Cutting costs, pivoting hard, and staying optimistic have become the guiding mantras for COVID-hit businesses around the nation. According to Wells Fargo Small Business Index’s third quarter results, around a third of owners think they’ll need at least a year to financially recover. Here are five aspects of business to re-evaluate to save money.
The owners who responded to Wells Fargo were surprisingly positive: Forty-eight percent predict they’ll see a boost in income by this time next year. Nevertheless, predictions are just guesses. And, coronavirus has proven that if it’s anything, it’s unpredictable. Consequently, organizations of all sizes need to re-evaluate to save money, getting frugal and taking the lean route.
Perhaps you’ve already asked your team where they think you could scale back and save dollars. Regardless, you may not have considered how you could trim the fat from the following areas of your business.
Aspects of Business to Re-evaluate to Save Money
1. Procurement
You can’t get around buying things for your office. But do you have to pay top dollar for everything from recycled printer cartridges to ergonomically correct chairs? Maybe not.
A huge benefit of being in a fluctuating global marketplace is that buyers naturally have decent negotiating power. Use yours wisely. Negotiate everything you can while being fair to your vendors. Be sure to investigate ways to engage in collaborative alliances with like-minded businesses such as joining a group purchasing organization (GPO).
GPOs allow you to enjoy deeper discounts on items you’re using anyway. Plus, some don’t require any membership fees. All you get are bulk rates and less of a monthly cash outlay.
2. Daily workflow
The work-from-home revolution has only begun. Although you may have been thrown for a loop at first by telecommuting’s surprising business benefits. For example, some organizations have decided to cut ties with their landlords and move all their operations remote.
Even if you can’t allow everyone to telework, consider which positions could. You’ll spend much less on paying for commercial space. Plus, when you need to replace staffers or hire new ones, you won’t be limited to talent in your geographic location.
Sound like a good way to stretch your budget? Just make sure that your leaders learn how to manage successfully when they’re not in a traditional office setting. Invest in remote management training today to ensure a solid working team tomorrow.
3. Marketing
Have you ever been part of a startup experience? The marketing methods used by emerging, nimble companies tend to be disruptive, innovative, and maybe even slightly unorthodox. Now is the time for your marketers to behave likewise.
That doesn’t mean you should jettison your digital ads, though, especially if they’re more than paying for themselves. However, why not mix up your marketing with some guerrilla-style tactics? For example, you could create partnerships with allied organizations, build in-roads with nano and micro social media influencers, and test all your content like crazy.
Pulling back on marketing entirely shouldn’t necessarily be on the table. That could put your brand in an unappealing position. But there’s nothing wrong with getting a little scrappy to re-evaluate to save money.
4. Recruitment and Hiring
It goes without saying that the pandemic led many businesses to put on hiring freezes. Today, some of those companies are finally ready to bring aboard strong candidates. Your firm might be among them.
Before you pop up an ad on Indeed or Glassdoor, reconsider. Why? You may be able to get away without hiring employees and still benefiting from a robust team of superstores.
What’s one way to get the help you need without committing to onboarding part-time or full-time personnel? Consider working with independent contractors to fulfill some of your team’s auxiliary responsibilities. You won’t have to worry about paying payroll taxes, and you’ll only have to pay contractors for the time they work or the projects they finish.
Another way to get terrific help without overpaying is to offer on-the-job learning opportunities to local university interns. Many college students are looking for ways to differentiate themselves on their resumes. Though you’ll probably pay them a stipend, you’ll get your money’s worth and then some. Kinda like free money.
5. Sales
Your sales team converts leads and brings money into the organization. Consequently, be sure to keep all your sellers happy. At the same time, think about ways to save on your sales strategies and salaries.
One creative solution could be to shelve promotions for this year but raise commissions. This idea allows you to reward your best salespeople. In fact, your top performers may earn more than they would have without the incentive. Another answer might be to cut back on travel budgets in lieu of conducting most client calls over Zoom or Microsoft Teams.
Above all else, be fair with your sales team. Don’t take away their base pay or reduce it; otherwise, you could lose fantastic employees. Rather, brainstorm win-win ways for them to work more efficiently and effectively without requiring additional money.
Spending too much is never a good thing in business, and it’s downright risky in today’s uncertain economic climate. Give some thoughtful consideration to all the small and large ways you can cut down on unnecessary expenses. You’ll put your company on better footing to survive and perhaps even thrive in 2021.
