Employee compensation should always be established to be in line with revenues and related growth in the coming year.Use this time to determine if better insurance rates are available or if different coverages would be more advantageous. These expenses may be easier to estimate however, you should consider reviewing the policies in place, especially around insurance. Other expenses are fixed costs such as rent, insurance, equipment leases, and certain other services purchased.Use this time to challenge your employees to identify cost savings related to the delivery of products or services. Typically, the gross margin of a business does not fluctuate substantially unless new products are developed, inventory prices change, or inefficiencies are identified within the manufacturing process. Some costs relate directly to revenue, whether they be inventory or employee services.Once the expected revenue figures are estimated, the focus can shift towards expenses. Discuss the expected sales with your sales department and set expectations to help determine compensation for this team.Communicate with your current customers to better understand their expected needs of your product or service. ![]()
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