When there is market uncertainty and confidence in the economy is low, increasing revenue can be challenging for many business owners. Another way you could potentially increase profitability is by finding intelligent ways to reduce your expenses. Fortunately, this doesn’t mean that you have to make changes on a grander scale, simple and effective steps can help you achieve this objective.
Review your business electricity and insurance contracts regularly
Reviewing your plan periodically during each quarter is a useful way to measure how you’re performing. Throughout the year, contracts will be due for renewal, this gives you a great opportunity to search for cheaper insurance policies and find the most competitive business electricity quotes. Utility Saving Expert, an online comparison site has streamlined the process making it easier than ever for businesses to save money on a whole range of products and services. Their in-depth guides and FAQs will provide you with all the relevant information you need to make the right purchasing decision with confidence.
Follow these five advantageous tips to reduce your business expenses and increase overall profitability.
Cheaper office supplies
One easy way to reduce your office supply expenses is to let your vendors know that you’ll be looking at alternative options. Search for options that are further afield, Amazon, the online retail giant is a great place to start. This is because they are often more competitive than traditional supply vendors, as multiple sellers will be competing on price in the online marketplace. If your current suppliers notice that you’re placing substantially less orders through them, they may have to consider offering you better pricing or risk losing you as a customer.
Reduce production waste
Business owners and managers are always looking for efficient cost cutting measures to save on production. One way to optimise your resources is to sell any leftover material rather than throwing it away or shipping it off to a recycling centre. Some left over material can even be repurposed to create a whole new product if production requirements allow for this.
Make the most of your business premises, if you have a large office or warehouse, and you’re not making full use of it, consider letting any unused space to other businesses.
Reduce your financial expenses
Speak to your accountant about your business expenses. He/she will be able to help you identify which areas you should target to save money. For many companies, this will often be done by comparing commercial energy and insurance policies to get a better deal at the time of renewal. Think about what level of cover you require as standard along with any important optional extras. Often, many insurance providers will include a number of these different add-ons which are nice to have but aren’t always worth paying the extra premium for.
Similarly, when it comes to business electricity and gas, there are a number of different suppliers and tariffs to choose from. Make sure you opt for the most suitable tariff that matches your day to day business activity and needs.
Some insurance companies can even help you consolidate multiple types of cover into one comprehensive policy. This can help you save both time and money. Before doing this, check to see if you’re getting good value for money as it can sometimes be cheaper to purchase cover separately. When you are nearing your business energy and insurance renewal dates, existing providers will tend to quote you a higher premium than you were paying previously. This is where using a comparison site such as Utility Saving Expert to compare a whole range of products and services can help your business save thousands of pounds each year.
Be cautious before taking on unnecessary debt
Having access to loans allows many businesses to expand and scale their operation. Before you sign on the dotted line for a sizeable amount of money, it’s important to conduct a thorough cost-benefit analysis. Think about how much this opportunity will cost you through repayment plans and the effects it will have on cash flow.
Use current marketing strategies
Not many businesses will want to stop using paid advertising campaigns. These can bring in a good ROI when optimised correctly, however, they can become exceedingly expensive if relied upon too heavily. This is where your marketing team will need to consider more cost-efficient alternatives.
If you haven’t already done so, building a customer email list and communicating with them through newsletters can be very effective. It’s also a good idea to have a strong presence on social media networks. Attending industry events and networking with other people is a great way to bring new clients to the business. After all, many customers are more likely to buy a product or service from people they know and trust.
We hope your business is able to implement these five tips to help you reduce your expenditure. Running a business is a big enough challenge in itself and we often get caught up in the day to day minutiae of it all. Taking a step back to revaluate the situation and make the necessary changes to improve things should be central to any strategy moving forwards.