Business management costs: It's not difficult to optimize

Business management costs: It's not difficult to optimize

Optimizing business management costs is the process of trying to improve the cost ratio, maximize the business value and profit of the enterprise.

Cutting costs is an issue that any business focuses on to optimize business profits. So which solution helps to optimize business management costs? Perhaps this is the problem that always gives leaders a headache? Refer to the following article of Navigos Search to get the correct answer!

1. What are business management costs?

General and administrative expenses include all expenses related to production and operating activities of an enterprise, such as expenses for personnel, costs of renting premises, procurement of equipment and expenses for marketing, taxes,...

Currently, in business operations, there are many unexpected costs incurred, affecting business results and production.

Explore the definition of business management costs 

2. Why do enterprises need to determine the business management costs?

In order for the business to operate smoothly, managers must closely monitor and check to capture these costs in order to optimize profits. Determining the business management cost is very important, details as follows:

- It is a basis for managers to control and estimate business activities of the enterprise.

- As a basis for managers to make investment decisions, product pricing, the choice of accepting or rejecting orders, and analyzing performance.

- Saving in the management and use of resources of the enterprise.

- Employees are more responsible for the economical use of enterprise resources.

3. What expenses are included in business management costs?

Business management costs include the following basic elements:

- Human resource management costs: This is the most important expense in an organization's cost structure. Human resource management costs include the entire amount of money that an enterprise must pay to its employees and officers in that unit such as salaries, insurance, allowances, ...

- Business expenses: Business expenses are expenses that enterprises pay for employees on business trips, including meal allowances, travel expenses, phone credit, room rental, baggage fees, etc. ...

- Expenses incurred: During the operation, the business will certainly have to spend the incurred costs to serve the work. Such arisings can be equipment damage, property depreciation, repair due to fire and explosion, ...

 - Cost of materials and office supplies: Enterprises cannot operate well without materials, equipment, machinery, office supplies, etc. Therefore, the budget used to purchase the materials is essential.

- Taxes and other costs: This includes the entire amount used to pay license tax, land rent, etc. from the establishment to the process of maintaining and developing the business.

Expenses included in business management costs

4. Experience in optimizing business management costs

Cutting and optimizing business management costs will help businesses ensure profits and the operating activities are not affected. To do this, business managers can refer to some of the following experiences:

Optimize management activities

Optimizing management activities will help save time, resources and operating budgets. Building a quality management system to help improve product quality, monitor business activities, and improve the position of enterprises in the market.

An irregular working process can easily lead to poor productivity, affecting the operation of the business. Therefore, in this way, managers must strictly control to ensure that employees' working activities are always in accordance with the set process. For less important tasks, cut back to reduce costs.

Optimizing Marketing costs

In today's digital age, any business needs a marketing strategy to optimize profits. However, if you only focus on expensive paid advertising, it is not a wise choice. To optimize costs, managers need to come up with an effective marketing strategy at a reasonable cost. For example, actively looking for customers, showing them the importance of products/services at the business,...

Applying modern technology and tools 

Paper costs should be replaced by digital invoices and electronic documents to optimize business management costs. By using modern technology and management software, businesses will save the cost of providing office space for employees. 

Choosing the right suppliers

In order to save a large amount of business management costs, the manager should consider choosing the most suitable and best supplier for his or her organization. Consider the target, evaluate whether the supplier can meet it, the price they offer is competitive, consider the service, product quality, quantity of materials needed, ... This requires businesses to take the time to carefully research and select before making a decision to associate with any supplier.

 Experience in cutting and optimizing business management costs

Optimizing human resources costs 

Labor costs account for a large proportion of the total administrative costs of the enterprise. Therefore, considering cutting human resources costs is an issue that managers need to focus on. In addition to cutting this cost according to the number of employees, enterprises can also take other measures such as arranging personnel and assigning jobs reasonably.

Managers need to focus on building a suitable and effective human resources team to ensure recruitment of the right people for the right jobs as well as limiting the fact that personnel resigns after staying for a short time and in the end businesses have to re-recruit people which causes a big loss in time and money. 

At Navigos Search - Vietnam's leading mid- and senior-level recruitment service provider, there are now more than 375,000 senior candidates, 85,000+ senior management - level candidates, helping to quickly recruit quality candidates for your enterprise.

Our consulting team are recruitment experts who have a deep understanding of the value of human resources, a deep understanding of each industry and professional skills that will accurately grasp the recruitment requirements of your business. 

Based on the rigorous recruitment process and the candidate's capacity, experience and labor market situation, Navigos Search will conduct a search for the most suitable candidate for your business with a very high success rate.

Our recruitment process is as follows:

- Step 3→ Support business interview: Navigos Search provides a list of potential candidates for your company after thorough evaluation. We will accompany the company and the candidate to provide additional support throughout the interview process.

Navigos Search - Vietnam's No.1 middle and high-level talent hunting company

With more than 20 years of experience in the field of recruiting mid-level and high-level personnel, Navigos Search is proud to have supported and brought successful recruitment solutions to multinational enterprises and corporations across Vietnam, helping them have the best quality human resources.

Navigos Search has a large pool of mid- and senior-level candidates. Therefore, if your business is in need of recruiting any mid-level and senior-level positions, please contact Navigos Search to receive the most professional and quality service.

Above all, Navigos Search has clarified the importance and how to effectively optimize the business management costs. Hopefully this information has helped business administrators have more information on how to reduce, save costs to invest, expand business scale and promote business to grow stronger. Thank you readers for always taking the time to follow Navigos Search!

Navigos Search - Vietnam's leading middle and high-level talent hunting company