Sometimes, it is not about the number of funds you have for your business; it is about how you manage the funds. When you take out some time to look at your current expenses in your business, you would realise that there are lots of costs you can cut down.
In addition, cash flow is an essential aspect of the business; if you don’t have enough money for the daily operation of your business, the company can fail.
You can’t entirely eliminate your operational costs; you can reduce them.
When you cut down unnecessary expenses, you are able to manage your money more and sustain your business in the long run.
Here are some ways you can cut down unnecessary expenses:
Do you need a physical office? Does your work require you to have a physical office? You have to be very sure about this so you can cut down on rents, office expenses, electricity, and so on. Take out some time to think about this.
Hire right: Research has shown it over and over again that hiring the wrong person can cost you a lot more money. Don’t be desperate to fill a position, take out your time and hire right. First, you need to ensure no one in your organisation can’t fill the job; it would be cheaper to promote your employee to a new position than to hire someone else to fill the position. However, before doing this, ensure the person you want to develop has a good understanding of the new position, and he or she is capable. Secondly, if there is no one to fill the position in your organisation, you should ensure you spell out the details of your job description before placing job adverts. Make sure all due processes are followed and test the candidates. Don’t just hire for competence along, hire for the character as well. Just as you should hire right, you should work hard to retain your staff. Hiring new staff would cost you more financially and in other ways. Hiring right and retaining should be a priority for you.
Outsource and consider flexibility: Do you need fulltime staff or freelancers? Take a look at your current mode of operation, are there some tasks that do not require fulltime staff? Can you outsource to freelancers and cut down unnecessary costs? Another thing you can introduce is flexibility; you can let some of your employees work from home for a few times in a week.
Cut down on printing: You never know how much you spend on printing monthly. Take a look at your current expenses when it comes to printing. Instead of sending printed memos and notices, can you send emails instead? Costs of envelopes, stamps, papers, letterheads, etc. can go a long way.
Negotiate: Never underestimate the power of negotiation. Have you tried negotiating with your suppliers? Can they give you discounts or rewards based on your existing relationship?
What ways do your startups cut down on costs? Let’s hear from you below.