“Every penny in someone else’s pocket is a penny less in yours.” (unknown)
This phrase elegantly expresses the importance of reduce costs in your company and do it on a regular basis through proper supervision.
Kaizen is a word of Japanese origin that defines the culture that everything we do can be improved. And when it comes to saving and improving the efficiency of our finances, this is a concept worth embracing.
And it is that the high costs together with the excessive expenses are one of the main reasons why a business can succumb financially. And although I am in favor of promoting these reductions, I also consider that the correct balance in this practice is one where you can earn some good pesos without sacrificing the natural growth of your company.
So, today I share some tips for reduce costs in your business effectively:
- Efficient telephone consumption in general by making use of corporate plans.
- Improve transport and logistics processes to reduce fuel consumption and vehicle maintenance.
- Comply on time with the payment commitments for loans and credit cards to eliminate costs for arrears and interest.
- Consider better tax strategies to legally reduce tax payments.
- Look for the best advantages with your suppliers when buying.
- Reduce the idle time of your teams.
- Use fewer paper prints and more electronic media such as email and the Internet.
- Carry out a thorough and general evaluation of all the important processes of the company and make them more efficient to gain productivity.
- Invest in adequate staff training, as this in the long run represents a better use of the company’s resources.
- Take care of your best customers. Getting new customers will always be more expensive than keeping current ones.
- Reduce travel allowances or reduce trips to only those that are strictly necessary as they regularly involve high costs for transportation, hotels and meals.
Cost reduction must be a process, planned and executed by management in an integral way, since many times in the desire to “cut expenses” (which is very different), the error of applying drastic measures that in the long run may involve the opposite effect.
Of course there are many things that can be added to the list to reduce costs. Which ones have worked for you?
Others resources to improve your business: