Balancing the books is vital to succeeding in business, here are a few things to consider when looking to save money.
1. Management of procurement & Supply
Careful management of your third-party spending could reduce these costs by up to 13%. Shopping around and comparing different costs and service levels, as well as building relationships with other independents and looking locally for business you can collaborate with can also help. Our Supply Chain team looks after this for many of our clients.
2. Client profitability
This can be a hard one when you're a customer-oriented business, but the bottom line is that often around 20% of your client base will be providing 80% of your income. For this reason it's a good idea to focus your efforts and attention on these customers, and consider reducing the number of clients that are at the lower end of the income spectrum.
3. Utilising new technology
Technology is constantly evolving and new low-cost solutions are becoming more viable. Before email was invented message boys used to run between urban offices, and now email is widely available and licenses can be very cheap. It's good practice to keep an eye on the market for cost effective solutions to processes which you may previously have taken for granted. Many tools including CRM solutions are now migrating to the cloud, and online tools such as Squarespace are available for things like webdesign.
4. Explore Outsourcing
Outsourcing is becoming increasingly common as businesses recognise the sense in focusing on their core function and outsourcing other activities. We estimate that our costs are around 60% of the cost of an in-house finance department. That's a pretty good reduction, right?
5. How Flexible can you be?
Many people consider staff costs to be some of their highest, could you reduce this by using on-demand services (for projects including copywriting and graphic design for example) or make use of interim/temporary staff?