Article written by Simon Unger | The Procurement Group
When a client says that everything is getting more expensive, the temptation is to produce a list of costs to cut. A more useful starting point is to establish what has changed and why. That turns a general concern about inflation into a practical conversation about decisions, evidence and responsibility.
For accountants and bookkeepers, this does not require becoming a specialist in every supplier category. It requires a repeatable review method, an understanding of the client’s operations and the judgement to bring in technical expertise when needed.
Separate the causes before choosing a response
An increase in a bill can come from four places: price, usage, scope or billing. The supplier may have increased its rate. The client may be consuming more. A new site or additional service may have expanded the scope. Alternatively, the invoice may contain an error.
Each explanation suggests a different response. A price change may justify a commercial review. Higher consumption calls for a discussion with the operational team. New scope needs to be checked against the business requirement. A suspected billing error needs evidence before it can be challenged.
The distinction matters because not every increase is waste. The cost of opening a productive new site is different from paying for a service nobody uses. Nor does an adverse variance automatically represent an achievable saving.
Protect capability while reviewing cost
Before agreeing a cut, ask three questions: does it remove waste or essential capability; who will notice the change; and what is the net benefit?
A reduction in cleaning hours, for example, should not be assessed only against the wage or supplier charge. It also needs to be tested against the required service standard, operational consequences and any additional work created elsewhere. The apparent saving can look very different once those factors are included.
Where suitable, a limited and reversible trial can help. Safety, compliance and critical service dependencies should remain explicit constraints, not risks hidden inside a financial score.
Apply consistent questions across overheads
Energy, telecoms, waste and merchant services can all be reviewed through four lenses: contract, pricing, usage and supplier performance. The technical details differ, but the initial questions are consistent.
What has the client agreed to buy, and until when? What does it cost in total at the expected activity level? Is the service being used? Is the supplier delivering what was agreed?
For energy, that might start with a complete site list and a renewal diary. For telecoms, it could mean matching billed services to devices and users before cancelling anything. For waste, the specification and collection pattern deserve as much attention as the price per lift. For card payments, total fees need to be compared against matched turnover rather than relying solely on the headline rate.
Finish with a plan and verify the result
A useful review ends with a small number of actions, not an extensive list of possibilities. Each action should have an owner, a deadline, an approver and a clear measure of success.
Prioritise by ease, impact and implementation risk, while allowing service and compliance deadlines to override the ranking. Then check what happens after implementation. The new invoice and the actual service should support the outcome being reported.
Keep recurring savings, one-off recoveries and cash-timing improvements separate. Include transition and implementation costs. This gives the client a clearer view of the benefit and makes future reviews more credible.
Deliver through the client’s existing adviser
There are different ways for a firm to offer this service without building every category specialism internally. Under a white-label partnership, TPG can support analysis and client-facing material in the firm’s branding for its team to deliver. Alternatively, TPG can deliver the agreed service to the firm’s clients on its behalf, under that branding.
The scope, fees, responsibilities, permissions and communication arrangements should be agreed before work starts. A sensible first step is one client, one category and one clearly defined decision.
Simon Unger leads The Procurement Group. To discuss a white-label cost-control partnership for your firm, contact [email protected].
The contents of this article are meant as a guide only and are not a substitute for professional advice. The author/s accept no responsibility for any action taken, or refrained from, as a result of the material contained in this document. Specific advice should be obtained before acting or refraining from acting, in connection with the matters dealt with in this article. The information at the time of publishing was accurate and could be subject to final changes.
