Cost Management Consulting
Efficient cost management is an integral feature of any small business success story
“Competition is the keen cutting edge of business, always shaving away at costs” Henry Ford
Cost management is different from cost reduction. The word "management" implies using available resources
efficiently and effectively to accomplish desired goals and objectives. When costs are managed, they are restrained
from growing larger than they should.
The process of cost reduction, on the other hand, concerns reducing expenses that are too high. Cost
Management is a very different concept from cost reduction.
In terms of business practices, cost management is a much better plan of action. It indicates
that your small business costs have not been allowed to grow past a reasonable level than what they are
intended to accomplish. There could probably be a lot of debate over which is easier, managing or reducing
expenses, but managing your small business costs is always part of a truly successful business.
Cost management is a strategic approach. Cost reduction is a reaction to a problem. To manage
costs means small business owners are staying on top of operations and attempting to create the maximum
profit margin. Small businesses that must implement a cost reduction plan are solving a problem that might possibly
have been avoided if they had a cost management plan in the first place
Every small business will at some point have to reduce it's business costs. Cutting costs in a running
small business can be difficult and it is much easier to keep control of the costs up front. But when times are
good, and sales are growing, the focus of small business owners often is on managing the revenue side of
the profit and loss. While revenue is being managed, "waste" is developing in the expenses.
Proxim Group's cost management consulting program follows the principle that you need to understand
how to manage costs before you can implement an effective cost reduction program and begin to maintain costs at the
competitive level they should be for your small business growth.
We do this by:
Assessing your small business' financial health
Developing an understanding of what currently drives each business cost
Determining whether any costs can be quickly reduced without damaging the business
Determining benchmarks for different types of costs
Putting together an action plan to achieve cost reductions and maintain ongoing efficient and
competitive costs for your small business
If your business profitability is low and cost reductions or implementation of cost management is not going to
achieve the desired results within a short time frame, we will tell you that it may be more effective to focus
primarily on Sales Improvement in
the first instance.
For true small business success a focus on sales and costs is required, but trying to target both at
once can often be an overwhelming challenge, so we look at which are you can gain the most from.
Think learning how to manage your costs is a good thing?
Why not call us on 1300 406 069 to find out how our small business cost
management consulting program can help you gain control of your expenditure, or simply use our