This proposal is designed to assist Artemis Sportswear Company in cutting their operational expenses to increase profit margins, while considering the effect on workers and productivity.
“In the 1970s, athletic sportswear began to evolve from a product line aimed at small and unique markets into a mainstream fashion product” (Clean Clothes Campaign, 2004). Artemis Sportswear Company has helped transform sport shoes and apparel into a fashion statement. Today the “total worth of the athletic apparel and footwear market is estimated at over 58 billion US dollars” (Clean Clothes Campaign, 2004).
In recent years Artemis Sportswear Company has been experiencing a decrease in sales due to the current economy. Artemis now wishes to assess operational expenses and find ways to increase profit margins. After assessing their budget we have found that the key problems of this company are wasted labor costs, office supply expenses and employee productivity.
In order for a company to survive, increase its revenue and reduce its operational costs, it may need to cut down labor. Labor is considered to be the highest cost within many companies. Artemis has a lot of pressure on its shoulders to cut down the operational costs. As a business, Artemis can cut down the operational costs by down-sizing the labor force so the company can compete with other sportswear companies. There are two ways a company can down-size the labor costs, one of these is down-scaling the direct labor, and the other one would be to relocate the labor and obtain cheaper labor force. Artemis does not only want to reduce the costs, but to remain an ethical company with a good reputation. The only good way for Artemis to achieve this is to down-scale direct labor. The most common way to down size labor is to terminate employees; however, this may affect the productivity of the remaining employees and affect their morale.