Sales through Service: Issue 19- Cost Reductions


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 Part 21 in a series of articles from Sales through Service: How to make customers want to buy again and again and again (because you’re so ‘great’!) by Guy Arnold


 Issue Number 19 – Cost Reductions

Every business is always striving to reduce costs: of course they are, and many Accountants and Finance Directors are paid handsomely to state the bleeding obvious.

Many Businesses and public sector Organisations are in the difficult situation of having to increase sales, or increase activity, whilst at the same time reducing costs.  This will continue to be the case as the world becomes ever more competitive, and the market becomes ever more global in nature.

First of all, have a clear Customer Focused Mission so you know what is a true cost and what isn’t:

So, what’s the counter intuitive answer to this? 

  • a true cost is something that detracts from your Customer Focused Mission.  It’s just a cost that adds no value to your customer’s real needs, and you should look at this to reduce it as much as possible.  However, lots of things that an Accountant will tell you are costs (for example, developing your people), are in fact investments, if they relate to the Customer Focused Mission and the customer’s real needs. 

So, look to spend MORE on those areas that are going to fulfil your mission and your customer’s real needs, and boost customer loyalty, referrals, repeat business, up-sales and cross-sales, plus at the same time reducing all of those costs that do not do this

Top Tip: Spend a lot of time making sure you, and all your team (and your accountants) know what is a real ‘cost’ in your business (and needs constant focus on reduction) and what is really an ‘Investment’ (and should be measured and invested in!)

Never be tempted to reduce spend that will then impact negatively on your customer experience: this is a short term fix to a long term problem: resist your Finance Director or Accountant when they tell you that you should cut down on expenditure in training, and in making sure the customer experience is consistent and continually improving.

  • Look at everything you do, one by one, little bit by little bit, and ask yourself, is this important to my Customer Focused Mission? 
  • Is this important to the customer’s real needs? 
  • How can I increase this inch by inch if it is important, or decrease it inch by inch (or quicker) if it isn’t? 
  • How will I measure results and know how I’m doing, and make sure these changes are happening?

How do you do this?  Or course: inch by inch:

So, look at all your costs, cut out the ones that are unnecessary, but instead of cutting out those sort of costs that your Accountant may say are relatively unnecessary, look to increase those if they drive customer loyalty, referrals, cross-sales and up-sales, and make sure you have clear measures and work on them inch by inch, because without these you will be stuffed and you will be tempted just to cut them (as they will have no IMMEDIATE bottom line impact when they are cut).


Next time: Issue 20- What is the Problem with Selling? 

Republished with author's permission from original post.

Guy Arnold
Guy is the author of 'Great or Poor' ( ) … a simple and effective system for delivery of consistent and continually improving customer experiences, 'Go the Extra Inch' the effective way to empower your people, and 'Sales through Service' ( ) how to sell more through repeat business, referrals, round sales and reputation (the 4 R's). Guy helps Organisations large and small to systematically make more sales for lower costs, through 4 simple principles.


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