You don’t have to be a corporate powerhouse to save big on costs. There are multiple saving opportunities that can positively impact company profits, but identifying them is the difficult part. You should be systematic in your approach to reducing costs, especially given the uncertain nature of the economy we operate in. Every penny counts, and the smallest increase in revenue or reduction in expensescan have a huge impact on profitability.
Often it’s simple, logical steps that can improve your bottom line, especially if you’re a small business. A good starting point is looking at what you’re doing well, and what you can improve on. Your business will benefit significantly from reduced costs, and your profits will subsequently increase without increasing sales. This article will provide actionable advice which will help you reduce business costs, and ultimately operate at a higher efficiency.
Reduce Financial Expenditure
By assessing your insurance policies and financial accounts, you’ll identify ways to save money. Insurance savings can be achieved by comparing providers to discover the most competitive rates. You can also consolidate insurance policies or bank accounts, and evaluate your policies to insure you’re not duplicating coverage. With a thorough cost-benefit analysis, you’ll avoid taking on unnecessary debt, and forecasting is another effective approach for business expansion. Consider the effect of debt payments on cash flow, where excess debt affects company rating and the ability to borrow in the future.
Modernise Marketing Efforts
We operate in a society that’s driven by technology, and though you don’t want to eliminate advertising that works, it’s worth assessing cheaper alternatives. Social media marketing and Content Marketing Systems are prevalent in modern business, alongside building a customer email list and implementing a referral program. Today’s economy is driven by recommendations, and traditional marketing is being rendered obsolete. You can reduce marketing costs by doing more in house, and increasing social media use.
Harness Virtual Technology
Operating in a virtual manner contributes to cost reduction, since various initiatives can be implemented for little to no expense. Virtual meetings help reduce travel expenses associated with traditional meetings, and though I wouldn’t recommend eliminating personal contact altogether, you should save these encounters for when they’re most beneficial. Virtual offices eliminate the need for physical space, where effective space utilisation can reduce costs associated with rent. Technologies like Google Docs are a great way to centralise documents online, and this is a more affordable and modern solution to storing paper and documents.
Use Efficient Time Strategies
By optimising productivity, you can reduce the cost of doing business. Wasted time equates to wasted money, so minimise distractions and align your business with apps that help employees stay on task. You can also utilise software to track employee time usage, and set realistic expectations for staff, while offering incentives if they exceed expectations.
Give Customers What They Really Want
Customer requirements shape your overall strategy. This involves providing customers with what they need, while avoiding the addition of costs that add no value. When customers see value in a service, they’re happy to pay for it, especially if it helps them run their business better. By aligning customer service with customer requirements, you’ll achieve more sales, profits, and benefit from customer loyalty.
It is not something that comes to mind straight away but quite often getting a specialist firm to take-over non-core operations, help improve focus and reduce costs. These firms due to their speciality in the area and economies of scale can do the job better and cheaper. Outsourcing these tasks also give flexibility to businesses to expand or to cut-down on level of service without the need for difficult HR issues. Contact us to see how we can help you reduce your cost base without impacting the quality of work.
I hope you have found this article informative, and are one step closer to reducing your business costs in 2018. If you have any questions or would like to become part of the conversation, please comment below and get the discussion going.