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Cost Reduction

Cost reduction may be defined as the achievement of real and permanent reduction in the unit cost of goods or services without impairing their suitability for the use intended or diminution in the quality of the product.

Cost reduction, should not be confused with cost saving and cost control. Cost saving could be a temporary affair and may be at the cost of quality.

Linked closely to your overall procurement strategy Cost Reduction implies the retention of essential characteristics and quality of the product or service and it must be confined to permanent and genuine savings in the costs of manufacture, administration, distribution and selling, brought about by elimination of waste. 

Using forensic analysis techniques we will:-

 

  • Understand your spend  - Understanding your spend starts with Spend Analysis in the form of ‘who spends what, where and when’. The following linked webinar discusses the added value of Spend Analysis and how this forms the basis for your ongoing procurement and spend management programme
  • Identify the value destroyers within your company and areas of waste 
  • Then agree with you an optimum supplier and sourcing strategy relative to your overall procurement strategy 
  • Undertake an effective cost reduction programme
 

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