Some Ways to Reduce Business Costs
Here are several ways for a small business to reduce its expenses:
Office space. Having employees work from home is one of the quickest ways to reduce a company’s demand for office space. When you provide an employee space in a standard office, there is not only the rental or purchase cost of the facility, there is also often utility, landscaping, and other lease management expenses. There may also be property taxes and other hidden facility charges you will avoid by having workers telecommute.
Equipment. You can usually function just as well, with big savings, by purchasing used equipment, furniture, tools and other business related items. Some first-time entrepreneurs fall into the trap of buying equipment with unnecessary features or expensive “high-fashion” furniture. Do you really need a fancy digital camera or a full-color laser printer? Sometimes a service company like Fed-Ex Office can provide you better quality and service at a lower price on large presentation projects.
Staffing. Do not hire permanent employees for temporary needs. Find short-term outsourcing and contracting opportunities for ‘ad-hoc’ requirements. In today’s high unemployment environment there are many good people who will accept short-term work. For tasks that do not require high technical skills consider interns or college students who want a part time job.
Office supplies. Paper and print cartridges are often a big expense for a small business. Do not print unnecessarily. Try a no-print policy for emails and other electronic documents. Print on both sides of paper if your printer offers that option. Sometimes we purchase supplies like pens even though we still have a box-full of half-used pens in our supply cabinet. Buy only when it is necessary, or when you think you can get a great deal on volume sales.
Web site. There is a tremendous range in the costs of setting up a web site. Shopping around can definitely save you money. The cost of a web host may be free or very high priced, depending on what services you will require. The free sites are included in packages of other services that various vendors provide. If you already use or need these services, the site is truly free. As your website gets more traffic, or if you need to put a lot of big files on your website, you may have to upgrade your site to a higher-priced plan.
Travel. Using the Internet for “webinars” for meetings and training can save employees travel time and travel costs. Video-conferencing can often have the same value as face-to-
Save travel expenses the old school way. Use the phone.
face meetings without the related travel expenses. Competition has reduced the cost of phone conference calls.
Purchasing. Do you belong to a trade association or local group? There may be an opportunity for group purchases. Identify areas for your company whereby purchasing as a group could be more financially efficient. When making a bulk purchase some vendors can give instant savings based on the amount of items acquired or the value of the total purchased. Check your invoices that you receive from vendors. Make sure your vendors are abiding by the terms and conditions of the contracts and agreements that you have with them.
This is an update of a post previously published on October 5, 2009.