Your Indirect Costs Allocation
Your accounting reports don’t show Indirect Costs in a useful manner again. Because this is where they have a set of pre-established categories that may or may not reflect your strategic needs. We will need to re-assign some of your costs categories by asking ‘what is the ultimate purpose of that expense’?
Spotting hidden Direct Costs
Re-grouping Indirect Costs
Let’s say your IT costs used to be minimal. But now you are launching an e-learning service for your clients and you will invest heavily in a platform to support your service delivery. We would want that cost separated and monitored against revenue for a while.
We will avoid splitting hairs if we can. But if the percentage of that hairy area is fairly big, we will look into details.
Benchmarks for Indirect Costs
We have seen enough businesses, most likely within your specific industry, so we can give you an indication of where your percentages could be. However, all our clients are at different stages in their growth and maturity. What someone spends for marketing after 20 years of stable account management activities is different from what someone should spend in their first three to five years of establishing a brand. We will not cage you in a benchmark and ask you to cut costs at any … cost, but we will not close our eyes if some of your budgets spring out of the spreadsheet.