Dupré Logistics

Are Invisible Costs Hurting Your Company?

Monday, July 18, 2011

Logistics has long been thought of, by most companies, as an operating cost that must be minimized. This is a very short-term and, frequently, dangerous viewpoint, not only in assessing logistics costs, but in analyzing costs for other functions as well.

What are invisible costs?

These are the costs that do not show up on a profit and loss statement as attributable to the given function since they are buried within other line items. For example, your company has assigned a mid-level manager in your purchasing department to spend 20% of his time on managing incoming and outgoing deliveries. His entire salary and benefits are allocated to the purchasing department. However, 20% of that cost should be allocated to your logistics costs. There are many other similar examples of allocating costs this way since it is not feasible for most companies to determine actual use of time and money for every function.

However, if you were to do such an analysis for your company, you might very well find that it would save you money if you outsourced some or all of this or other functions where possible. The ability of that manager to put that 20% of his time back into his primary functions might well save or earn your company far more than the cost of outsourcing the function. It is impossible to accurately measure the cost of lost opportunities if that manager had been able to focus on his main priorities for that additional 20 percent of his time.

Invisible costs are to a company like an undiagnosed disease is to a person. It is harming the company, yet no one is aware of the harm, sometimes not until it is too late. Make sure you analyze all functions and systems in your company regularly to determine whether it is better to keep it in-house or to outsource it.

Are You Ready for Better Times?

Friday, July 08, 2011

As our country is coming out of the recent deep recession, we need to make sure that our companies are ready. We’ve all trimmed our costs as much as possible to survive the recession, but now, to grow and flourish in better times, we need to change our focus from cutting costs to investing wisely in the future, if we haven’t done so already.

Many companies cut costs so deeply that their service levels suffered. They will struggle to win back a reputation so they can keep current customers and appeal to new ones. We all have to focus now on remaining productive and efficient, while increasing our customer services. Customer service will be a major divider between successful, growth companies, and those that fail or merely survive.

Being good is no longer enough. Every company has to plan to be better, especially in the eyes of their customers. Focus now on where you should spend the added income that will be coming to you from business growth in the future.

Welcome To Driving The Supply Chain Blog!

Friday, July 01, 2011

Lots of changes are happening in the field of logistics and in most other industries as well, and we’re sure more changes will be coming. The world moves quickly these days and we have to keep up with it. New regulations… New Technology... New challenges.

We welcome you to our new blog. Let us know what you think. Our goal is to provide helpful information, track news in the logistics industry and in the general business environment, discuss trends and ideas, answer questions and provide any other information you would like to see.

Our blog provides the opportunity for you to easily respond to anything you see and to let us know your thoughts and opinions. The more we hear from our visitors, the more we can give you the information you want. Help us help you.

Send us information about experiences you have had – the good, the bad and the ugly.

If you are not familiar with our company, please visit our website to learn more about our services.

Welcome aboard.

Dupre Logistics

© Dupré Logistics  Site By Usable Creative - Lafayette, Louisiana Website Design & Development Privacy Policy