A lot of new business owners might look to making more sales to increase their profits, and while this can work, it’s often the wrong area to look at. Making sales costs money, while cutting costs doesn’t.
So, if you want to boost your bottom line, it’s making savings you should look at first. Here’s a brief guide to getting a better result at in the final line of your financial statement.
Don’t hire until you have to
One of the biggest costs for any business is hiring staff. You have to pay for tax, national insurance, sick pay and holidays as well as a salary. There will be a point in time when it makes sense to hire staff, but until that day comes, you should look to outsourcing instead.
It’s cheaper, you get expert knowledge, and you only have to pay for what you need. Until you need someone working around the clock on a particular task, it’s always best to hire a third party instead.
When you do start hiring staff, it’s vital that you get as much productivity out of them as you possibly can. Now, I’m not saying you should pay them low wages and work them into the ground – far from it. In fact, all that will produce is the opposite effect.
Instead, look at managing your worker’s time better. Try out an absence management program to reduce the number of sick days and time off you have to deal with. Recognize when their most productive periods of the day occur, and use this knowledge to plan out your days more efficiently. In short, be a better boss – people will work harder for you if you are there for them when they need you.
Stay away from expensive offices
Two other significant costs for small businesses are your rent and rates. It’s where a lot of fledgling companies fail. They have big dreams and want to put out a professional and creative image, but the reality is they can’t afford a pricey office in a fancy location.
There are plenty of alternatives out there, from shared workspaces and offices in areas that don’t come with a hefty price tag. Of course, it’s nice to have that illustrious address – but it’s even nicer to have a profitable business.
Cut overall costs
Utility bills, supplies, paper, office equipment and technology – it all costs money. So, you should always be looking for ways to cut back your spending without impacting on the quality of your product or service.
It doesn’t mean scaling back, so you sell something inferior, but it does mean trying to find better deals for everything. If you can do this for six or seven costs every month, that’s a significant amount of money to save every year.
I hope you have enjoyed this post. Take a look around my blog for more interesting hints and tips.
He is a passionate Blogger, Entrepreneur, Writer and Thinker. He has been blogging from last couple of years and love every thing about it. He covers almost every thing related to technology on his Blog, Cyberockk.com.