All businesses look to cut out unnecessary expenses. With growing competition from overseas, this often allows them to remain competitive in the marketplace. For SMBs working on strict budgets from the offset, though, reducing costs can be the difference between survival or closing their doors.
Here are three ways you can save money without sacrificing on quality.
Reducing the Price of Your Regular Bills
Many business owners chalk off their monthly bills as simply one of the costs of operation. However, these fees can often be drastically reduced with little effort on your end. Use compact fluorescent lamps rather than incandescents, as these use around one-third of the electric power and still last longer. Likewise, look out for office supplies that scores highly on energy efficiency indexes when it’s time to upgrade your printer, scanner, and other equipment.
Switch to More Energy Efficient Vehicles
If your business owns a fleet of vehicles, either for your remote sales team or as part of a logistics company, you may benefit from upgrading your existing vehicles to newer, more energy efficient models. Not only can you expect this to result in regular fuel savings, but some vehicles, such as Kia’s latest range of eco dynamic cars, are also exempt from road tax due to their low emission levels.
If your business offers company cars to its employees, this will be a much more attractive proposition if the vehicles cost less to run, and may help you to attract the best talent available. People love perks and this is one of the perks that you don’t want to miss out.
Manage Your Inventory More Carefully
Finally, if you run an inventory-based business, it’s crucial that you ensure you’re managing your stock closely. Checking your par levels several times a year will give you much better understanding of consumer buying habits. Not only will this help to eliminate the chance of ordering unnecessary stock, but your warehousing costs will also go down if you have less inventory to store. Many storage providers work on variable rate, where what you pay is dependent on how much inventory you store.
Try not to get caught up in the idea that all stock is a valuable asset. Goods that were previously in demand can quickly turn into dead stock as seasons change or they become obsolete due to new technology.
Reducing costs may seem pretty straightforward, but making cost reduction a part of your company culture needs extra effort on your side as a business owner and employer. Make sure you socialize the cost reduction regimes and, if necessary, have an employee or a group of employee whose role is to make sure that cost reduction practices are on top of everyone’s mind.