June 2022

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Supply Chain: Strategic cost management: Uncover supply chain inefficiencies

Controlling costs is critical for any energy company. Firms may spend to grow through acquisition, develop new business, gain market share or invest in new opportunities.

Long, P., Opportune LLP

Controlling costs is critical for any energy company. Firms may spend to grow through acquisition, develop new business, gain market share or invest in new opportunities. However, as a business activity decreases following this period of growth, what happens to the variable costs? If companies have planned strategically, their variable costs fall directly proportional to their activities. Conversely, if they have invested without careful execution of the growth strategy, companies may be stuck with higher variable costs despite the lower activity. This asymmetrical relationship can be found through comparisons of selling, general and administrative (SG&A) and cost of goods sold (COGS) t

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