Addressing your cost and capital needs today to fund your future for tomorrow
SG&A and operations
Where can I streamline my business operations to be more cost efficient and resilient to fluctuations in revenues?
- Operating model: Only 35% of large companies say they are making good progress in their digital transformations.
- Labor productivity: 70% of organizations believe that productivity is a concern with remote working.
- Third-party spend: 50% of Fortune 100 companies' expenditures involve third parties.
- EY employs leading practice tools such as ZBB to identify which cost levers a company should pursue to maximize profitability.
Revenue and margin
In what areas do opportunities exist to optimize products and customers to drive topline growth and gross profit?
- Cost of goods sold: 41% of companies are accelerating plans to automate as a result of the coronavirus, which will impact the cost of goods.
- Price and promotions: 20% of manufacturer revenue is invested on trade promotions (pdf).
- Customer demand: Responding to changing customer trends, 75% of organizations selling direct to consumers will offer subscription services by 2023.
Capex and cash
Where can we free up capital from operations that can be redeployed for growth or for a stronger balance sheet?
- Working capital: The average amount of working capital carried by companies amounts to 5% of total revenue.
- Capital portfolio: The average real estate costs at most companies amounts to 3%-5% of total revenue.
- Tax savings: The average indirect tax burden at most companies amounts to 25% of total personnel expenses.