In the uncertain economic times, every penny you spend counts. For startups, even the slightest increase in the profit and reduction in expenses can impact the overall profitability. Speaking of expenses, how can you reduce them? How can you reduce the business overheads?
Perhaps you can try these tips:
Buy in bulk
If you have to buy some items try buying them in bulk. The seller is always willing to give a discount when the order placed is in bulk quantity.
Get rid of all unprofitable clients
It is time to evaluate your clients. There are good chances you are working with such clients who are unprofitable for your business. A good example of such clients are the ones who pay slowly or who don’t offer any incentives.
Figure out a way to manage them. Instead of wasting your time on such clients, focus on those who actually bring profitability for your business.
Outsource some of the tasks
Do you think that you have started spending so much of your time on managing the human resources of your company and doing little work on growing the business? It is time to change this.
Most entrepreneurs want to do everything by themselves and this is not just to save money but to have control over everything or to deliver the best quality. You need to understand that when you are busying doing these tasks, you are neglecting other tasks that could actually add value to your business.
In other words, this is costing your business instead of saving. Don’t hesitate in outsourcing talents for tasks such as bookkeeping or recruiting.
Reduce the uncollected revenue
If you are in the field for some time, you would know why uncollectable revenue is bad for business.
Unfortunately, we all have clients who pay back so much later. To cover our expenses, we end up lending money and this becomes expensive for the business in the long run. The best way to encourage your clients to pay earlier is to start charging interest or a late fee for the past-due account. This will offset the loss and help you reduce the business expenses too.
Lean on technology
You can reduce a lot of business cost by using technology. For instance, you can minimize travel expenses by arranging virtual meetings. That does not mean you eliminate personal contact altogether, but keep it minimal.
Use the skills of your employees
Make the most out of the skills of your employees. There are always employee who are efficient in particular areas. Give them responsibilities that they can fulfil. Doing so, keep on exchanging tasks. Give all employees a variety of tasks so that things don’t monotonous and their efficiency is maintained at the same time.
Focus on quality
Whether it is products or services, quality always wins. You can build credibility with high-quality products and then even charge higher prices for your products. This will bring you more revenue.
Take a look at your monthly printing costs and think do you really need paper and a printer. Start going paperless. Stop printing and mailing coupons. Start using online payment platforms.