As food for thought, consider the following eight tips for reducing expenses, offered by business specialists from around the nation:
1. Watch that inventory. Supply and demand isn't important only in product or service pricing. It's also critical when it comes to inventory levels. Nothing kills profit like ordering more than you need. One option is inventory-tracking software, which can do the job for you automatically.
2. Don't take financial statements for granted. On a regular basis, review your company's accounts receivable, accounts payable, phone bills, and bank and charge account statements. You might be surprised at what you find, such as simple clerical errors that can add up.
3. Modify marketing. Getting the word out, of course, is important. Yet, the cost-effectiveness of that marketing must be periodically evaluated. And don't just take the word of a sales rep. Do some research yourself. There also are no-cost promotional activities that warrant consideration, such as cultivating local/regional media contacts.
4. Try partnerships. Chances are, your company isn't the only one with a limited budget for things such as promotions. So find a company with similar needs and forge a partnership that will benefit both parties. Local business associations are a fertile ground for those types of relationships.
5. Conduct salary surveys. Just maybe, you are paying your employees too little, which means they continually leave, resulting in the expenses of hiring new workers. At least annually, scan your industry to see where you stand. Paying a fair rate, or even slightly higher, could save you money in the long run.
6. Outsource work. Free employees from mundane tasks. This can be achieved by reviewing employees' secondary duties for tasks that can be completed by temporary help. This could include payroll, updating Web sites and other jobs that perhaps can be done more efficiently by someone else.
7. Offer profit sharing. This might cost the company some money initially, but workers will learn to care more about a company's bottom line. If the company makes more money, they make more money. The incentive to save money becomes greater when your own pocket is affected.
8. Forget about 411. Replace the idea of dialing directory assistance with the requirement to instead use a phone directory. The directories are free and can be obtained for frequently called areas. The point here is that although directory-assistance charges, like other "small" expenditures around the office, don't amount to much by themselves, collectively their costs are significant. Again, a penny saved is a penny earned.
Julian Arhire is a Manager with DtiCorp.com - DtiCorp.com carries more than 35,000 HVAC products, including industrial, commercial and residential parts and equipment from Honeywell, Johnson Contols, Robertshaw, Jandy, Grundfos, Armstrong and more.
