Business uncertainty continues to pressurise global organisations. According to the recent Finance Leaders Survey of the Association of Chartered Certified Accountants and the Institute of Management Accountants, CFOs must set priorities and continue to focus on the traditional gate-keeping functions of cost reduction and financial controls. They say, it should not be a one-time action and that it can be used regularly to strengthen a company’s performance.
Chris Allison is the Managing Director of Auditel, the UK and Ireland’s leading independent cost management consultancy. He comments: “Few businesses have the time or resources to manage their essential running costs effectively in-house. They can be as diverse as utilities, communications, office supplies, merchant card fees and catering. This function is in addition to finding the time to keep on top of contract renewals and seek out innovative cost management solutions. It is an uphill task without dedicated outsourced professional help.”
Since 1994, Auditel has built a reputation for delivering ethical and sustainable solutions for over 3,700 organisations through their Total Cost of Purchase® model. Their approach is now widely regarded as the most effective in cost management. Auditel regularly delivers results that not only meet, but exceed clients’ expectations.
Allison says: “We have assisted organisations in both the Media and e-Commerce sectors. Here are a couple of examples.”
The Lady Magazine
The Lady Magazine was founded in 1885 by Thomas Gibson Bowles. It is the oldest women’s weekly and is thought to be the oldest magazine still owned by one family. Famous for its classified adverts, The Lady remains the first port of call for anyone seeking domestic staff through listed vacancies for nannies, butlers and governesses. The Prince of Wales and the Queen Mother are believed to have used it and the Duchess of York famously once advertised for a dresser.
Ben Budworth took over as Publisher and Chief Executive in 2008. Cost management was an important part of his planned transformation as supplier contracts had been in place for many years and had never been reviewed. Auditel was engaged by The Lady in 2010.
Ben enthused, “Auditel has proved to be a valuable resource for us. I was impressed that they didn’t simply switch to the lowest bidder but found the supplier that best suited our needs. By outsourcing our cost and purchase management, we have not only made savings but have saved ourselves the time and money of doing it in-house. I would recommend them to other businesses without hesitation.”
Auditel have made welcome reductions for The Lady in three main areas so far. Electricity costs have been lowered by 11%, credit card charges by over 17% and, most significantly, stationery and IT consumables by an impressive 20%.
Prior to February 2013, Tindle Radio owned and operated nine local commercial radio stations on the UK mainland and Channel Islands. At the time, their Group Financial Director was keen to make sure that they were on top of their business costs. “Initially we just wanted to make sure that, without compromising quality, the costs of our managed supplies across the group were as low as possible, with a particular emphasis on energy expenditure.”
He appointed Auditel to investigate the electricity, fixed line and mobile telecoms costs. As a result of their thorough investigation, considerable savings were achieved totalling nearly £43,000.
These included over £31,000 on electricity across eight sites, representing a saving of more than 32%.
£4,445 (43%) on fixed line costs and a further £7376 (33%)on mobiles.
Tindle were delighted. “Auditel’s professionalism and attention to detail is impressive. Under their management, savings have been made for us in every category. Best of all, this hasn’t affected the quality of our services at all. If anything, the quality has increased!
“Auditel now handle any problems with billing or contracts whenever necessary. They provide us with regular detailed reports and updates, without overloading my in-tray! The time this saves myself, my accountant and the admin team makes such a difference. We are more than happy to recommend them and can see their service being of benefit to other organisations.”
As Allison points out: “There is a difference between cost cutting and cost management. Cost cutting is a one-time attempt to decrease your expenses. Cost management is an ongoing task of monitoring your expenses, keeping track of what is spent and constantly watching the marketplace to ensure that you are receiving the best value for your pound. Even if you think you’ve got all your essential costs under control, it won’t hurt to make sure. Why not book your Auditel Business Health Check today?”