BUSINESS INSIGHTS

How to lower business expenses and improve your bottom line

3:30 Minute Read

by Spectrum Business

Hand uses a calculator on a desk, while also holding a pen, as a person makes calculations.

Your business is wasting money. The discipline of these reviews will enable your business to have cash on hand for opportunities and expenses that can help you boost your bottom line.

Some of the most common opportunities for savings include:

Phone, Internet, office cleaning and other services — new plans, promotions and bundled services can help you save
Annual contracts such as insurance and maintenance agreements — shopping around to identify current pricing and asking your current provider for the best deal possible can result in savings

Ask other business owners about deals they receive and follow up to see if you can get the same savings. Also investigate what discounts your industry or professional associations may offer.

Pay early to gain savings

Some of the invoices you receive may offer a discount for early payment. While the 1% to 3% or so that these discounts typically provide may not seem like much, these savings can add up. Establishing these habits also has the potential to encourage a culture of thrift in your organization, which may encourage your team to look for opportunities to save money for your business. Even if a discount for early payment isn’t offered or stated on an invoice, it can be worth asking for since most companies are looking for a way to get their cash faster.

Automate

Many of the tasks you may still do manually — such as bookkeeping, payroll, bill payment, inventory management and point of sale — can be done more efficiently through automation. Chances are you have already automated some tasks, but in the spirit of “time is money” consider automating even more of your administrative work.

Buy used equipment

Shiny new equipment is fun to buy, but it may also be more than your company needs to be efficient. Refurbished computers, servers, phone systems, projectors, printers and other equipment can provide a significant cost savings over new items. Many computer stores that refurbish and sell items also provide service, which can help put to rest your concerns about the reliability of used equipment. Of course, use your judgment. Don’t skimp on a new system when advanced functionality is really required, for example, to produce productivity gains or to provide “state-of-the-art” customer service.

Use free services

A surprising number of services can be procured for free. For example, anymeeting.com provides an option for hosting a free webcast, freeconferencecall.com enables you to host conference calls for no fee and surveymonkey.com lets you post short surveys at no charge. Always look for free options when you are searching for a new product or service for your business.

Provide free employee perks

It is easy for small business owners to assume that paying more is the best way to attract, reward and keep employees. Some people are, of course, motivated by money alone. However, there are plenty of other perks, many of them free, that may mean more than money to some of your staff.

For example, schedule flexibility can be extremely valuable to employees who have children or aging parents to care for. You could let someone come in before or after rush-hour traffic or allow them to work on a schedule that accommodates their personal responsibilities. Letting people work from home occasionally, if it suits your business model, can boost employee loyalty without a cash outlay. Closing early — or completely — during slow times, such as around the holidays or on slow summer Fridays, is also a benefit that doesn’t require a cash expenditure.

A penny saved really is a penny earned, and using this approach will help to build your business coffers. Take steps now to ensure that you have resources available for important expenses and business opportunities when they arise.