A business with operating expenses that exceed its target range should always begin by reducing the number of employees, the largest operating expense for most businesses.

Question

Quizplus · Accepted Answer

Reducing the number of employees is not always the best initial step for a business with operating expenses exceeding its target range. It's important to first conduct a thorough review of all operating expenses to identify areas for potential savings or efficiency improvements. Cost reduction strategies can include renegotiating contracts, improving processes, or investing in technology to reduce long-term costs, among others. Layoffs can have negative impacts on morale, productivity, and the company's reputation, and should be considered carefully and as a last resort.

A Business with Operating Expenses That Exceed Its Target Range