Whether you’re running a small business or a large company, expenses will always be there.
6 Smart Ways To Cut Business Costs
They’re a normal aspect of your business operations. Most often, you set aside a fraction of your budget for daily and monthly expenses.
However, improper management of your finances will make it harder for your business to maintain profitability, or worse, it can lead to bankruptcy.
Thus, it’s crucial for business owners to know how to deal with their expenses and reduce business costs whenever and wherever possible. Doing so will help you achieve your target profit and enable you to spend more on efforts that would ultimately boost your sales.
However, keeping your business costs low may not be that easy as it requires changes, tough trade-offs, and trying things you’ve never thought of before.
Thankfully, it’s possible to trim down your expenses without having to completely alter your business plan or compromise some of your business assets. Here are six innovative ways you can lower your business costs and achieve better profitability:
1. Minimize Printing
One of the less obvious but costly expenses involved in business operations is printing. Printing entails the use of several resources and tools such as reams of paper, printers, photocopying machines, and ink cartridges.
Since printers break down from time to time, especially when they’re used often, having them repaired and maintained regularly can cost you a fortune. Paper isn’t cheap, either. If you’re printing every day, you’re likely utilizing hundreds of pieces of paper and refilling your ink cartridges numerous times a month.
The entire printing process comes with all kinds of costs, and some of what you’re printing may not even be necessary.
To solve this issue, take advantage of technology and go paperless. For instance, when submitting reports, you can save them in PDF format and send them through email and other online platforms.
When sending personalized invitations or important messages for employees, business partners, or clients, you can do it with the help of websites like Greenvelope.com
Not only will you save on printing expenses, but going paperless will also make it easier for you to organize and back up essential data. This is because you don’t have to keep stacks of physical documents in your office and risk losing or misplacing them at some point.
2. Utilize Online Marketing
Another expense most business owners spend money on is marketing. Marketing is essential for your business as it helps spread the word about your company and attract more potential clients to your brand. Some companies use a big chunk of their budget for billboards, TV commercials, or even newspaper and magazine ads.
Unfortunately, spending too much on traditional marketing may not always be good for your business, especially if it’s not doing anything to increase sales or entice leads.
Instead of shelling out money for billboards and related forms of advertisement, you can utilize search engine optimization (SEO) to drive traffic to your company website and boost awareness about your brand and products or services.
Moreover, you can use social media platforms like Facebook and Instagram to find prospective customers and engage with your current ones.
Online marketing is more affordable than printed ads and traditional media. But before you make the switch, make sure to study your target clients first and find out which method will help you reach out to the best.
3. Make Use Of Freelancers
Sometimes, hiring more employees than what your company actually needs can be detrimental for your business in the long run. Not only will you have to budget for their monthly compensation, but you’ll also need to pay for their sick leaves, vacation leaves, health insurance, training, and so on. An alternative to hiring a new set of permanent employees whenever you have additional projects or tasks requested by clients is hiring freelancers.
There are tens of thousands of professional freelancers worldwide who are willing to work for you and provide high-quality output in the comfort of their own homes. Having freelancers work for your company on a per-task or per-project basis will greatly reduce your operating costs. Plus, freelancers can contribute fresh ideas and showcase the kind of creativity you may not get from your current employees.
4. Consider Remote Work
If you want to keep your operating costs at a minimum without compromising your employees’ jobs, you may consider letting them work remotely. Schedule at least two or three days a week when your staff will work from home. This way, you can save a lot of money since you won’t have to use as much electricity in your office as you normally do.
What’s more, allowing your employees to work remotely would make it possible for you to downsize your office. Since not all of your staff members have to be physically present every workday, you can move to a smaller office with a lower rental fee. This would result in lower utility bills as well.
As for your employees, working from home will be advantageous for them because they no longer have to spend a lot of time and money on commuting to and from the office. Plus, they’ll be able to work in a comfortable environment, which can boost their motivation, productivity, and performance.
5. Travel Less
It’s common for some companies to conduct face-to-face meetings with their business partners to discuss plans, proposals, and other projects they may be initiating in the future. However, setting up trips and meetings is costlier than you think.
You have to spend on plane tickets or gas for your car, hotel accommodations, food, and other travel expenses.
You can easily cut back on those if you choose to conduct virtual meetings. You can do so on videoconferencing platforms like Zoom and Skype.
You’ll be able to avoid the hassle of booking hotels and tickets as well, and you can use the money you save for more essential purposes.
6. Hire Interns
Nowadays, more students and graduates are looking for internship opportunities to improve their backgrounds and gather relevant experience for their resumes. You can utilize those talented and skillful individuals by hiring them as your interns. Taking this route can bring numerous benefits to your company.
First, because many of them are looking to make an excellent impression, they’ll strive to do their best for your company. Second, interns don’t need to be compensated, although it’s up to you if you wish to give them an allowance.
Either way, it’ll cost you less to have interns than to hire new regular employees.
Lastly, it’s a win-win situation as internships will not only help you save on employment expenses but also allow your interns to grow as young professionals.
You may need to provide them with training first, but this will help you ensure that they’ll contribute properly to your company.
Regardless of the kind of company you have, cutting business costs should always be one of your goals. This doesn’t have to mean letting go of employees or sacrificing the quality of your products or services.
Instead, let the tips above guide you on how to start reducing your business expenses and work on increasing your company’s profitability in a positive and efficient manner.