Cost Transformation in 2012

It is no secret that the majority of newspapers are losing money across the Western world. Traditional print media is suffering from digital competition and remains unsure how to take advantage of the opportunities brought about by websites and smart devices.

Offshoring first became common practice in the early 1990s and has seen its popularity increase over the past 20 years. However, despite the substantial benefits offshoring can provide, there is evidence to suggest many businesses are not effectively managing the process. Numerous Benefits but Limited Satisfaction In theory, outsourcing should yield significant returns for companies.

As profit margins tighten and businesses continue to search for ways to increase cash flow, reducing stockholding is an increasingly attractive option for companies. One of the main issues raised by this strategy is the lack of flexibility it affords businesses faced with high, seasonal demand for products.

As profit margins tighten and businesses continue to search for ways to increase cash flow, reducing stockholding is an increasingly attractive option for companies. One of the main issues raised by this strategy is the lack of flexibility it affords businesses faced with high, seasonal demand for products.

With procurement functions under increasing pressure to deliver quick win savings, long term projects such as Supplier Relationship Management (SRM) are often put to one side. In addition, there is a divide in opinion regarding the involvement of buyers in SRM; in some business the functions are kept separate whereas in others SRM is part and parcel of the procurement process.

With benefits including improvements in the engineering stores area, coupled with supply chain consolidation, outsourcing engineering stores currently represents best industry practice. An increasing number of British manufacturers are moving towards a business model which encompasses fully outsourced engineering stores. This approach allows the manufacturer to engage with a single supplier for its requirement of engineering spares.

As 2012 comes to an end, 4C Associates looks back at some of the predictions made earlier this year. Edward Ainsworth considers predictions four and five: "There will be more of a focus on the link between cost reduction and shareholder value," and "Significant savings will come from broader company-wide cost reduction programmes."

Despite having had 10 months to plan for the festive spending spree, many retailers are not taking full advantage of their shopping outlets.