5 Surprising Ways Most Businesses Waste Money
You have to spend money to make money, the saying goes, and it’s true. Business expenses are an unavoidable reality, and every business has bills to pay. But are you paying too much? Here are five surprising ways businesses often overpay.
No one can do it all, and sometimes farming out specific tasks is smart. Before you do, however, make sure you don’t already have a competent employee in your business already. Perhaps, for example, you need a new company logo. You could hire a graphic designer, but maybe one of your warehouse workers has an art degree and an amazing talent you don’t know about. Take an interest in your employees and pay attention to their educational experience and hobbies. You might already have what you need in-house.
Employees need tools to do their jobs well, but office supplies add up quickly. Buy only what you need and avoid unnecessary gimmicks like colored paper clips and overly ornate letterhead. Buy in bulk when you can to save money, but know what to buy as needed. For instance, break room snacks, envelopes with their own adhesive, and printer ink all go bad if allowed to sit too long before use. If a bulk deal is too good to pass up, go in on it with another company.
Firing people just plain sucks. Especially in a small business where you work closely with employees and genuinely like them. People who aren’t pulling their weight are a huge burden, however. Coach employees and try to bring them to the level you need, but know when to cut the cord. It might also be worth it to investigate better hiring techniques and improve ways to interview and find potential employees.
Advertising is critical for helping customers find you, but you need to do it right. Know your target demographic and where they go for help. A full-page ad in the phone book won’t attract tech-savvy millennials, but it might be the best way to reach elderly clients. Baby boomers might surf your website from their laptops, but younger clients may require a mobile phone friendly site or an app. Always track the return you’re getting on your advertising dollars and adjust your marketing plan accordingly.
The right tech gear can save a lot of time and money, but you can have too much of a good thing. Take the time to figure out what you need before shopping for software and equipment and then stick to your plan. The more bells and whistles you get, the more things there are to go wrong. Don’t skimp on what you need, but don’t get caught up in something shiny that you don’t, either.
While these five areas may not be the only places where your business can trim some fat, they are a great place to start. It will take a little effort to make the necessary tweaks and changes to your budget, but the improvement in your bottom line will make the effort worthwhile.
Many basic principles of personal finance also correspond to business finance as well! Here are a few articles discussing some relevant topics! Prioritizing Your Needs versus Your Wants, Every Business Needs a Website, and Use Your Financial Records to Predict Future Challenges. If you enjoy them, make sure to read some of our other articles as well!
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