the profits at
the end of the year, that is, the amount of money he makes net.
It is easier to increase profits by cutting the expenses in many cases
than it is to increase profits by increasing sales. And here let us
remark that on this subject, as well as all the other subjects we are
writing about in this series of articles, we have in mind the matter of
common sense, temperate action. Extremes carry things too far. You must
not cut the expenses beyond the point where it seriously interferes
with the sales.
If you are interested in this matter of expense, and you certainly
should be, take up your items of expense for last month or last year,
go over the cost of help, the cost of raw material and the cost of
manufacturing; go over each branch of your expenses, analyze the items
carefully, look into every point thoroughly, and we will guarantee that
at the end of your analysis you will see where you can save a
respectable sum in the operation of your business. In going into this
matter of expense, do not take all the items at once, but take each
item up separately and go through it thoroughly.
Do not assume that you are paying too much for everything, but use good
sense and good judgment and see that you get your money's worth. Take
the item of wages. Look over the individuals in your employ, and you
will see a place, for instance, where two persons can do the work three
are now doing. Remember, it is generally true that where two persons
are engaged in handling a certain department and they are overworked,
the tendency is to give them additional help. When this is done you
will find thenceforth all three are busy. In other words, each of the
two persons who were formerly overworked ease up and do less work the
moment the third person is given as assistant. You have noticed that
where you put three employes to do the work formerly done by two, it is
almost impossible--if you take the employe's word--to get two employes
to do the work after three have been doing it.
The work should push the employe. The employer should get full capacity
of his employes.
Look over your pay roll and make up your mind that here and there you
are going to employes and ask them to help you save money, and at the
same time you will let them earn more money for themselves. You will
find that this plan works admirably.
For instance, if you have three employes getting $10.00 a week each; go
to the two who do the most work and say t
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