Small Change makes a Big Difference when cutting Business Costs

There are many strategies for cutting business costs from your budget, but be careful you’re not cutting too close, or cutting out something you will need later on. This is where it pays to look at the details.  Business owners should ask themselves the following question.  Where can the smallest changes in time management, materials utilization, and employee productivity make the biggest difference in the bottom line? Then, review these five simple strategies for cutting costs in your business:

  1. Telecommuting gives you and your employees the option to work from home or other public locations without the time and expense of commuting. Companies are saving more on office space and energy costs by allowing employees to work from home. Employees have greater professional satisfaction that directly contributes to improved productivity.
  2. Cut travel expenses by reducing traveling. Avoid conferences and trade shows that are not directly profitable, and use that time to focus on maximizing income potential.
  3. Buy second-hand office furniture and equipment. Get over the misconception that second-hand means less than the best. Employees get the same utilization from barely-new or gently-used office furniture and other amenities.
  4. Reduce your tax bill. A quick and easy way to reduce your tax bill is by clearing your books of old assets that you no longer use or need. Also look out for tax breaks and incentives to purchase hybrid vehicles or reduce your energy consumption.
  5. Track your inventory. Only keep those items that are absolutely necessary and be careful with ordering for stock. Reduce overhead from rushed delivery or more-expensive brands by planning ahead and tracking carefully. Internally, encourage employees to “reduce, reuse and recycle” – not only is it good for the environment, but it’s good for the budget, too.

The avenues of cost-savings are more versatile than you think, and can be effectively implemented without compromising on the quality of your goods and services. The first step is to take a close look at how your business is running now, and developing a strategic plan for the future.

Remember, running a business successfully does not need to be complicated.  Keep it simple!

For more information on business analysis, business planning, and ways to grow your small business profitably, please check out our website.

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