Your business is designed to make money. And, of course, it makes money whenever you sell a product or deliver a service. But, as you well know, that’s not the whole story. The money you make is made from something – and that something is more money. What matters in the end is your business’ profit, the amount of money it makes above the amount that it spends.

And that, of course, means that what you sell is only half the equation. The other half is what you spend, and reductions in that overhead cost are just as beneficial as increases in profits.

Material and supply costs

The most obvious place to start with savings is in the raw materials and supplies you need in order to run your business. If you make physical products, the materials you make them from are likely a major cost for your business. Even in service industries, office supplies and necessary equipment can cost big bucks.

It’s important to take care when cutting material costs, because you don’t want the quality of your product to suffer. But there are a few ways to try to dig up some savings. A tech company could begin importing its materials from a company like ICRFQ, for instance. Buying non-perishable materials like office supplies in bulk can also save money.

Your business space

Another pricey part of doing business is setting up and maintaining the place in which you do it. Your business space costs you money, whether it’s an auto garage or an office space.

The most obvious way to save money on space is to shop around and downsize. But what if you own your business space, rather than rent? Well, then you’ll want to invest in maintenance and repairs up-front. Attempting to save in the short-term by avoiding plumbing or electrical repairs will cost you dearly in the long run, because big problems with these systems are more expensive to fix than small ones – and big problems can even shut down your business, costing you in productivity and profits.

Utilities and services

Speaking of your business’ plumbing and electricity, how much are you spending on utilities?

The fastest way to find out is to track it. Your utilities companies use meters like the Abest Meter to keep track, and so can you – or you can just look at your bills. Tracking your usage of these services is vital. Armed with information about your company’s consumption, you can identify areas of potential savings, negotiate with your service providers, and budget properly for the future.

Management and organization

Finally, it’s worth looking at your business itself. Is the human element of your business operating efficiently? What about your systems and processes? If your company struggles with organization, you’ll lose money in all sorts of ways: from obvious losses in late payment penalties to more subtle losses in the form of productivity and morale.

Organize your business on every level, and you’ll enjoy a leaner organization. Everything from the employee hierarchy to the way you manage telecom bills matters to your overhead costs – and, therefore, to your profits.

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