No one can argue that the primary goal of running a business is to make profit.
While there are several factors influencing profit gain, one of the most significant areas affecting your bottom-line is, in fact, your business expenditures.
The lower your expenditures are, the more profit you get — it’s that simple.
Although there are unavoidable costs that come with running a business such as wages, production, overheads, it is all about managing it and finding ways to be more effective at using your resources better without sacrificing your product quality.
Cutting Business Costs
So how and where do you start exactly? Here are some strategies you can look into to reduce your business cost:
1. Use Social Media to Your Advantage
As more people are finding the use of modern technology convenient, it pays to have a robust online presence. Having a social media page is a surefire way to attract new customers without paying for the high price of advertising.
2. Outsource, Outsource, Outsource
Paying employee salary plus benefits is probably the biggest chunk of your business’ budget, especially if you are a small organization. Keep your full-time staff to a minimum and outsource work that is highly specialized to independent contractors.
3. Work out an Exchange Deal
When you are strapped for cash, don’t give up just yet. Give the age-old practice of bartering a go! Say for example, you are a PR company who needs an office redecoration. Why not work out an agreement and get a discounted price in exchange for some PR services?
4. Live in the Cloud
Instead of blowing your cash on expensive hardware, opt for cloud-based services to store your data. Software such as Salesforce only cost as much as US$25 per month per user.
5. Go Green
Most often than not, it is the smallest change that creates the most significant impact. Consider turning off equipment when not in use, or printing on the other side of the paper to reduce paper waste and cost. Not only is this practice a great PR move, but it is also a smart financial strategy.
6. Save on Maintenance Costs
Is it really necessary for the cleaning lady to come daily? Employees can, no doubt, handle tasks as easy as emptying their trash; if this can be arranged, expect to save a great deal of money by constantly reviewing maintenance costs such as this and cutting back wherever possible.
7. Hire Fresh Graduates
As an employer, you want the most experienced candidate to work for you. But remember that experience also costs more.
Consider hiring inexperienced but smart candidates. Not only are you saving big bucks by paying them entry-level salary, but you also benefit from them being knowledgeable on the latest trends and technology. More often than not, they are even more flexible and eager to learn more.
8. Allow Work from Home Arrangements
Offering employees the option to work from home, where possible, is a win-win situation for both the employee and the business owner. This affords schedule flexibility to the worker while it brings considerable savings in utility and operating costs to the employer.
Recommended: Pros and Cons of Remote Working Teams
Get Right to It!
There are a million other ways to reduce your company expenditures while getting more leads and sales. Start by reviewing and identifying your expenses; understand the nature of your spending and its relationship to your company’s sales and profits; re-evaluate your business strategy; formulate a plan and stick to that plan!
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Jimmy Rodela is a Freelance Writer and a Content Marketer. He is the Founder of the Guild of Bloggers.
He is a contributor on websites with millions of monthly traffic like Yahoo.com, Business.com, Monster.com, Business2Community and SocialMediaToday.com.
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