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Cut with care
Page 48
Page 49
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The recession may be hitting you hard, but make sure you don't make cuts in haste that you'll end up repenting at leisure.
Words: Louise Cole Once we know that budgets must be cut back, it is tempting to wield the knifewithout fear or favour. It is also particularly tempting to hack at those things we perceive as costs, but which do not make an obvious contribution to the bottom line. Downsizing must be a subtle and balanced process — there are many elements of a business that are not just icing when times are good, but invaluable and supportive parts of your organisation. Strip them away indiscriminately and all might crumble further down the line.
Health and safety
As an operator, you can't afford to cut corners here. Saving money at the risk of personnel or visitor safety is nothing short of crazy. Accidents happen and they can have a devastating effect on those who suffer them — families, the rest of the workforce, your peace of mind and, of course, your customers. You can also be accountable for negligence claims, or, in the event of a fatality, corporate manslaughter charges.
If you don't believe us, in 2007-8 2.1 million people had a work-related illness; 229 people died at work; and there were 300,000 reportable injuries — that's 1,000 per 100,000 workers. And road transport still has the highest rate of over-three-day injuries of any sector (1,245.8 per 100.000 employers).
Compliance
Of course, safety concerns extend out to the road as well. Roadworthiness, drivers' hours, undertakings to the Traffic Commissioners (TC) — all these are born out of public safety concerns. Flout them and you risk collisions, prohibitions or even 0-licence revocation.
In 2007-8, there were 4,300 prosecutions for drivers' hours and tachograph offences, with an 83% conviction rate; almost 1,000 overloading charges, with a 94% conviction rate; and another 2,000 HGV offences, which had an 87% conviction rate Every one of these would have to be reported to the TC, every one risked a licence, many probably ended a career. The bottom line is make sure you don't end up being a statistic.
Operators must continue to not only put properly resourced procedures in place for compliance, but also take personal responsibility for ensuring that they work.
Sales and marketing
A typically soft option. and many people make the mistake of thinking that marketing is just for the good times Its worth remembering the story of Pears Soap, the only brand to campaign throughout the Second World War. Its brand and poster are still remembered today but who were the competition? Reasons not to cut: brand is more important than ever customers want reliability and stability. You can't afford to hang on to the customers you have and not find more because your customers are as vulnerable to recession as anyone All markets are now more competitive and keeping a low profile won't help you pull in extra volume. If you need to save cash, emphasise value. If you are canny, a website can be your most cost-effective marketing tool; equally, emals are cheaper than letters Be smart, sell smart.
Customer care
From a commercial point of view, ignoring your customers is the most dangerous move you can make. Customers are already jittery. They are not only looking for cheaper options, but they want to spread their risk of transport failure and they are hanging onto their own customers for dear life If you cut back too hard, so that you can't fulfil service levels they are used to whether it's deliveries being on time or having someone on the end of a phone to deal problems you stand a high chance of losing them. Cutting back so hard that you cannot properly service your existing contracts is suicide w
From a commercial point of view, ignoring your customers is the most dangerous move you can make..."