How to minimise business expenses

Once upon a time when you were an employee, saving your company money may have fallen rather low on your priority list. That’s not to say that you were an out-of-control spendthrift. If nothing else, whoever reviewed your expense reports probably would have set that right in short order. However, finding creative ways to reduce spending likely didn’t occupy much of your time. Once you move into management or own your own business, suddenly cost controls become much more important.

Let’s consider how to minimise business expenses in some practical ways.

Outsource

Cloud computing has been a boon in so many respects. From backing up prized photos on your mobile phone (along with some you may regret), to simplifying file sharing. It has also made outsourcing multiple business functions much easier and less expensive. Easy targets are accounting, payroll, and human resources. Plenty of firms can achieve economies of scale by serving clients all over the globe. Handling these business functions for you much more inexpensively (and sometimes much more proficiently) than you could by hiring the necessary staff.

Be the Squeaky Wheel

As mum or dad might have told you, the squeaky wheel usually gets the oil. (Of course, sometimes the squeaky wheel just gets kicked, but let’s be optimistic, shall we?) Your business has plenty of vendors who are quite content to keep your business without offering any concessions on price. Unless of course, you kick and fuss and make noises about going elsewhere. You may be able to get price breaks, fee reductions, or discounts on everything from delivery services, to package deals.

Is it worth shopping for every single purchase among half a dozen vendors? No; your time is better and more productively spent elsewhere. But talk to a sales representative for a competing office supply company every year or so. Approach your bank or merchant processor to see whether they’ll reduce your fees — and don’t hesitate to mention that you’re pricing alternatives. Give another insurance broker the chance to quote your policies every couple of years. In short, don’t let your vendors get complacent and take your business for granted.

Not Every Customer Is Worth Having

Especially if you came up in sales, your brain may be conditioned to get and keep every available customer by any means necessary. Once you move into management or ownership however, it’s time to think differently. Look closely at your customers and see who’s getting special pricing or discounts. Who requires lots of special attention for relatively little purchasing volume? Then, who must constantly be chased to pay 90-day-old invoices, and so forth. Not every customer is profitable; some may even be COSTING YOU MONEY. Wouldn’t you rather spend time and effort strengthening relationships with your most profitable customers instead of working to keep those that really aren’t worth having?

These are three areas in which, depending on the nature of your business—you may be able to find ways to minimise business expenses a little or a lot. Technology and new ideas are constantly giving rise to better ways of doing things, so pay attention to trends and developments. Every day entrepreneurs are working to find a new solution to someone’s problems, and tomorrow one of them might solve one of yours…and save you some money in the process.

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