By Eric Sikola
If you’re a small business owner, it’s likely that you care as much about cutting unnecessary expenses as increasing sales. The problem, however, is identifying which of your current expenses can be reduced and how.
Reducing costs in your small business and creating processes that will cost you less money over time doesn’t have to be a huge undertaking or even a lot of effort. In many cases, it’s about making smarter choices when deciding how to spend your business funds.
Here are six simple strategies for reducing expenses at your small business:
- Expense Reports Policies: The first thing a company should do before anything else is make sure it has an expense policy in place. Without a set of guidelines, employees may abuse the system by submitting false or unnecessary expenses. It also may result in the loss of a tax deduction to the company or additional taxable income to the employee if procedures are not followed.
- Incentivize employees. Paying job boards or recruiters can be expensive and somewhat disappointing. Why not set up an internal incentive program for employees to recruit new hires? It will not only help with recruitment and saving the company money, but also help boost employee morale and overall job satisfaction.
- Ask for corporate discounts. Plenty of companies negotiate discounted rates with hotel chains, car rental companies or airlines, as the cost savings can be significant. It might take some time to research, but most companies offering corporate discounts outline their discount programs on their websites and include all the benefits and cost savings.
- Outsource. From payroll and human resource management to benefits and compensation, small business owners can spend up to 40% of their time engaged in these HR-related tasks. By outsourcing key HR functions, small businesses can help increase business productivity and focus on their goals, as well as better control employment costs.
- Buy refurbished equipment. Buying brand new equipment is a big business cost. You can reduce these expenses by buying refurbished furniture and equipment that is often as good as brand new. Small businesses can also look into leasing options versus buying office equipment.
- Ditch your landline. Traditional telephone lines can be an expensive and sometimes unnecessary business cost. Small business owners who opt to use cell phones instead of a traditional landline can reduce their business costs. There are even corporate cell phone plans that businesses can explore to reduce monthly fees even further.