The True Cost of Running a Business
William Maloney and Art Boulay
OPI Consulting

(c)1998 OPI, Inc. All rights reserved.
 


William Maloney, Sr.
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Art Boulay
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The True Cost of Running a Business

Many business owners are surprised to learn that there are many hidden costs to running a business. Unfortunately they only learn about these additional costs after they experience the frustration of managing their business day-to-day. Here is our detailed list of both the obvious and hidden cost to running a business. Business owners and company executives must develop strategies to deal with each of these cost issues.

Understanding the True Costs of Running a Business

VISIBLE COSTS
Salaries
Benefits
Overtime
Customer Complaints
Consultants
Special Overhead Costs
Equipment Costs
Maintenance Costs
Inventory and Supplies
HIDDEN COSTS
Lack of Employee Motivation
Excessive Employee Turnover
Lack of Clear Business Purpose and Strategy
Sick Pay
Ineffective Employee Relations
Lack of Clear and Consistent Policies and Procedures
Training and Developing
Administrative Errors
Billing Errors
Theft
Disability Pay
Waste
Poor Processes
Inadequate Staffing or Over staffing
Effective Performance Management
Inefficient Systems (Management and Operational)
Low Productivity
Grievances
High Account Receivable
Equipment Downtime
Lack of Proper Equipment
Injuries
Employee Frustration
Ineffective Public Relations
Lack of Clear Vision and Mission
High Insurance Costs (Worker’s Comp)
Lost Customers
Inadequate Staff Development
Poor Internal Communications
Fear
Litigation
Low Inventory Turnover
Distribution Delays
Lack of Technical Skills
Poor Image in the Market Place
Management Frustration
Owner Frustration

Hint: To understand the importance of strategies please read our Strategies for Success. We offer you our own strategies as a guideline

Strategies for Success
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