In today＊s demanding business environment, it is an unfortunate fact that a large number of senior managers and directors become so absorbed in the day-to-day running of their companies that they often failed to see savings they could make-or the hidden profits they could exploit. This is particularly true in smaller companies. They may be simply too busy to see what is really happening. In fact, these directors would often do better to work less and think more about the actual procedures they are using in the running of the company.
Detail is often the key to improving the overall picture. The secret of identifying hidden profits is to work on the business and not in it. Often the involvement of an independent individual who can point the director in the right direction is invaluable in showing that even minor improvements can have a dramatic effect on profit margins.
To take one example, the manager of a car parts factory could not understand why, although his staff were always busy dealing with telephone enquiries, the actual number of sales remained frustratingly low. A standard system for dealing with the enquiries was what was needed and, once introduced, it paid dividends-without the need to invest in expensive new technology.
Another example concerns the owner of a small specialist export company. He exploited his existing computer system by creating a database containing the details of all his customers. He used this to send them all a newsletter, keeping them up to date and telling them about new products as they came out. He found this increased the number of enquiries he was receiving because his customers were passing the newsletter around their contacts. Of course, newsletters are not the only way of using a database to increase sales.
The business world is full of examples like these that can be used to prove more or less anything that you want. What is vital is to look closely at your own organization and see what improvements you could make to it. In addition to such initiatives as those mentioned above, it is also worth examining current expenditure. Overheads need to be kept under control and actually reduced where possible every cost such as postage, stationery, telephone calls, heating should be questioned individually. Check their value to the company. Calculate the annual cost of each and then see if it would be possible to get it at a better price somewhere else: it usually is. No businessperson enjoys spending money unnecessarily.
There is no doubt that a mistake common among growing businesses is allowing costs to increase to quickly. Managers are too busy concentrating on recruiting more staff or improving customer service. Rather, they should be ensuring that the rate of growth continues by guaranteeing that no cost is allowed to rise unless it is clearly related to profit by the generation of further sales. That is the real core of business activity and it should never be forgotten that everything else is only there to make that happen.
15. In the first paragraph, the writer says that many managers
a. are unwilling to make savings.
b. do work that they are unsuited to.
c. are too eager for their business to grow.
d. spend too little time examining company systems.
16. One way to increase a company＊s profits is to
a. look at individual performance.
b. have a strong inside knowledge.
c. understand the value of small changes.
d. have a strong sense of direction.
17. The manager of a car parts factory increased his profits by
a. changing his staffs telephone procedure.
b. improving his staff＊s telephone manner.
c. updating his telephone equipment.
d. providing more telephone lines.
18. The exporter＊s computer database proved useful because he was able to
a. improve his company newsletter.
b. research new products.
c. respond to enquiries quickly.
d. attract new customers.
19. What is the best way to reduce overheads?
a. remove unnecessary services.
b. find cheaper suppliers.
c. reduce telephone calls.
d. cut down on stationery.
20. According to the writer, the only factor that should cause running costs to increase is
a. the previous rate of growth.
b. the number of sales resulting.
c. improvements to the standard of service.
d. the need to increase the number of employees.
Useful words and expressions:
Demanding; absorbed; margins; frustratingly; dividend; newsletter; expenditure; overheads; core;
Have you ever noticed the following sentences in your reading? If not, read them through and pay attention to the bold parts.
15. They may be simply too busy to see what is really happening. In fact, these directors would often do better to work less and think more about the actual procedures they are using in the running of the company.
16. Often the involvement of an independent individual who can point the director in the right direction is invaluable in showing that even minor improvements can have a dramatic effect on profit margins.
17. A standard system for dealing with the enquiries was what was needed and, once introduced＃
18. He found this increased the number of enquiries he was receiving because his customers were passing the newsletter around their contacts.
19. Calculate the annual cost of each and then see if it would be possible to get it at a better price somewhere else: it usually is.
20. they should be ensuring that the rate of growth continues by guaranteeing that no cost is allowed to rise unless it is clearly related to profit by the generation of further sales.