4 Ways To Cut Business Expenses
Here are four ways to cut business expenses in a sustainable way.
Date: 3/9/2022 6:36:22 PM ( 5 mon ) ... viewed 31 times
Every business goes through lean times at some point. In a turbulent market, it's likely that even the most profitable companies will need to trim the fat in order to make ends meet. Owners often find themselves at a loss as to where to cut expenses in a way that won't cripple their ability to grow again when times get good. Here are four ways to cut business expenses in a sustainable way.
1. Get Utility Costs Under Control
Utility costs are a constant drain on the coffers, but unfortunately, they're not a consistent one. The cost of electricity and water tends to go up over time. Start with assessing your position in that regard by getting a professional energy audit. They're done in multiple levels of rigorousness, which means costs vary widely, but in the long term they can identify waste before it happens.
In the meantime, make a habit of shutting off office appliances when not in use. Remember to unplug them since leaving them plugged in still drains some electricity. Take advantage of natural lighting and consider switching your lighting to compact fluorescent lamps (CFLs). Pay extra attention to your digital infrastructure. Computers consume massive amounts of energy, especially if they have large monitors. Setting them to sleep mode cuts energy use to a mere three to 10 watts.
Of course, you might want to go off the grid entirely. Solar energy in particular is virtual and robust, and also easy to find. If you're in North Carolina for example, typing "find solar panels Charlotte NC" into a search engine turns up many choices. Solar is a long-term investment and can take a decade to pay for itself, but the payoff in price stability, resilience and eventual gains can easily be worth it.
2. Leverage Business Process Automation
The combination of artificial intelligence and cloud computing has opened the door for an abundance of business process automation (BPA) tools. These range from algorithm-based analytical programs to customer relationship management (CRM) software and other sales force automation systems. Chatbots can also be useful as a source of cheap customer service, with an article in Forbes Magazine revealing that proper chatbot usage can increase sales by around 67%. They might be impersonal compared to a live operator, but these automated tools can help a lot of people at once.
In a similar vein, consider replacing physical meeting spaces with digital ones. Voice over Internet Protocol (VoIP) applications like Skype make the process intuitive. Consider allowing workers to stay remote if they want to; a Stanford University study found that remote workers are 13% more efficient than their counterparts in the office because they're more comfortable and therefore work harder and longer. Give your workers the flexibility to complete tasks their own way, and they'll do them better and faster.
3. Practice Efficient Time Management
Time is money. That's not just a catchphrase, it's an economic truth. Start by keeping your workspaces distraction-free. Make sure that you have the people who are most dedicated to and energized by a task doing those tasks. Consider time-tracking software to monitor the progress of projects quantitatively. Invest in team management software like Basecamp to keep everyone connected. If you want to go even further, try maximizing your office infrastructure for human efficiency. Ergonomic seating and even certain color schemes have been proven to boost productivity.
4. Reevaluate Your Contracts
Many owners make the mistake of thinking that they're locked into every deal they make. That's usually not true because negotiation is always quite often an option. If there isn't a high demand for the real estate you occupy, try renegotiating your rent. Choose large discount vendors to take advantage of an economy of scale. Save on office supplies by telling those vendors that you're price shopping. See if they're willing to offer lower rates to loyal customers. Be confident and remember that B2B services are a two-way street.
Hard times require tough choices, but that doesn't have to mean downsizing or ending the dream of expansion. On the contrary, these simple strategies can help you make the most of your company's potential.
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