Many businesses are not undertaking regular reviews and some firms do not check their outgoings at all.
Business costs should be checked on a regular basis and any big rise in costs should be analysed to find out what is causing it and whether it is justified in raising the sales of the business.
By making savings on costs and purchases, a business can help to improve its financial results.
A tight rein on spending should be part of any businesses overall financial strategy.
Here we present 10 ways to keep costs down.
Reducing fuel costs
There are various ways to reduce the amount that your business spends on fuel costs. Employees can share trips if more than one are going to the same place.
Another option is to plan deliveries or collections so that one destination leads to another so that multiple journeys can be cut down to fewer trips.
IT & Accounting costs
Many IT and accounting services are charged via expensive annual contracts. With the rise of new technologies cheaper options are emerging.
By using cloud based accounting and IT services your business could cut costs in this area.
Review your supplier base and see if there are options to switch to cheaper alternative suppliers or renegotiate existing contracts.
Are there any contracts that you are paying for but no longer use or are not getting the best value from?
Is it possible to buy some items in bulk to get a discount?
The rise of online retail is linked to convenience and the ability to buy items at a discount. Is your firm making the most of this option?
Nowadays, many everyday items can be purchased online at a discount, so review your purchasing strategy to ensure you are making all of the savings you can.
Review out of date subscriptions
Check through your purchase ledger and make a list of the subscriptions that you are paying for on behalf of employees or the business as a whole.
Are they all being used? Are any out of date or relating to employees that are no longer with the firm. If so, cancel them and make savings.
Offer to pay suppliers early for a discount
You can try and negotiate a discount on purchases by offering to pay suppliers early. Many companies will accept a discount, usually between two and five per cent, if you pay your bills early.
The cost of gas and electricity has been a major problem for both households and businesses in recent years with the cost doubling in just six years between 2006 and 2012.
Review the energy tariff you are on and see if you can find a cheaper alternative. By paying by direct debit and running an online account you can save up to ten per cent.
Check that your business is using energy saving bulbs, turn down the thermostat for the summer and ensure your building is insulated properly.
Review travel costs
Are staff travel allowances too generous? Could you cut down on long domestic trips and overseas visits by using virtual connections, conference calls or Skype
Another way to save money is to book trips in advance and also getting employees to pool a car if more than one person is going to the same destination.
Find cheaper office space
Review the cost of your business premises. Are you in expensive area with higher rates? Do you need to be there or could you consider moving to an alternative site that is cheaper.
Manage your stock
Are you over stocked in any areas. Does this mean you can you hold off new purchases in some areas or reduce the amount you buy in the future?
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