5 Easy Ways To Impact The Bottom Line One of today's headlines and story in the Wall Street Journal read...
Stocks Sink Into Correction
As Credit Fears Take Toll
By E.S. BROWNING and ROBIN SIDEL
November 27, 2007; Page A1
"Fears of a credit squeeze and economic downturn pushed the Dow Jones Industrial Average into a full correction, as yesterday's 1.83% decline sent it 10% below its October peak. Prices of U.S. Treasury bonds soared as investors fled to their relative safety.
The Dow's correction amounted to an acknowledgment by investors that a period in which banks "were virtually giving away money," in the words of one trader, is over. Banks are suddenly retreating, and consumers who had been loose with their spending are counting their pennies more carefully. That has led to gathering gloom about the prospects of the world's leading economy, amid early signs of trouble overseas."
So what are you doing to count your pennies more carefully? Here are five suggestions.
1. Look at all the vendors and outsourced work that you have done. Revisit all those contracts to really see if you need everything that you are outsourcing. Ask yourself "Can we do this internally instead?". This can make an impact in two ways, first if you cancel a contract you save the money you would be normally spending for that work. Second it may give an opportunity to one of your current employees to grow their career by taking on new responsibilities. The bonus is the second options builds "buy in" and teamwork and who doesn't find that profitable.
2. Call all your vendors and ask them for a better rate. Most vendors are willing to give you a discount rather than loose your business all together. The worst that can happen is they say no but you will never know unless you ask so don't be shy.
3. Revisit you own pricing strategy for opportunities. Look at all the pricing you sell your goods and services to others for. Have you given more of a discount than you probably should have? Or maybe you offered a special price based on consumption and that company is not consuming what they said they would.
4. Cut out the fringe benefits. Whether its golf outing or weekly lunches really take a look at what gives you the most bang for your buck. This one is usually hard to do because there is not always a clear return on investment so be objective.
5. Revisit labor models. This will probably make the biggest impact on your bottom line. Your labor costs are one of your biggest expenses and making a couple of minor adjustments will make a big difference. Think about attrition. Don't just automatically go into hiring mode everytime you have a position open. Again this may give an opportunity for one of your current employees to grow their career by taking on new responsibilities.