An investigation into the effectiveness of cost reduction techniques, a cost benefit analysis: case of Plus Five Pharmaceuticals

Abstract

This research study was undertaken to analyze the effectiveness of cost reduction techniques on cost benefit analysis at Plus Five Pharmaceuticals. The researcher observed that cost reduction techniques implemented were actually resulting in increased costs which triggered the need for this research. The research therefore aimed to identify the current cost cutting measure adopted, to establish necessary controls to validate the implementation of the identified cost reduction techniques and to discuss the impact of other cost reduction measures on Plus Five Pharmaceuticals .Also targeted by the research were the challenges encountered in the execution of the suitable cost reduction techniques before concluding to determine the cost reduction techniques which Plus Five Pharmaceuticals could adopt to improve on its profits. The researcher concluded that that cost reduction improved profitability thus a benefit on the cost benefit analysis. Although some techniques were not implemented correctly, the occurrence of the expenses differ depending with the period. The researcher rolled down the curtain by recommending that the company should have stiff rule of measure facilitating costs control to achieve the goal of cost reduction techniques .Training and workshops alerting the employees about the controls are necessary as they educate the workers on the aim of cost reduction, reasons for the implementation and the possible outcome if the procedures are not followed.