From the course: Cost Reduction Tips - How To Cut Costs And Maximize Profits

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A lack of investment can be costly

A lack of investment can be costly

From the course: Cost Reduction Tips - How To Cut Costs And Maximize Profits

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A lack of investment can be costly

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- When you're thinking about cost reduction, one of the questions is, do we reduce the amount of investment in certain areas? And I think it's really dangerous to cut your investment. But of course if you can be scientific, if you can work out whether it's worth it or not, then that's the best way. So I'd be very careful about under-investing in people, for a start. You don't want to have cheap people and not train them. You're never going to win the battle with your competitors if you do that. But also not investing properly in machinery or even buildings, I think there's a lot of hidden cost in having buildings that are not efficient. And we've already talked about stock and work in progress. One of my customers for example, they are not very good at paying their bills. They're always having cash flow problems and so they get put on stop by some of their suppliers so they're always short of work in progress and they quite often end up moving stuff around from one place to another…

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