Last Updated on Apr 14, 2020 by James W
No matter the size of your business, whether you are part of a large international organization or a small start-up venture, there are always ways that you could help contribute to reducing overall business costs. Most businesses will keep a tab on their expenditure, as part of their overall business plan, but there may be an occasion when you are hit with an extra outgoing that you had not budgeted for – and need to cut back in other areas to cover the costs.
So, whether you are looking to find out which areas of your business are costing you more than expected, or perhaps you need to reduce overheads as part of your yearly budget, you may be surprised at just how much you are spending.
Begin with a review
When it comes to approaching your business costs, it is important that you liaise with both your finance teams and consult your original business plan. If your finance department is working effectively, then they will be keeping your costs within your original budget proposal, and should have rejected any expenses if they were over budget.
The reality is that pressure from managers and executives to get tasks completed on time could have seriously affected your overall budget. So, if this is the case, then you will need to work out which areas of your business plan have been compromised.
From changing suppliers to using a different and more costly printing firm, you should soon be able to identify where any money has gone and ensure that these unnecessary outgoings do not happen again. Make sure to conduct a bi-annual business review, to see how your business is performing against your objective and to ensure that your finances remain on track.
Improve supplier relationships
Having positive relationships with your suppliers is essential for the future of any business. These are the people that will supply you with the goods and services that you need to get any essential business processes completed on time, ensuring the successful operation of your firm.
However, even if you have had the same supplier for years, there is no reason why you shouldn’t shop around now and then, in particular, if you feel that you are being overcharged for a particular good or service.
You can then use this information to approach your existing supplier to negotiate your current rate. The chances are that they will drop their prices to retain your custom, or even offer you a discount on bulk orders. If you pay your invoices early or use cash over a credit card, then make sure that you also take time to barter for a better deal. You may even be able to buy certain goods at cost price, or even find that your supplier is prepared to waiver tax on a number of products and services.
Get Internet savvy
If you are still spending thousands of dollars on complex and costly print marketing materials and campaigns, then it is time to get with the times and start using the Internet to your advantage. In fact, using online tools such as your corporate website and social media can even save your business money.
Your corporate website is the ideal tool to use if you are looking to share relevant and important business information, such as contact details in the form of an email list, or online forms that your marketing team can turn into new leads. Social media channels, such as Instagram, LinkedIn, Facebook, and Twitter, have a huge variety of potential benefits for your firm. Instagram and Facebook are ideal platforms on which to share imagery and links to potential articles of interests, and even showcase new launches.
If you are looking to reduce your recruitment costs, while still attracting top talent, then sites such as LinkedIn can enable you to make this process much more efficient and timely. Plus, if you are keen to complete essential training for your staff, but currently are unable to finance this, then why not look online for free training resources and information? Tedtalks are shaping the way we conduct our everyday lives, providing valuable life lessons and information. So, if you are losing money and want to improve your business results, then look online.
Invest when necessary
You may dream of renting a bigger and better office space, but if you are currently facing budget cuts, then now might not be the right time. When it comes to reducing your business costs, you need to remain realistic and ensure that you do not try to stretch your bank balance when your finances definitely do not allow.
However, certain aspects of business such as your safety and health and welfare should always be paid for – no matter your current budget. If you need to obtain a loan for your business to cover essential costs, then companies such as Bonsai Finance can help. Otherwise, make sure that you have some budget set aside for emergencies, and make sure that you re-invest any money which you do not spend in your business budget. Doing so will enable you to expand and develop your firm for the years to come.
Many businesses find their business costs spiraling out of control, or remain unsure why their firm is losing money fast. So, it is important that you keep track of your finances and stick to any business plans that you may already have in place. Be sure to draw up an annual budget as part of your plan, and make sure to complete a bi-annual review.
Check in with your suppliers to see if you can obtain any additional discounts. Use social media and online tools for marketing and even training your staff if needed. Finally, remain realistic in terms of your business priorities. Make sure that you always have some money set aside in case of an emergency, and be sure to re-invest in your firm for the long term. Once you have used these top tips, you are sure to notice your business costs rapidly reducing – enabling you to keep on track and plan for the future of your firm.