major way to reduce cost

Q. 1 - What is the major way to reduce cost? 

Ans: - There are nine major cost drivers that come into play in determining a company cost in each activity segment on the value chain-

01.   Economic or diseconomies of scale.

02.   Learning curve effect.

03.   The cost of key resources

i.                    Union Vs nonunion labour.

ii.                  Bargaining power vis-à-vis supplier

iii.                Location variable

iv.                Supply chain management expertise.

04.   Link with other activities in the company or standing value chain.

05.   Sharing opportunities with other organization business unit within the enterprise.

06.   Benefit with vertical integration.

07.   First mover advantage and disadvantage.

08.   The percentage of capacity utilization.

09.   Strategic choice and operating decision.