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When was the last time you reviewed your expenditure?
Often when businesses look at reducing costs, attention is not always paid to third party overheads, such as marketing, property, logistics, food and catering and IT. Most businesses will have overhead expenditure across 30/40 different categories, many of which will be relatively modest values, but combined they will be material.
Being strategic in how you review your costs and continually looking at where savings can be made, will have a direct impact on your bottom line.
Savings made at Gerald Edelman
Auditel reviewed Gerald Edelman’s P&L and identified savings of between 10-40%. The following categories were where the most significant savings were made:
At Gerald Edelman, we used Auditel as we didn’t have the resources in-house to regularly review our goods, consumables and services.
To identify these savings, we provided Auditel with a copy of our P&L and a selection of invoices. Auditel then notified us of the areas that should be reviewed and provided an indication of the savings that could be made.
Using a procurement service
For businesses that do not have the resources internally to review their overheads, or do not have a strategy in place to regularly review their third-party suppliers, an outsourced procurement agency may be able to help. Read our article, Cost and procurement – the road to recovery, to find out more.
Typically, if you have £1million of overheads an average saving of just 10% would provide additional bottom line profits of £100k.