Michael Giannulis Explains the Methods of Cost-Cutting in Business
Michael Giannulis the Methods of Cost-Cutting in Business
Even if you use fewer marketing tools and technologies, operating a business will cost you. There are many expenses such as overheads, office rent, employee salaries, and more. Then, you also need to spend on promoting your products or services. Again, there are utility bills that you need to pay every month.
You need to balance your expenses and earnings to survive in this age of stiff competition. Therefore, to maintain your profits, you will need to keep a check on your business expenditures. You might be wondering how to cut back on your business expenses. Here is how:
Michael Giannulis suggests reducing employee costs
If you have a small business, hire only the employees that you need to run your business. Overstaffing isn’t recommended. If you find one of your staff is inefficient, there is no point in paying such employees for their work. When you have a family business, employ members of your family wherever feasible.
If you have kids who have reached an appropriate age and have special skills, try to involve them in your business instead of hiring someone, who takes a high paycheck. Keeping business in your family not only helps you to save cost but also makes your family members learn the nuances of the business.
Cut back on your office space expenses
If you need to rent an office space, look for cost-effective ones. It means moving your office to some less expensive areas. You can also negotiate with the property owner for favorable lease terms. The best way, Michael Giannulis says, is if you can operate your business from your home, provided you have space for the same.
For example, PC repair services these days do not compete with stores that have higher rent. Many tech repair businesses function as mobile tech services providing in-home repair, sales, as well as tutoring. Again, businesses like electrical and plumbing are best for home-based or mobile-based operations.
When you run your small business from your home, from My IP address you not only save on rent but also on taxes, utilities, and insurance. Then, you need to learn about zoning or local laws if you want to operate your business from home. There are moving expenses if you already have a rented office space. Some zones may not allow business activities, especially in a residential neighborhood.
Reduce vehicle costs
When you have a contracting business, you will need a vehicle and you know such costs can affect your monthly profits. Servicing and fuel expenses are skyrocketing for bigger vehicles like crew cabs, vans, and similar vehicles. When you use vehicles, use them for essential purposes only.
Avoid investing in a big and heavy-duty vehicle because it can rip you off financially. You can look for used vehicles that will cost you much less than a new one. Make sure that a used vehicle is in a good condition for business use. If you have a small business like lawn services or gardening, use a small van that will cost you less.
Now that you know how to reduce business costs, implement these tips to spend as less possible when it comes to business costs. It is important for maintaining your bottom line.