Artemis Sportswear Proposal
Alyssa Casler, Derrik Carr, John Humphrey, Raven Porter, Tieran Dysart
Comm/215
Oct 13, 2014
Rebecca Kinney

Artemis Sportswear Proposal
When running a business, there are many factors that go into a successful business. Keeping your customers, shareholders, and employees happy will determine if your business fails or succeeds. The biggest part in keeping a business thriving is if it is making money. We could raise prices and leave everything the way it is, but that could lead to a decline in customers. Raising the prices with no inside changes to how the business runs could also scare away investors or lead to less interest in our company. This could also lead to our employees not having very much confidence that we will be around as a stable job opportunity.
During the recession, many companies were losing profits and created unnecessary risks in search of growing their profit margins (Mariotti, 2011). This is the basis of the proposal to increase Artemis Sportswear profits without taking unnecessary risks. The four points labor costs, operational costs, marketing, and non-essential costs will guide us in increasing profit margins without taking unnecessary risks. Another point we will discuss is the impact on morale and possible solutions to alleviate the impact on our employees during these changes. Even though, there could be a negative impact on workers and productivity, cutting operational expenses will increase profits and could help avoid massive layoffs of employees.

Labor Costs
One of the biggest changes that have to be made are in our costs of labor. Michael Lewis (n.d.) explains that:
Salaries and wages are one of the largest costs of every company and are often the most difficult to control. But changing compensation is touchy for those who are affected, so it is important to handle the changes with compassion, truth, and firmness (p. 1)
Making changes to how we conduct training, overtime, outsourcing, as well as employment status and benefits, are going to be a big change that Artemis Sportswear and its employees will have to face.

Training One change in training can help the company not rely on specialists that typically demand higher pay than non-specialists do that change is called cross training. Cross training is improving the proficiency levels of all employees in many different skills outside of their normal roles. This will ensure that all employees know and can perform the steps in the production process (Mayhew, n.d.). This method will ensure that recruitment and training new hires will happen less often since the employees will have learned more skills than when they came in.
Overtime
Before we consider hiring, we should consider adding overtime pay. According to Lewis, M (n.d.) considering if our current employees would enjoy the extra pay we would be able to get more work done with fewer people. The overtime pay could be considerably less than hiring, recruiting, and spending money to retain employees.
Outsourcing
Outsourcing certain duties to third party services is another viable option. Instead of hiring full time employees for non-critical tasks such as janitorial, secretaries, or other maintenance duties we can combine the use of technology and independent firms according to Lewis, M (n.d.). Finding a service that can provide janitors and maintenance staff for a smaller fee than paying monthly salaries can be very beneficial. For duties, that we would normally hire a clerk or secretary for, we can be replace with an automated computer system for checking in, sending messages, and making appointments for meetings.

Benefits Changing the way we do benefits for employees can also help cut costs considerably. Instead of getting rid of certain high-cost benefits, we can change them in order to save money and still provide employee benefits. Reducing the costs of employee health insurance by raising the deductibles and increasing the premium costs that employees pay will insure our workers are covered as well as reducing the costs on the company Lewis, M (n.d.). This plan would affect everybody including owners to ensure fairness. Employee impact To better improve company morale among workers when you as a business are trying to save money it is important that you keep your workers happy and upbeat. Even if you do sometimes try , you can't keep everyone, and that thought alone can mess with the morale between employees. Now always having the threatening idea that they too can be fired at any time is not a good way for workers to work hard. So how can you as a company implement new ways to boost morale and keep employees happy? When times are looking grim, you want your employees to feel secure and that they matter. According to Melcrum; a global business that thrives on helping businesses build the bridges between employees and employer communication. They have a three stage strategy that will improve employee morale when the economy is looking rough. Three stage approach goes as follows:

* Stage One: Listen * Stage Two: Communicate * Stage Three: Recognize
Now what do these mean exactly in the company context? Well, listen is giving your employees the time of day to hear them out on new ideas or feedback they might have. This type of thing will give your employees a sense of feeling as if they are contributing, but also it help you as the employer gain the trust and loyalty of workers. When a company goes out of its way to listen to workers and hear them out, it no longer creates a gap. Instead, it creates more of a friendly, family environment. The next stage is communication, and that is a big one. This is where as a company you include everyone in the ideas, changes, and issues the company has. This creates a better workflow for problem solving because then works feel as though they too are helping make changes. Communication in anything is important in anything, so why not communicate with your workers and see what they think. Stage three is recognize, and this one is simple. All you need to do is pretty much give credit where credit is do. As an individual everyone loves to succeed and receive the appropriate credit. So as a business, be specific with recognition and how you award it. This could be with incentives, a formal note/letter, or even during a team meeting, give time to recognize you employees and they will feel appreciated. With the listen, communicate, and recognize you as a company can boost morale in employees. Securing their minds that since you are listening and communicating with them their jobs are not in trouble, and they will work hard.

Operational cost
Energy Efficiency
An important way to increase the company’s profit margin is to cut costs. Operational expenses are anything that the company has to spend money on to stay in business. Cutting expenses can mean changes for many aspects of the business. Cutting down on energy consumption is part of that. Every commercial facility has to have sufficient lighting. Making sure that all lighting is turned off or dimmed in places not currently being utilized will reduce a large chunk of energy waste. Switching all fixtures to using energy efficient bulbs will save energy usage for lighting by about 75 percent as opposed to standard bulbs. That equals a savings of around six dollars per year, and with a life span of 10 to 25 years it could save from $40 to $135 over the lifetime of each bulb ("Energy star Light bulb", N.D.).

Light bulbs are not the only way to cut energy costs. One simple adjustment to the settings on the computers can save a substantial amount of energy. When a computer has a screen saver on it still uses the same amount of power as if it were in use. Setting the computer to go into standby mode cuts down on the energy being used by the processor and monitor to around three watts. This equates to a saving of $25 to $75 dollars per computer per year. In addition to that, turning the monitor off instead of leaving it on standby mode will reduce energy cost by an additional $10 to $40 annually ("Power Management Myths Explained", N.D.).

Government incentives
Installing energy efficient equipment does come with an upfront cost for the materials. Depending on which state the facility is located, there are both state and federal government incentives to assist with the cost.(consider rewording) The government plan to assist with the cost upfront includes grants or loans, as well as rebates for the equipment. Another way program to assist with the upfront cost is a sales tax reduction or exemption on eligible products.(unclear) There are also programs that offer financial incentives in the form of direct income tax deductions ("Financial Incentives for Energy Efficiency", 2013). The money that will be saved on the electric bill, with the government incentives, will allow the company to continue to increase profit margins.
Reduce material costs
Another significant area that a business can cut operational costs is on office materials. One area that always costs heavy is paper supply. Changing to electronic communication can help decrease cost, while also being environmentally friendly. A great example of this is sending an e-mail instead of a memo or a fax to cut down on paper use. In a study conducted within the EPA Region 10 Offices, the staff made specific rules to reduce paper usage. A few of the rules instituted include printing on both sides of the paper, and making a collection of paper scraps to reuse. The measures instituted were a great success; the result was decreased paper usage by 30 percent. This drop in waste caused the savings of $49,000 annually ("National Resources Defense Council", N.D.). Cutting expenses like these can create a big effect on spending and increase profit margins. Marketing
Grassroots marketing also known as guerilla marketing. It means that starts from the ground up.(reword) In most cases marketing will try to get a lot of people to be interested in their product, but grassroots marketing tries to target a small group of people and they hope that it spreads to a large amount of people. Grassroots marketing also costs a lot less than other types of marketing. In the article "Grassroots Marketing & All" it states (Roberts 2011) "Murphy said that grassroots marketing has become "most of what we do." Because it usually is not as splashy or expensive as traditional marketing, grassroots campaigns are often embraced by small businesses or start-up companies that do not have a lot of money to spend, yet are seeking ways to make an impact."(para 1) Using demographics in marketing helps understand the market. Demographic information includes geographic area, age, income, gender, race, and also education level. Also, demographics includes shopping habits and how much they shop, number of children, marital status and also other information about the consumer they would need to know. According to Zhan (Zhan 1999) "Constructing a statistical and demographic map of the country shows purchasing behavior, the depth and breadth of buying power, and, perhaps most importantly, trends. Once you have found a country where the economic forecast is sufficiently optimistic to warrant further research, it is time for the nitty-gritty numbers." (para 1) Demographics is important in marketing because it can help the person trying to sell target the costumers instead of trying to campaign to the wrong type of people. It will help them decide where to campaign their item they are trying to sell, when to sell it and who to sell it to.

Non-essential cost
Another key way to reduce operational expenses for Artemis Sportswear is to cut non-essential cost. Non-essential costs include travel expenses and equipment for staying connected to long distance clients. In a less than ideal economic climate, the “business” class is slowly dwindling away; in a recent study of American travelers the strongest airline was Southwest airlines which cater to the economic traveler. ("The World’s Best Airlines", 2014). Cutting out travel expenses for Artemis Sportswear completely would be impossible but, in order to continue to increase profit margin it would be smart to look at travel expenses in a way that mirror’s what was reported in American Express’ annual business report. "Savvy organizations are making sure that travel is not yielding revenue is eliminated or substituted by use of technology." ("From hotels to airfare, cost of business travel going up; Firms scrutinizing all non-essential corporate travel," 2008, para. 6). By keeping travel expenses to a bare minimum, Artemis Sportswear will be able to invest in technology that will save the company money in the long term. Simulcasts and virtual meetings allow Artemis Sportswear to stay connected to long distance clients for a fraction of the cost; as soon as equipment is purchased the monthly traveling expenses are eliminated.

Conclusion
In order for any company to remain operational, profit must be made. When the cost to operate goes up there are several ways to ensure there is still a profit margin. One way would be to raise the retail cost of the product, but that might cause a drop in the number of units sold. Another way is to cut labor costs; this method could cause morale to drop. Which would lower worker productivity. The most important part of the cost reducing process is weighing the money saved against any potential negative impacts. If Artemis Sportswear can effectively cut cost to increase profit margin, without too much negative impact, they will ensure the company remains profitable and relevant for years to come.

References
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Mariotti, J. (2011). Improve Profitability & Reduce Risk -- Thrive in a Recession. Retrieved from http://www.forbes.com/sites/prospernow/2011/09/01/improve-profitability-reduce-risk-thrive-in-a-recession/
Mayhew, R. (n.d.). The Importance of Cross-training in Improving Team Performance. Retrieved from http://smallbusiness.chron.com/importance-crosstraining-improving-team-performance-33216.html
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Energy star light bulb. (N.D.). Retrieved from http://www.energystar.gov/products/certified-products/detail/light-bulbs
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National Resources Defense Counsel. (N.D.). Retrieved from http://www.nrdc.org/enterprise/greeningadvisor/pa-reducing.asp
Power Management Myths Explained. (N.D.). Retrieved from http://www.it.northwestern.edu/hardware/eco/myth.html
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