Brief Solution for Cost Control

 

 

» Applicable Scope

 

The Solution is recommended for enterprises’ control of risks caused by sharp increasing operational cost. It proposes corresponding countermeasures on the basis of systemic analysis of the causes for operational cost increase, to help enterprises control cost and reduce risks effectively.

 

Note: This Solution is not suitable for HR cost control. For HR cost control, please refer to Brief Solution for Risk Management of Post-Employment, Brief Solution for Risk Management of Professional Managers’ Job-hopping, or other risk management reports and academic articles under the column of Management Communication.

 

 

» Frequently Asked Questions

 

“Recently our company’s sales rise dramatically, while there is no obvious increase in the total profit amount with the same price. Is there any potential risks behind this phenomenon and how to control the risk?”

 

"For this half a year, our company’s expense for purchasing office gifts and supplies had increased significantly,and some suppliers have also been changing. How to identity the reason and change the situation of sharp increase of cost?”

 

 

» Brief Solution (Sample)

 

Enterprise operational cost soaring in certain period foretells the potential risk in cost management or personnel management. Following measures are recommended for effective detecting and controlling cost risk.

 

1. Keep original material purchasing and suppliers in record and investigate the marketing of materials to identify if there’s any unreasonable purchasing or not.

 

2. Check the background of purchase staff and keep in record, toidentify if there is any intimate relationship between the purchase staff and suppliers.

 

3. Contact suppliers to find out if the purchase staff had any behavior against the company’s regulations.

 

4. Examine the production and logistics process to find out if there is any behaviors leading to material waste or logistics cost increase.

 

5. Keep marketing promotion activities in record to find out if there is any inappropriate marketing behavior.

 

6. Comprehensively analyze the above information and make sure if there is any risks in cost control and personnel management, then nail down the corresponding countermeasures.

 

7. Seek a professional institutes as a third party for effective risk management proposals and solutions.

 

 

Links

» Risk Management Research Report on Cost in Logistics

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» Risk management Research Report on Cost in Other

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