Implementing waste minimization measures in the retail and wholesale sectors can reduce costs by up to 25% with little investment. Top tips include separating waste for recycling, reusing packaging materials, and arranging returns to suppliers to reduce waste. Reducing waste improves profits through cost savings, enhances environmental reputation, and ensures compliance with regulations.

1. PROFIT NEWS
iNSiDe THiS iSSUe
CSR & Cost Reduction Reducing Waste in the Gas and Electricity Price Hikes
Fleet expert Sean Bingham Retail & Wholesale Sectors “Utilities expert Steve letley explains
explains how Corporate Glenn Cotter details why companies across the UK need
Social responsibility and how implementing waste to consider their utility spends now,
effective cost control go minimisation measures can and not in 3 months time”
hand in hand. reduce costs by up to 25%
“Given these major changes, which will alter the benefits landscape placing new
responsibilities and legal obligations onto employers, a long, hard look at the entire
structure and delivery of employee benefits is advisable”
Brian Morgan, Director – employee Benefits
expert NewS - iNSUraNCe TeaM
Employee Benefits – review now
or pay later!
Unlike your general insurance For most employers, particularly those that
arrangements, which are probably the fail to plan for the changes, the advent of
subject of some form of annual review, auto-enrolment will lead to significant extra
your employee benefits programme may costs in contributions and considerable
not have been properly reviewed and additional administration. Despite this,
tested for a number of years. Brian Morgan, Director, Employee Benefits
at Expense Reduction Analysts Insurance
If this is so, you are not only missing an Cost Management (ERAICM), says;
opportunity to obtain improvements in the
way your programme is structured and “From the conversations we are having
serviced, you could, as we will demonstrate, with businesses throughout the country, it
also be storing up some significant financial is clear that most employers simply do not
issues for the future. appreciate just how great these increased
costs could be. For large employers, the
One such issue is the potential impact additional expenditure involved in funding
of pension auto-enrolment. Starting contributions alone could run into millions
from October 2012, for the first time, all of pounds each year. Yet our experience
employers will have to enrol their staff in is telling us that few employers are fully the provider and levied from the fund’s “Auto-enrolment is however, only the cost-effective and tax efficient.
a pension scheme and make contributions. aware of this, let alone actively planning investments will cease to be payable on latest in a long line of changes within the
Auto-enrolment will be phased in between for how auto-enrolment will affect their new schemes, or if a move to a new advisor employee benefits marketplace. Traditional “Given these major changes, which will
October 2012 and February 2016, starting businesses. takes place. Where this is the case, any ways of accessing employee benefits alter the benefits landscape placing new
with the largest employers. Employees will advisory costs associated with the running provision are changing as fees displace responsibilities and legal obligations onto
also have to contribute unless they choose “Recent research conducted by ERAICM of such schemes will, in future, have to be commissions and purchasers increasingly employers, a long, hard look at the entire
to opt out. shows that the likely increase in numbers met by the employer. Such costs will not be question the value obtained for that structure and delivery of employee benefits
joining and the need to match employee recoverable from the employees although expenditure. Old ways of providing cover, is advisable. As we have demonstrated,
The introduction of auto-enrolment, the contributions means the financial impact employers may be able to deduct them a ‘cradle to grave’ approach (or at least until the option of simply rolling over your
most radical change in pensions’ policy for employers currently contributing from contributions. an employee’s projected retirement date), existing programme, year-on-year, without
in decades, is a key part of the Coalition to employee pension arrangements are increasingly seen as inappropriate as subjecting it to an independent, transparent
Governments welfare and economic could be as high as a 40% increase in “Given this, where an organisation has employees stay with a company for only a and impartial review is one which may
reforms, and is expected to see millions of overall contributions, plus additional a scheme where its advisor is currently few years, rather than several decades. This come back to haunt your company in the
working people saving for a pension for the administration and management time costs. remunerated on a commission basis, it shift in the employer-employee covenant years to come.”
first time. There are no exceptions, even should consider reviewing its position now produces new challenges for employers
for the smallest employers, and there are “Our findings also show that few in order that any remedial or restructuring – particularly in the areas of Long Term To find out more about how ERAICM can
a complex range of changes surrounding organisations fully understand how their work can take place under the existing Disability, Private Medical Insurance assist you in this key area, please contact:
eligibility and contributions all of which pension scheme advisor’s commission commission terms. Once the changes have and Occupational Health provision – and
need to be taken into consideration when arrangements are currently structured. taken place, it will be difficult to change should lead to the consideration of new Brian Morgan, Director – Employee
planning for this seismic change in the Post the reforms, costs which are currently advisors unless the employer is prepared to approaches to the structure and delivery of Benefits, ERAICM on 01737 226866 or
pensions landscape. wrapped up in commissions paid for by pay hefty fees for corporate advice. such benefits in order to make them more b.morgan@eraicm.com

2. expert NewS - SeaN BiNGHaM
CSR and Cost Reduction - delivering
benefits to both the environment and
the bottom line
At first thought, you wouldn’t administration burden to be taken on.
automatically link Corporate Social Considering the health and safety aspect of
Responsibility with cost control, as an organisation’s CSR strategy, an effective
reducing cost is certainly not the road risk management programme will
primary goal of any CSR programme. have a positive cost positive cost impact
on insurance premiums, limit the loss
However, a recent study by Kenexa High of accidental damage excesses, reduce
Performance Institute has revealed that down time of vehicles through repair and
organisations that are genuinely committed ultimately create a more effective work
to CSR substantially outperform those force.
that are not. The report (which studied
175 companies) found that those that Also, for fleets looking to sharpen up
were most committed reported an average their CSR practices; when it comes
return on assets that were 19 times higher to employing strategies to implement
than the average of those least committed. a cohesive CSR and cost control
programme, a holistic approach needs to
A core focus with fleet operations in terms be taken which evaluates all the different
of CSR is centred on the environmental areas of cost of ownership within the
impact of its vehicles. Placing a limit corporate departments responsible for
on the amount of CO2 emissions being procurement of fleet vehicles.
produced is not only beneficial to the
environment, but will also lower the tax Effective advice and guidance for fleet
burden. Indeed additional fuel savings drivers is also essential to achieve
are achievable through behavioural optimum Corporate Social Responsibility
management in training staff to adopt the and cost reduction benefits. If you do
key rules of eco-driving. Studies have not have appropriate cost, purchase and
proven that fuel consumption can be supplier management expertise in house, “at first thought, you wouldn’t automatically link CSr with cost control, as reducing
reduced by more than 10%. However it is it is worth researching the market place cost is certainly not the primary goal of a CSr programme. However, within a fleet
believed that incentives for drivers will be for experts who can offer unbiased and
required to maximise the potential savings, objective advice pertinent to a business’s
environment, CSr and cost control go hand in hand.”
which normally requires a considerable specific culture. Sean Bingham, Fleet Management expert at expense reduction analysts
expert NewS - paUl DaviDSoN
Merchant Card PCI-DSS
Guidelines updated
August 2011 saw the PCI Data Security the development, management, education,
Council take the opportunity to update and awareness of the PCI Data Security
it’s guidelines for merchants using Standard (PCI DSS) and related standards
Wireless technology to collect payments that increase payment data security.
from customers.
Founded in 2006 by the major payment
The Payment Card Industry – Data card brands American Express, Discover
Security Standards (PCI-DSS) lay down Financial Services, JCB International,
minimum security requirements and MasterCard Worldwide and Visa Inc., the
guidelines to all merchants, including the Council has more than 600 participating
growing number of merchants employing organisations representing merchants,
‘Tokenization’. These regulations have banks, processors and vendors globally.
been created as part of an overall aim to “Wireless networks continue to be an easy
reduce the level of data breaches where target for data compromise, especially
customer card details are stolen. Failure to as new devices are added to these
comply with these standards or incidents environments.” said Bob Russo, General
leading to data loss can lead to substantial Manager of The PCI Security Standards
fines and brand damage. Council. “This resource remains an
important tool for understanding how to
Tokenization is the process of replacing secure your payment card data when using
sensitive data with unique identification wireless technologies.”
symbols that retain all the essential
information about the data without The guidelines are designed to help
compromising its security. Designed to merchants to interpret the PCI-DSS
minimise the amount of data a business standards, so are not prescriptive and do
needs to keep on hand, this practice has not change the standards. Each merchant
become a popular way for small and mid- must ensure that their individual operation
sized businesses to strengthen the security complies with the PCI-DSS standards.
of credit card and e-commerce transactions
whilst minimising the cost and complexity To find the guidelines on Wireless
of complying with industry standards payment and Tokenization, visit the PCI
and government regulations, such as Security Standards Council website: www.
those outlined by The PCI Data Security pcisecuritystandards.org where merchant
Council. payment guidance, Self-Assessment
Questionnaires, lists of qualified Assessors
The PCI Security Standards Council is an and valuable information is available.
open, global forum that is responsible for

3. expert NewS - THe CoMMS TeaM
Have your rates to call mobiles dropped?
From April 2011, OFCOM has enforced benefiting from this reduction.
a reduction in Mobile Termination Rate
(MTR). The MTR was originally introduced
to allow the Mobile Network Service
The MTR is the amount that the Mobile Providers to recoup their investment in
Network can charge the originating building the network infrastructures but
network (e.g. BT) for inbound calls to their OFCOM, under sustained pressure from
network, this has been reduced from 4.18p/ BT, has decided that the Service Providers
min to 2.66p/min. have had sufficient time to cover those
investments and over the next few years
For example, this means that it now costs MTR will drop to close to 1p/min.
BT less to route your call to a Vodafone
mobile and O2 less to route your call to However, this is not all good news; The
an Orange mobile. Essentially, it is now reduction in MTR will impact the revenues
cheaper to route all cross network calls to of the Mobile Network Service Providers
mobiles. and whilst the strong levels of competition
will prevent them from increasing their The Expense Reduction Analysts
But there is evidence that these savings headline business rates they will be looking Communications Team have tools to quickly
are not being passed on to all end-users, for areas where they can up their prices and and easily analyse your communications
so companies should scrutinise their it is likely that the hardest hit will be pay- costs and advise you on how to get the best
bills carefully to see if they are actually as-you-go customers. value from your suppliers.
expert NewS - GleNN CoTTer
Top ten tips for reducing waste in
the Retail and Wholesale sectors
Top ten tips for reducing waste in the Most UK businesses can reduce their waste The recycling ethos… The significant cost savings and sandwiches without the need for any
Retail and Wholesale sectors costs by 1% of turnover. This is equivalent • Avoid producing waste in the first place improved efficiency achieved with waste alteration or redesign. The trays are no
to increasing sales by 10% or even 20%. • Minimise the amount of waste you do minimisation allow companies to maintain longer used just once, but are re-used at
Reducing operating costs and overheads Shopping centre managers in the UK produce their position in a very competitive UK least three times. Broken trays are returned
is paramount for companies operating currently spend about £36 million/year • Use items as many times as possible market. It will also put them in a strong to the supplier for recycling.
within tight margins and in a competitive on waste disposal. This cost is expected • Recycle what you can only after you position to deal with the increased The benefits have included:
marketplace. to rise to £39 million/year by 2012. Given have re-used it competition arising from the breakdown • estimated savings of over £125 000/year
the true cost of waste there is a strong • Dispose of what’s left responsibly of European and global trade barriers. • savings of approximately 200 tonnes/
The cost of waste is typically 4% of business case for taking action to prevent year of plastic
turnover – in some companies it can be and reduce waste. Waste minimisation Why reduce waste… Improve management control • savings of approximately 270 tonnes/
as high as 10%. Implementing waste focuses on avoiding waste from occurring. Some of the main reasons for reducing the A systematic waste minimisation year of cardboard reduction in the
minimisation measures can reduce these Waste management focuses on how best to amount of waste your company produces programme gives greater understanding packaging obligation costs for Boots and
costs by a quarter – often with little or no deal with wastes that do occur. are detailed below, along with advantage of material use, utility consumption, waste its suppliers
investment cost. Across the retail sector as it can bring… generation, waste management procedures
a whole, this could result in cost savings of In the retail sector, implementing a and waste disposal costs. This knowledge Top Ten Tips for reducing
£2.25 billion/year. systematic programme to minimise waste Increase profits allows greater control of what is happening waste in the Retail and
can reduce the costs associated with: Most UK businesses can reduce their and the associated costs. Wholesale Sector…
Waste minimisation is good environmental • packaging waste costs by 1% of turnover. This is 1. Separate waste at source (particularly
practice and good business practice. • waste disposal equivalent to increasing sales by 10% Improve their image cardboard and polythene) and send for
Reducing material consumption and • water use or even 20%. In a business where profit Greater public awareness of environmental recycling.
waste generation while providing the • heating and lighting margins are tight, a reduction in waste issues has increased pressure on retailers, 2. Separate food waste – particularly if
same service reduces both environmental • warehousing product returns costs can be the difference between profit suppliers and shopping centre managers to a waste compactor is used to prevent
impact, and costs whilst improving those • damaged goods and loss. Maintain competitiveness. improve their environmental performance. odours and contaminated run-off (the
all important profit margins. • transport Service providers that can demonstrate compactor may hold waste for a number
• buildings and grounds maintenance good environmental practice have a of days).
marketing advantage. 3. Arrange for returns and unsold products
to be sent back to suppliers.
Achieve cost-effective compliance with 4. Re-use packaging materials (e.g. bubble
environmental legislation wrap and boxes) and use re-usable
Retailers are subject to a number of wood, metal or plastic pallets/crates for
regulations and other mandatory charges, regular deliveries.
e.g. Duty of Care, the packaging waste 5. Fit water saving devices in toilets and
regulations and landfill tax. The costs of washrooms, e.g. urinal timers and
both waste disposal and compliance with cistern volume adjusters.
environmental legislation are set to increase 6. Turn off lights at night and during
further in response to these and other factors. closed periods.
7. Ensure heating, boiler, air conditioning
Adopt a systematic approach… and lighting programmes are
A successful waste minimisation programmed correctly to turn off
programme is one based on a systematic at night and when premises are
approach that involves: unoccupied and that these systems are
• measuring material use, utility regularly maintained.
consumption and waste generation 8. Install energy-efficient heating, boiler,
• planning air conditioning and lighting systems.
• identifying priorities for action This is particularly relevant for lighting
• setting targets that is in high/continuous use.
• implementing waste minimisation measures 9. Set budgets and/or benchmarks for key
• monitoring material, utility and waste management
costs (e.g. £/m2 of floor space/year or
These ‘Boots’ were made for kWh/m2 of floor space/year for energy).
recycling… 10. Obtain bills from head office if they
The Boots Company has developed a are not received at the branch. Develop
system for re-using the plastic transit incentive schemes to reward waste
trays for the delivery and display of its reduction and efficient use of energy.

4. SucceSS Story - Wharfedale expert NewS - STeve leTley
Expense Reduction
Analysts deliver
Gas and electricity
amplified savings price hikes Not only does this simplify the
administration, this will also allow
companies to take advantage of better
pricing as energy providers will offer better
on Wharfedale’s
rates depending on the level of business
Gas and electricity price hikes have Companies also need to be smart when being placed.
commanded a lot of attention recently. negotiating new contracts to reduce the
burden of the recent price increases; in a Energy efficiency should also be looked at,
courier costs
These price increases have been caused very volatile market that sees changes on a as by reducing the energy used, companies
by a number of world events including day to day basis, this may be achieved by can make significant reductions on their
uncertainties in the Middle East and the simply approaching the bills. Fairly easy steps can be taken to
earthquake and Tsunami in Japan which market at the right time reduce consumption, this may involve
in turn have caused worries about supply and not when the market looking at replacing equipment which
shortages going forward. is at a peak. However, will involve capital costs or it could be as
companies can also simple as looking at internal policies for
With these price hikes in mind, together obtain an advantage powering off computers terminals and other
with clocks going forward and the colder by trying to bring equipment.
months fast approaching, now is the time to all energy contracts
think about Utilities supply arrangements. under the umbrella What is clear is that companies need to
of a single supplier consider their Utility spends now and not in
Wharfedale has been part of the IAG sufficiently in the courier market – suppliers Companies need to review their Utilities with a single 3 months time when the cold dark nights are
Group Ltd. since 1996. Always at the had merged, services had been enhanced – supply arrangements on a regular basis to contract end date. well and truly upon us.
forefront of loudspeaker design, from that it might be worth Wharfedale’s while ensure they are in appropriate contracts.
it’s conception in 1932 by Gilbert Briggs, for Steve Parrott to review their courier In some cases, companies who have not
Wharfedale is one of the most creative costs again on a contingency basis. negotiated new fixed term contracts may
and innovative companies in the market. be paying in excess of 50% more than they
Pioneering products such as the Diamond Steve Parrott describes the result: “What need to for their energy supply! In this day
series, which first defined the market for I found was very significant. Not too long and age, that could prove very costly.
bookshelf speakers and are now regarded after we finished our two-year monitoring,
as ‘classic’ designs, were firsts of their kind. the supplier started to edge his prices up –
changing the basis of volumetric weight
Continuing this tradition, IAG has invested calculations, increasing fuel and other
in and developed new manufacturing surcharges, and increasing the per kilo rate –
processes and technologies, and an to the extent that they had eventually clawed
innovative building process that has enabled back between 16 and 17% of the 19%
them to produce high quality materials for a saving we had originally identified. And the
fraction of the cost. only notification that Wharfedale got of any
of these changes was in very small print on
Paul Wheatley of Expense Reduction the last page of an 8-9 page invoice.”
Analysts reviews the partnership between
his company and Wharfedale: “Looking “It is only something that a regular,
back, it is the courier project that stands detailed review could have noticed.”
out. It certainly had its twists and turns. But, Tim Harris comments: “I was naturally
going back to the beginning, when we first surprised by what Paul and Steve showed
got the go-ahead from Tim Harris to look at me. That is when I realised the true value
this area, I was fortunate to be able to call of their service. To be fair to my guys,
upon the expertise of my colleague, Steve there is no way in the world that we could
Parrott, to analyse the spend.” have devoted sufficient time and effort to
recognise that these prices were creeping
Steve Parrott comments: “The initial project back up. It is only something that a regular,
followed the normal pattern. After looking detailed review could have noticed.”
in detail at their expenditure in this area, we
were able to recommend various changes Steve Parrott then analysed the market
which resulted in a 19% saving. As is the on Wharfedale’s behalf, recommending expert NewS - CHariTy SpeCialiST
norm, we then undertook our two years’ changes implemented in the summer of
Ten tips for reducing your
monitoring service, to ensure that these 2011, which will realise 36% savings.
savings were realised across that period. The significantly better savings, delivered
through an alternative supplier, reflect the
“What I found was very significant” many changes that had taken place in the
charity’s expenditure
“At the end of that period, Tim Harris took supplier market. These changes prompted
the decision not to opt for our ongoing the recommendation on this occasion to
service, and in all honesty, you can see the switch suppliers to one whose service
logic behind this. The incumbent supplier profile better matched Wharfedale’s needs.
had retained the business so had been
known to Wharfedale for many years; the Tim Harris summarises the value of Neill Summerfield, an Expense Reduction the expense is vital to the charity managerial control is vital to ensure costs
tariffs were set. On the face of it, there was Expense Reduction Analysts’ service Analyst consultant, recently helped the are kept to an absolute minimum. If this is
nothing that necessitated monthly analysis.” to his business: “I cannot recommend Royal Academy of Dance save over £1m Tip 4: Be Objective – Weigh up all options not possible all purchases need to be visible
Paul and Steve and the service that their in costs. These are his top ten tips on and look at the issue from all areas of the through statements and receipts.
Paul Wheatley continued to manage the company delivers, highly enough. They do how other charities can reduce their own charity before making the decision to cut or
account’s other requirements, and fifteen something which no business – certainly expenditure. change supplier. Tip 8: Read the small print – Charities
months after Expense Reduction Analysts no business of our size – could do. They often get stung as they haven’t fully
had ceased the routine monitoring, in the find savings, and they make sure that those Tip 1: Have a thorough review – Many Tip 5: Shop around – It’s tempting to stay understood the legalities behind contracts
course of a general discussion, he suggested savings are realised for as long as one asks charities decide to cut costs but don’t with the same suppliers for years due to lack and agreements with suppliers. Always
to Tim Harris that things had changed them to do so.” carry out a thorough review first and make of time to ‘shop around’, but this time can read the small print before signing any
rash decisions that might not be the most equate to large cost savings. What was the contract and seek advice if unsure.
effective cost savings in the long run best deal 5 years ago probably isn’t now, so
“expense reduction analysts have Tip 2: Make a list and prioritise – After
look at what other suppliers can offer. Tip 9: Keep up-to-date – Technology
is evolving as fast as ever and there are
proved that they can add profit to my conducting a review, list every element Tip 6: Negotiate – Suppliers across all always new ways of making tasks quicker
of expense within the charity and look at sectors and industries want your business and easier.
bottom line. They are experts at staying the ROI of each of the costs, this will help so barter with them. Don’t automatically
make clear which expenditures to cut first. take the first offer; keep going back to Tip 10: Don’t lose sight of quality – In
on top of the detail of costs to ensure that each telling them you’ve been offered a difficult economic times cutting costs
Tip 3: Listen to staff – After recognising better price. might seem like the only way to survive,
they are realised over the longer term” potential cost savings speak to staff about but never make any decisions that will
their thoughts on reducing the expenditure. Tip 7: Take Control – Many charities allow impair on the quality of your services. It’s
Tim Harris, Managing Director, Wharfedale They might agree or point out a reason why staff to make purchasing decisions but just not worth it.