We are living in an uncertain economy where every penny counts. Even the most insignificant reduction in expenses or increase in revenue can have a huge impact on a business’s profitability. Most businesses, especially SMEs, work on tight margins and are constantly being squeezed by an increase in expenses. For this reason, controlling costs has never been more important. Keep in mind that it’s the simple common-sense steps, as opposed to a major business overhaul, that will cut your business costs and help improve your bottom line. Here are a few to get you started:
Reduce Utility Bills and Telecoms
There are several telecommunications trends driving the industry today, which in turn has increased telecom costs. Utility bills are also fast becoming one of the largest expenses for businesses today. Businesses are finding it quite complex to manage these two areas. Luckily, with so many providers available in the market, you can compare deals on utility bills and telecoms as well to ensure you are getting value for your money. Be sure to not let contracts roll and explore other ways to lower utility bills and telecom costs.
Reduce Supply Expenses
If your business is constantly making large purchases of a particular product or service, consider monitoring your supply costs. This means checking for discounts from existing suppliers. Be sure to familiarise yourself with suppliers by making timely payments. Some suppliers will even offer discounts for early payment. Also, approach long-term suppliers and try to renegotiate contracts for your loyalty.
Cut Business Vehicle Expenses
To reduce company vehicle expenses, start by not paying as much for the vehicle. Businesses that are just starting out or on a tight budget should consider leasing as opposed to purchasing. The next step is to reduce vehicle use to essential use only. This will reduce fuel consumption and servicing costs. Since having vehicle insurance is compulsory, be sure to compare deals to get the most comprehensive protection at affordable rates. Check out moneyexpert.com for a van insurance quote as a good starting point to lower your fleet costs.
Manage Employee Expenses
It’s important to create a clear and strict employee business expense policy. The policy should establish guidelines and procedures for employees incurring work-related expenses and describe the types of expenditures that are reimbursable. For instance, business travellers should be provided with a reasonable level of comfort and service. The policy document should be easy to read and not leave room for confusion or misinterpretation. It should also be subject to modification so as to reflect current work-related expenses.
Barter With Other Businesses
There are several businesses out there experiencing the same struggles you are –trying to skimp and save every penny. If you have products or services that make valuable trades, consider bartering them for other products or services that you’re currently paying for. There are several bartering & swapping websites to get you started. Besides helping your business through slow periods, bartering also helps you build up valuable relationships with other businesses.
