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SMEs will encounter bottlenecks in a certain period of time. Operating costs have been rising, but it is difficult to find where the costs lie. We call this an “implicit form”. This article summarizes the existence of various “hidden costs” of the company, which can be compared to self-test.
Business operations are nothing more than a race against time. The conference is a collective activity for companies to solve problems and issue directives, but it is also a high-cost business activity. Many corporate executives do not have the skills to hold meetings. They all have six phenomena: no preparations before the meeting, no topics at the meeting, no implementation after the meeting, no need for attendance, no time for control, and speechless. Precision CNC Parts China | Get Custom Prototypes in Days.
2. Purchase cost
Once there was a company, when it was doing a new project, the daily operating cost of the project team was 80,000 yuan. However, on the eve of product launch, the procurement department spent a week in order to purchase more than 100,000 yuan worth of packaging. The reason was Find low-cost suppliers to save on procurement costs. The entire marketing team therefore waited more than a week to sign the contract with the customer.
3. Communication costs
In most companies, you will find that in the process of communication between colleagues, there will be serious distortions, or words inadvertently, or unanswered questions, or hundreds of people… This phenomenon, said that small, so that many processes Become an invalid process or lose a lot of important opportunities. If you say something big, it may cause hidden trouble for the company. This is a typical cost increase due to poor communication. Precision CNC Parts China | Get Custom Prototypes in Days.
4. Overtime cost
Many employers always think that it is a professional phenomenon that employees “overtime work” after work. As everyone knows, this may imply a very high cost.
The reason for overtime is not necessarily because the task is too heavy. It may be caused by the inefficiency of employees. If the objective task is really heavy, then the company should replenish new personnel and positions in time to be truly development and progress.
Working overtime consumes more staff energy and physical strength, seriously overdrafts the health of employees. In the long run, some important employees will not be able to exert their effectiveness for a long time, and there will be hidden dangers for the company. For example, some mechanical operators will work overtime because of overtime. It leads to mental disorders and accidents, and companies have to pay a heavy price for this.
5. Talent flow costs
The loss of employees, especially older employees, will undoubtedly bring the company several times more than its income. After many small businesses have been in business for many years, you have discovered that they have always been such a small team. Apart from the boss, no one employee has left the company since its inception. This may be an important reason why it cannot develop. Precision CNC Parts China | Get Custom Prototypes in Days.
6. Post misplaced costs
In human resources management there is a famous saying “put the right people in the right place.” Unfortunately, there are not many companies that can really do this.
7. Process costs
There are too many chaos in the enterprise because of processes. This is a common problem in enterprise management. The process of slow-moving enterprises must be confusing or unreasonable. They have to bear high costs for this, but they have always turned a blind eye. Precision CNC Parts China | Get Custom Prototypes in Days.
8. Sluggish resource costs
Stagnant resources can be said to be the most widespread “implicit” in the enterprise, such as idle equipment, backlogs of inventory, low-utilization job occupations, idle funds, and shelved businesses. Although they will not necessarily continue to consume the input of enterprises, they are part of the assets of enterprises and companies will bear the implicit cost of interest.
9. Corporate Culture Cost
Saying that corporate culture can become a cost, perhaps many people disagree, but it is. We will find that the employees of some enterprises are apathetic and extremely inefficient in doing things. No matter how excellent the employees are, as long as they enter, they will soon leave or they will become so. We cannot but say that this is an “environmental” issue. And this “environment” is exactly the corporate culture of this company. Precision CNC Parts China | Get Custom Prototypes in Days.
10. Credit costs
We have found that many companies are accustomed to default on payment from suppliers, are accustomed to defaulting on employee salaries, are accustomed to deducting others, are accustomed to defaulting on bank loans, and so on, and believe that this can reduce the pressure on corporate liquidity. However, in the long run, this will become a serious hidden form of business operations.
11. Risk costs
It is every entrepreneur’s dream to push the company to the fast lane. However, the risk factor also increases simultaneously. In particular, large and medium-sized enterprises, although they have developed rapidly and are rich in income, they will be catastrophic in the event of a crisis. Precision CNC Parts China | Get Custom Prototypes in Days.
12. Entrepreneurial costs
There is a good sentence, one bear and one bear. Entrepreneurs are like the heads of an army. They themselves are the employees who pay the highest costs. The bosses of many private enterprises have turned themselves into the “emperors” of the company. All of them have the final say, and all employees have become executive machines. However, the lack of entrepreneurial personal factors will add a heavy cost burden to the company.
It can be seen from the above that companies often bear many burdens in their operations and management. The discovery and effective reduction of these hidden costs may be a powerful measure for the progress of the company. Precision CNC Parts China | Get Custom Prototypes in Days.