A penny saved is a dime earned…

 If a business makes 10% profit on every dollar of revenue, the business must earn an extra dime for every unnecessary cent spent. For a one hundred thousand dollar vendor account with $10,000 (10%), the business would have to earn $100,000 just to pay for errors and inefficiencies. For a one million dollar vendor account, $50,000 to $100,000 in waste would require the business to earn $500,000 to $1,000,000 just to pay for the mistakes of a purchasing agent, vendor issues, and/or a lack of reasonable inventory control. Although it is dubious to say $100,000 in waste equals a $1,000,000 loss, $100,000 in waste would essentially negate $1,000,000 in revenue. For a business with multiple vendor accounts of this scale, that is a huge portion of revenue erased by a failure to adequately address unnecessary and controllable expenses.

Although sales and customer service are important in terms of revenue, purchasing, receiving, and inventory control are critical business functions when it comes to retaining that revenue. Those who are proficient at purchasing, receiving, and/or inventory control are worth their weight in gold, especially if they have the record-keeping and analytical abilities to build and improve the systems necessary to achieve efficiencies in these areas. How many (small) businesses owners overlook these costly business functions and those who reduce the costs associated with them? How many think about ways to get employees to care about these things or empower (hire/promote) those who do?