Business Cost Reduction Strategies

How To Reduce Business Costs And Sustainably Transform Your Business

How can you reduce business costs and transform your business? With the current economic climate, organizations must reduce unnecessary costs and strategically transform the way the business operates to remain afloat. 

The business cost reduction strategies of today are about being proactive and identifying opportunities to reduce business costs and transform the way your organization works.

Cost Saving Challenges

Many organizations find that cutting expenses leads to reduced productivity, causing them to lose customers and revenue. Choosing the right cost reduction strategies for your business is not easy and requires extensive planning and a solid understanding of your organization’s situation. We use our expertise to help you plan and implement sustainable cost saving strategies in the workplace without reducing headcount. 

The Poirier Group is one of the leading cost reduction consulting companies that provides organizations with the trusted insights, practical advice, and strategic guidance needed to reduce and manage business costs with confidence. Whether it’s reducing labor costs, a supply chain challenge, administrative struggles, or a plan to improve operational performance, we help organizations identify operational cost savings initiatives in the workplace that streamline processes and free up headcount in a sustainable way.

Growth-Focused Cost Savings Strategies

Initiating cost reduction strategies is about refocusing and improving existing resources and operational processes in order to maximize your spending. The Poirier Group implements forward-thinking procedures that will lower your operating and overhead costs in the short-term and allow your business to achieve sustainable growth in the long-term.

Many organizations think cutting expenses leads to reduced productivity, causing them to lose customers and revenue. That doesn’t have to be that case. Choosing the right cost reduction strategies is not easy and requires extensive planning and a solid understanding of your organization’s situation. We use our expertise to help you plan and implement sustainable cost reduction initiatives without reducing headcount. 

At The Poirier Group, we provide organizations with the trusted insights, practical advice, and strategic guidance needed to reduce costs and manage costs with confidence. Whether it’s a supply chain challenge, administrative struggles, or a plan to improve operational performance, we help organizations streamline work to free up the headcount in a sustainable way.

TPG’s Approach to Reducing Costs

We help organizations streamline work to free up headcount in a sustainable way. Our vision for this work is to leverage technology, processes and capabilities to create a lean and efficient business that can survive and thrive in any economic environment.

Assess the Risks Before it’s Too Late

By conducting a risk analysis that flags the severity of potential revenue shortfalls, a company can focus on identifying and building out new opportunities to cushion an unexpected shortfall such as:

  • Losing a major contract
  • Economic downturn
  • Increased product costs that can’t be passed on (labour shortages, machine breakdowns, increased freight costs, supply chain delays) 
  • Unexpected events (pandemic, influences of war)

Forward Planning for the Unexpected

Create a cost cutting plan before it is needed, to allow a proper assessment of the risk and value of each measure, who/what is impacted, and the lead time required.  Planning before a crisis allows stakeholders to buy in and support the measures when tough decisions need to be made quickly.  A sound Plan B, for immediate or short term cost cutting measures, provides the details necessary to make informed decisions on what to cut, and the lead time required to effect the savings.

Cut Unneccesary Costs

Look for big-ticket, low-impact items across the organization. What items can be postponed or avoided? 

Get in the habit of cutting unnecessary costs and avoiding unnecessary spending. Can multiple services be bundled? Can certain licences be downgraded? 

Before economic crises happen, be conscious of unnecessary spending across the organization on a continuous basis.  

Reinforce Company Values

The typical first step companies will take when faced with cash flow issues, is to lay people off.  The impact this has on morale, company reputation and the individuals who directly suffer can be more damaging than the immediate benefit of reducing the bottom line. Layoffs do not cut the amount of work that needs to be done – only the people who are available to do it. This makes the situation just as bad for the people who stay as the ones who leave, since their workload increases. 

Look to your company values, and what makes you a great company to work for.  In good times and bad, your values should always guide your decisions

Start Improving Your Cost Reduction Strategies Today

Direct and Indirect Cost Reduction Strategies

The Poirier Group helps to identify and improve both direct and indirect cost reduction strategies by employing Lean Six Sigma methodologies.

Direct Cost Savings:

Indirect Cost Savings:

Cost Savings Opportunities Across The Value Chain

Our high-impact business management consulting services help you transform your business and reduce costs across the value chain.

People Management and Human Resources Efficiencies

Our team at TPG knows how it can often feel like a balancing act between keeping your business’ doors open and supporting your hardworking employees. It’s also important to keep in mind that the whole world is living through an incredibly stressful time, so meeting your employees’ needs and ensuring their health and wellness are all the more critical.

HR cost savings are achieved by streamlining workflows, reducing single points of failure, clarifying roles and responsibilities, performance measurement and management, focusing on values and culture through turbulent times, reskilling employees and cross training them to backfill for other roles.

Our HR cost savings consulting services are designed to give you practical employee cost reduction strategies and sustainable solutions that once implemented, will increase buy-in and reduce the need to increase headcount. 

Through working with our team to improve performance measurement & management, as well as training & development, our clients have been able to backfill for other roles and improve productivity whilst also improving morale. This has meant they’ve been able to measure the impact of their training in real time too!

Reducing Costs with Technology

TPG’s IT process improvement consultants will remove manual work, streamline workflows and reduce spending on unused IT software licenses. We will work with your IT teams to eliminate redundant processes and make space for innovation while automating manual tasks with technology to help you get more done, faster.

Technology can also be used to create transparency into critical processes across the business through Business Intelligence tools and data management tools. By increasing data transparency, leadership can make more accurate decisions, faster, with real-time data. 

Reduce Operational Costs

Our Operational Improvement Solutions are designed to help you create a more sustainable and productive business.

Operational cost reduction can be achieved through making operations more streamlined, and less complex and reducing variability in the business – making it more predictable; reducing duplication, errors, delay times and rework. Operational improvement methods such as Sustainable Productivity Improvement (SPI) and Sustainable Process Improvement (SPI) help achieve these goals by focusing on improving communication, visibility, discipline, accountability and commitment to processes. SPI also emphasizes teamwork and sharing knowledge throughout the organization.

Procurement Cost Reduction

Accurate, efficient and transparent procurement strategies can be put in place to maximize savings. These include refinancing, negotiating contracts and bundling. As well as supplier management – proper measurements and visibility – collaborative supply chain cycle time and cost reduction, consolidating vendors and deliveries will result in large savings at the bottom line.

Supply Chain and Logistics Savings

The business of supply chain and logistics is both complex and diverse, making it difficult to get the knowledge you need. Our team has put together a market-leading package of services and support to help you cut your costs, shorten lead times and increase inventory accuracy. 

We help our clients to improve the supply chain and logistics cost savings. We can optimize your transportation routes and freight management to avoid high fuel costs and high labour rates for truck drivers.

Our team of supply chain and transportation experts improve forecasting, inventory management (Shrink Reduction, Inventory Placement), and SKU rationalization. This reduces both out-of-stocks and inventory gluts by providing increased transparency. 

Embrace automation in the distribution centre to lower labour rates and increase the accuracy of inventory delivered to stores. It also enables increased tracking and performance measurement across the supply chain. 

Manufacturing and Warehouse Cost Reduction

With the right strategy, you can improve efficiency and decrease unnecessary expenses while improving product quality. Here are some manufacturing cost reduction measures that can help your company thrive:

  • Reduce the cost of production, storage and distribution 
    • Cut out surplus
    • Cut shipping costs by optimizing supply chain network design and managing fleet distribution. 
    • Reduce energy consumption including turning lights off and reducing machine downtime 
    • Optimize pick paths and slotting processes
    • Evaluate production processes
  • Avoid capital expenditure by increasing operating capacity. This will help avoid expanding new facilities or setting up new warehouses
  • Reduce the direct cost of materials by negotiating contracts with suppliers or fining new suppliers
  • Improve Safety Procedures 
    • Ensure safety process and audits are in order – reduces the need to hire more people to replace injured staff and will cut the cost of training
    • Ensure audit processes for facilities are in place

Marketing Cost Savings

Implementing the right marketing cost reduction strategies can help you to get a better return on your marketing investment. Implementing these strategies can have a big impact on your bottom line. 

The first step is to work out what processes need to be automated, and which are important, then use analytics to analyze where value is still being driven from marketing investments. Improve customer targeting by focusing on more niche target audiences for advertising to get the most bang for your buck. 

You can also reduce costs by optimizing your customer acquisition funnel, re-purposing older content, using free tools instead of subscription tools, and reviewing the software being used.

Cost Reduction Insights and Resources

Available Across Industries

A good rule of thumb to follow when looking to shed costs in the retail and grocery sectors is never to sacrifice product quality, which is likely why your customers chose you in the first place. However, maintaining product quality can be quite costly, so scouting out other costs to reduce is often the priority. 

Strategies such as focusing on client retention, auditing total expenses, reducing shipping costs, and automating business processes are all viable options among the many available for retail companies. Knowing which will work for your business is crucial, however, and that’s where TPG comes in. We’ll help identify which cost containment path will work best for your company and follow through with its execution. Let’s talk about how our consulting team can help you.

Reducing costs across your supply chain can seem like a never-ending process since many different options are available. Improving your staff’s communications and training, optimizing procurement strategies, implementing more efficient inventory and warehouse management systems, and utilizing TPG’s logistics will all likely enhance your supply chain’s ROI. 

The Poirier Group’s industry-leading consultants will find the cost-cutting measures that will return the most significant ROI for your organization’s supply chain. Contact us today to get started.

The health and Life Sciences industry is experiencing overcapacity amid the current pandemic. TPG is eager to implement efficient workflow management solutions, which many health and life sciences companies are in dire need of. Our performance improvement and Lean Six Sigma solutions will help create the time and money savings that many health sciences organizations need.

In a world where ‘too much money is chasing too few deals’, operational improvement stretches the field of value creation possibilities. Our operational analyses and improvements during and after M&A activity alleviates the tension between meeting price expectations while delivering satisfactory returns to investors.

A successful M&A should accomplish the desired financial and strategic objectives of mergers and acquisitions while minimizing employee stress, avoiding management crises, and accounting for all legalities and government regulations. TPG’s private equity consultants will help your company avoid these obstacles and the financial risks associated with them, as our guidance will help your business move through these corporate decisions with ease.

TPG Uses Lean Six Sigma to identify different forms of waste, inefficiencies and variation on your manufacturing floor to save valuable time and money. Our team is staffed with multiple Lean Six Sigma Black Belts who provide excellent advice, strategy, and solutions in direct and remote settings to create time and cost savings.

Our team of experienced engineers can build and implement custom software solutions to automate tedious processes within your business. Our cloud-based software can provide up-to-date data transparency into different areas of your business, allowing you to make real-time decisions. Leave the heavy lifting to us and enjoy the time and money savings a custom IT tool can bring. This is cost containment for the modern world.

Check Out Our Recent Successes

At TPG, while process improvement, strategy execution and performance optimization are core to what we do, we keep cost containment as a central benefit to many of our engagements, where our services almost always yield a positive ROI.

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