In tough economic times, tightening the belt around your business expenses can help ensure you ride through any financial upsets. While it does take money to make money, there are several ways you can control your expenditures and keep your profit margins growing. Here are a few ways to help improve the company’s bottom line.
1. Reduce Office Space Expenses
Commercial real estate swings according to the economic conditions, and you may find that there are lower-priced properties available in other locations. You could also attempt to renegotiate your lease with your landlord. Sometimes, all it takes is mentioning that you are looking elsewhere to open the door to negotiations. Having your employees work remotely is another way to cut office space expenses.
2. Revisit Your Supply Chain
The costs of raw goods and materials can be a huge part of your expenses, but there are ways to help trim this number down as well. Low cost country sourcing is one option, but you can also seek new bids from your supplier’s competition. Innovation may be have changed the material options for manufacturing, leading to alternative materials that are more economical. Just be sure you don’t sacrifice quality for cost.
3. Re-evaluate Your Insurance Coverage
Insurance rates always tend to go up when a claim has been filed, but if you haven’t had any claims and you have strong risk management policies in place, there is a chance you could get a lower rate on your insurance coverage. You can shop around for a new insurer, but if you haven’t had claims, you might be able to reduce some of your coverage limits in order to drop your rate with your current provider.
Drastic times call for drastic measures, but your business doesn’t have to suffer while you reduce expenses. Some common sense evaluations of frivolous spending and revisiting existing contracts are good places to start when looking at saving the company money.