Expenses. Every business has them, no doubt about it. How you manage those expenses, however, can make or break whether you’ll continue to realize success or not – especially if you’re just starting out. The key is to reduce business expenses as much as possible so that your bottom line isn’t impacted too significantly. That said, here are 4 simple things you can start doing today to bring those expenses down.
Put on your negotiation cap. One of the biggest drains on profits that small to mid-sized businesses face is that of interest. What many people fail to realize is that these rates are rarely set in stone. If you have a good payment history, you may be able to talk your credit card companies or other lenders into dropping your rates down to save you some cash. You may also be able to negotiate better prices with your suppliers. It never hurts to ask!
Buy vs. rent. It may seem like a better idea to lease your office equipment and furniture rather than incur the entire expense up front, but in most cases it’s not. When you calculate all of the extra money you’ll spend in interest and other fees over the course of the rental or leasing period, you’ll see why. Whenever possible, purchase what you need up front. Not only will it save you interest over time, but you’ll also enjoy certain tax benefits.
Outsource. There are plenty of tasks that could easily be delegated to an outside party, and for much less than you may think. Online freelance databases, like Elance and oDesk, boast tens of thousands of highly skilled, reasonably priced professionals that offer skills such as web development, graphic design, data entry, content writing and more. Additionally, outsourcing some of your main business functions, such as bookkeeping and tax accounting, can be more cost effective than hiring in-house.
Re-evaluate expenses regularly. It’s important to revisit your ongoing expenses from time to time to make sure they’re still necessary. For instance, going through your communications expenses, such as mobile phone, internet service and landline, can help you identify things that you’re paying for that you may not need. Once you’ve found such areas, adjust your contracts and spending accordingly to save money.
Business expenses are a necessary evil, but as long as you stay on top of what you’re spending and apply these simple tips, you’ll continue to keep your head above water and your profits will prevail.