Leverage: Adding Value by Reducing Costs Part 5 (6 Part Series)
Forwarding Freight, In Job Logistics, Liability Insurance, Logistics, Transportation Jobs, Warehousing Jobs, distribution jobs
This is Part 5 (6 Part Series)
Eliminate costly parts inventories
Buy parts on consignment. Carrying less inventory and paying for parts as used can reduce costs. Leading manufacturers provide parts on consignment. If the manufacturer is not receptive, pursue an independent dealer that is.
Contract maintenance.
Third party providers seek to provide their services for as many customers as possible from each facility they operate to absorb their fixed overhead and indirect costs as efficiently as possible. Purchasers of contract maintenance services can leverage this knowledge by negotiating a favorable rate structure. Purchasers should also consider the following:
· Look beyond just the first and second years - consider the total package.
· Do not pay fixed charges when equipment is not in use because of mechanical failure.
· Get replacement vehicles without paying extra.
Sales and service.
Sales and service are the “no frills” maintenance option. Here, the fleet operator is likely treated as just another customer. However, savvy buyers realize that sales and service providers have the same fixed overhead/indirect costs as contract maintenance providers. A sales and service provider may be having difficulty absorbing its overhead which your business can help solve.
Click here for part 4 of this 6 part series.
Click here for part 3 of this 6 part series.
Click here for part 2 of this 6 part series.
Click here for part 1 of this 6 part series.
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admin @ March 12, 2009
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