How to Cut Costs in Your Business
3 Minute read
Before the dividends, running a business can be expensive. SME’s are constantly being hit with increasing costs and unforeseen expenses, so frugal budgeting is more important than ever. You do not have to wait for your business to show signs of a financial struggle before act; there are many tactics you can implement to improve the bottom line without sacrificing quality or productivity.
Reconsider your marketing
It is naive for a business to think that they can survive in the digital age without harnessing its marketing advantages. Fortunately, it does not have to be expensive. Marketing can be done on a shoestring with creativity and a little thinking outside the box. Gone are the days of flyers in letterboxes and an ad in the Sunday paper. Technology has allowed businesses to reach millions of consumers quickly and cost-effectively.
With more potential customers online than ever before, businesses should not overlook the importance of social media to grow their business. All companies should have a committed digital marketing team to continually drive the brand and keep it current.
Lower your office space costs
You do not have to run 100 percent of your business from a local commercial premise. Office rentals are expensive so it pays to think of an alternative.
If the work can be done just as efficiently from a remote location or shared working space, do not waste money on office rentals. Fortunately, technology has made distance obsolete so interrelated business functions can be performed from all over the world. This means you can take advantage of growing a remote team in countries like the Philippines where you can drastically lower your staffing costs as well as saving on office leases.
It’s not only the monthly lease you will be saving on; operating your business from home, offshore or co-working spaces will save you money on insurance, utilities and business taxes.
Cut supply costs
Business is business. Loyalty to an existing supplier should not take precedence over reduced costs from the competition. As a business owner, you should be constantly monitoring supply costs and comparing alternatives. Prices do not have to be final. Negotiate deals based on quantity and early repayments.
Take a look around the office. Can the weekly fresh flowers be replaced with a plant? Can complimentary coffees from the café be limited to one a day? Cutting costs does not have to compromise the business, but they can make a huge difference to the bottom line.
Cut staffing costs
Nontraditional staffing arrangements can cut costs without lowering productivity. If roles do not require a full time, in-house salaried employee, there are a number of alternatives:
Internships are a great way to access low-cost talent as well as training them to the work ethic that aligns with the company’s mission. Interns require a lot of careful management and mentoring which may not always be viable for busy businesses.
Hiring a virtual employee is a great alternative for small businesses to outsource tasks that are time-consuming but necessary to the functioning of a business. Administration, accounting and data entry can all be outsourced to free up your domestic team so they can focus on the core tasks at hand.
Offshoring your non-core functions to the Philippines will significantly reduce your staffing costs and reduce your overheads without sacrificing on skill or quality.
If you would like to take the first steps in cutting costs and increasing your profit, talk to Deployed to see how growing a remote team in the Philippines can improve your bottom line.