Cutting on cost is one of the main jobs for any construction manager. Some unnecessary expenses that can deprive a construction company of its profit should be avoided at all cost. Construction review online has studied some of these uncalled for expenses and now presents them in no particular order.
1 Money-losing product lines.
As a manager you should keep in tab and know which products you need and which ones you don’t. Once you know which products are losing money, you need to figure out how to cut those product lines and how much cash you’ll conserve by doing so.
2 Offsite customer conferences.
You’ll face an outraged sales force when you suggest cutting the offsite customer conference in an expensive hotel. Perhaps you can suggest that holding that meeting with customers at a local Inn would be a better investment.And it might just ensure that the company survives until it can afford to go back to an expensive conference facility in the future.
3 Free food.
If you give your employees free meals — an expensive perk that seems quite popular in Silicon Valley — you ought to calculate how much it would cost to shut that down and how much cash you could save if you made employees bring their own food — or buy it at cost.
4 High executive salaries.
If you do all these things and you still don’t add at least six months of breathing room before you run out of cash, it is time to look at yourself and your executive team for cost savings.
That’s right, you are going to need to take a cut in salary and bonus. And if you can get your executive team to do that and it’s still not enough, you may need to ask your employees to follow suit.
5 People who don’t fit your culture.
Most companies make some bad hiring decisions. If your company has a strong culture, odds are good that the people who don’t fit are sucking up the time of the people who do.
Perhaps you’ve been delaying the process of managing the misfits out of the company. A cash crunch is the perfect opportunity to put that on your immediate to-do list.