People Share Corporate Cost-Cutting Measures That Actually Cost The Company Money

Tall office buildings
Photo by Sean Pollock on Unsplash

Even in a strong economy, or after making billions of dollars in profits, all businesses try to look for ways to save money.

Sadly, one very common solution is to lower the numbers in their workforce, resulting in layoffs for those whose departments they deem unnecessary.

Others look for slightly more unusual solutions.

However, sometimes these solutions are made without a great deal of thought, and these presidents and CEOs soon discover what they thought would be a cost-cutting measure ended up costing them even more money.

Sending them racing back to the drawing board.

Redditor Embarrassed-Mouse-49 was eager to hear stories of greedy companies whose attempts at penny-pinching backfired rather embarrassingly, leading them to ask:
"What did your company do to “save money” but ended up costing the company lots of money instead?"

You May Get A Little Hot...

"Shut off the HVAC system to save on electricity costs during the summer."

"Had to pay over half a million in mold remediation costs."

"F*cking morons."- dinosore

Never View People As An Expense

"Lay off a bunch of veteran people so they can bring in newer workers for cheaper."

"They find they couldn't bring in newer people for cheaper so they hire newer people at close to the same price as the veteran workers."

"Veteran workers are mad they have to train somebody making almost the same as they are with no experience and start leaving."

"Company has to pay fewer remaining veteran workers even more to get them to stay while paying inexperienced workers close to what the workers they just laid off were making."

"To my knowledge, prior to the lay offs, the veteran workers weren't even complaining about pay."

"Now the department is at a worse state and more expensive than what it was prior to their plan to save money."- Frankie__Spankie

Simply Illogical

"The roof of our building was leaking bad."

"Got quotes for doing just a third of the roof and for doing a whole new roof."

"They choose to do third of the roof."

"All it did was move the leak."

"A month later they did the whole roof."

"They would have paid a lot less had they done it right the first time."- sonsonmcnugget

Cat Olympics GIFGiphy

Location, Location, Location! Or Not...

"Business travelers must fly to the closest airport to the destination."

"Is Airport A one mile closer to the destination than Airport B?"


"Are the airline tickets 2x as expensive?"

"Also yes." - Reddit

A Hospital Is Nothing Without Its Nurses!

"Underpaying the nurses so they quit and had to pay agency 3x the going rate."- junotinychonk

The Dangers Of Outsourcing

"Moved 'corporate' phone support from UK to India for a very large fizzy drinks company, despite the contract saying guaranteed UK support."

"Over 50k phones canceled and moved to their rival."- WimbleWimble

"Someone I know worked for the 'oldest American' hoist company."

"They decided to outsource production to china."

"The cost of transport, losses, customs, etc made the Chinese hoists just as expensive as their American-made ones and then the Chinese company stole the plan to make and sell themselves for less."- Diabetesh

You Never Know When You're Going To Need Them...

"Company ran a campaign for 'outside the box' ideas in cost cutting, with stock awards for proven savings."

"Our facility maintenance manager claimed a $300k savings by eliminating unnecessary capital spare parts in the warehouse and received a $30k award."

"Six months later a critical compressor failed resulting in the plant reducing to half capacity at a $500k per day profit loss."

"It would only take two days to repair, however, the parts were no longer in the warehouse."

"They were among those eliminated and sold for scrap."

"It took 90 days to receive replacements."

"Total loss to our company was just over $50 MILLION."- eron6000ad

God Forbid People Are Rewarded For Good Work

"I used to work at a place with a sizable distribution center and thousands of SKUs."

"The warehouse's team of pickers was a great group of folks."

"They were fast, extremely accurate, and very good at their jobs."

'I brought them cookies on a regular basis and made sure to take good care of them."

"One day, some f*cking walnut decided that they were 'making too much money' in incentive pay (they got a bonus for accuracy and for picking above and beyond their normal quota of items) so they canceled the picker incentive plan and bumped up their quota, saying 'it's their job, we're getting robbed paying them extra to do what they should be doing anyway!'"

"Pick rates began falling sharply within the first week or two, because the incentive pay for being an outstandingly fast and accurate picker made the otherwise crappy base pay for that job turn into a living wage."

"Warehouse staff was enraged by having their pay jacked with and now being unable to pay their bills while still being expected to perform as well as they did before, so they started performing to the old quota."

"Management did much finger wagging and tried to write up a couple of the top pickers for 'deliberately underperforming and hurting the company'."

"Those top tier workers refused to sign the writeups, walked out of our warehouse, walked into the warehouse of our direct competitor, and had new jobs that same day."

"The rest of the high performers followed over the next couple of weeks."

"Delivery routes got delayed because of the short staffing and loss of the best workers, customers got upset because they were receiving the wrong items or not getting them at all, and the sales team, which wasn't paid enough to get screamed at by angry customers, was furious."

"Cue a meeting with the sales team and the f*cking walnut, who proceeded to lecture everybody about how 'picking is an entry level job' and 'anybody could do it' and how they're going to bring in a bunch of temp labor 'because they will actually appreciate the opportunity'."

"Fast forward a few months and it turns out the temps are idiots and caused the number of pick and 'not on pallet' errors to increase, customers are now leaving in droves, and sales people are bailing out too."

"The company lost millions of dollars in business and had to lay off half the staff because they were going to go bankrupt otherwise."

"All this because some f*cking walnut thought they could squeeze the people at the bottom of the pile who actually did the work that made the company money."- nancybell_crewman

From $75 Max, To A $75 Steak...

"We used to get a travel per diem for our meals."

"Most people would eat cheap like get a free breakfast at the hotel and get a $5 footlong and split it for lunch and dinner and bank the rest."

"I traveled a lot so it was like a nice perk."

'The company got wind of this and changed their policy to we had to buy and expense all our meals."

"The problem was they had to have the same policy for all employees so they couldn’t put a cap on meals due to the sales guys having to take out clients and stuff."

"We took full advantage of it and ate like kings."

"My meals expenses were twice what they were paying in per diem."- velvet_satan

Woman Like Me Fine Dining GIF by Little MixGiphy

Safety First

"I used to be the head of security for a club that had the most tight-fisted owners I’ve ever heard of."

"I kept telling them that we were dangerously understaffed."

"The police told them the same."

"So did the fire brigade, they said there wasn’t enough of us to evacuate the venue if we had to, they were right too."

"The owners wouldn’t listen."

"The club was taking around 45k per week but they wouldn’t pay for radios for us to least be able to communicate."

"We had so many incidents there that it was just insane."

"There just wasn’t enough of us to actually watch the whole club and even when we did see something we couldn’t call for back up."

"I found a set of second hand radios for under £200 but they refused to buy them I ended up buying whistles for the team to at least give us something to use to get each others attention."

"They also wouldn’t pay to get CCTV installed which upset the local police."

"One night a bartender came out to the door and told me there was a fight inside, there was no security inside just 2 of us on the door."

"When we went in there was around 60 people brawling on the dance floor."

"We did what we could but it was beyond our control."

"Eventually the police arrived but wouldn’t come inside they stood outside and essentially instructed us to kick everyone out and they would keep them out."

"We spent 45 minutes dragging people out of there."

"Many people were injured and after the fight one of the guys who had been fighting came back and stabbed a guy he had fought with."

"The police decided enough was enough and approached the council who as expected revoked the premises license."

"They lost the club altogether."- operative87

Gig Economy...

"Not giving the guy doing 2.5 full-time jobs a slight raise, instead letting them walk and paying 3 new people (combined) at least twice what they were paying him to do all the same work at like 65 percent the quality level."- BigPZ

Experience Matters...

"Consolidated the sales departments and made salespeople stop selling the stuff they knew how to sell and forced them to try to sell products they weren't familiar with to customers they had no history with."

"Company almost went out of business in a matter of months, and this was not a small company."- MostBotsAreBad

Sell Salesman GIF by Ryan SerhantGiphy

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