(Newswire.net — January 29, 2020) — Overhead is the enemy to successful business profits. Every time you make a sale, it feels great, but the expenses are just going towards covering operating costs and not your bank account.
While you’re glad you can pay your bills, it’s time for you to start paying yourself. If you’re tired of overspending on the operating costs for your office, here are a few ways to cut back.
1. Join a GPO
A group purchasing organization (GPO) is one of the best ways to leverage your buying power from suppliers and retailers. It allows you to go in on bulk items as a group rather than purchasing them individually, which motivates sellers to offer more affordable prices.
The larger the GPO, the more buying power you have. You’ll get steeper discounts by joining a group that already has many network members, and you can invite other companies to join as well, increasing your buying power. As long as people stay in the group, you can enjoy excellent prices on supplies and merchandise from vendors for a steeply discounted price.
2. Go Paperless
Some companies are still dragging their feet regarding going paperless, despite the ease and affordability of sending and storing information over the cloud. Paper, ink cartridges, printers, and printer upkeep contribute to hundreds of dollars per month for a small office, and much of their use is unnecessary.
Consider backing up all your files digitally and doing all of your client communication over email and phone rather than mail and printed forms. Many companies are also cutting costs by using tablets or erasable laminated pages for client intake forms.
3. Cut the Phone Lines
Many small businesses bypass communication expenses by eliminating phone lines. There’s no need for most small companies to use landlines when cell phones do the trick.
Many companies avoid excess physical phones altogether by using voice over internet protocol (VOIP), which is a phone service over the internet. It’s more affordable than many phone plans and you can stretch its use further in the office compared to a single phone.
4. Schedule Your Lights and Heating
Set up a smart system to run your lights and temperature control. You can set your lights, heat, and air conditioning to run on a schedule so that your HVAC system isn’t setting an ideal temperature when nobody is around. Sensitive motion-sense lighting is also a great way to conserve energy in areas that are not used often.
The installation cost isn’t bad either. In a small office, you could use a programmable thermostat and lighting control device made for a residential home. A larger office will need a more integrated system, but it will still save you hundreds per month on lighting, heating, and cooling, so it’ll be worthwhile.
5. Consider Eliminating the Office
Thanks to the interconnected nature of the internet, many companies are finding ways to work entirely remotely, eliminating the need for an office. If you find that each member of your staff can work independently with the occasional online meeting, it might be worthwhile to let everyone work from home and completely cut the overhead of an office space.
This isn’t ideal for every company, but it’s perfect for some.
6. Hire an Accountant
You might have felt that you’re saving the company big by avoiding the cost of an accountant or expense manager, but that may be the reason that your overhead costs are so high. An accountant can analyze your incoming and outgoing expenses, identify patterns of overuse, and implement cost-savings projects to reduce your overhead.
They can also help you prepare your expenses so that come tax time, it’s simple to file your returns for the greatest return. They can likely help you find deductions you didn’t know existed, saving you big money during tax season.
7. Evaluate Third-Party Contracts
If you were budgeting at home, you might evaluate your subscriptions and determine which ones are necessary and which are excessive. The same principle applies to your business, but instead of evaluating subscriptions, you’re looking at third-party contracts.
How many organizations have you hired that you can live without? For example, is it really necessary to pay a cleaning staff for a small office? As you look at these extra costs, you might be able to identify huge opportunities for cost savings and greater profits.