Global crisis are resulting in uncontrollable price hikes, which is effecting many businesses bottom line.
While these increases are not controllable internally, there are ways you can cut business expenses to save money and improve profit margins.
We recommend start by reviewing your expenses line by line and finding the excess “fluff”.
By using the line-item approach, you will be able to see the categories you are spending money and the individual activities that contribute to the overall company expenses.
By following this approach you will help trim your budget and give your business some wiggle room.
How to identity waste & reduce spending:
1. Inspect your recurring costs
Almost all small businesses rely on cloud-based subscriptions from social media scheduling tools to customer relationship management systems (CRM). And more often than not, these subscriptions often go unnoticed, especially when employees leave and these accounts are not deactivated.
These Software as a Service (SaaS) vendors often update their features, so you could end up with more than one tool that does a similar or same function.
Solution: Review all your subscriptions and ask employees how they use them and decide which ones need to be eliminated. If it’s not saving you time or adding value – cancel immediately.
2. Ditch the landline
Still holding onto landlines? You should check out Voice over Internet Protocols (VoIP) which uses the internet to make and receive calls and provide a massive saving over traditional multiline phone systems. VoIP offers greater flexibility and reduces your reliance on other third-party subscription services.
Solution: Consider a business phone system with unified communications that can handle business text messaging, voice calls & even video conferencing without needing to take a separate subscription.
The exact savings will depend on number of users & phone numbers required for your business.
3. Access your travel habits
Price of fuel has drastically been rising since the Russian/ Ukraine conflict and finding ways to reduce travel costs will be a substantial saving.
Start by looking at your expense reports to see how your sales team or support staff use their cars & dine-out funds and what your business gets in return. Analyse the data to see if their are ways you can cut back without diminishing customer service levels.
Solution: As COVID-19 has shown us that teams can operate remotely/ virtually and to encourage this transition you can consider creating goals to increase percentage of virtual sales while decreasing in person sales and offer incentives to team member who meet targets.
Look at alternative training opportunities other than trade shows that requires travel & accommodation expenses so you can educate your team without the added expenses or airfare and hotel.
4. Evaluate your inventory
Items that are not selling or have low-profit margins may not be worth replenishing unless they fulfil a specific role or have a purpose.
Solution: Assess your cost of goods sold and speak with vendors to find out if they have any substitutes and let them know you are shopping around for flexible pricing. The same principle applies for office consumables like break room supplies – shop around for deals or consider making bulk purchases on certain items from external corporate procurement agencies.