Even though the economy is generally doing well right now, any kind of small business is always pushed to do more –with less.
Even in good times, the best way to add more to the bottom line is to streamline – but the challenge there is always “how do I cut costs, and not compromise quality?” Here are some successful strategies.
Do you know what one of the biggest wastes is in any business? Office Paper! With all the hoopla over iPhones, iPads, mobile computers, et al we may be growing more “wireless” all the time, yet we are far from a “paperless” society. In fact despite advances in electronics the average office worker in a typical business today still uses about 50 sheets of paper every day!
By going to a paperless payroll system and other manners of paperless accounting and record keeping, businesses can significantly reduce paper consumption, as well as save money.
Besides companies switching to paperless record keeping and accounting systems, there is a lot that can be done to reduce paper consumption around the workplace.
- Print on both sides of a sheet of paper, most modern office copiers have this feature
- Use recycled paper whenever you can, and recycle whatever paper you use
- Use paper properly, improperly stored paper accumulates dust and dirt that leads to more paper jams in machines and more waste
Another area where you can save some “green” by going green is to switch to compact fluorescent bulbs, (CFL) or LED bulbs. Both use far less electricity than traditional incandescent light bulbs of similar lumens.
Going green, reducing waste and using energy more efficiently is only one way to cut costs without compromise. Here are a few others.
When we are discussing ways to save money, it may seem unusual to talk about spending money to outsource some of your business’s operations. No small business owner is ever really comfortable considering cutting staff, but the truth is certain services can be done less expensively and more efficiently outsourced then by in-house staff. Accounting services, especially billing and collections are one of these. In fact, many billing companies will go after your past due accounts more aggressively than you would, because that is how they get paid, and collecting on past due receivables will certainly help your bottom line.
Maximize Your Marketing Dollars
Henry Ford once said, “Trying to save money by not advertising, is like trying to stop a clock to save time.” Sure at first when you want to cut costs it may seem like a good idea to cut back on advertising and marketing expenses. But the better idea is to not spend less on marketing, but to spend wiser.
One of the best ways to maximize your marketing dollars is to focus on your branding. Today one of the best ways to build or improve your brand identity is to leverage the power of Social Networking. If you do not have a Facebook and Twitter account, get one. They are great ways to grow your business, spread the word about special offers, build a community of loyal followers.
Other General Cost Cutting Tips
- Join a purchasing group to reduce the cost of equipment and supplies. Trade associations offer membership in such groups – many are free to join – and some claim savings of up to 65%.
- Install a setback thermostat if you are responsible to pay for heat and electricity in the office, they cut utility bills at work as well as at home.
- Manage staff time better. Overtime can be a significant expense. If you have hourly employees to whom you are paying a lot of overtime on a weekly basis, either they are not managing their work efficiently – or you are understaffed. If it’s the latter, it is often cheaper to hire an additional person, then continuing to pay overtime at time and a half
- If you do not own your building, try speaking with your landlord about renegotiating your lease. You may be able to lower your rent if the owner thinks you may leave, as they would prefer to keep the place occupied at a lower rate than have it sit empty for a few months trying to find a new tenant.
- Speaking of space, are you using yours as efficiently as possible? Is it possible to sublet part of your space to an income-generating partner or ancillary service provider?
- Put off any unnecessary purchases of big-ticket items, or office improvements. If you do have to buy something, look for quality used equipment rather than new.
The bottom line on your bottom line? No business can survive and thrive during good times or bad, without controlling expenses. Belt tightening is a basic tenant of economics. The more you save, the more you earn – it’s as simple as that.