How to Cut Costs and Leverage Productivity
Generating sales in and of itself is a major challenge for most businesses. How much profit is made from the proceeds of sales will be dependent, in part, on how good management is at reducing costs and increasing efficiency. Here are some ways to reduce the amount of money that goes back out to cover expenses.
Business Debt Restructuring - Don’t get Caught in Debt Cycle
As much as is possible, avoid acquiring goods and services on credit. If credit has to be used to fund some purchases, ask the seller for better terms such as an extension in the repayment period or ask for interest free terms. Also seek the best financing deal that can be had, and try to avoid using a high interest loans to finance anything but short-term debt. Where credit cards are used, repay the full amount before it becomes due to avoid paying high fees and interest. For example, if you have a custom silicone manufacturing business, you can have the molds paid in advance, rather than having other payment options. This way, you can pay for operating costs rather than incur debts.
Enlist the Professional Services of Family and Friends
Avoid paying high legal fees to a lawyer by calling in a favor from a lawyer friend. To save money on tech jobs, enlist the support of the local whiz kid. Many small business owners will be surprised to find out just how easily a teenager can resolve some common computer problems. Not knowing the value of the service they had just provided, many will accept less than minimum wage gleefully.
Hire a professional to File the Tax Returns
In a rush to complete their tax returns or just get them out of the way, millions of taxpayers miss the opportunity to claim certain deductions that are due to them. This why a good tax professional is worth the fee they charge in many instances, in that they can help a client to claim deductions, valued at hundred or even thousands, that are due to them under the tax system.
Use the Affiliate System
Sometimes online retailers offer an affiliate promotion as part of their marketing program. Customers can save by first signing up for the affiliate program and then purchasing through their own link. Check the terms of service to determine if the retailer allows this, but in general it isn’t a problem. Using this strategy can save 25% or more on the purchase of some products.
There are 101 ways to save money and increase profitability, but it has to be worked at. While no list will be exhaustive, small businesses have an infinite amount of ways to save money on all expense items they currently carry. Evaluate each expense and investigate alternatives to find more cost effective offerings in the market. Of course one has to be wise in this pursuit, don’t spend $100 trying to find a way to save $90.