10 Areas to Cut Business Expenses
Cutting your business expenses doesn’t necessarily mean that your company is in trouble; it simply means that you are looking at ways that you can run the most efficient organisation possible. There are a host of areas that you can target for cuts and we are going to take a closer look at some of them here. Remember, managing your business expenditures is something that you should be looking to do on an ongoing basis. If you let things spiral out of control, you could find yourself in difficulty later down the line. So, here are a few areas that you can look to make your business more streamlined.
Business Insurance
It is worth keeping an eye on your insurance premiums in all areas of life, and this especially goes for your business insurance. After all, there is no point in paying more to receive exactly the same service. With so many comparison websites and services out there these days, comparing your rates is easier than ever and is something that you should be doing on a regular basis. Even if you decide not to change supplier, it often makes a big difference simply getting on the phone with your current insurer to question them about any cost increases or extra charges that they are trying to impose on you.
Office Space
Office space can be mighty expensive, and if you are not utilising what you have completely, you should ask yourself why not. Now that remote working is becoming an option for more and more people, you may find that you no longer need the space that you have so you are able to downsize your premises. Also, now that so much can be stored digitally, you may no longer have the need for big manual storage systems. This doesn’t mean that the business is in trouble; it simply means that you are being prudent and you are moving with the times.
Staffing Costs
One of the biggest expenses in any business is the cost of staffing, so you need to make sure that this is kept under control at all times. There are plenty of ways in which you can do this. For example, rather than hiring a full-time employee, you could look at employing a freelancer who is available on a more flexible basis. Alternatively, you could look to hire an apprentice. Not only is this a more affordable form of labour, you are also giving someone a start in their working life. Another option is that you could outsource certain services to other companies rather than hiring staff. After all, some of the jobs you need doing could only be temporary and may not merit a full-time member of staff.
Negotiate for Goods and Services
Bartering for your business goods and services is something which has existed since the dawn of time, so just because something is listed at a certain price, it doesn’t mean that you can’t get it down. After all, companies expect a certain level of good-natured haggling. Alternatively, you may be able to organise a reciprocal relationship in which you provide your business service in exchange for theirs. Also, before you agree on anything, it is always worth getting some different quotes so you are able to compare and contrast exactly what is on offer. Building up a good working relationship with your suppliers is always the best way that you are going to be able to get the best price each and every time you turn to them.
Vehicle Services
If you are out on the road a lot or you run a business which is based on vehicles, you should be looking at ways that you can make being on the road as affordable as possible. Of course, the best way of reducing travelling costs is not to travel at all! With such a myriad of videoconferencing and other methods of communication around these days, you can easily do business with companies all over the world for free. But if you do have to travel, rather than paying full-price at expensive gas stations, take a look at Quarles fleet fuel cards. If you are looking to buy a company car, you should look at the most fuel efficient hybrid or electric options which will save you money in the long run. On the other hand, if you are just starting your business and you don’t have huge funds set aside, you could look into leasing a vehicle which could end up being the more affordable option for you. Don’t forget to ensure that anyone who is driving for your business has the appropriate insurance so you avoid getting into any expensive legal problems in the future.
Supply Costs
As a responsible business owner, you should always be looking into ways that you can reduce your supply costs. When you are buying something, ask yourself whether or not it is absolutely essential for the successful running of your company. After all, new technologies have made a lot of things redundant so there is no point constantly investing in things that you simply don’t need. Don’t be embarrassed to ask for discount from your current supplier. As we have already talked about, successful negotiation and bargaining is what business is all about!
Advertising Budget
Traditional forms of advertising can get very expensive very quickly. This is why so many businesses are looking to the digital world as a way of getting their message out there. Not only this, SEO, email marketing and social media can end up being more effective methods of communicating with the consumers of today. So, if you find that your advert in the local paper is not getting you anywhere, it may be worth investing that money into PPC advertising instead. Whenever you are promoting your business, you should try to analyse what sort of response you are getting. And you should also update your campaigns so you are trying different angles to attract a new group of customers.
Your Time
Your time is what of the most valuable areas of your business. If you are whiling it away doing tasks that could be automated or outsourced, you need to reassess your priorities. So, you should have a weekly diary that you stick to as closely as possible. At the end of the week, look back to find out if there are any tasks which took an inordinate amount of time. Are there any ways that you can make these more efficient? Can you pass them over to other members of staff? As well as the day to day running of your company, it is also important that you devote plenty of thinking time to the ‘big picture’ areas of your business. This means the ideas that will drive your business forward into the future. Monitoring daily activities is something that many business owners avoid doing, but it is also something which could make all the difference to you.
Taxes
A professional accountant is going to give you the best idea about how you can cut your tax bills to a minimum. You want to be maximising as many available deductions as possible so you are not sacrificing your profits when you don’t have to. Saving receipts is a very useful habit to get into and you always want to think about the tax implications of all your decisions. If there is one area of your business that you should be looking to get a professional eye, it is certainly your finances.
Office Culture
Implementing an office culture of efficiency is one of the most valuable things that you can do. Essentially, this means ensuring all your employees know just how important it is that you are all working together to cut business costs wherever possible. It could be something as simple as not printing emails unless they are essential. It could be that you have a regular meeting where people can pitch their ideas about how you can run a more efficient company. If you get your staff members involved in this process, it helps them to all feel included and they will be more enthusiastic about finding innovative ways in which you can save money as a business.
These 10 areas give you a good overview of where you can cut your business expenses. Remember that this is something that needs to be done on a regular basis. Once you have analysed your business once, this doesn’t mean that the job is completed. After all, there are always new methods being created to help business owners run companies that are more efficient. The world of business can be very Darwinian, so if you are not prepared to evolve and adapt, you could find that you lose the survival of the fittest battle. Don’t let your costs spiral out of control as this is every bit as important as ensuring that there is plenty of money coming into your company every month.
