Businesses have been looking for ways to cut their operating costs for as long as businesses have existed. It can be a troublesome area because business owners have to sort of use triage to figure out what gets cut and what stays, sometimes resulting in cutting things out that you don’t necessarily want to get rid of.
There’s only so much money in the budget, though, which means some things are going to have to go. The trick is to take a really close look at where you’re spending money, down to the very smallest of expenses.
In fact, the really small expenses can be the best things to eliminate because they tend to have less of an impact, or consequence on your business. If you find yourself in need of cutting costs, this post is going to help because we’ve compiled a list of a few ways you can save money without hurting your business or your employees.
1. Have Fewer Meetings
Meetings are a funny thing. They are often misused or overused by businesses because, though there are times when a meeting is actually needful and can be very productive if conducted properly, you can usually accomplish what you would do in the meeting without getting everybody together in a room, real or virtual.
Professional people love meetings for some reason. There’s something about sitting in a room where one person talks at a time and says things about a given subject or project. There’s something about this act that makes us feel like we’re getting things done, but many times, meetings are extremely wasteful of time, personnel, and resources.
We don’t always think about it, but there is some cost attached to all those meetings. Everyone attending those meetings has to stop their work and end up costing the company. Time is money, and that applies to everyone working for the company—not just the owners and executives.
You just have to remember that while your employees are at their desks, with customers, or wherever they are, working, they’re making money for you because they’re doing their jobs. When you call them in for a meeting, though it may provide information or direction that they need, they aren’t working, which means they’re actually costing you money. The first thing you should ask yourself is, “Why are we having a meeting?”
Sometimes, they are so routine that you’re just meeting out of habit, but is it really needed? Secondly, ask yourself if you can accomplish whatever you aim to do in the meeting through other means, such as an email or a phone call. You can end up saving a lot of time and money if you find ways to eliminate some meetings.
2. Go Paperless
Paper is expensive. This is another thing that we’re barely even conscious of as we’re using it every day for the business, but it has to be paid for at some point. You can keep your sticky notes (we all love sticky notes); although, you could invest in dry-erase whiteboards for everybody and do away with the sticky notes. Who am I kidding? No way—we love sticky notes.
There are a lot of applications where you can go paperless, such as company memos, informational packets and notes for meetings that you hand out to everyone at the meeting, and any kind of reports that are typically submitted with real paper. The more paper you eliminate, the more money you’ll save. Just about everything can be done electronically now, so there are many opportunities for eliminating paper.
If you like, you can even make it a policy in your company that employees are not allowed to use paper for any correspondence, messages, or presentations. Sometimes it’s helpful to have a hard copy, but in most cases, we only use hard copies for things because that’s what we’re used to. It’s usually very easy to simply convert whatever the material is to an electronic version. Not to mention..it helps save the environment!
3. Man Hours
Cutting hours of employees is a touchy subject for obvious reasons. If you don’t handle it properly, it’s one of the fastest ways to upset people and end up with a bunch of disgruntled employees who feel underappreciated. For any employees who are paid on an hourly basis, you can probably find certain times when not everyone needs to be on the clock, even if the cuts you’re making are very small.
Cutting a half-hour here and there, every day, can add up to quite a bit of money that you’ll save on wages. Obviously, you’ll want to do this carefully, so that you don’t end up reducing their hours too much. Many owners don’t care that much if their employees like it or not and go ahead and slash hours as much as they want, which is a terrible way to run your team.
It’s true, however, that there are times when you’re just burning money and some extra hours have to be cut because it’s justified in those cases and can’t really be helped. The reasons for cutting man hours that we’re talking about here are another story. To reduce your spending for the business by cutting a little bit here, and a little bit there, you should actually be able to take a small bit of your team’s hours without having any significant impact on them.
A good way to maximize efficiency with time management of your staff is to implement a temporary initiative where everybody gets a timesheet on which they need to record the time they spend on each project or task. Those timesheets give you a clear idea of where time is being wasted or used somewhat inefficiently. Clockspot is an excellent tool that can help you do implement this strategy.
4. Cut Down Overhead Costs
Overhead is one of the expense categories where businesses throw away a lot of money, and there are quite a few ways in which you can bring down your overhead costs with a little adjustment. The first thing you can do is to find ways to use less power. That could mean installing more efficient lighting and appliances, or installing solar panels to supplement the grid power that’s coming in.
In general, what you should look for is any way that you can spend a little less on things like rent, HVAC, lighting, furnishings, or any other overhead cost. Is there any way that you can reduce the cost of any bills that are coming in for the business? Can you change the billing package for your Internet service in favor of a cheaper plan?
Have you considered switching from a traditional phone company to a virtual phone system? A virtual phone service like Talkroute is most likely going to be much less expensive than using one of the main phone carriers that you may be using right now. Many of these suggestions are of course for businesses that run out of a separate office, but you can use most of the same principles by applying them to your home business, too.
One more strategy that you might consider is the possibility of adapting employees to work remotely. It’s not for everyone, but converting even one or two employees into remote employees will quickly cut down your company spending.
5. Consider Converting to a Home Business
Many small businesses immediately go for the traditional office space because they feel that it’s just what you’re supposed to do and that it’s necessary. It’s not always necessary. As you grow and add more employees, you may then need the building to facilitate everyone’s space that they will need to do their jobs, but even with multiple employees, you can absolutely run your business out of your home and allow all employees to work remotely, if that’s what you prefer.
The bottom line is that you will save a lot of money if you don’t have to maintain a separate office space. More and more small businesses today are opting for the home business option with remote employees, and there are very good reasons for that. The first reason is technology.
There are now all kinds of tools that you can use to make working remotely easy to manage, and in some ways, it’s even better than working together, in-person, using the traditional structure. Besides the cost savings, you’ll have some really happy employees because they can work on their own terms and be closer to their families, which anyone working for a company who has a family can appreciate.
6. Use Content Marketing Instead of Traditional Advertising
The traditional methods of advertising that have been used for decades are becoming far less effective than promoting your product online through content marketing. So, not only are the conventional advertising outlets more costly than organic online marketing, but they also don’t even work as well.
You’ll find that the cost of writing deliberately-designed, targeted blog articles on a regular basis to draw traffic to your website is far lower than renting a billboard, making a TV commercial, or buying airtime for an ad spot on the radio. It just makes much more sense for a small business to spend its time learning how to use SEO to its advantage and bring in targeted traffic to the website, to convert web searchers into new customers.
There’s virtually no cost to do this, either, outside of the time it takes to create the content and to market it properly online. Outside of organic content marketing through SEO strategy, even using PPC (pay per click) ads or retargeting is going to be cheaper to create than the traditional methods.
You’ve probably noticed that just about every business now has a blog attached to their website. If you haven’t got in the game yet, you may not know how it works, but you can clearly see that there a lot to be gained from content marketing, or else so many companies would not be using it. We live in a time when people find businesses, the services and products they need, by searching for them online, almost exclusively.
People also do all of their research for comparing products to find the best provider via web search, as well. This is exactly why content marketing is so effective because it capitalizes on the fact that people are going to find businesses and buy from them, by searching on the Internet.
It can be a challenge to find ways to cut costs for your business, as most of the things that you consider getting rid of are things that you need, and it comes down to a matter of deciding what you’re willing to part with to save the money you need.
As you weigh your options and decide what you will cut so that you can pinch your pennies, it’s important to be careful not to eliminate anything that will harm your employees or make it difficult to do business. It’s generally the small things that make the most sense to get rid of because they tend to have the smallest impact on your business’ operations.
As long as you take time to weigh out your options and just make small cost cuts along the way, you’ll put your business in a position to save enough money to grow and have more success in the future.