A checklist for decisions in business, at work and when buying. Each line gives the usual starting point, the thing worth checking before acting on it, and a calculator to check it with your own figures.
Read this firstEvery starting point on this page is sound, and usually right. A cheaper supplier is often simply cheaper. A fee often pays. An extra check is often worth it. Nothing here says a practice is wrong.
What each has is a second figure that is easy to miss. The saving, the price or the wage is one clear number. What goes with it arrives later, or somewhere else, as an estimate. A decision that counts both is easier to make and easier to defend.
Each line ends in a calculator that puts the two figures side by side. Often it confirms the starting point. Sometimes it shows where a small change would give a better result.
Running a businessWhere the saving has a line in the accounts and the things around it do not.
The usual starting pointReducing headcount saves the payroll.
Worth checkingIt does. The other half of the sum is what that work was supporting: output, know-how, and the customers who deal with those people. Counting both gives the full result.
Check it: Reduce headcount: the full cost
The usual starting pointA cut saves the amount on its line.
Worth checkingThe saving shows at once, in one place. Related costs can show up later, under other headings. Setting the two side by side makes the case for the decision stronger.
Check it: Good on paper
The usual starting pointA lower-priced supplier lowers costs.
Worth checkingOften it does. Worth checking alongside the price: defect rates, delivery times and rework, which land on other budgets.
Check it: Switch to a cheaper supplier
The usual starting pointMaintenance and training can be deferred.
Worth checkingDeferring them helps this quarter. Worth checking what the deferral is likely to cost later, and the chance of it.
Check it: Skip maintenance
The usual starting pointMarketing is a flexible budget.
Worth checkingIt is. The sales it supports thin out over months, not on the day of the change, so the full effect arrives after the saving is counted.
Check it: Cut marketing
The usual starting pointChoosing where the team works is a cost decision.
Worth checkingIt is, with two bottom lines: the business's, and each person's. Seeing both helps pick the arrangement that holds.
Check it: On-site, hybrid or work from home?
The usual starting pointA thorough hiring process lowers the risk of a hire that does not work out.
Worth checkingIt does, and the early rounds do most of it. Worth finding the round where time to hire starts costing more than the extra certainty is worth.
Check it: How many interview rounds?
The usual starting pointA requirement narrows the field to stronger candidates.
Worth checkingIt narrows the field. Worth checking how many people who could do the job it also screens out, since each of those has to be found again.
Check it: Should the role require a degree?
The usual starting pointA screening test helps choose well.
Worth checkingHow well depends on the test. Two tests of the same length can screen very differently, and the figures show which one earns its place.
Check it: A work-sample test
The usual starting pointA small fee adds revenue.
Worth checkingIt does for every customer who pays it. Worth knowing how many can be lost before the fee stops paying.
Check it: A convenience fee at checkout
The usual starting pointMore checks reduce risk.
Worth checkingThey do, with diminishing returns: each added step has less left to catch. The figures show how many steps do the job.
Check it: Compliance checks for new customers
The usual starting pointAn approval step adds control.
Worth checkingIt does. Worth counting the time of everyone who has to ask, to find the number of sign-offs that gives the control at the least cost.
Check it: Sign-offs on a request
Working, or looking for workWhere the headline figure is the wage, the payout or the offer.
The usual starting pointThe pay is what I make.
Worth checkingCommuting, childcare, clothes, meals and unpaid hours all come out of it. What is left, divided by the hours it really takes, is the wage.
Check it: Is this job worth it?
The usual starting pointWhat the app paid out is my income.
Worth checkingThe car, the fuel and the tax come out first. The miles are the largest cost and the easiest one not to count.
Check it: Gig work log
The usual starting pointA second job is extra money.
Worth checkingIt is extra hours first. After its own costs and tax, the hourly figure can be well under the first job's.
Check it: A second job or side gig
The usual starting pointA higher salary farther away is a raise.
Worth checkingThe longer commute is paid for in money and in hours, every working day.
Check it: A better-paid job farther away
The usual starting pointApplying costs nothing.
Worth checkingIt costs hours: forms, assignments and interview rounds. Knowing what a process asks for helps decide where to put them.
Check it: A take-home assignment
The usual starting pointDoing it myself is free.
Worth checkingIt costs your hours, the tools, and sometimes doing it twice.
Check it: Do it yourself, not hire someone
Buying somethingWhere the headline figure is the price shown.
The usual starting pointThe price is the cost.
Worth checkingThe advertised fare is for the bare seat. The bag, the seat next to your family and the fees are added afterwards.
Check it: Is the cheap flight really cheaper?
The usual starting pointThe cheaper one is the better deal.
Worth checkingA lower price can buy a shorter life or higher running costs. Cost per year of use is the figure that compares.
Check it: Buy new or used?
The usual starting pointRepairing it is cheaper than replacing it.
Worth checkingA repair buys a few more years of an old machine. Set against the years a new one lasts, the smaller bill can be the dearer choice.
Check it: Fix it or buy new?
The usual starting pointPutting it off costs nothing.
Worth checkingIt costs nothing today. Some problems stay the same size while they wait, and some grow.
Check it: Put off a car repair
The usual starting pointPaying monthly makes it affordable.
Worth checkingA smaller payment over a longer time is a larger total.
Check it: Borrow or pay cash?
The usual starting pointThe extended warranty is peace of mind.
Worth checkingIt is a price paid for a chance. Set against how often the thing fails and what a repair costs, it may or may not be worth it.
Check it: Extended warranty
The usual starting pointIt is only a few dollars a month.
Worth checkingA subscription is priced by the month and paid for by the year. What matters is the cost each time you use it.
Check it: Gym membership
The usual starting pointA day out costs the price of the ticket.
Worth checkingTravel, parking, food and extras often come to more than the tickets do.
Check it: Is the trip to the amusement park worth it?
The usual starting pointThe room rate is the room rate.
Worth checkingResort fees, parking and taxes are added per night, after the comparison has been made.
Check it: A hotel room with a resort fee
Three ways a cost hidesA hidden cost is still a cost. It is in the mix whether or not it has a line of its own. What makes it hidden is one of three things, and often all three at once.
When it arrives. Some show up at once: the bag fee at the checkout, the desk that now has to be paid for. Others take months: the customers who drift away, the repair that grew, the people who leave the following spring. The later it arrives, the less likely anyone is to connect it to the decision.
Where it arrives. It can seem unrelated. A saving in one department turns up as overtime in another. A cut to training turns up as a quality problem. A seat left open turns up as a sale that was not made. Nothing on the page says the two are linked.
Whether it has a line. The saving has a line. The cost often has none: output not produced, time spent waiting, an hour of your own evening. What has no line is hard to weigh.
These can be the costs that matter most, for a plain reason: a cost that is seen gets managed, and one that is not seen is left to run. The calculators here ask for them by name so that they are counted once, in the same sum as the saving.
The pattern underneathFace value is what is presented: the price, the saving on the line, the hourly rate, the fee.
Actual value is what you live with: the same figure after everything it sets in motion has been counted.
Sometimes the two are the same. If nothing depends on what is being cut, added or put off, it is a plain sum: you save what the line says, or pay what the tag says. Face value is then the whole story, and the calculators will say so.
They part when something depends on it. Then the cut takes other things with it, each passing on only what it received, and a subtraction turns into a multiplication. Telling those two cases apart, and pricing the second, is what these calculators help with.
The gap between them is the hidden cost. It is hidden because it lands later, or on someone else's budget, or on a person and not on an account. Good on paper explains why that happens, and Why it multiplies shows when the gap is small and when it is not.
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