20 Ways to Reduce Unnecessary Expenses (and Profit)
When you are running your own small business, the obvious goal is to make as much
profit as possible. For many small business owners, generating an income every month isn’t a problem. The real problem is that the good old dollar doesn’t seem to stretch as far as it did ten years ago. If your expenses are cutting into your business profits, you aren’t alone. Every small business owner struggles with the battle between profits and expenses, which is why I’ve come up with a list of expense-cutting strategies that are perfect for the small business owner.
Laureen Miles Brunelli, a popular contributor at About.com, recently published an incredibly helpful article about cutting the monthly budget and putting more income into the bank account each month. You can check out her list of ten helpful money-saving strategies here. There are hundreds of ways to save money each month by reducing unnecessary expenses. Here is my list of twenty great ways to cut costs and increase profits.
Sell Your Car
An automobile is one of the biggest money pits in existence. Not only do you have to pay for regular vehicle maintenance and upkeep as well as insurance, but you’ll also spend hundreds of dollars a month for the fuel necessary to keep the car moving. You can save a lot of money by getting rid of the money-hungry vehicle in your driveway, and this is especially necessary if you have two or more vehicles.
Take the Bus
If you don’t have a car, how are you going to get around? I always recommend public transportation, especially for small business owners who live in urban locations. The bus, metro, or train can be a great way to get from point A to point B without spending a fortune. You can even complete some last minute business tasks in transit.
Reorganize Credit Card Debt
Many small business owners are paying way too much each month on their credit cards simply because their interest rates are far too high. You may be able to reorganize your credit card debt, however, by transferring the balance on a card to a credit card company willing to offer a lower interest rate. Even a difference of a few percentage points can translate into huge savings for your business.
Refinance a Mortgage
If you own a house or other property, you might be able to cut unnecessary expenses each month by refinancing your mortgage. Taking advantage of newer, and lower, interest rates on a large purchase will help you save thousands of dollars in the course of a year.
Change Your Light Bulbs
Did you know that energy waste is one of the most unnecessary expenses for most small business owners? Energy is incredibly expensive, and this likely represents one of your largest profit drainers. You can start cutting back on energy usage by changing out all the light bulbs in your home or business for energy efficient bulbs. These use less energy and last much longer than incandescent bulbs.
Use a Smart Thermostat
A smart thermostat, one that can be programmed to turn on and shut off at various times throughout the day, can help you save hundreds of dollars each year on energy usage. When you aren’t going to be at home or in the office, program your smart thermostat to shut off completely or maintain the bare minimum temperature recommended for the property. In the summer, an unused space can safely be programmed at close to eighty degrees. There’s no need to pay for air conditioning when no one is around to benefit.
Put an Electronic Timer to Work for You
Similar to programmable thermostats, electronic timers can be incredible money savers for your business. An electronic timer will automatically shut off lights, electronic devices, and even appliances when you are not on the premises. Even if you forget to turn the lamps off, your electronic timer will take care of the job for you.
Pay Attention to Energy Drainers
You might also want to consider getting your home or business office evaluated for energy efficiency. Leaky windows or cracks around door frames can cost a fortune over the course of a year.
Chuck the Cable Bill
Cable is one of the most expensive services on the market today, and many people don’t use their cable connection enough to justify the expense. Cut out the luxury channel packages and invest in basic cable, or revolutionize your life by cancelling a cable subscription altogether and going for a bike ride instead of watching the tube.
Change Your Entertainment Habits
If you spend a lot of money on movies, entertainment venues, and other expenses each month, you can cut out these expenditures to save a bundle throughout the year.
Eliminate Expensive Memberships
Memberships to clubs, athletic centers, and gyms may seem like wise investments up front, but most consumers don’t use these locations enough to justify the high cost of membership.
Shop for Groceries
Instead of eating out for every meal, shop for groceries at a discount grocery store and pack your lunch. You’ll save hundreds on food each year.
Buy in Bulk
Save money on the necessities by buying in bulk. You’ll spend more money up front, but the cost per unit will be much lower.
Magazine and newspaper subscriptions may seem like a great way to keep in touch with the world, but with so much free information available online, the cost of these monthly subscriptions is excessive.
Forgo the Name Brands
Generic products are usually just as effective as brand name products, so skip the fancy logos and buy the discounted products.
Bundle Your Insurance
You may be able to save a fortune by bundling automobile, homeowner’s, health, and even life insurance together. Talk to your insurance provider today about this tactic.
Reevaluate Your Cellular Phone Bill
A monthly, no-contract phone may not have all the bells and whistles, but you can save at least $50 each month by making the switch.
Outsource Some Business Tasks
Cut down on expensive business staffing needs by outsourcing some of your business tasks to a professional outsourcing company. You’ll save a lot of money in a year and free yourself up to tackle more important tasks.
Pay Attention to Waste
Waste in your business is a huge profit threat. Pay attention to what is being thrown out or rarely used, and stop purchasing such large quantities of these items.
Choose Your Business Location Carefully
You might be able to save money by moving your home or business to another location. Living in popular urban environments or high-end residential neighborhoods could be an expense that you simply don’t need.
These twenty strategies may not miraculously solve all your cash flow problems, but they can help cut out unnecessary expenses so you’ll have more money for improving and growing your business.
If you have other tips for eliminating expenses, I’d love to hear them! Add your comments below, and thanks for your continued support.