As Companies Strive to Cut Costs, What Essentials May Suffer?
Posted: Monday, April 06, 2009
by Sandra E. Graham
My Books and Articles
With basically all companies under great pressure to cut corners, slash costs, reduce manpower and production, do consumers need to be concerned about product safety, quality, cost, and quantity? I would say yes.
When employees are cut, other employees are required to take up the slack and may be required to perform operations outside their expertise. This could cause product quality issues, which in reality raises production costs again where the plan was originally to cut costs. This could also lengthen production time rather than shorten it as hoped-again adding to production costs.
Credit card companies have begun sending out letters informing credit card consumers that their interest rates will be going up. This is probably to help cover losses due to all the consumers who have defaulted on their cards, been approved for lower payment plans, or filed bankruptcy and don't have to pay at all. If you have been the lucky recipient of one of these letters, read the fine print-you have the option to reject the new raise in interest rates by replying to the credit card company in writing and making no new purchases with said credit card. If you follow these instructions, the interest rates on your already accrued purchases cannot be raised.
Some companies are doing things a little differently-instead of laying off the workforce that they realize are needed to keep production flowing smoothly are coming up with other ways to trim costs. Laying off only seasonal hires and temporary help, and placing a hiring freeze on corporate heads-imagine that! The bonuses that they save alone would keep a company going for many months-maybe years. Economists would probably agree that it is in a company's best interest to keep their workforce and cut corners elsewhere. Although most costly, experienced laborers are the most valuable assets a company has. If only they could come up with better products at a lower cost, all our problems would be solved.
It appears that lawyers are being hurt worse by the economic slump than all other producers combined. If you have noticed the influx of commercials on television and through emails, every product imaginable has a flaw that is a danger to the public and if you've used or consumed that product; you may be entitled to monetary compensation of unspecified amounts.
Just this week I had one friend laid off and another cut down to four days per week. And yet they tell us that the stock market has risen every day this week and that maybe the worst is over???? I don't know about where you live, but I'm not seeing it. Reality Bites!!!
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Top-level comments on this article: (8 total)Great article. Well done.You are so very correct. Companies want money and will cut quality before profit.Thanks, Connor.---Reality Does Bite!Have a great day.Sandra
Great article Sandra. Thank you for keeping us aware of those things we generally wouldn't pay the proper attention to. I feel so sorry for all those who have lost their jobs, and pray with all sincerity for them and those to come. Reality is biting on every hand, yet some how those of us who have already been bit must remain available encouragers.DeborahYeah, I feel for everyone and the whole country in general. It is a sad situation.Thanks for reading and commenting.Sandra
Well said Sandra!I agree with you and also hope that quality doesn't suffer in the process. Luckily, those in my extended family who have lost jobs due to cutbacks now have new jobs. I can only pray that others are as blessed.NancyThank you, Nancy. And that is truly good news among all this bad.Thanks for reading and commenting.Sandra
I enjoyed this article, i am a transport manager and our business has slowed down due to the amount of our customers who have either gone out of business or have cut down on staff or production. It is sad to see.Thanks, Samuel. I hope it doesn't eventually make things worse for you.And again, Welcome to Searchwarp.Sandra
The first thing our countries (Canada and USA) need to do is stop buying products from China. Have you noticed that almost everything you see today is made there? And talk about poor and sometimes dangerous quality; they just don't seem to care.As you know, I work in a funeral home. Today I was working in the prep room and while I was taking a body out of a plastic body bag, I happened to notice a small tag on it. It said, "Made In China". Can you believe that? I started laughing hysterically. My coworker thought I had gone nuts.I hope you meant the 'body bag' was made in China---not the body?????????But yes, I know all about 'Made in China'. The company I worked for had a plant in China. They would bring assembled parts over from China and relabel them as "Made in USA". Go figure!Thanks for reading and commenting, David.SandraWell, the body could have been made in China, but I think, in this case, it was made in Canada. lolWouldn't relabeling an article as you describe be considered a form of false advertising or fraud? I think somehow that would be illegal.Would seem that way to me, also. But, big conglomerates have their loopholes to get around any justice system. The parts were made in an American plant that just happened to be on Chinese soil???? I don't know our legal system is all Greek to me--I've had dealings with it a few times and it never seemed to work to the good of the people in any case.Thanks for the feedback.Sandra
Service suffers first in the retail business, it seems. Instead of the average (some would say lousy service) we are used to, we will now get horrendous service. I have noticed many stores saving a couple of dollars by not staffing correctly, which is really death to that store. The first rule of retail is "staffing is everything." Without staff, the company cannot sell it's product(s).Well done.Thank you, Michael. I worked in management and my first concern was manpower and trying to keep everyone working. There are many costs involved with lay-offs; to the company as well as the people losing their jobs.Sandra
Sandra another good article and yes raising rates, I seem to recall writing to this awhile ago, that said no one, yes few to none concerned about usury or the money these politicians get from lobbyists, and even awhile we all talk about Easter, amazing isn't it, oil and water and it matters not to the vast majority. Yes how totally amazing out of one side God the other, well relativity. Best wishes.A sad State of affairs. And now we are hearing murmurs of the roughest times being behind us--still a few bumps and lay-offs ahead, but the worst may be over???Ah, well. There is always hope.Thanks, Robert, for stopping by again.Sandra
Typically the stock market will recover before the economy does, just as it tanks before the economy does. But who knows?Thanks for reading and commenting, Ken.Have a good day.Sandra
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