It's now well known that Corona has severely impacted the profit margins of businesses from a large number of sectors. This may also apply to your sector. Many businesses saw their income shrink and are now in difficult waters.
An international survey by PWC shows that 77% of CFOs have cost control high on the agenda for the coming months. That's more than three-quarters of companies, that's enormous. And that shouldn't be surprising.
Reduce Costs?
They want to realize that cost control as follows:
- Investments are postponed
- Facility and other maintenance costs are reviewed
- Operational savings are sought
- Ways to save on personnel are examined
It's understandable that companies mainly look at themselves when it comes to reducing costs. But it really pays to also look outward instead of only at your internal operations.
Negotiating
In addition to cutting or reducing certain costs, renegotiating prices and associated conditions with existing suppliers is an important source of savings.
What do you think about reviewing your indirect costs (also called operating costs)? They often fly under the radar in many businesses. And these costs amount to about 10 to 15% of turnover, and are often spread across a large number of smaller suppliers.
In addition, in recent years of high prosperity, attention has mainly gone to revenue growth, and probably somewhat less to the price level of your suppliers.
This has caused prices to rise much faster than inflation, and you're paying significantly more than if you were to contract the same product or service for your business right now.
Room for Improvement
So a lot of money is leaking out of your organization. And that's particularly unfortunate.
Our experience teaches that with many existing contracts there is room for improvement. Savings percentages of 15% and more are absolutely no exception for us. Only many don't realize this, and so many companies leave a lot of money on the table.
You know this now, and can therefore start reducing those costs from now on. Don't have time to get started with it? Or don't you have the necessary skills?
Have you ever thought about outsourcing this exercise?
With our 'No Cure No Pay' formula, you only pay if we can actually help you reduce costs. Your investment is paid back in less than 6 months, but you still benefit from the favorable rates for years. Definitely worth trying, and without any risk.