Second, reduce the time cost. For example, a product can be produced in one minute, but it takes an enterprise two minutes to produce it. This invisibly increases the time cost and labor cost. Time cannot be repeated, and it is a non-renewable resource. But I find it really terrible that China enterprises waste time. I have no idea of the time. Delays in decision-making, implementation, delivery, inspection and audit. This delay will increase the time cost.
Third, reduce the circulation cost and inventory cost. Circulation costs include transportation costs, storage costs, packaging costs, processing costs, distribution costs and so on. Macroscopically, circulation cost includes three costs: transportation cost, storage cost and management cost. The modes of transportation include land transportation, water transportation (river transportation and sea transportation), air transportation and pipeline transportation. Each mode of transportation has its own advantages and disadvantages. The best way to reduce transportation cost is to master all kinds of transportation information. Optimize the combination with the lowest cost to reduce the cost. For example, you can add water to the land, add air to the water supply and so on.
No matter which way is adopted, the time, cost, product integrity and distance should be calculated to reduce the transportation cost. For inventory cost, the best way is to adopt JIT management. It is difficult to realize JIT inventory-free management in China, because the lack of corporate integrity is common in China. JIT requires the goods to arrive on time and have zero inventory. Require close cooperation between internal and external enterprises, which is not what ordinary enterprises can do. If JIT can't be implemented, then the cost of inventory and inventory management should be reduced as much as possible.
Fourth, reduce operating costs. Operating costs include main business costs and other business costs. Main business costs include direct material costs, direct wage costs, indirect material costs, indirect wage costs, other direct costs, manufacturing costs, management costs, etc. There are several ways to reduce operating costs. First, try to use high-tech equipment to improve production efficiency. High-tech equipment includes the use of robots. However, there is a prerequisite that enterprises should train professional equipment maintenance and maintenance personnel. High-tech equipment can produce more products with fewer employees. The second is to use knowledge workers with high proficiency and skills. Only when knowledge is used in production and operation can it produce more value.