As a business owner, you know you need to run a lean operation to maximize profits. When spending outpaces income, it’s common to want to make big changes. But cutting staff or reducing business hours often only hurts your bottomline. You can save money in multiple ways that you might not have considered yet.
Consolidate Suppliers and Vendors
If you’ve got a different supplier for every aspect of your business needs — from office supplies to each element of the product you sell, you may have too many suppliers. This means you’re not maximizing efficiency or your own negotiating power — and paying too much for supplies. You can apply the 80/20 rule to so much in life, including the idea that 80 percent of your supply spending should come from 20 percent of your suppliers.
Look for ways to consolidate suppliers. Negotiate with the remaining suppliers for better prices, especially once they realize you’re bringing extra business. You’ll save on costs and your business will run more efficiently because you’re not juggling so many vendors.
Cut Utility Costs
The lights have to come on, as so does the air conditioning or heat, but there are plenty of options to add efficiency here, too.
- Allow telecommuting for staff who can perform tasks from home. If all they need is an internet connection and a computer, there’s almost no reason for them to come into the office every single day.
- Offer four-day work weeks. With less people in the office, less energy will be used — and fewer office supplies.
- Make your business more energy efficient. While there will be a greater upfront investment, you’ll see the difference in lower utility costs immediately. Upgrade everywhere you can from double-sided printers to LED lightbulbs to an energy-efficient HVAC system.
Go Non-Traditional Whenever Possible
If you’re still running your business the way you did 20 years ago, there’s a chance you’re missing out on important cost savings. The principles of business may not change, but the tools do.
- Use social media and web content to attract people to your business for a lot less than the cost TV, radio, and print ads. The biggest investment is time if you do it yourself or you can use the next tip to hire someone to do it for you.
- Outsource where you can. Laying off employees isn’t the goal, but if you need to hire someone new, consider a freelancer instead of a dedicated employee. You’ll only pay them for the work they do, and you won’t have to pay for benefits or payroll taxes.
Check Your Insurance Coverage
If you haven’t thought about your business insurance in years, you’re likely paying too much or don’t have the right kind of coverage. And if you haven’t seen your insurance agent since your first policy was written, there’s definitely a problem. Work with an independent insurance agent who understands your industry and your business needs. An annual review of your insurance coverage could uncover all kinds of savings.
- Only buy the insurance coverage your business really needs — and don’t pay for coverage that doesn’t make sense for your industry.
- Don’t go without important insurance coverage just to save money because you could face a financial crisis if you have to pay for damage or an accident out-of pocket.
The right amount and type of insurance coverage is imperative for any business. If you’re ready to make sure you’re not paying too much for business insurance, contact Charlotte Insurance today. We’ll make sure you have what your business needs.