Thought for the day25 Jul 2012 | Filed under: Cost & Purchase Management
We are all familiar with the statistic that 1 in 3 start-up companies will fail in their first 3 years but I was amazed to discover this weekend that fewer than 1 in 10 will actually survive 10 years in business. Depending on where you look, current forecasts are that around 25,600 UK companies will fail in 2012 rising to 25,800 in 2013. Gloomy news indeed.
Hearing these statistics made me think about the companies Ruth and I have worked with over the last 4 years. Of the 45 companies we have managed projects for only one has ceased to trade – a failure rate of less than 0.5% within our own, admittedly small, sample. Interestingly over 90% of the companies we are personally working with have been in business for 10 years or more, with 5 of these being established in excess of 100 years. So why should our sample be so different from the rest ?
Could it be that companies who take an alternative view on how they procure their essential services by using outsourced expertise are better placed to survive the recession ? When speaking to my clients I know they all appreciate the financial savings we have delivered for them and it never ceases to amaze me how they also benefit from the time we save them as well – in one case allowing a client enough resources to start a new sales division.
What do you think ? If you are open minded to the fact that there may be better ways of managing your costs then we would welcome a conversation.