Financial efficiency is one of the most important things to manage in your company. The lower you manage to keep your costs, the greater your profit margin will be and the more success you’ll have in your business – it’s a pretty simple equation, right?
But keeping your costs low without compromising the quality of your products, services and performance is a tricky tightrope to walk. There are certain areas in business where it’s important to spend a little bigger, but there are always places you could stand to save a little too.
If your budget is looking a little intense and you need to reduce your expenses pronto, here are a few areas that could be sucking you dry for no good reason.
In truth, we can all be a little wasteful with our consumption, even in our homes. When it comes to things like energy usage and general wastefulness, you could probably cut down a little bit in your office. There are plenty of tips to reduce overheads in your monthly expenses.
Simply being aware of how much energy, paper and other office supplies you use can make a huge difference. However, if an office space isn’t a crucial part of your company’s functionality, consider switching to a remote-work model, which will save you massively on rental and upkeep expenses.
Most people don’t realise how much they’re spending on their day-to-day printing. It’s a known fact that employees take advantage of office printers for their personal needs, and even work-related printing is often unnecessary.
You could opt to use managed print services for your printing and documentation needs, which will help you better understand the printing habits in your office, optimise your usage and even save time and money. Often, the simple task of handing things over to someone who knows what they’re doing can be a catalyst in improving how your business works.
Bookkeeping, taxes, and other accounting functions are tedious and complicated, which is why many companies decide to hire a full-time accountant to help them with these financial needs. However, simply using accounting software can be beneficial for your business and save you time, money and stress in the long run.
These programmes will automate a lot of the accounting tasks you need to do, making tax season and other money-related processes far easier to handle. Plus, there are loads of accounting programmes that are user-friendly, easy to understand and most importantly, very affordable. This is a great way to save costs, especially for a smaller business.
Paying a set salary to all your employees will form a large portion of your business’s budget. However, you might find that not all of your staff are crucial to the day-to-day functioning of your business and you’d be better off paying them per hour or per task.
Rather than employing full-time staff, consider outsourcing certain business functions. This will look different for each company and the functions they need to be fulfilled, and you’ll easily be able to figure out which staff members are not crucial to have on hand full-time. Cutting down your team might be difficult, but could save you in the long run.
This is not to say that you should be purchasing cheaper supplies and compromising the products and services you offer to your customers. However, the art of negotiation is a skill that could end up saving you loads of money when you put it to good use.
Try negotiating prices with your suppliers when ordering supplies in bulk – you might be able to get discounts, free shipping or other cost-cutting benefits when you shop around and ask the right question to the right people. Keep in mind that you’re not married to your suppliers either, so keep hunting for better offers and deals every couple of months.
All in all, you can tell that there are plenty of ways you can cut costs in your company without sacrificing the quality and good name of your business. By looking at who you hire (and don’t hire), investing in some helpful software programmes, and getting business savvy with how you communicate with suppliers, you could reduce your business expenses significantly without any change to your output.
Take some time to research other ways and areas you could cut costs, have discussions with your partners and do an audit of your budget to identify other areas where you might be overspending.