6 Simple Ways to Minimize Business Costs

Profit is everything when you own your own business. In order to make money and ultimately be successful, you must be profitable! But how? Decreasing your business costs will be one of the best ways to increase your take home profit. By following some simple yet creative tips, you can easily cut these tedious costs.

1. Price Shop: All business owners have required supplies and services such as rent, insurance policies, internet, or phone plans. Before getting locked into a certain price and contract, it is important to shop around for multiple quotes. You may find the third or fourth vendor your contact regarding a service offers the best price for you. 
   • Once you have your services booked, don’t settle! You should always make it a point to review your services either annually or upon your contracted end date. Many companies will increase the cost of their services annually, so checking with competitors for introductory rates can save you a lot of money.
     • If you love your servicer, rather than switching providers, you can see if the company you currently use offers different plans or policies for a cheaper rate. 
   • When shopping for basic office supplies such as pens and paper, consider looking at large big box retailers. Many of the larger companies offer bulk discounts. If you are working with a smaller supply company, it doesn’t hurt to ask if they have a price matching policy or offer a subscribe and save deal. You would then continue to support smaller businesses and get a good discount. 

2. Be Environmentally Conscious: Remember in elementary school the “reduce, reuse, recycle” saying? It truly does come in handy when owning a business. You can save money by getting creative with your recycling and reusing. 
   • If you have large quantities of cardboard, wooden pallets, totes, or other disposable items, you may consider selling these to individuals or businesses who may be in need. 
   • If you find yourself having large quantities of certain materials, maybe you can find a new product to make or sell using the abundance! Get creative and the possibilities are endless. 
   • Saving trees also saves you money! You can cut paper costs by printing on both the front and back of paper. Whenever possible, use digital programs and cloud filing to reduce the amount of printing needed. Thanks to technology, people can sign and retain legal documents all electronically thus saving thousands of pages (and dollars) annually.

3. Be Energy Efficient:  Utilities such as electric and water are huge annual expenses that can’t be avoided. However, making some energy efficient choices can help to reduce the cost. In today’s world where going “green” is on the forefront of everyones mind, there are so options to save money and the planet. Every office space or store front needs electricity, air conditioning, heating, and plumbing. Know your options to save the most money possible.
   • Check with your electricity provider for different energy efficient plans. For example in Gilbert, Arizona where the A/C never stops running in the summer, the electricity provider has different “time of use” plans that rewards you for being more energy efficient during hight peak hours. Every provider has different options, call yours to see which you may benefit from the most. 
   • When looking to remodel or find a space for your company, consider things such as energy efficient windows, sun screens, or solar panels. These are all effective ways to minimize electric costs. 
   • After business hours, why have your lights on or your A/C still running at a low temperature? Investing in smart home technology such as lighting or thermostats will allow you to control these factors from anywhere thanks to an app. You can ensure all lights are off at the end of the day and turn up the thermostat each night to avoid wasting unnecessary electric usage. Thanks to these apps, you can also setup preset arrangements and schedules.  

4. Optimize Employee Efficiency: When employees are being more efficient with their workload, they are helping the business to succeed. It is hard to encourage every single employee to be 100% invested at every moment of every day, however, there are some things you can do increase productivity.
   • Offer incentives for employees who exceed metrics. Depending on your goal as a small business will depend on what or how you chose to incentivize the staff. A common example is to incentive staff to exceed sales goals with bonuses or time off. 
   • Look into efficiency tracking programs. More and more companies are using tracking systems for their employees to log their daily completed tasks and track efficiency. 
   • Reduce distractions. For example, if your staff is on computers throughout the day, consider blocking websites for social media or personal use.

5. Review Your Office Space: Consider your current office space compared the amount of business you have. Is the size of your office appropriate? Maybe you can consider downsizing to a smaller location to save money while still serving your customers. If you don’t need a storefront to sell your goods, perhaps consider remote work. All of your employees can work from the comfort of their own home (which has been known to increase efficiency thanks to less socializing) and you no longer need to pay for rent or utilities. 
   • Meetings, one-on-ones, and team building exercises can all be conducted through video conferencing and internal chat systems when employees work remote. 

6. Meet With Your Accountant: Accountants, especially when you work with them regularly for tax and bookkeeping services can give you invaluable advice regarding your businesses finances. Using an accountants bookkeeping services gives you access to a variety of financial reports such as cash flow or profits & loss statements. In addition to cutting business costs, these financial reports can tell you where you are losing money and your areas of improvement. 
   • Aside from providing these reports, accountants can also give you advice or answer any financial question you may have regarding your business and growth 

If your business isn’t profitable, then you have no business. Making little adjustments in a variety of areas to reduce costs can help your company thrive financially. Making the decision of where to cut which cost can be overwhelming, however meeting with an accountant at My Accountant Bookkeeping & Tax Service Inc can help empower you to make good financial decisions. When it comes to cutting business costs, no one knows the finances of your business better than your accountant. Minimize your business costs today to start maximizing your overall profit.