Clever Ways to Cut Costs in Your Company
Companies of all sizes are always looking for innovative ways to reduce their business expenses. Keeping costs low and sales and productivity high is key to building a long-lasting business, and it’s unquestionably essential if you’re looking to scale.
The most successful companies have perfected the art of cutting costs in some areas and channeling more funds and effort into others. On the other hand, companies that fail to grow or even survive beyond the first two or three years will usually find fault in the way they managed their finances: reducing funding for essential things such as staffing and pouring majority of their money towards things like untested and inevitably unfruitful marketing efforts.
There are hundreds, even thousands, of ways to reduce operational or production costs within the company, but if you have found that the most popular ones aren’t doing it for you, it might be time to look into unusual and clever ways on how to reduce expenses in the office.
How to reduce costs in the workplace – the unusual way
Before you start brainstorming about ways to reduce company expenses, it’s important to examine your current spending first. Knowing where the bulk of your money is going tells you where you need to focus your cost-cutting strategies on.
This article can give you an overview of the common costs of running a business. Of course, your own expenses will be different depending on the type and size of the company you have. An e-commerce business will definitely have wildly different expenses compared to a digital marketing consulting company. It’s best to audit your cashflow first to ensure that you’re making highly informed decisions with regard to cost-cutting.
Ready to get your fill of uncommon but highly effective ways to cut costs within your company? Let’s get started.
1. Go paperless.
Not only will going paperless allow you to save hundreds or thousands per year (depending on your usage) on paper and ink/toner, it’s also so much better for the environment. Plus, you won’t have to buy or repair your office printer/s anymore which can boost your savings too. Good advocacy like being a “green company” can help with your marketing and branding efforts as well.
2. Outsource specialized work.
It’s easy to assume that an expert can get the work done in less time and with less effort, so why are you still spending your own time and effort doing things that are not your forte? You wouldn’t expect the CEO of a big company to take care of payroll or be the one to schedule social media posts right?
There are many available options for you when it comes to outsourcing work. For instance, there are small marketing agencies that you can work with for your marketing and branding efforts. You can hire a freelancer to do your logo, edit your product photos, or build your website. You can purchase easy-to-use software to simplify your accounting and payroll and hire a virtual assistant to manage it. In short, it’s best to leave the specialized work to the experts.
3. Get rid of your rental office space.
Leasing an office space is expensive, no matter what city you’re in. If you want to do business in central business districts, the cost of leasing office space for each employee can be in the thousands. As a more affordable alternative, you can share office space with other companies or look into coworking. This means that you’ll only be paying for space when you’re actually going to use it. For the rest of the time, you can just work at home or at a coffee shop and encourage your employees to do the same. Take advantage of the popularity of remote work among employees today.
4. Encourage healthy living in the workplace.
Health insurance is an expensive cost for any company, but even if you’re not providing one for your employees, it still helps to have fit employees all year round. When your employees are sick, your productivity takes a hit. This can mean anything from customer concerns that were not processed in a timely manner to sales opportunities that were missed entirely.
5. Make your office “smart.”
Smart appliances have become so popular because of the energy savings that they bring to the household. So why not take these smart equipment into your office too? A programmable or smart thermostat can help you reduce energy costs. Smart lighting can also ensure that lights only turn on when they are in use, that no faucets are left running, and that the refrigerator is always closed. Sure, you might shell out a sizeable sum to make your office smart at first, but the energy savings you’ll get will definitely make up for this in the long run.
6. Regularly audit your subscriptions.
Even the smallest subscriptions can see your money going down the drain quickly. Every company uses a multitude of tools, services, and software to increase efficiency and productivity. And while many of these tools are essential, you can expect a good chunk of them to be super wasteful as well.
To make sure that you’re not unnecessarily spending on services or software that are not doing anything for your business, have a quarterly, biannual, or annual audit of all your subscriptions. Get rid of the ones you barely use or don’t use at all, and switch to annual payments for tools that you see yourself using for a long time. Annual subscriptions can offer you hundreds or even thousands of dollars in savings when you switch to annual payments for all the tools you’re using.
7. Encourage your employees to share their own cost-cutting ideas.
Your employees will definitely have their own unique ideas about reducing costs in the company, and as the people who actually deal with particular tasks on a daily basis, they will know where your funding gets wasted. Host a quarterly session for brainstorming cost-cutting strategies to encourage your employees to speak up. Plus, when they know that you’re doing something else to reduce expenses, they can feel more secure about keeping their jobs.
8. Team up with other businesses.
Sometimes, sharing your resources and even your profits with other businesses can lift both your businesses up in ways you’ve only dreamed of. It might seem counterproductive, but effective partnerships with other businesses you trust can help you reduce costs and boost sales by splitting common expenses like marketing and sharing resources like office equipment and even human resources.
9. Review your employees’ efficiency.
Getting rid of unproductive employees is hard, but it’s an essential move to keep your business running. Not only do ineffective employees mean wasted resources, but they can also be bothersome for your more efficient employees because they are the ones who have to carry the weight of the ineffective ones. Keep your staff efficient, effective, and happy by replacing unproductive employees every now and then.
Unconventional cost-cutting solutions from real companies
Real companies have also utilized a ton of weird and wonderful ways to cut costs. After all, creativity has its own rewards. Established companies who have tried all the usual ways to reduce business expenses had to turn to more imaginative ways just to cut costs. Here are some of the most interesting ones!
- American Airlines allegedly saved between $40,000 to $100,000 by removing a single olive from their in-flight salads.
- Yahoo implemented a mandatory unpaid Christmas leave in 2009 leading to $21 million in savings.
- Cisco shut down their company for four days during the end of the year which, along with other cost-cutting methods, allowed them to save around $1 billion in 2008.
Want to know more about these fascinating cost-cutting tactics? Check out this article on 10 Bizarre But Effective Corporate Cost-Cuts from The Richest.
Why virtual staffing is the best way to save money
Hiring virtual assistants to reduce the cost of staffing is nothing new. In fact, virtual assistant services have been helping so many entrepreneurs save money without sacrificing skill and productivity. But it’s still important to discuss just how useful virtual assistants are when it comes to cost-cutting ideas for large companies and small companies alike.
The best way to know just how effective virtual assistant services are is to hear it straight from entrepreneurs themselves. Check out how turning to virtual staffing has changed the way these entrepreneurs do business:
“The addition of our virtual assistant has been one of the most positive moves that we have made for our business this year. It has made all of the difference in our daily work life that this virtual assistant can take over many routines but very time-consuming tasks. We need to learn to better utilize virtual assistants in our business. I complement 20four7VA for their skill in matching the needs of the client with the skill set of the virtual assistant.” – Edward Izard, Best Self, M.D.
“Hiring a virtual assistant helped me grow my business before I was able to commit to hiring any staff in house. I’m a commercial real estate broker and, in the beginning, revenue was spotty at best. I couldn’t commit to hiring an assistant that was going to be dependent on me being able to pay them each week. Besides, I didn’t have quite enough work to keep somebody busy every day. Hiring a virtual assistant allowed me to get the help I needed with the tasks that were taking away from me being able to generate new business.” – Kevin Vandenboss, Vandenboss Commercial, as seen in ‘19 Entrepreneurs Explain The Benefits of Using a Virtual Assistant’ from Rescue a CEO blog.
Convinced? Let us help you hire your very first virtual assistant. At 20Four7VA, we take care of every detail and we make sure to guide you every step of the way. Click here to schedule a free, no-obligation consultation call now.