Want to improve profits?

Beat competition ?


TRY
COST REDUCTION STRATEGIES
FOR  TURN AROUND

COST REDUCTION IDEAS THAT  WOULD  BOOST  PROFITS, CUT
LOSSES AND IMPROVE  PRODUCTIVITY FOR  MANUFACTURING UNIT ,
BIG ,MEDIUM AND SMALL BUSINESSES  .EASY TO UNDERSTAND AND
IMPLEMENT.EACH IDEA HAS POTENTIAL OF SAVINGS UP TO 20-30%.


What is cost reduction


It is broad  program where everyone is focused on reducing cost from
each areas of manufacturing activity.Cost reduction can be achieved
through reduction , elimination , modification , substitution or innovation .
All cost drivers are taken into account and with thorough analysis the
best and least cost path is adopted for each activity.The best method to
achieve results are to bench mark operating parameters to world class
companies .This drives  every One to match or even surpass these
figures.


The major parameters for any manufacturing unit

  • cost per unit ($/unit)

  • man-hours/unit

  • units produced/unit time

  • break down time (%)

  • change over time ( min/hrs )

  • waste (%)

  • defectives (%)

  • fuel consumption (k therms/unit)

  • electricity consumption (kwh/unit)

  • water consumption ( kltrs /unit )

  • inventory turnover ( %)

  • lead time (min/hrs / days)


Why cost reduction


  • profits

  • waste reduction

  • increase productivity

  • competition

  • resource conservation

  • image enhancement


Where to implement cost reduction

Areas for cost reduction are

  • raw material procurement

  • logistics - inbound and outbound

  • production ( process ,time and work study,maintenance ,
    automation)

  • energy

  • human resource ( out sourcing )

  • sales & marketing

  • finance


How ?

In today’s  competitive world Corporates and businesses are struggling
to maintain profits and  healthy bottom lines .Cost of  production ,fuel,
raw material and human resources is rising each year . These
developments has prompted people to  look for  Cost reduction Ideas
&method s.  Those who have opted for focused cost reduction  
strategies have survived those who could not managed have perished . In
my 15 years of existence in manufacturing industry I have seen  the
impact  of cost on people/companies where some have been forced to
shut operations  or  have no options but to cut  salaries or the worst lay
off people.

Check links to following areas

PROCUREMENT , OUT SOURCING , ENERGY , AUTOMATION ,
PRODUCTION , PACKAGING  AND
WASTE REDUCTION-----MORE

""SAVE  RESOURCES  FOR  BETTER  PROFIT""

Please write to below mentioned  email address for your  ideas,
suggestion  or any other comments related to the web site .

subodh@shumaonline.com
F-73,KRISHIAPPTS,APMC,PL-4,SEC-13,ROHINI,
NEWDELHI-110085
Cost Reduction Strategies             
                              
Cost reduction strategies                                     
      

Cost  Reduction  Lesson

PROCUREMENT :The companies which have  greater geographical  presence or
are multinational can  achieve better price by buying bigger volumes  instead of buying for
individual units. Central buying policies are recommended for such unit .

Bulk buying results in  annual contracts for a period of  twelve months for entire year
requirement with prices being finalised  for the entire period .


Most of the commodities  and raw material  has seasonal  cycle  of prices  as they peak
and fall in intervals .Hence we can book maximum amount of our requirement  when prices
are low .



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