My old boss at Tesco had an interesting way of considering whether to invest the companies money on stuff that we told him we needed. He calculated the profit in an average shopping trolley using this value as a unit of currency to measure whether expenditure would provide a good return for the business.
For example I wanted to do an advanced facilitation training course. We worked out that 55 trolleys of shopping would have to be sold to pay for the course. It forced me to look at the expenditure in a very real way and after exploring other options I found an 8 trolley solution. I put this logic to use regularly at Orange where we used how many annual mobile phone contracts would be needed to cover a cost.
So, what would be the ‘shopping basket’ for your business? Perhaps it is the number of hours chargeable work you would have to do, the number of shipments you need to make, number of meals served, number of kids that have to be cared for in a week etc.
This tool isn’t just for cost control. I also use it in sales and it won me a client a couple of years ago when we worked out that if I helped him sell one more product a year it would more than fund his investment in coaching. Get in there!!!!Share