A one per cent cut in purchasing costs has the same impact as a 10-15 per cent increase in sales, according to the Chartered Institute of Purchase and Supply.

The new entrance of Browns department store in York.

Couple this with an estimated £10 billion overspend each year by British companies on everyday business expenses and concerns over recession and the global economy, and it is easy to understand why business managers can no longer choose to ignore everyday business expenses as an area to be targeted for reduction.

Michael Wood, of ERA, specialists in Expense Reduction Analysis, was recently asked by independently-owned department store Browns of York to investigate its overheads in the areas of stationery, print and merchant card fees.

Browns, which was praised in York Civic Trusts' Annual Report for its re-designed entrance, has been trading since 1895. It has a smaller branch in Helmsley.

After an initial investigation into annual usage at Browns an exercise was undertaken by Mr Wood to evaluate the competitiveness of the existing agreements, against current market prices and service levels. The results are expected to deliver significant savings to the company this year.

He said: "In today's highly-competitive market place Browns, like ERA, has demonstrated its ability to not only meet but exceed clients' expectations, whilst encouraging and achieving a friendly and effective working relationship."

Mr Brown believes most companies are overpaying suppliers by as much as 20-50 per cent by not buying at the correct volume to secure the best prices.

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