Scientific And Effective Control Of Costs

< p > < strong > 1. The cost control is to spend the money properly. < /strong > /p >

< p > < a > href= > //www.sjfzxm.com/news/index_c.asp > McKinsey > /a has evaluated Chinese Enterprises: "the giant of cost advantage is the dwarf of cost management".

Actually, cost control is an art of spending money instead of saving art.

How to spend every penny just right and use every resource of the enterprise to where it is most needed is a difficult problem faced by Chinese enterprises in the new business era.

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< p > traditional < a href= "//www.sjfzxm.com/news/index_c.asp" > cost management < /a > is based on whether enterprises save or not, and unilaterally starts with reducing costs and even trying to avoid certain expenses, emphasizing saving and saving.

However, the international companies believe that the enterprises that control the basic idea of cost saving are only local enterprises. They have nothing to do with exploiting workers and reducing raw materials.

Therefore, we need to learn the cost control strategies and methods that modern enterprises should have.

If enterprises want long-term benefits, they can only carry out cost control from a strategic perspective.

In other words, it is not to cut costs, but to increase productivity, shorten production cycles, increase output and ensure product quality.

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< p > simply cut costs and reduce costs as the sole goal can not be approved by visionary entrepreneurs.

In simple pursuit of cost reduction, generally simple measures will consider lowering the purchase price or grade of raw materials, or reducing material input (stealing material) of a single product, or considering reducing the labor cost of the process, so as to achieve the purpose of cost reduction.

This is very dangerous, it will lead to a decline in product quality, the loss of labor resources, and even loss of the market already owned.

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< p > < strong > two, < a href= > //www.sjfzxm.com/news/index_c.asp > cost control > /a > establishment of scientific mechanism < /strong > /p >

< p > to achieve reasonable control of costs, how do we do it? Let's see how multinational enterprises establish cost control system: < /p >

< p > first step: strategic target guide cost control target < /p >

< p > the right direction is half the success and the cost control is the same.

The purpose of cost control is to continuously reduce costs and gain greater profits.

Therefore, when making the target cost, we must first consider the profit target of the enterprise, and also consider the competitive selling price.

Because the cost is formed in the whole process of production, the cost takes place in every link, everything and activity. Therefore, the target cost should be decomposed to all departments and even individuals.

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< p > 1. enterprise project analysis < /p >

< p > each department aims to carry out annual work with marketing goal orientation, lists all kinds of projects needed to achieve the goal, decomposes the tasks at the same time, analyzes the links of time, cost and performance, and compares costs and benefits.

For example, how many marketing and promotional projects need to be completed in the market department next year to achieve the established goals, and after each item is decomposed into tasks, the cost of each task will be reasonably budgeted and the revenue generated will be estimated.

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< p > 2. carries on the industry value chain analysis < /p >

< p > industry value chain: enterprises exist in a certain value chain of a certain industry, including the connection point with upstream, downstream and channel enterprises, such as the packaging of supplier products can reduce the pportation costs of enterprises, and the vertical link of improving value can also reduce the cost and enhance the overall competitive advantage of enterprises and upstream, downstream and channel enterprises.

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< p > 3. competitor's < a href= "//www.sjfzxm.com/news/index_c.asp > > value chain < /a > analysis < /p >

< p > the value chain and the value chain of our competitors are in the parallel position in the industry value chain. By analyzing the value chain of competitors, we can calculate the cost of competitors.

Then, compared with their own enterprises, they find out the difference between their competitors and their activities, and foster strengths and circumvent weaknesses and strive for cost advantages.

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< p > second steps: cost control four step execution method < /p >

< p > 1. reduce project and task with unclear objectives < /p >

< p > in the case of clear business objectives, each project and task is to achieve the goal of service.

After the project is analyzed, the items and tasks that are not clear are cut off.

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< p > 2., define the cost tasks of various departments < /p >

< p > implement the method of "total staff cost management".

The specific way is to calculate the ceiling of the cost first.

Then the horizontal decomposition is carried out to all departments, vertically decomposed into groups and individuals, and linked to rewards and punishments, so that responsibilities, rights and interests are unified. Finally, a target cost management system is formed across the whole enterprise.

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< p > 3. cost accounting, meticulous management < /p >

< p > no standard is quantified in terms of numbers, so there is no mention of thrift and control.

Accompanying the cost control plan is a list of figures, including controllable costs (personnel, water and electricity, packaging, consumables, etc.) and uncontrollable costs (depreciation of fixed assets, raw materials procurement, interest, sales costs, etc.).

Every month, every quarter is sent to the manager by the financial summary. The overspending and abnormal data are marked in red.

In the concluding meeting at the end of the month, relevant departments need to explain the overspending part.

In order for employees to develop cost awareness, it is best to establish the SOP manual for process and cost control.

The manual proposes methods of cost control from raw materials, electricity, water, printing supplies, labor insurance supplies, telephone, office supplies, equipment and other consumables.

Of course, effective incentives are also a good way to control costs, so cost control incentives also become part of staff salaries.

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< p > 4. "advance" and "extension" < /p > of cost management.

< p > "advance" is to increase technology investment and control procurement cost; "extension" is to integrate upstream and downstream.

Today's market competition is strength competition, talent competition, product and service quality competition, and cost competition.

In a sense, cost determines the competitiveness of an enterprise.

Under the premise of ensuring the quality of products, reducing costs is an important way for enterprises to gradually expand their market share and is the basis for improving the economic benefits of enterprises.

Enterprise managers should change the traditional narrow concept of cost, combine the actual situation of enterprises, and make full use of modern advanced cost control methods to enhance the competitiveness of enterprises and meet the challenges of all parties.

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