15 Apr 3 Tips to Trim Your Business Expenses in 2020
Launching and owning a business is an exciting endeavour, however it takes an immense amount of preparation and strategy to ensure that at the end of the day, your company is still profitable. Surviving the first year may be easy, with roughly 80% of small businesses staying afloat according to the Small Business Administration. However, that number drops to under half after surpassing the five-year mark which begs the question, how do you stay competitive in a dynamic landscape of rivalrous markets?
When you get down to the nitty gritty, every penny counts and the only way to really keep your business running successfully is by making sure your expenses are outweighed by your return. While this equation may seem simple, it is where most business owners falter leading them down a rabbit hole that’s often impossible to escape. Luckily, there are various implementations you can execute quite easily to ensure your company continues on a path of upward trajectory.
Move deeper into the cloud
In this digital age, more and more businesses are switching from printing and filing hard-copy paperwork to storing all documents digitally through the cloud. With a growing business comes increased capacity requirements, new employees and a need to implement contemporary practices to save time and keep costs down. Examining new cloud options in order to further migrate away from local hardware will make combating these changes more linear.
While this dramatic move may seem difficult and costly, it can actually end up saving your business more money in the long run. Instead of negotiating with old school data centres for contract renewals and increased capacity, opting to move all systems over to the cloud makes forecasting ROI a whole lot simpler. Readily available and incredibly reliable, cloud systems also offer better security measures thanks to database backup and periodic maintenance checks.
Take a hard look at your finances
Another way to bring down business costs is reassessing financial commitments such as insurance policies and bank accounts. While these expenses are often necessary, especially for companies with full-time employees, they can end up being costly if handled improperly. Looking for more competitive options or negotiating discounts and better payment terms will inevitably lead to lower outsourced expenditures for your business.
In addition to finding cheaper alternatives for benefits and software, eliminating unnecessary costs such as unused phone lines and computers can help revive the current financial situation of your business. You will also want to assess your inventory levels and turnover ratio. For many companies, inventory is a hefty expense, and if items are collecting dust in your warehouse, it may be detrimental when trying to break even.
While analysing your finances is rather straightforward, picking the right changes to make is detrimental to the success of your business. It’s important to consider how cost-shaving methods can affect your employees and the overall performance of your company. Chew over how these changes may compromise your standards or if they could result in a negative effect on the overall performance of your business before moving forward with a plan of action.
Reconsider holding on to that fleet
Depending on the industry, following employment an expectation is often set to receive a company car. However, buying and leasing cars as a small business owner is expensive. With lease agreements come lengthy terms, long cycles, upfront costs and inflexible contracts, and new accounting standards make taking out large number of leases financially risky.
Cutting company-paid travel expenses is an easy way to bring down the current costs that may be piling up. Instead of stocking up on overpriced automobiles or continuing to pay the burdening monthly payments for your caravan, consider selling your fleet off and subscribing to Carbar.
Subscribing to Carbar won’t just save you money, it’ll save you time. Bundled into one flat weekly fee is all of the fussy little things about keeping a car – insurance, registration, servicing and roadside assistance. We take care of keeping the car running, you take care of keeping your business growing – simple!
If you’re interested in learning more about how Carbar can keep your company moving, start a conversation about our Carbar for Business service.
Register your business today and join the Carbar revolution.