25 Ways to Cut Costs
You want your business to become more profitable, but revenue is stagnant. It might be time to start cutting some expenses.
If you don’t know where to start, we’re here to help. Boxelder’s list of 25 Cost-Cutting Strategies offers simple changes that can go a long way toward making your business healthier and more profitable.
To break things down, we split these suggestions into three categories:
Quick Cuts — These are minor changes, or line items you can easily cut from your monthly expenses. Each one might not help you much on its own, but string a few of these together and the savings will start to add up.
New Approaches — Slightly more involved, these strategies will likely include some changes to your business operations.
Culture Changes — These are top-down alterations to your business strategies and processes. They might require you to rethink major aspects of your business and company culture, but the sweat equity involved could pay off huge dividends.
- Cut Down on Utilities – Reduce your monthly bills by cutting down your use of electricity, water, and heat. This could mean buying more efficient appliances.
- Save on Office Supplies – Make a plan to reduce your use of office supplies. For example, going paperless can significantly cut your monthly expenses.
- Buy Used Equipment – Buying used or refurbished appliances, technology, or office furniture can save you money without sacrificing quality.
- Make Smart Bulk Buys – Buying in bulk can save you money – but make sure it’s only for essential purchases that won’t expire before they’re used.
- Cut Back on Monthly Services – See if you can renegotiate contracts or downgrade where possible for monthly services like consulting, software packages, etc.
- Sign up for Loyalty Programs – Do you regularly buy supplies from the same stores? If so, joining their loyalty programs and earning points will help you out in the long run.
- Collect Credit Card Rewards – Find a better business credit card with better rewards and earn miles or cash back on all your expenses.
- Pay Invoices Early – Secure discounts by paying your invoices early. Many contractors offer this type of discount.
- Spend Less on Travel – Book discount flights, use public transit, or even telecommute. Travel costs add up over time, so you can save big by reducing them when possible.
- Invest in Efficient Vehicles – Look to phase out your company vehicles for more fuel-efficient options. Hybrid cars will save you money on gas and could even earn you tax credits.
- Find New Clients – Might your suppliers benefit from your business’s goods and services? Perhaps they’ll be willing to work out a bartering system — it can’t hurt to ask.
- Negotiate Your Lease – You could have more room to negotiate your lease than you think, especially if you’re a long-term tenant. It’s certainly worth a shot.
- Audit Your Advertising – It may be time to audit your advertising spend. Dive into your analytics to determine which channels or campaigns aren’t working. There are likely more cost-effective methods to produce leads.
- Modernize Your Marketing Efforts – Traditional advertising is expensive – and not always effective in today’s market. Switching to inbound marketing strategies (blogging, social media, etc.) can cut your costs and increase your ROI.
- Switch to a Line of Credit – Minimum payments for your credit card can become a draining monthly expense. Switch to a line of credit with a low interest rate to cut costs.
- Seek Alternative Funding – Expand your options beyond bank loans when you need extra cash. Peer-to-peer (P2P) lending is an excellent option.
- Negotiate with Vendors – See if you can negotiate lower rates with vendors with whom you’ve already established a relationship.
- Outsource Your Admin – Many routine office tasks such as call-answering and bookkeeping can be easily outsourced or automated, bringing down costs.
- Save on Insurance – From raising your deductible to finding a cheaper provider, there are many different strategies for cutting insurance costs.
- Improve your Accounting Practices – Talk to a licensed accountant or use an accounting software such as QuickBooks to help track your expenses and maximize your tax deductions.
- Keep Your Employees Happy – Hiring new employees is expensive and time-consuming. Keep the employees you have by investing in a healthier workplace and company culture. Not to mention, study after study has found happiness correlates with productivity in the workplace.
- Embrace Freelance Work – Look into which tasks can be regularly handled by private contractors and freelancers. You may not need as many full-time employees as you thought.
- Downsize Your Office – The COVID-19 outbreak has made it very clear that working from home is more possible than we previously thought. Maybe your company could benefit from downsizing — or even eliminating — your office space.
- Team Up with Other Businesses – Joining buyer groups or trade associations will connect you with productive partners, help you leverage your collective purchasing power, and drive down costs from vendors.
- Cut Out Customers – Let’s face it – some customers cost you more money then they bring in. Those customers aren’t worth your time and effort.
Need more cost-cutting advice? Reach out to our team of experienced bookkeepers and business consultants today!