Businesses should not cut costs due to harsh economic decisions – Expert

Inflation 8 Inflation pushes costs of doing business up

Fri, 20 May 2022 Source: www.ghanaweb.com

Businesses should reduce cost – Expert advises

Difficult times will pass, Financial expert

Inflation rises to 23%

Businesses have been cautioned against making rushed decisions due to the current harsh economic times.

Managing Partner of Trust Consult, Charles Mensah, has stated that businesses should instead of cutting costs reduce the cost of operations as the economic phase will pass.

Speaking on JoyNews’ PM Express Business Edition, he said, “So, you’re going to look at the innovative way of delivering certain service that you’re providing, innovative ways of doing things. So, this is time for us to start thinking the best way without affecting the quality of things. Because it’s a phase we’ll pass, but if you rush and cut cost, by the time the phase is gone, it’ll be difficult for you to come back.”

He added that “I think most companies have started negotiating with their employees to have a freeze on salary increase, and then also accruing the expenses and telling them that we don’t have cash but we recognize the expenditure so when the cash flow improves, they’ll pay.

“I know some companies that have taken some restrictive measures where they’re paying only 50% of their salary now, and they’re accruing the next 50 for future when things improve.”

The financial expert stated that business owners should be slow in making decisions that affect their businesses so as not to be affected when things bounce back to normal.

“Because as we speak right now, if you rush to cut costs and things improve it will be difficult for you to turn on the machine. Because once the machine is in motion you don’t rush to make certain decisions. It’s a reasonable period for you to have a discussion with your employees, for you to have a discussion with suppliers and then your customers. So, there’s a bit of negotiation as we speak.”

Source: www.ghanaweb.com
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