One of the keys to success in this cost-conscious business world is managing your expenses and maximising your margin. Sometimes, however, the bottom line doesn’t reflect your sales activity – profit is down and the only explanation can be ballooning costs. Using these tips you can combat expenses and take control of business costs.
Outsourcing certain processes isn’t the massive risk it used to be. Instead, it’s a cost-effective solution to complement increases in activity. If your team can no longer handle the company’s day-to-day operations then it might be time to consider outsourcing some parts of the business.
The best place to start is with bookkeeping and administration, however not everything should be outsourced for the sake of it. Follow the values of your business – if your company believes in superior customer service, it would be unwise to outsource telemarketing or support because you lose quality control. Many online services can direct you to great third-party operators, but always get references from people you trust to minimise the risk of choosing a lemon.
Slash some overheads
While it’s never popular among employees, tightening the purse strings can help your bottom line (and help keep those employees in a job!). One area in which you could save is travel expenses. Set a policy that dictates what is and isn’t reimbursable and then stick to it. Always look for the cheapest deals and call airline companies to investigate their corporate discounts.
Look into reducing office space and implementing hot-desking, where employees share workspaces. Perhaps more staff could work from home or you could join up with another business and share rent. Another popular way to eliminate waste and save a dollar is to go completely paperless, meaning you’re no longer paying for printer ink, paper or the printers themselves.
Invest in technology
Technology can greatly enhance the revenue potential of your business and cut superfluous costs. For example, social media marketing is a great way to engage your customer base with great content and start a two-way conversation. It’s also an extremely cost-effective marketing strategy that doesn’t require the huge cash investments of traditional media and can see real returns if done correctly.
Subscription-based cloud apps can also let you scale with your business’s growth so you never spend more than you need to on software. Further, software can dramatically increase productivity and efficiency. Manual processes waste time that could be spent on more valuable business activities, such as sales and networking with new contacts. Consider trialling QuickBooks Online for free and see how much time you could really save.
Customer relationship management software lets you create better customer profiles and streamline the sales pipeline, meaning you get more positive results from your leads – leads that could become paying customers.
These tips are just a few ways to keep a lid on your expenses and drive your business toward greater net profits.