Whatever position you are in with your business, it’s always beneficial if you can reduce your overall costs. This isn’t always easy to do, though, and many business owners or managers may feel that they are already doing everything they can to cut down on spending.
If you’d prefer to reduce costs further but you’re just not sure where to begin, consider the following points…
Staff are usually a major cost
Hiring people to work for you is one of the most costly aspects of running a business, but in most cases it’s absolutely essential. If you have the right people doing the right jobs and being managed in a way that maximises their potential, you should be able to make a good return on every employee you hire.
However, most businesses aren’t fortunate enough to be in this position all the time and they could still take measures to improve their return on investment in staff. One idea to try is leaving a position open for a while when someone leaves, and seeing how much of their workload can be shared by other staff. This may allow you to refocus the priorities of each team member and hire someone at a lower price point to pick up the slack.
Get property costs down
You might find that you are paying more than you need to be for your premises. Many businesses rent their offices but don’t need as much space as they have, or could move to a cheaper area. Another thing to consider is whether you need an office at all, or if employees could actually work from home.
Shop around for suppliers
You may have good working relationships with your suppliers, but you’re not necessarily getting the best prices. Ensure you review your long term business partnerships regularly to make sure you’re still getting a competitive deal. For anything new that you need to buy, get several quotes and compare to find the best value solution.
Remember that small costs add up
Make sure you don’t forget about seemingly insignificant costs which can quickly add up over time. You might not realise how much things are really costing because some things are paid annually, some monthly, some weekly and some only rarely. Make sure everything is written down and reviewed formally on a regular basis so you can quickly identify areas you could save money on.