![]() Aside from just factoring in the interest costs of a business loan, other costs should be taken into consideration. ![]() When seeking a business loan in Singapore to support their expansion plans or to fund a new major project, they tend to underestimate or factor in the true cost of financing.Īside from banks’ commercial loans, SMEs should also source for any government assisted financing schemes such as the Temporary Bridging Loan Programme which could help lower interest costs. Many SMEs owners are over optimistic when projecting their future revenue and growth. Many losses of company’s internal data may happen during overtime as there is no supervision and more privacy. Many employees use the company’s resources to conduct personal tasks while claiming overtime. Whilst working overtime, the employees don’t always spend it on work-related tasks. For example, a machinery operator could become fatigued due to frequent overtime, which may lead to workplace accidents. Frequent overtime, in the long term, could limit an employee’s performance, preventing the employee from performing at peak level. Overtime requires more effort and energy from the employee, which is a burden on the employee’s health. Overtime is not always a result of a heavy workload, but low productivity and inefficient work processes. However, this may lead to higher overall labor costs and there are three reasons why: Lots of employers may find the overtime employees put in as a display of work ethic. Culture of speaking out and clarifying doubts should be encouraged. Tasks and instructions from management should be communicated clearly and without any ambiguous intent. Important announcements such as new product launches or new SOP guidelines should be communicated via one official channel such as company’s internet or bulletin board.Īll enquiries from other staff members regarding new announcements should be redirected to the respective department or personnel only to ensure information is disseminated via one channel. Ideas and tasks might not be expressed clearly, or everyone has a different interpretation on the same set of unclear instructions. Many businesses provide their employee with training on techincal skills required by the industry, but most companies fail to provide training on communication skills.Ĭommunication between colleagues can potentially get lost in translation. ![]() Communication CostsĬommunication is an important part of business operations. SMEs do not typically have sufficient scale to internalize a system of checks and balances for tenders and bids, unlike bigger corporates. Such human errors might lead to the business missing opportunities to secure a better deal. Personnel in procurement roles might misjudge purchase prices or fail to conduct sufficient due diligence on current market trends. We often only focus on the volume and prices of purchases, failing to pay attention to other details. Procurement CostsĮvery company has a different procurement process and procurement typically poses significant risk for redundant cost leakage. Ineffective meetings that does not result in tangible and productive outcomes consume resources and reduces staff morale. Many in management don’t have the proper skillset for meetings, which results in the six lacks: Lack of preparation, lack of topic, lack of execution, lack of necessity, lack of time management, and lack of focus when speaking. Every minute in a meeting should be multiplied by the number of attendees’ value to the company to reflect the actual time invested in a meeting. Meetings are costly group activity because a meeting is usually an activity that involves many of those in the leadership or management team. There are many lurking “hidden costs” when scaling as business and poses one of the biggest headache for a business owner. Most SMEs experience increase in costs and constantly fire fights as the business scale, but fail to identify the reasons behind it. As your business grows, there will always be challenges to tackle.
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