There are two general scenarios a business might be facing when it comes to cutting costs. In the first scenario, they might want to cut costs as part of larger, more long-term strategic planning and objectives.
In the second scenario, costs need to be cut quickly and efficiently. Cutting business costs can be a necessity in terms of cash flow or staying afloat.
So how can you realistically cut costs in a way that’s sustainable and can happen quickly?
Introduce Expense Management Software
If you take a look and start evaluating your costs, you’re likely going to see that travel and expense costs are too high.
You may also see that human error happening in expense reporting as well as accounting and financial departments are adding up very quickly as well. You may even be surprised to discover there’s fraud occurring, and it’s costing your organization as well.
Implementing expense software is something that can be done very quickly. With a user-friendly platform, the rollout should be pretty seamless, and it makes it possible for businesses to identify places where costs can be cut immediately, and also cut out waste, fraud, and error.
In general, even outside of the realm of expense management software, choosing platforms and technology with robust reporting are really helpful ways to reduce costs. Without visibility, it’s impossible for business leaders to see where spending can be cut.
Evaluate Miscellaneous Spending
Miscellaneous spending can just be anything that might not fall into another category or doesn’t seem like that big of a cost. However, when businesses start delving in, they often see that these costs can quickly spiral.
For example, if your company is spending thousands of dollars a year on outdated office supplies, you can cut that right away.
The gig economy makes it simple for businesses to outsource their talent needs. Often, outsourcing provides access to leading talent in specialized niche areas, and businesses can save on overhead costs and the costs associated with payroll.
For example, rather than having an in-house marketing team, outsource it and use them on an as-needed basis. Outsourcing is a great way to make a business leaner and to cut costs significantly, while still ensuring the level of specialization and expertise is there in the people you’re working with.
Something else to consider is looking at redundancies and inefficiencies in existing staff and job roles. If there are two people doing the work of one, it may be time to consolidate the job roles and make some difficult decisions.
Finally, businesses want employees to be happy and stay on-board if they’re valued talent. They want this even if they are in the midst of cutting costs. There are other ways you can retain talent aside from just offering them more money.
For example, employees enjoy benefits that involve retirement or financial planning tips. Employees also find recognition valuable, and it doesn’t have to cost anything. There are ways to show employees you appreciate them and avoid high turnover numbers without spending too much.