You have to reduce your company’s operational costs if you want to increase your profits and get better returns for your investment. Fortunately, there are a number of ways that can help you achieve this without having to make drastic changes in your company such as reducing the benefits that your employees receive. Here are some ideas as to how you can reduce your business costs:
- Reduce Your Energy Usage
A big chunk of business expenses often goes to paying for electricity bills. Because of this, it makes sense that you check your energy use to see if there are changes you can make to cut your energy consumption. Simple changes in workplace habits can make a major difference so make sure that you enlist your employees’ help in your effort to cut your electricity costs. People in your organization should make it a habit to power off electronic equipment that is not in use. Monitors of computers that are on standby, for example, should be shut off and lights in areas that are not in use should be turned off. You may also want to replace your lighting with compact fluorescent lamp because CFL is more energy efficient than incandescent and halogen lights. If you are replacing old equipment in your office, you should also make sure that you go for equipment that has the energy star label. Computers, printers, fax machines and air conditioning units that have earned the energy star label are more energy efficient and therefore, more cost effective to use if you want to save on your electricity bills.
- Switch to Cost Effective Services
Businesses also have to spend on services so you may want to do an assessment of the services that your company avails of to see if you are spending more than necessary. If your company is spending a lot to cover your phone bills, for instance, you may want to look for options that can help you save on your phone expenses. Calls should be avoided if there are alternative means of communication. When ordering materials from your supplier, for example, you may want to send an email instead of placing your orders through phone calls. Should you need to make long distance calls, you may also want to make use of business VoIP services because placing calls online is more cost effective than making calls through landline or cell phone. For your computing needs, you may want to put a stop to paying for prohibitive licenses on premium software products and switch to using open source software instead. You can opt for GNUcash instead of paying for a premium accounting software. You do not also have to spend a lot on Microsoft Word because OpenOffice makes a good alternative for word processing software.
- Find Cost Effective Ways to Market Your Business
A bulk of business expenses often goes to paying for advertisements. Although advertising your products and services is crucial to your company’s success, you may still want to consider your options to get people to patronize your business. Instead of spending most of your marketing budget paying for ad spaces, for example, you may want to make use of referral system. In this marketing strategy, you encourage your customers to spread word about your business and you reward them if they successfully bring new customers to your business. The reward can be a special discount when they avail of your services, freebies or gift certificates. You will have no problem with word of mouth marketing if you are confident about the quality of the products and services that you provide your customers.