Your overhead costs help power your business, but they also cut into your profits. In return, that typically reduces the amount of funds you can reinvest into your business growth.
If you’ve committed to attracting new clients, expanding your service offerings and growing your company this year, reducing unnecessary spending related to overhead costs can free up some cash and allow you to go after your biggest goals. Try these six unexpected ways to cut costs and grow your business in the new year:
1. Cut Cleaning Costs
The Houston Chronicle notes that the commercial cleaning crews can charge by the visit, the hour, or the square footage. Be sure to know which it is before you hire your cleaning team, since even on the low end, that can mean your business is spending thousands of dollars per year on commercial cleaning — for each location. Reduce your cleaning costs by enlisting your team to be proactive and keep things tidy themselves. Schedule weekly cleaning sessions and come up with rules for the communal areas in order to minimize mess.
2. Shop Your Utility Prices and Insurance Coverage
Take stock of your fixed utility costs, from internet services to telephone providers. If you’re not locked into a contract, it may be time to compare prices. Deals, programs targeting small businesses and promotional bundles can dramatically lower costs.
Before purchasing new services, look at each plan and policy to make sure you won’t be paying for services you don’t use. It may also be possible to cut costs by strategically raising the deductibles on insurance policies. Just make sure you don’t sacrifice performance or necessary coverage.
3. Use Technology to Cut Costs
Look systematically at your business to see if a small, upfront cost in technology (or using technology tools to change the way you do business) can save you money. For example, if you’re still using a landline, switching to a VoIP service may help you cut costs.
Cloud-based technologies can be less expensive than maintaining on-site servers. Additionally, video-conferencing solutions and virtual meeting rooms can reduce travel expenses, while telecommuting can increase productivity in certain positions. When technology lets you reimagine the way you connect with your team and customers, it’s possible to get more done and reduce spending.
4. Streamline Training and Development Costs
Does your company invest in training or industry events? Look for strategies to combine expenses. For example, sending multiple people to an event may cost the same as a single admission, thanks to group rates. Perhaps your team could focus on attending a single industry event rather than multiple conferences.
If you’re investing in training your team, it might be less costly to fly in a trainer than to send your people to an off-site location. Similarly, consolidating multiple customer events into one larger affair can net savings in areas like facilities and food — and ultimately let you put on a higher quality experience while netting savings overall.
5. Think Strategically When You Need Extra Help
If your business experiences seasonal spikes or needs assistance in specific areas, consider solutions other than hiring. When you treat hiring strategically, it’s possible to get maximum value from a lean and organized team. Interns, freelance workers and outsourced agencies can often help complete ancillary tasks at a fraction of the cost of full-time employees.
6. Buy Refurbished
If you’re purchasing technology, like laptops for your team or a printer for the office, consider choosing refurbished equipment. Refurbished equipment is typically pre-owned and has been restored to factory defaults before being sold. They’re often covered by warranties and can provide substantial savings over purchasing new.
Strategically shaving money off your overhead expenses can free up capital that can be used for other purposes. Whether you want to ramp up your marketing or grow your product lines, reducing overhead spending is a smart way to work toward your goals.
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