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In
this issue:
This Month's Key
Questions
Telecoms
- Are You Paying Too Much?
Testimonial
Tip of the
Month
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Welcome to the third issue
of our newsletter
Whilst a business succeeds
in increasing revenue the impact of rising operating costs can mean that
net profits are flat.
A successful organization
will focus on business development,
customer service and
delivering quality products/services – and this is
how it should be.
However, have you ever heard
the following:
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‘We
have the skills to keep tight control on our costs and have an idea
of where savings can be made – it is just that we are too busy to
undertake a detailed
analysis.’ |
With the help of
Total Purchasing Solutions
overheads can be treated as
an
opportunity to contribute to bottom line profitability.
Total
Purchasing Solutions - Putting the Cash Back into your business with
average savings
achieved of over 22%
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TESTIMONIAL
We have
been able to make savings of over 20% in four areas - landline and
mobile telephones, office supplies and photocopiers - of our
overhead expenditure. In addition, we are very impressed by
your smooth management of the transition to our new suppliers.
This has meant that my staff are not distracted from their day to
day duties and responsibilities.
Ada
Madukoh
Executive
Director
ProDiverse
UK Ltd
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KEY
QUESTIONS
Is your business more loyal
to its suppliers than your suppliers are to your
business?
e.g. Maybe the annual price
increase should be an across the board price decrease. Have you
asked the question?
MONTHLY
TIP
According to a report in the
McKinsey & Co. Quarterly a 10% reduction in Overhead Costs can
increase shareholder return by 11%.
And this is just an
average.
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Telecoms
- Are You Paying Too Much?
This may seem a bit
'old-hat', yet landline telecoms costs can be cut by as much as 35% -
this is even where a Least Cost Routing company is already being
used.
The
main areas to look at are:
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1. |
Calls
to Mobile – These cannot be
avoided and often accounts for over 70% of monthly call spend.
However, rates are falling - in September 2004 there was an OFCOM
imposed tariff reduction and there will be more in the future.
Further, intense competition is causing telecoms providers to
slash their margins. |
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2. |
Minimum
Call Charges and Rounding -
Take an example where the headline rate for a local call is 1.5p per
minute. Now with a 1p minimum call charge a 20 second call
will cost 1p or double the advertised rate. If calls are
rounded up to the nearest minute the cost will be 300% more than
expected. In addition, 25% of business calls are below 30
seconds. What impact are these two areas having having on your
telephone bill? |
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3. |
Line
Rental – Line rental can now
be reduced with access to BT Wholesale
rates. |
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4. |
Contracts – Signing a contract
for 1-5 years is excellent for the telecoms company
as reductions do not have to be passed on
and customers cannot benefit from moving to a lower cost
provider. Also, if a 3-month notice period is include in the
small print, who at your organisation will send the letter to
exercise this option? |
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Total Purchasing
Solutions are working with a number of telecoms
service providers to
ensure billing accuracy. Before any recommendations are made a
detailed analysis of the calls profile is conducted to ensure only
appropriate options are looked at.
To discuss how you can
implement a ‘Cost Reduction’ program call
David Davis
on 0800 652
2642 |
Total
Purchasing Solutions -
Saving
time and money for your business |
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