Figuring out how to cut costs is one of the toughest parts of running a successful business. You want to ensure that whatever you do, the money going out of your company isn’t exceeding the cash coming in. In other words, you need to make a profit.
These days, it doesn’t always cost much to get a business up and running. You can launch a website from the comfort of your own home and sell products online with ease. There are even dropshipping companies who will handle the shipping and packaging parts of eCommerce for you.
However, that doesn’t mean that you won’t have to deal with financial issues from time to time.
When crises in the market, changes in the economy, and other factors reduce your income, it’s crucial to find ways of cutting costs. Since the last thing you want to get rid of during this difficult time is your talent – what else can you do?
Try these strategies to reduce costs without cutting your staff:
- Reduce office space expenses. One of the most expensive things you’re likely to pay for in any business is your office space.
- For years, entrepreneurs assumed that they needed an office space or retail location to thrive. However, more and more companies are now using space in the home, instead of business office space.
- Thanks to the cloud and remote working tools, you can even have an entire team on-board helping to run your business without investing in office space.
- If you really need to have a physical office for client meetings, you could always reduce the size of your real-estate, or think about hiring office space out when you’re not using it.
- Barter with suppliers. Bartering is a pretty old-fashioned concept, but it can still work today.
- Ultimately, if you have something valuable you can offer your suppliers, they might be able to work out a deal for you.
- For instance, if you’re a web design company, you could offer to re-design the website for the company that supplies your computers if they’ll give you a discount.
- If your business bakes delicious foods, then you could consider swapping some of your hand-made items with the alcoholic drinks store down the road. This allows you to expand your product portfolio and potentially attract more customers without spending a fortune.
- Change suppliers. If you can’t barter with your suppliers, and they’re not giving you the best deal on the items you need, it might be time to look into someone who can provide a better offer.
- There are tons of ways to find local suppliers and manufacturers online. It’s a good idea to get samples of what they can offer before you commit to anything though.
- You might also look into changing suppliers for some of your less tangible needs. For instance, can you use a less expensive broadband supplier for your office internet? How much are you currently paying for things like VoIP and telephony to connect to your customers?
- You could even look into making your office or home office more energy efficient and seeing whether you can reduce your expenses that way.
- Look into different kinds of staff. If it seems like the only way you can reasonably cut costs right now is to let go of talent, you can try some other options for your employees first.
- For instance, asking your permanent staff members to reduce the hours for a little while might be better for them than letting them go. Discuss potential changes in schedule with your staff to see what you can work out.
- If you need to hire specialists and professionals outside of your team, consider working with contractors and freelancers that work on a per-hour basis. This is often an affordable option. You also won’t have to worry as much about overhead expenses with freelance staff.
- Explore different kinds of marketing. If you’re struggling to cut costs and nothing seems to be working, it might be a good time to look at effective, but less expensive, marketing strategies.
- Maybe you could reduce the amount of budget you put into your social media and content marketing campaigns by using some word-of-mouth advertising instead.
- Reach out to your previous customers and ask them for positive reviews that you can share on social media.
- Consider writing your own case studies about what you’ve accomplished for clients in the past and share them as part of your content strategy.
- You can even look into creating guest blogs for other companies related to yours online, so you have an easy way to reach new customers.
Cutting costs doesn’t have to mean cutting down on the staff that keep your company running. Try these strategies and you may be able to cut costs and still keep your talent.
