reduce costs?