It’s Time To Save Some Money!
Reviewing a company’s costs and expenses should be a regular occurrence but it can be difficult for a business owner to find the time. After nearly twenty years providing business restructuring services, it still amazes me when I see a company throwing money away that could easy improve the bottom line.
At least once a year, the directors should sit down and take a hard look at the expenses of the business to determine if they really are necessary. Sadly that rarely happens until it’s too late and the company is so burdened with cost that it has a cash flow crisis.
The largest bills are usually the wages, materials (if any) and rent. It may not be feasibly to change premises or, certainly in the current market, renegotiate your rent but it’s always possible to look for alternative suppliers for products and materials. A regular check to see who is supplying the same items to ensure you are getting the best value is a good idea.
An owner/manager should also know exactly what each staff member is doing, what they cost and ensure they are contributing to the bottom line. Cutting staff is usually the area that most people avoid like the plague but carrying excess staff can bury a business very quickly.
Other expenses can also get out of hand over time. Large overheads or regular expenses should be looked at. Advertising is always a good one to review. Companies can carry on year after year advertising in the same way. Markets can change and knowing how your customers are finding your business is incredibly important. You don’t want to be spending money on paper based advertising if your customers are finding you online.
The bottom line is simple. Shop around. Check for alternative suppliers of services on a regular basis to make sure you are getting a good deal. If you don’t like the service, product or advice you are getting, look somewhere else. You might be getting the best deal but, equally, you might not.