Overtime is expensive, but a little preplanning of your work schedules will go a long way here...

1. Top 10 Tips for
Reducing Your
Expenses

2. 1. Reduce Overtime
Overtime is expensive, but a little preplanning
of your work schedules will go a long way
here. The feast or famine cycle that many
businesses go through can drive costs up
without a corresponding increase in sales.
The trick is to keep a steady pace with your
work. Otherwise, you find yourself needing to
pay overtime simply to keep from missing your
deadlines.

3. 2. Create a budget
If you don’t have one, make one. It may seem
like a time-consuming project but if your
money is important to you, then the results will
be more than worth the effort. Simply put, a
budget is your most effective tool for setting
and reaching your financial targets.

4. 3. Nurture a cost saving culture
Everyone can and should take fiscal
responsibility for their work. One way to do
this is to involve everyone in the budget. A
budget isn’t just a tool for Management. Make
all your employees accountable for the line
items that affect them. For example, an office
administrator may be accountable for keeping
your office supplies on target with your
budget.

5. 4. Play the “savings game”
Get together a small team of employees and
go through your income statement line by line.
Your goal is to come up with 3 ideas for saving
money for each line item. It will be difficult for
some items, but think outside of the box on
this. They don’t all have to be keepers. Make it
an open brainstorming session and tell your
people that no idea is a bad idea. You can
prioritize and implement the top 10 ideas once
you are done.

6. 5. Negotiate and renegotiate
everything
You may be surprised at the results. Nearly
everything is negotiable. Even your banking fees are
negotiable if you’re doing enough business with them.
The trick is to see the transaction from your supplier’s
perspective. For example, even if you don’t buy in
large batches, you may be able to negotiate a volume
discount on materials that you purchase over the
course of one year. Basically, you’re guaranteeing
your business in return for a discount.

7. 6. Decrease your waste
Every company has waste… wasted
materials, wasted time, wasted efforts,
wasted money, wasted employees and so
forth. Make waste the enemy!
Everyone in your business must learn to
identify it and take steps to eliminate it. You’ll
never have a perfectly efficient business, but
as long as you are in business, that should
be your goal.

8. 7. Decrease your inventory
Doing this may require the streamlining of
some of your business systems, but if you
carry excess inventory simply because you
may need it as some point, your savings will
be more than worth the effort.

9. 8. Go green
You can reduce your utility expenses by
becoming a “power smart” business. Turn off
the lights when they’re not needed; automatic
switches will help with this. Use energy
efficient lighting. Turn the heat and a/c off on
weekends and/or evenings. Don’t use
equipment unless you have to. Give your
local power company a call for more ideas.

10. 9. Save money through
partnering
There are many ways to partner with another company
for mutual benefit. One way is to share marketing
costs by creating a joint campaign with a
complementary business. For example, a real-estate
firm might put on a joint seminar with a mortgage
broker, or a group of retail stores in the same area
might organize and promote a sidewalk sale.
If you use your imagination, the possibilities are
endless.

11. 10. Reduce your receivables
Your first step is to standardize your approach. It’s
easy to develop an effective collections system.
What’s hard is sticking to it. That’s because we don’t
want to risk offending our customers. But you can
ask for money without being rude, and besides,
if you’ve fulfilled your part of the bargain it’s only fair
that your customers fulfill their part. So be polite, but
be direct. After all, it’s your money, and you
shouldn’t be forced to lend it out against your will for
an indefinite period of time (especially if you don’t
charge interest or late fees).

12. Mark Wardell is President & Founder of Wardell
International , an advisory group that helps business
owners plan and execute the growth of their companies. The
author of seven business books, Mark also writes regularly
for several national & international business publications.
Email him at mark@wardell.biz.