The most effective cost savings usually aren’t the ones you think of first.
The traditional cost savings that are made by letting staff go can have such a negative effect on so many areas of your business that you could end up in a worse situation only a few months down the track. What’s the alternative? Look for increased efficiency within your business – a few small adjustments to how you run your business will make a huge difference to your costs and cashflow. So, where are the best places to start making savings?
5 Savings for Savvy Business Owners
Efficiency – not just Savings.
- Get your team together and ask those at the ‘coal face’ how you can do things more efficiently. Ask staff for their ideas for how to reduce costs and increase customer satisfaction and reward the best performing ideas once implemented. Aiming for efficiencies, making more money with the same amount of resources is what makes a business more profitable and more valuable.
- Talk to your Suppliers – it never hurts to ask!
Discounts or extended payment terms may be available. Your suppliers are more likely to say yes if you’re one of the first to ask, rather than one of the last.
- Your Customers – do you have a robust debt collection strategy?
Having a formal Terms of Trade and Credit Application procedure let’s your customers know you’re serious about debt collection from the outset. It can be as simple as having as many ways to pay as possible, including credit card and direct debit etc printed on your professional looking invoices and following up with fortnightly emailed statements.
- Part-time Staff – get the help you need at the right price!
Ever thought your business needs a Financial Controller to get costs and cashflow under control or a Marketing Manager to take on the role of further promoting your business, but thought you couldn’t afford it? A quick search online will show you just how simple and cost-effective it can be to get help onsite at the right price.
- Overheads – savings that go straight to the Bottom Line.
In not all but some businesses, a drop of 20-30% in turnover is expected this year. Can you continue to cover your current overheads with a drop in turnover? It’s time to come up with some alternatives.