Establish Daily Forecasting
With just about every business now under pressure to lower prices, it is more important than ever for business owners to know their real costs. What are the daily forecasts for your customers and what will you need to satisfy each order? By developing a system of receiving forecasts and then applying needed labor and materials, you will determine your exact costs each day.
To get started, you should ascertain your next-day activity from your customers. Then determine the number of man-hours required for the next day to meet client demand. In allocating labor, you should have just enough employees to get the job done for each customer without overtime. Add the daily cost of materials needed to complete the work.
At the end of each day, look at the number of tasks actually accomplished and compare it to the actual labor employed. If you see discrepancies in productivity, you can adjust as needed.
This daily forecast will give you a more concrete and accurate picture of your business. It will help you identify ways to save money, boost productivity, improve operations, and ultimately compete more effectively.
Chris Carey President Chris Carey Advisors New York