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Do you recognise your hidden costs?

By 17th January 2018April 27th, 2022No Comments

 

Paul Strachan

Posted by: Paul Strachan

Clever cost management means you can prepare yourself against the unexpected and make provision to insulate yourself from any nasty shocks that may otherwise have the potential to derail your business.

Some things can be planned for and quantified and others are trickier. Maximising staff productivity is one of the factors that is harder to get right on paper. Under-performance of staff isn’t always easy to predict but can be hugely costly to a business, particularly a SME. This may be due to an unnecessary volume of emails or meetings or a work environment that isn’t conducive to productivity.

Firing and hiring new staff isn’t always the answer either as this comes with its own hidden costs. Recruitment is a time-consuming process which involves costly advertising and agency fees. The amount of non-productive time involved in induction and training is significant and costly too.

Keep the cash flowing into the business as quickly as you can to avoid the hidden costs of fees and interest on overdrafts and loans. Reduce the time you are prepared to wait for an invoice to be paid. The sooner you have the cash in the bank, the quicker you can reinvest in your own business.

Protect your intellectual property. If your business is based in an original idea, then the success of your venture is dependent on how quickly you protect that idea through patent or trademark. It may seem costly and complicated to do so, but delay could cost you your business.

If you would like to explore what opportunities may exist – then contact me for an initial discussion.

Paul Strachan M. 07793 447961 T. 01307 460667 E. paul.strachan@auditel.co.uk