Business expenses, if not kept in check can spiral. It is something which all business owners strive to control. Cutting day to day expenses and overhead is not easy. If you’re running a small or medium sized business, there may be things you have not considered.
Search the Internet and you’ll find hundreds of suggestions to reduce business costs. From business websites to bloggers there are myriad sources of information. It can be the introduction of small changes which lead to big savings. It may be a complete overhaul of established procedures.
Let’s take a look at four suggestions that could help your business become more efficient. Increased efficiency will lead to less waste and increased profits.
Reduced traveling expenses
Any travel time saved is time that can be spent on productive tasks. There are plenty of meetings that can be done over Skype or other communication apps. Travel expenses are cut at a stroke. Gas and servicing costs for fleet vehicles are also reduced as a result of less travel time required.
Expenses such as hotels, plane or rail fares could add up to thousands of dollars per year. Why waste traveling time when a customer or supplier is a call away? Management and employee teams become more efficient. Look at ways in which your business travel time can be scaled back or cut completely.
Deploy digital timekeeping
Manual timekeeping is time-consuming and costly. It can also be prone to error. Deploying hourly payroll software powered by a mobile app will streamline payroll. Accounting procedures will become more efficient. Employees will submit their working time via the timekeeping app on their Smartphone. Accounts staff can spend the time saved on other critical elements of their work.
Employees will no longer be required to hand in a timesheet at the end of the week. Payroll staff will no longer spend hours reconciling hours worked to hours billed. Tax calculations are pre-set – employees know the pay received is accurate. Also, they will know that tax deducted is accurate. All timekeeping records and payroll will be stored in the cloud. Storage space for paper records is no longer required.
Reduce inventory levels
Keep inventory to a minimum. A digital inventory system will flag up when supplies need replenishing. Less money tied up in inventory is more money in the bank. Bulk buying to gain discount isn’t an efficient method of saving money. Buy as and when inventory is required. Pay bills on time but ask for a discount for early payment. Suppliers prefer early payment rather than extended credit terms.
If you understand the true cost of inventory and how it works, you’ll want to seriously consider overhauling your current system. If you do not understand the intricacies of spending capital on idle inventory, you need to educate yourself sooner rather than later.
Hire temporary staff
Occasionally you may need to hire temporary staff. Increased workload or staff absences may place pressure on service delivery. Hiring part time or temporary staff can bridge the gap. You can save on resources. Temporary staff does not require expensive health insurance commitments or vacation pay.
As soon as the rush has subsided, temporary staff can be let go. If demand for products or services remains at an increased level, your temporary workforce could easily be made permanent.