Cost-Cutting

How can you achieve cost savings while retaining your workforce? The only way forward is to scrutinize every single expense: phone bills, electricity, and so on. Newzy has set out to hunt down waste; here are some of our top tips and best practices.

This summer, Opinion Research conducted a study for IBM focusing on companies with 100 to 1,000 employees, surveying nearly 1,900 businesses across 17 countries. When asked about their primary strategic focus, 53% reported concentrating on cost reduction and productivity gains, while 47% are adopting innovation-driven policies to identify new growth opportunities. In France, all 175 surveyed companies identified cost reduction as a top priority.

It is therefore essential to scrutinize even the smallest company expenses to streamline operations and achieve savings—small gains that can ultimately reach up to 30% of revenue, or even more depending on the cost centers! Be careful, however, not to rely solely on an attractive price tag: plan your purchases ahead of time! Indeed, a printer with an extremely low upfront cost can become incredibly expensive if its ink cartridges are overpriced and have a short lifespan. The same applies to a photocopier: it can prove to be costly if it breaks down quickly and its after-sales service is not covered by the contract.

At the same time, adopting eco-friendly habits is essential: turning off lights when leaving a room, using energy-efficient light bulbs, minimizing paper usage, placing orders online, and opting for digital payment cards to reduce physical transactions…

LEVERAGING PROCUREMENT

« Purchasing accounts for anywhere from half to three-quarters of a company’s total costs! , asserts Abbad Hicham, Sales Director at KLB Group, a procurement and supply chain consulting firm. As a true driver of profitability, procurement must be streamlined.*They are rarely centralized: for instance, if an individual needs a computer or office supplies, they place their order directly. Another common scenario involves a procurement department working with local suppliers, or even placing small orders with multiple vendors. However, it is essential to consolidate and group these purchases to ensure the best possible negotiation leverage.* , explains Ricardo Wille, Head of France Operations at Synertrade. The principle is to optimize consumption based on actual needs while ensuring excellent value for money. For Christophe Fillon, Procurement Director at Lowendal Masaï, *Regarding indirect procurement, action must be taken across three primary levers. First, buying the same items for less—meaning negotiating the same product or service at a more advantageous price. The second lever is technical in nature. It involves analyzing the company’s specific needs and, based on that, redefining contracts, particularly in the telecommunications and insurance sectors where pricing and services evolve very rapidly. In the case of office supplies, this also means occasionally reassessing approved vendor catalogs. Finally, the third point: process organization. For example, buying less or restricting overall consumption.*  » From the outset, the company can achieve savings of around 15 to 20%, or even as much as 40%! Mathieu Pettex, President of Factea Group, specifies, ” above all, companies must learn to consume more efficiently. » To assist them in this endeavor, Factea’s sustainable development division publishes a responsible purchasing manual tailored to their needs, covering more than 200 product categories. This booklet can be accessed online or is available upon request. For each category and product, it details the necessary sustainable development investments, supported by various scenarios demonstrating the potential cost savings for the company. This manual enables companies to independently integrate sustainability into their procurement policies. Alongside this guidance, traditional levers such as cash or early payments remain effective; although marginal, they provide significant negotiating power. Year-end rebates are also a key strategy. However, this only works if the supplier does not simply bake those discounts into their prices the following year! This further underscores the importance of reviewing contracts annually. Finally, as Mathieu Pettex rightly points out, it is essential not to lose sight of ” *what you buy is also what you sell: companies must make themselves attractive to suppliers to ensure competitive pricing!* »