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Procurement Service Providers can Analyze Controllable Costs PowerPoint Presentation
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Procurement Service Providers can Analyze Controllable Costs

Procurement Service Providers can Analyze Controllable Costs

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Procurement Service Providers can Analyze Controllable Costs

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  1. Compass Advisory Services Corp. P.O. Box 686, Middlesex, NJ 08846 , Office: (732) 271-1700 , Fax:  (732) 271-1701 , Attn: Dan Barlette, Jr. , e-mail:  DBarlette@ATSCostReduction.com

  2. Procurement Service Providers can Analyze Controllable Costs in a Cost Management System Compass Advisory Services Corp. P.O. Box 686, Middlesex, NJ 08846 , Office: (732) 271-1700 , Fax:  (732) 271-1701 , Attn: Dan Barlette, Jr. , e-mail:  DBarlette@ATSCostReduction.com

  3. Unless cost management is treated as a viable part of the firm’s strategic direction, ongoing cost management efforts are doomed to fail. Finance crunches many numbers and some only provide a reason as to why the numbers are the way they are. The company needs to use the product costs when determining pricing decisions instead of target costing. That way the finance department can review the cost drivers and determine if any behaviors should be modified. Compass Advisory Services Corp. P.O. Box 686, Middlesex, NJ 08846 , Office: (732) 271-1700 , Fax:  (732) 271-1701 , Attn: Dan Barlette, Jr. , e-mail:  DBarlette@ATSCostReduction.com

  4. An important objective of any cost management system is to trace as many costs as possible directly to the activities that caused them to be incurred. A cost that can be traced to a particular department is known as a direct cost. An example of this is an automotive mechanic’s salary which is traced back to the automotive service department. A cost that is not directly traceable to a particular department is known as an indirect cost. An example of this would be a national advertising campaign. This process is vital to senior management’s objective of eliminating non-value added costs. These are the costs of activities that can be eliminated without deterioration of product quality, performance, or perceived value. Compass Advisory Services Corp. P.O. Box 686, Middlesex, NJ 08846 , Office: (732) 271-1700 , Fax:  (732) 271-1701 , Attn: Dan Barlette, Jr. , e-mail:  DBarlette@ATSCostReduction.com

  5. Another cost classification that can be helpful in cost management involves the controllability of a cost item by a particular manager. If a manager or employee can control or heavily influence the level of a cost, then that cost is classified as a controllable cost. Costs that a manager and employee cannot influence significantly are classified as an uncontrollable cost. Compass Advisory Services Corp. P.O. Box 686, Middlesex, NJ 08846 , Office: (732) 271-1700 , Fax:  (732) 271-1701 , Attn: Dan Barlette, Jr. , e-mail:  DBarlette@ATSCostReduction.com

  6. Controllable costs are broken down into short-term and long-term costs. For example, the long-term costs associated with equipment leased by a hospital are controllable when the 5-year lease is negotiated. In the short-term, after the lease is signed, the rental costs are uncontrollable until the lease period ends. Compass Advisory Services Corp. P.O. Box 686, Middlesex, NJ 08846 , Office: (732) 271-1700 , Fax:  (732) 271-1701 , Attn: Dan Barlette, Jr. , e-mail:  DBarlette@ATSCostReduction.com

  7. The cost management system that is established for the company should be able to track all of these controllable costs. A third party procurement system provider can assist your company in analyzing your controllable costs to ensure you are receiving the best pricing without degradation in delivery or quality. The top procurement service providers will go through your entire cost structure to determine the potential areas for cost savings in the products and services you are purchasing. This assessment is usually reviewed by senior management such as the President, CEO, CFO, or strategic sourcing leader. The senior leader decides whether or not to hire the procurement service provider. Compass Advisory Services Corp. P.O. Box 686, Middlesex, NJ 08846 , Office: (732) 271-1700 , Fax:  (732) 271-1701 , Attn: Dan Barlette, Jr. , e-mail:  DBarlette@ATSCostReduction.com

  8. This activity can provide a proven, no-risk solution to reduce costs, improve bottom lines, increase compliance and quality, and enhance a company’s competitive position. By implementing procurement outsourcing, the company can reduce costs and increase their profit lines. The company does not have to worry about increasing headcount or downsizing the workforce. Compass Advisory Services Corp. P.O. Box 686, Middlesex, NJ 08846 , Office: (732) 271-1700 , Fax:  (732) 271-1701 , Attn: Dan Barlette, Jr. , e-mail:  DBarlette@ATSCostReduction.com

  9. The procurement outsourcing company you select should be trusted procurement experts that have long term relational business partners. They should have an extensive network of suppliers they have done business with over several years. A world class procurement service provider will protect your business interests at all times. Finally, the top procurement outsourcing companies have no upfront costs to their cost reduction services. They will share a percentage of the cost savings when the program is implemented. Compass Advisory Services Corp. P.O. Box 686, Middlesex, NJ 08846 , Office: (732) 271-1700 , Fax:  (732) 271-1701 , Attn: Dan Barlette, Jr. , e-mail:  DBarlette@ATSCostReduction.com

  10. About Above the Standard Procurement GroupAbove the Standard Procurement Group® provides cost reduction, procurement outsourcing, and business growth services. They are a privately owned company located in Middlesex, NJ. Above the Standard helps small to fortune-100 companies, hospitals, non-profits, and school districts save money on products and services they are already buying and improves their bottom line. Their founder has delivered results over 30-years saving clients billions of dollars. Above the Standard Procurement Group® provides their services on a pay-for-performance basis meaning there are no up-front costs and only make money if there are cost savings. They share a percentage of the cost savings when the program is implemented. To know more visit - http://www.atscostreduction.com/ Compass Advisory Services Corp. P.O. Box 686, Middlesex, NJ 08846 , Office: (732) 271-1700 , Fax:  (732) 271-1701 , Attn: Dan Barlette, Jr. , e-mail:  DBarlette@ATSCostReduction.com

  11. ATS Cost Reduction and Business Growth Contact Us ATS Cost Reduction and Business Growth Contact U Compass Advisory Services Corp. P.O. Box 686, Middlesex, NJ 08846 , Office: (732) 271-1700 , Fax:  (732) 271-1701 , Attn: Dan Barlette, Jr. , e-mail:  DBarlette@ATSCostReduction.com