Electricity and Water Costs Reduction for Webstar Food Industries - Case Study Example

Assignment Cover Sheet Number: School of Law and Business Charles Darwin Casuarina NT 0909 Phone: (08) 8946 6830 Fadel Rkein 227766 Unit Name: Unit Code: PROFESSIONAL PRACTICE EXPERIENCE PRB001 Lecturers Name: MS. ROOPALI MISRA Assessment Title BUSINESS PROPOSAL Semester: Year: Assignment 2 (select assignment number) 2 2014 Due Date (dd/mm/yyyy): Lodgement Date (did/mm/yyyy): Applied for Extension: (dd/mm/yyyy) 29/08/2014 29/08/2014  N/A  NO  YES – to       Lodgement Locations: (refer to specific lodgement requirements as set out by the lecturer) DO NOT LODGE BY FAX nor EMAIL nor at LECTURER’S OFFICE The assignment must be lodged online via the Learnline Assignment Lodgement link on the Learnline site for this unit. Ensure your file is named using a file naming convention that allows the lecturer to identify to whom it belongs. Failure to use an acceptable file naming convention may result in your assignment lodgement being rejected. Refer to the endnotes of the assignment details for lodgement options if the Learnline Assignment Lodgement link for this unit is unavailable. KEEP A COPY Ensure you have a copy of the assignment lodged. If you have submitted assessment work electronically please make sure you have a backup copy. DECLARATION BY STUDENT I certify that this assignment is my own work, based on my own personal study and research, and that I have acknowledged all material and sources in the preparation of this assignment, whether they be books, articles reports, lecture notes, any other kind of document or personal communication. I also certify that this assignment has not previously been submitted for assessment in any other course or at any other time in the same course and that I have not copied in part or whole or otherwise plagiarised the work of other students and/or persons. I have read the University’s Academic and Scientific Misconduct Policy and understand its implications.* http://www.cdu.edu.au/governance/documents/3.3AcademicandScientificMisconduct_000.pdf Student Signature: (Select if lodging electronically FADEL RKEIN *By submitting this assignment and cover sheet electronically, in whatever form, you are deemed to have made the declaration set out above Office use only Assessor use only Date Received: Please place grade here D…..../M…..../Y…..... Date Sent to Lecturer: D…..../M…..../Y…..... Comments:       ELECTRICITY AND WATER COSTS REDUCTION FOR WEBSTAR FOOD INDUSTRIES PREPARED FOR: John Conner Managing director, Webster Food Industries PREPARED BY: Mercy Changelings, The accountant, Webster Food Industries SITUATION Webster food industries are in need for a reduction in the electricity and water bills. The electricity and water bills have gone up since the financial year began. It has created an increase in the costs of production and has led to the overall reduction in the company’s profits. Reduction In the costs will cause better management, improving the employees’ salaries and getting better equipment for production It has come to my attention that most of the employees leave the water running after washing their hands and most of them do forget to switch off the electric equipment’s when they are not in use, this has led to a significant increase in the costs of electricity and water bills, which has led to loses. Electricity and water bills are major costs in companies and creating awareness by seminars and reminding them through notifications in the affected areas will reduce the costs. Giving employees the responsibility of reminding their fellow colleges to do the small things like not leave the water running and to switch equipment is and lights off whenever they leave a room will lead to division of responsibility, which will lead to a growth of a positive response towards change. Proposed solution In order for the reduction of electricity and water costs to work, we need to start with a seminar for our employees to educate them on a better way to use the water and electricity in our company to reduce costs and improve profits. We can start by setting dates in which the seminars will be implemented and getting a well-known spokesperson to educate our employees on better ways of usage of the company’s resources ( Bloomsbury information ltd 2009). Typing notification in the bathroom sinks reminding employees not to leave the water running after use, employing a supervisor to help remind the employee’s handling electric equipment not to leave them on because not only does it increase the electricity costs but it also imposes a risk for the employees by increasing the number of accidents (Stewart 2004). Developing a work guide and distributing them to the employees guiding them on better usage of the company’s resources, not only does it guide the employees on how to save costs it also acts as a reference for their work thus increasing the production. Introducing allocation of costs to determine which department uses a lot of electricity and water and establishing ways to reduce the usage in those departments. Reducing services that are not required that use unnecessary electricity and water that increasing the cost. Taking measures that will reduce overcharging such as making an agreement with the electricity company and the water company to give a discount or charge a fixed amount that will reduce the cost of electricity and water (Stewart 2004). The electricity and water costs can also be reduced by seeking alternative providers of the services that are of quality and quantity that will lead to reduction of costs. Hiring a recognized audit firm to do an in-depth audit to fish out the unnecessary activities that cause the increase of the company’s costs. Steps to be undertaken 1. Deciding on the best dates to carry out the seminars to educate our employees without interrupting their work. 2. Assigning each of the selected dates with the various departments and assigning a lot of time to the department that is worse affected. 3. Putting up reminders in the necessary places. 4. Printing out and distributing educative pamphlets with a guide to help the employees with proper usage of the company’s recourses. 5. Make a proposal to the electricity and water companies that will see the reduction of charges. 6. Seek out the unnecessary services that lead to increment of the company’s costs. 7. Making sure that the electricity and water bills are paid on time to avoid penalties that increase costs. Benefits Reduction in costs will improve the company’s profits which will enable us improve and advance our capital to a level where the production of our products will be much easier. This will lead to profits as the products will be of high quality attracting customers. The quantity of the production will also improve leading to more profits. When the company is doing, well the employees will also benefit by getting a higher salary that will improve their standards of living. The reduction of costs will also lead to the growth of the company which will offer more employment to the people of the society improving the country as a whole in the long run. Proper use of the electric machinery will also benefit the employees by reducing the number of accidents thus reducing the electricity cost as well as the medical costs (Accenture 2014). Hiring a recognized audit firm to do an in-depth audit will not only reduce cost in the long run by eliminating costs that may occur due to unnecessary activities but also correct errors that will lead to costs like the existing ghost workers that may still be in the payroll. A proposal to the electricity and water companies will not only reduce costs but also make sure that the company is getting the best services, which will lead to a production of quality and quantity products. Making sure that the electricity and water bills are paid on time will not only reduce costs but will also not reduce the production in the company due to disconnections. Obstacles The biggest obstacle facing this proposal is changing the habits our employees. Punishing employees seem ignorant to the proposed charges and rewarding employees who seem to understand and implement the proposal charges will help in curbing the bad habits. The cost associated with employing a supervisor to supervise the department with the most electric equipment’s may also is an obstacle (Jay 2001). The cost of printing out pamphlets will also be an obstacle due to the number of employees. The cost of putting up stickers at the affected areas like bathrooms and electric departments to remind employees not to leave the electric equipment’s on and not to leave the water running will also come with costs ( Entrepreneur media 2004). Putting up the proposed dates of the seminars may also be an obstacle it may destructs proper running of the company and thus leading to costs. The seminars may also come with costs of paying the employees allowances and providing them with meals so as to encourage them to attend and to avoid disruptions. The costs that’s will be associated with hireling a good educator and spokesperson who is from an electric and a water company and getting one that will direct the right message to the employees will also cost the company. Also providing writing materials at the seminars so that the employees take notes of what the spokes persons are teaching will also come at a cost (Hickel 2008). . The proposed agreement to the water and electricity companies may be rejected and it may take a lot of time and many negotiations to find a company that that will agree the proposed terms. Doing a deep audit will take a lot of time which will come with a lot of costs for the auditors fees and may disrupts the company’s running during the audit process (Jay 2001). Payment of the electricity and water bills may be an issue especially due the lack of priories the bills and numbing the old habits of paying the bills late. References 1- Accenture, strategic cost reduction. Service overview 2014.Available from: Read More