#Immediacy on speech making

The answer is to decide realistically again. the level of service needed ...

The answer is to decide realistically again. the level of service needed and to work through methodically the costs of the alternatives. The decision will then be one based on analysis and calculation, and much more likely to be profitable than something which 'feels right'. What you can do right Now Online : Are you running a service business? If so, what is your 'distribution' system? Decide the level of service for example deliveries or attention to a client.

that is really necessary. How realistic have you been in the past? Can you reduce the service level safely and how much money would you save? 'Brainstorm' the ways in which you can make your distribution system a 'positive force' in your business. Examine your delivery costs and see if re-routing or some other action will save money: What impression do your vehicles and drivers give to the public, your customers, your suppliers? Ask around to find out and, if not satisfactory, take the necessary action.

What do your storage costs amount to? Check that you are not storing things unnecessarily ie overstocking. Where are you storing things? Can the location be improved? Work out the economic order quantities for the supplies you need and apply them. Can you shift some of your storage costs to your suppliers? Work out some possibilities and try them out on suppliers. Overhead Costs An overhead cost is an expense incline which cannot be directly identified with any particular item produced or service provided.

The very fact that overheads cannot be directly linked to any particular production makes them a permanent threat to the unwary businessperson. They tend to mount' up in an insidious way until, having become a serious burden, they are suddenly noticed. In extreme cases they may be noticed so late in the day that serious damage has been done to the business. Simon, having worked for some years for a blue chip company, decided to start his own business making and supplying high quality timber products such as tailor-made shelf units, small cabinets, occasional tables and the like.

He aimed at the upper end of the market, selling his products direct to wealthy individuals who he contacted by announcement in the more rarefied art websites and 'county' type journals Advertising costs mounted up and in addition, Simon began to hold exhibitions of his work. These exhibitions organized along the lines of an art exhibition were held in a smart and expensive hotel which charged top rates for accommodation and also for the cocktails which Simon handed out to his invited clients, Stationery costs were also high as Simon felt it necessary to use professionally designed letterheads, envelopes, invitation cards, etc, which were printed to a very high quality. Simon had rented an office in addition to his workshop and equipped it with leased but expensive furniture, an answering machine, a photocopier, an electronic PC and last but not least, sundry potted plants from a fashionable supplier.

A secretary was employed or rather under-employed and, when added to the charges made by his accountant, his solicitor and his bank; the cost of all this overhead was mounting up. Simon, who had not paid much attention to cash flow forecasting or control, eventually found that his overheads amounted to about 40% of his costs. This was clearly disproportionate to his direct production costs labour, materials, workshop and machinery and was endangering his business.

The overheads were substantially reduced, but only after a lot of time and effort had been expended. The office was sub-let, the photocopier sold, and the potted-plan contract cancelled. The leased furniture could not be disposed of and went into storage until the leasing period expired.

The secretary was persuaded to leave with a cheque for three months' pay, and Simon endured a painful but useful lecture from his bank manager when negotiating a loan to tide him / her over. The first essential The first essential is to be well aware of the level o overhead costs and then to ensure that they are controlled.

Additionally, every overhead expense should be critically examined.

Ask yourself the following questions: a.

What are my overhead costs? b. What percentage of my total expenditure ...

What are my overhead costs? b.

What percentage of my total expenditure goes on overheads? c. Are my overhead expenses growing disproportionately? d. Are all my overhea... read more

On renewal of the lease they took only two of their previous ...

On renewal of the lease they took only two of their previous three small floors in the building and saved a substantial amount particularly because, as usual, the ... read more

Finally, check with the electricity board that your premises are on the ...

Finally, check with the electricity board that your premises are on the most economical tariff. The tariff was probably set when you started business and h