Cost Saving Ideas

KathyA

Does anybody have any ideas or experience with reducing overall organizational operating costs (such as renegotiating janitorial, security, landscaping contracts for price reductions, eliminating free bottled water and/or coffee, unnecessary newspaper/publication subscriptions, etc.)? Thank you.

System

We operate with tax dollars. Since we are non-profit, we function with finite dollars. I came from a large corporate setting. In both entities, employees murmer about how the company wastes money. Apparently, they know where the money is being wasted. (sarcasm here). Poll them. All of your ideas are sound. See if your employees come up with other ideas and give them a percentage of the savings quarterly. It's better than profit sharing.

"Sam"

deniseE

Absolutely review your newspaper and magazine subscriptions. With so much free information on-line, you really need to decide if the paper is worth having. If you are a doctor's office and looking for patient reading material, see if employees would be willing to donate their old magazines, some patients may be willing to do that as well.

In our office, we pay for the bottled water. We contract with a company to deliver the bottles every 2 weeks. The monthly cost for about 20 employees is 3 dollars. This is far less than hitting the vending machine!!! So we don't mind that the company does not pay for this.

Carefully review office supplies. Determine what is a business NEED and an employee WANT. If and employee would rather use the Bic FAT pen rather than the standard med. blue ink, then let her pay for it.

Ask for estimates for landscaping....and determine how much you really need. Maybe until things are better you can scale back the flowers and general planting....

If employee pay is an issue, do you have anyone up for early retirement? It might be worth looking into. You may even have some employees that would be willing to be part-time for a while....

good luck!

TN HR

Something that has has been working well for me recently is assigning "account managers" for each area. For example, I have an "account manager" who is assigned to our uniform vendor account. This person has been charged with evaluating the relationship, identifying cost-saving opportunities and implementing steps to reduce costs. This need not turn into a huge project. You will be surprised at the results.

As far as office consumables, I would develop a "core list" of supplies and assign one person as the central point for all ordering. Begin by conducting an inventory of all supplies on hand and only order as needed. Office Depot, for example, set-up a website for us with our "core" items on it. They are, for the most part, heavily-discounted branded items and they are the only ones that my assistant can order under her login account. For specialty items, I can log into my account and authorize her to purchase by either item # or dollar figure above and beyond any pre-set spending limits I have assigned. It's a pretty neat set-up. Contact a rep at Office Depot and they can set you up at no cost.

I hope some of these ideas help.

Gene

Don D

Our entire corporation worldwide has a stringent "Waste/Cost Reduction Program" in place with monthly, quarterly and annual goals per facility. Dollar goals are set annually and are distributed to unites, departments and individuals. Performance evaluations include this piece. We even cost out the amount of money saved by reduction of physical footsteps in mfg processes. Examples of things in my department are: reduction in subscribtions, elimination of company gifting program, bidding out janitorial and landscape periodically, changing vendors for golf shirts, cease newspaper subscriptions, trash half of the HR publications we were getting and reduction of 'gifts to employees' amounts. Last year, this facility had a 1.2 million dollar cost reduction. When this mindset becomes part of the culture and everybody is on board with the thought process, it works and gives us more dollars for quarterly profit sharing distribution. We have six named teams, scoreboards, gifts, different colored shirts, lots of healthy competition. It really works. In the month of July alone, I managed to save $2300 annually by elimination or cutting the things I mentioned above just in HR.

Pork

KATHYA: In HR the greatest cost savings you can have is in the reduction of medical benefits plan. If your company is not already self insured for medical and W/C insurances, you should be looking there. I agree that cutting back on the subscriptions HR has or needs is also critical. Every body has a newsletter on every aspect and if you are not careful one could end up on everyone's list. I sorted through all that were coming in and chose one for payroll, one for OSHA (because I also have the safety tail wagging this puppy), one for personnel law, and one for compensation. The rest continue to send but I never choose to send back and I don't also pay.

Hope this helps you.

PORK

HRQ

Labor. Labor. Labor. Labor. Labor. Labor. Did I say LABOR? x:D

There is always room to trim.

Closely supervise employees toward the end of their shifts. Send employees home early when they aren't busy.

Make sure employees get a lunch break at every possible opportunity. Often, employees who are not closely supervised will work through lunch, claiming they didn't have time to go. It just takes a supervisor pushing them out the door, most of time. They often just want to earn extra $$$ by not taking a meal break. I've also met many lazy supervisors who let their employees skip a meal break because the supervisor just doesn't want to cover for them.

Schedule a 40 hour/week position for 37. Somehow the job still gets done, and potential for overtime is reduced if they happen to "get stuck" late a few times.

I like the team idea from another post. Get a copy of your year-to-date G/L and assign sections. Have each team review every vendor that's been paid during that time. Managers who review their own expenses can get pretty protective of what they spend, but when they review another department's expenses, they see lots of room to cut the fat.

marc

Everyone has made great suggestions. You should review your own expense statement and rank the categories from largest to smallest and then get out your magnifying glass and start looking at what goes into each category. Start with the largest because that is usually where your time investment will have the best pay-off. Know your total dollar target before you start and overshoot it a bit. The savings you identify will usually not be as large as you imagine when the dollars are actually spent. And everyone has their little 'pet' expenditures that are difficult to cut even tho no one else understands their importance. Sharpen that pencil!