You’ve been going at your business for a couple of years, and you’ve found a steady stream of clients and new leads to keep you afloat. But no matter how hard you try, you just can’t cut down on your running costs, and profitability is stagnant. Below, we’ve put together 5 ways to change that; reducing your running costs and ensuring your business is as successful as it can be.
The single biggest running cost in your business, other than staff, is likely your premises. If you rent a store where you sell your products and services and you’re just not making ends meet, then you should consider moving to a place that’s more financially manageable. Assess the situation; if you sell products online, do you really need a plush city-centre hub? Moving outside could be cheaper and more effective. However, remember to calculate the cost of moving before you make any firm decisions; relocating a business is not to be done lightly.
Cut down on staff
Getting rid of staff is something no business owner wants to do, especially if they’re turning a profit and can manage to sustain their employment. But letting deadwood go, or replacing an employee with a cheaper, more efficient one, is what business is all about. Analyse your team; decide which roles are essential and which are fluff, and make those difficult decisions.
Unless you’re running a huge organisation, you don’t need a marketing expert in house. Another way to save money is to get rid of non-essential employees and outsource; a £25,000-a-year social media executive, for example, can be replaced by a company that offers affordable social media management. These smaller, cost-effective switches will save you big in the long run.
Get tough on perks
Do you really need a company party once a month? Could you replace coffee machines in the staff room with a kettle and some tea bags? Cutting back on perks and company benefits can help to improve your bottom line, and many of the things can be done without anyone noticing. Cheaper toilet paper, tap water rather than bottled. In the words of Tesco, every little helps.
Protect the environment
Going green and thinking of the environment is another way to cut your operational costs – and the best part is, you can use it as an excuse to promote your business. Turn off office lights and computers when they’re not in use, switch to energy-efficient light bulbs and equipment, turn off the heating when it’s not freezing cold, and invest in fuel-efficient vehicles. Some of these may mean you spend more in the beginning, but in the long-term, you’ll be rewarded ten-fold.
The truth is that it’s easy to take out cost-cutting measures if you look in the right places; the tips we have offered in today’s post are only the beginning. Good luck with your strategy.