It is not uncommon for businesses to find areas for savings. This may mean retrenchment or downsizing the organisation to fit the fiscal objective. However, there are other ways to save money without eliminating jobs.
Expanding or outsourcing to the appropriate locations can achieve maximum efficiency and cost reduction. The appropriate locations are recognised as growing economies, and ones that provide opportunities for lower production and labour costs. And currently, Brazil, Russia, India, and China are the ideal locations for such expansion.
Dubbed as BRIC, a term that first appeared on a Goldman Sachs (a multinational investment banking firm) report in 2003, Brazil, Russia, India, and China are becoming the go-to countries for sourcing out goods and services, as well as affordable raw materials. The four economies are even projected to boost wealth by 2050. By investing in any one of these countries, your business could implement one effective supply chain strategy, which should always be aligned with your company’s goals.
With lower production costs, including labour, you’ll not only have funding for other crucial aspects of your business but you’ll also be able to pass on the savings to your consumers, which is always greatly appreciated by any market. Of course, this business strategy will need detailed planning and, more importantly, precise execution so your company doesn’t lose out on opportunities and waste strategies.
Since you will be venturing outside of your location, be it to Brazil or India, you will want some expert guidance in managing the plans and seeing implementation.
A supply chain assessment must be carried out, for starters, so that you’re able to determine where your business’s strengths and weaknesses lie, and which areas require improvements. This assessment will give your business greater insight as to which new economies will provide you with better opportunities.
For instance, labour may be cheap in China but the goods you market or the services you require may be better produced by Brazil.
By investing in the right locations for the manufacture of your goods or the application of your services, your business will have more capital to improve operations with new technology and innovative solutions. The use of modern technology is especially important where delivery of goods and services are concerned, as your competitors are more than likely to be using the latest systems to ensure speed and accuracy of deliveries.
Meanwhile, innovative solutions used on distribution networks, making deliveries or returns more convenient, can boost customer service, which in turn develops customer loyalty.
It may not always be easy to reduce costs while still maintaining the quality of your goods and services, but it can be done. It can be done by knowing where to invest your capital and by seeking expert guidance to ensure you achieve your business goals.