If you can reduce your business expenses, that will give you access to capital you can use to upgrade budgets, save money, or invest. You’re probably already employing various money-saving strategies, but there’s almost always a way to save more.
If you’ve tapped out all the standard money-saving techniques, here are several more unusual ways to dig a little deeper and save some more.
1. Improve your workflow with automation
Perhaps the most overlooked way to cut expenses is to increase productivity. The more time your employees are wasting, the less work gets done, which means your payroll dollars are being wasted.
Improving workflows is an often overlooked strategy because it’s not easy. But many businesses have deployed software with automation recently to make it happen.
For example, a fleet manager used Cetaris to decrease overtime by 90% through streamlining of workflows and increased productivity. Through the system, work was scheduled and assigned to the right people, and the manager got a firmer handle on parts availability through automation that kept the right items in stock.
This reduced excess downtime, and repair times were also cut in half, while total overtime was simultaneously lowered.
2. Pursue small warranty reimbursements
Warranty reimbursements can make a surprising dent in your effort to save money. Do you file a claim whenever you can? Or do you pass over the small dollar amounts because that’s less effort?
If you neglect to file claims to recover $30, $100, or even $200 here and there, you’re missing out on the opportunity to save thousands of dollars in the aggregate. That $200 repair charge may not seem like a big deal at the moment, but if you bypass five of those each year, you’re losing $1,000 per year and $10,000 over ten years.
Remember, you’ve already paid for the repairs covered under your warranties. You paid for them up front when you purchased the machine or vehicle. You might as well get your money’s worth when qualifying repairs become necessary.
3. Get real about what constitutes a necessary expense
Some expenses are unavoidable, such as having to pay for an email marketing system, a website, payroll, office furniture, and all the software necessary to run your firm. But just because you can’t avoid these expenses, that doesn’t mean you have to buy the most expensive option.
For example, if you don’t have many email subscribers and you don’t execute advanced marketing strategies, you may not need to spring for the $400-per-month option.
Everyone can agree that necessary expenses are out there, but it’s not necessary to expend funds on the premium-price plan or item. Recalibrate the way you regard required expenses and make sure you’ve compared all the options before making a commitment to buy.
Building a website for your operation is clearly necessary, but you may not need to hire the best developer in the nation if you require no more than a simple site with a few pages and no customization. If an independent developer can do a good job, let that be good enough for you.
4. Require approval for all purchases made with company funds
Don’t give anyone permission to spend company money without filling out a purchase request form. It may seem tedious to require purchases under $50 to go through an approval process, but you don’t want to end up with a pile of small but unnecessary purchases.
When someone doesn’t have to seek permission to buy something for $30, he or she will be less likely to think it through and judge whether it’s necessary. If the item turns out to be unsuitable, the staffer might just buy something else and hope that works, which effectively doubles the money spent.
If you have more than one person with the freedom to spend money without approval, that may increase the chances of fiscal waste. Instead, have a form that requires everyone to explain why they need to make a particular purchase.
Just the act of implementing the request form might deter a lot of potentially frivolous purchases that the employee wouldn’t have been able to tie to a genuine company need.
5. Review your purchases regularly
Whether you do it yourself or you outsource it to an accountant, review all of your company’s purchases on a regular basis to make sure you can identify each expense. Don’t leave anything unaccounted for.
Having a purchase request authorization system will help you keep track because you’ll have requests and receipts with the exact totals to verify all that has been billed. If you find anything that seems odd, or recurring charges that don’t make sense, you’ll be able to investigate and cancel unnecessary services before they bill again.
Reduce your expenses as much as possible
To maximize your savings, use the tips outlined in this article to eliminate unnecessary expenses that may been routinely slipping through the cracks. Every dollar adds up, so the more you aim to save, the better.
