You want to reinvest in your business but you can’t because there never seems to be anything left over at the end of the month. Been there?
Growth is often heavy on the mind of entrepreneurs. That’s why many of us went into business for ourselves–because the sky’s the limit when you’re the boss. You get to make the decisions about investment and growth strategy. But that’s hard to do when there’s no cash left to play with.
Increasing sales seems to be the go-to when it comes to increasing cash. But there’s something even easier you can do. Lower your overhead.
Before you claim there’s no way to reduce your expenses, take a step back and look at your business from an outsider’s perspective. Then be really honest with yourself about what you’re spending.It’s time to get real--and honest--about your expenses if you want to grow your biz. Click To Tweet
Take a Big-Picture Look
It’s hard to cut costs if you have a thriving business with team members. But look at who you have on your team and what they’re doing for you. Do you really need the function they perform? What’s that function doing to help your business? I’m not suggesting that you let anyone go, but maybe the team members’ talents would be better spent on other areas of your business. Or maybe it’s time to cut back on hours.
Another big-picture item is where you do business. If you don’t see clients in person, do you really need physical office space? Can you save that money for growth opportunities?
Take a Closer Look
There’s a lot of wasted money in business, even in small businesses with tight budgets. Once you have a good look at the big picture in your business, it’s time to take a closer look at where your money may be leaking out. Think of this like looking at your Starbucks habit. Sometimes you just don’t notice those $5 purchases until they happen five times a week!
Do an audit of any subscriptions or systems you’re paying for on a recurring basis. When you do this, be sure to involve your team. What are they actually using? Why choose that tool over something else? Is there something they could use that accomplishes the same task but doesn’t cost quite as much?Do an audit of your subscriptions and recurring payments to save cash in your biz. Click To Tweet
Just like you would with your home budget, look at things like insurance coverage, legal fees and overhead costs like internet and phone service and try to negotiate new rates with your carriers. If you’ve been a loyal customer for some time, many providers are willing to lower rates for you without discounting your service.
If you already run a tight ship, you may not find any leaks you can plug. In cases like these, it’s important to have people on your side who can help you navigate through your finances to make the best decisions possible.
Have you determined that you can cut some expenses? I challenge you to cut 5 percent this quarter, then see if you can cut out another 5 percent later this year.