Welcome back to another installment of Whitepaper Wednesday here on the Purchasing Certification Blog. This week, I’ll be reviewing a whitepaper entitled “Cost Savings That Stick” from the Corporate Executive Board and Toolbox For Finance.
This whitepaper essentially dichotomizes “Elite cost cutters” and “other companies.” “Elite cost cutters” are those companies that have sustained cost savings for at least three years.
So how do the Elite cost cutters save more? According to the whitepaper, sustainable cost reduction comes from a focus on Cost of Goods Sold (CoGS) instead of Selling, General, and Administrative Expenses (SG&A).
That’s a nice correlation but, at only two pages in length, the whitepaper doesn’t dive deep enough into this topic. Do CoGS suppliers have more of a propensity to hold their pricing for a longer time period than SG&A suppliers? Why would some of the companies choose not to focus on CoGS? Did industry make a difference in the results?
Unfortunately, these are all questions that go unanswered in the whitepaper. Despite that, if you want to download your own copy of the whitepaper, you can do so from the Toolbox for Finance Web site (registration required).
To Your Career,
Charles Dominick, SPSM
President & Chief Procurement Officer
Next Level Purchasing, Inc.
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