Penny-Wise Acumen in Costonomics: Transforming Costs into Entrepreneurial Gold Through Smart Financial Management

Enkeleda Lulaj ()
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Enkeleda Lulaj: Faculty of Business, University Haxhi Zeka, Eliot Engel, 30000 Peja, Kosovo

JRFM, 2024, vol. 18, issue 1, 1-36

Abstract: This research demonstrates that penny-wise acumen in costonomics can lead to significant financial gains, transforming costs into entrepreneurial gold for enterprises. The study aims to explore how effective financial management, through the application of cost management factors, can convert costs into entrepreneurial opportunities and drive long-term business sustainability. The research utilized exploratory and confirmatory factor analysis (EFA and CFA), along with reliability analysis (Cronbach’s alpha), employing SPSS and AMOS software to examine the relationships between critical cost management factors. The findings reveal strong correlations among these factors, each playing a vital role in optimizing cost efficiency and enhancing business performance. Cost Management Effectiveness (CME) emphasizes clear cost structures, supplier evaluations, and overall cost control. Strategic Cost Management (SCM) focuses on identifying cost drivers and benchmarking against industry standards to uncover cost reduction opportunities. Cost Optimization Mastery (COM) involves monitoring production costs and assessing cost quality to ensure financial stability, while Cost Management Policy (CMP) stresses the importance of robust policies and employee engagement in controlling costs. Lastly, Cost Management Vigilance (CMV) highlights the need for the active monitoring of variable and overhead costs to maintain financial discipline. This research underscores that businesses in the manufacturing, hospitality, and commercial sectors can successfully leverage these cost management practices to foster competitive entrepreneurship and sustainable growth. Future studies should explore the role of emerging technologies in cost management to uncover new strategies for profitability and sustainability.

Keywords: costs; financial management; costonomics; hotel and tourism enterprises; manufacturing enterprises; commercial enterprises; corporate finance; management accounting (search for similar items in EconPapers)
JEL-codes: C E F2 F3 G (search for similar items in EconPapers)
Date: 2024
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