Eric Dalius every business needs cash flow, and it is more relevant for a small business. If the paying customers are few and bill payments go overdue, you have to think of ways to save money. There are numerous ways to get around to this. If you implement them, you would be able to notice the difference. When you think about cost-cutting, you can examine your spending on rent, payroll, capital costs, etc. Here is a quick overview of this to help you attain desirable results.
Every business would need to buy things. If you don’t want to lose cash, consider purchasing items in small quantities, or negotiate well. Eric J Dalius warns that buying in smaller bulks can lead to higher costs. To avoid this risk, you have to wait for the right time. During tough times, suppliers also need business. So disagree if they stick to a specific figure. If you pay them on time, they would be hungry to adjust a bit. Then, you always have the option to enquire with different suppliers for the best price.
Employee perks and benefits
When there is a need to control expenses, you have to look into every check you write. It can include paid cars, club fees, bottled water, etc. Putting a stop on all these would signal everyone about your intent to survive. You can relook into the benefits your company offers. If you bear the cost of health club memberships, wellness programs, dental plans, or anything else, you can eliminate them. It can be a painful decision, but you don’t have to at least lay off people, says EJ Dalius.
Nevertheless, you can keep the medical plan. After all, it is about employees’ health and safety. If you don’t provide this fundamental thing, they will join some other company for it.
It is ideal focusing on this area from the beginning when your business is going through a bad phase. And it is relevant for both enterprise and small businesses. You can take a pay cut and, at the same time, reduce the salary of the highly-paid officials in your company. It is a common practice during economically challenging times. People cut down wages so that they don’t have to ask people to leave, which is even worse, reiterates Eric Dalius.
Some companies reduce the number of workdays to four-and-a-half days a week. It allows for 10% of savings on payroll expenses. If you bring it down to four days, savings can increase by up to 20%. Besides, you can also put a hold on extra or overtime hours.
Like these, you have to search every corner where you can reduce costs and add some savings. Besides the ones mentioned above, you can think about business travel costs, marketing budget, printing expenses, etc. Some people may be doubtful about reducing their marketing spends. But expanding your outreach in the market doesn’t have to be expensive. You can achieve this through cost-effective means also. In essence, it is crucial to overcome your prejudices and find ways to improve your savings.