Date: September, 1997

Title:
Local company saves businesses bucks by analyzing and altering office expenses

Author: Suzanne Thompson

Publication: The Daily News

There is more flowing over fiber optic telecommunication lines than just conversation. Cash also gushes along the lines and Mike Siano believes for many businesses at least some of it is headed in the wrong direction. Siano's company, SDS & Associates Inc. analyzes expenses for companies and helps them reduce costs primarily in telecommunications. This area is a specialty of Siano's, whose company has expanded so much he recently opened offices in Houston and Atlanta. The Atlanta office opened four months ago, the Houston office last month, Siano said.

On a local level, the company has grown so much that it is in its third office since it began in March 1993. The office is located at 474 Perkins Extended, Suite 215. (Since the article, the office has moved to new location)

Siano said his company audits about $3 million a month for his customers in telephone expenses. What makes SDS different from the other expense reduction firms, Siano said, is no upfront money is asked of customers. He said his firm performs a free analysis of a company's expenses in about 30 days. After the analysis is complete, Siano meets with the prospective client and explains areas that can be tightened to save money. For this service, Siano asks the customer to sign a 36-month contract, during which SDS is entitled to 50% of the amount the company saves. If the company saves nothing, SDS gets nothing. But with $3 million a month rolling in from Telecommunications savings alone, that has not often been the case. Siano said savings realized from the Telecommunications comprises 75% of his business. Siano is a former employee of Baxter Healthcare, and after he tired of the corporate world, he went to work for his father's company. His father owns Siano Appliance Distributors; and after Siano worked his way to vice president of sales, the income from his father's business had jumped from $100,000 to $300,000 per month. During that time, other business people began inquiring about the methods his father's company used to contain overhead expenses. It was then that Siano said he noticed an article in the Wall Street Journal, which reported $35 million, was paid to the expense reduction industry in 1995. "I immediately started investigating," Siano said. He attended classes to learn expense reduction techniques. Armed with his knowledge, Siano said he fine tuned the methods he learned to form his own style. Three main areas in which to find savings are telephone, utilities, and freight, he said. "But so far, the one that is the most consistent for me to know that I am going to save the party money is Telecommunications," Siano said. Because all companies use Telecommunications, it is an area to which any company can look to save money on a constant basis. Siano said another reason Telecommunications is the first stop in reviewing office expenses is there often are problems with the bills. "I've found that this is the most abused billing system that I've ever seen." He said. Problems can range from simple billing errors to misclassifications in billing rates. He said companies frequently are charged at a rate, which is inconsistent with the negotiated rate. All to often Siano said, company owners and office managers simply pay the bills, without careful line-by-line item review. In addition to providing scrutiny of billing procedures, Siano said he also negotiates more favorable contracts with either the same or a different phone service provider. Susan Crawford, director of marketing for Dennis Electric, said the company has been clients of SDS for about a year. Phil Dennis, Crawford's brother and office manager at the family owned business, estimated savings on Telecommunications to be between 10% and 15% annually. He said this translates to about $250-$300 per year. Dennis said Siano also located a vehicle maintenance provider for Dennis Electric, which saves them money on routine maintenance of their service vehicles. One of Siano's larger clients, Methodist Health Systems, Inc. has realized substantial savings due to SDS, said Dennis Gross, director of information systems operations. "It has been in excess of $10,000 so far," he said. Gross signed a contract with SDS in December. "We have realized some savings already from discrepancies that they uncovered and got some corrections of and reimbursements from some of our business partners." Gross said he is pleased with the services from SDS, and the potential for future savings is even greater. "We are working through some service modifications that have been recommended by SDS & Associates that have the potential to save the organization as much as $100,000 a year," he said.

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