Do you need to lower your budget? 10 ways to get started

When you need to cut costs in your business, it’s hard to know where to start, especially if you have employees who depend on the success of your business. However, there are a few great ways to get started to get your business finances back on track.

To help you choose the best path, 10 members of the Young Entrepreneur Council (YEC) weigh in on the following question:

“When faced with a situation where austerity is needed, generally speaking, where do you first look for cost savings, and why?”

Here’s what they suggest you take a look at and what you can do to get started.

1. Eliminate process errors

“Inefficient, error-prone processes cost companies tons of money. If errors in a process result in poor service or defects in your products, you will lose money every time that process is run because you have to spend money to fix those errors. If your teams understand how to optimize those processes to eliminate errors, the financial benefits will far outweigh traditional cost-cutting ideas.” ~ Karlo Tanjuakio, Kure

2. Negotiate with suppliers

“One way to cut costs without negatively impacting your business is to negotiate with your suppliers. Many of the companies you work with will likely prefer to negotiate a lower rate for you than risk losing your business to a competing offer.” ~ Bryce Welker, the CPA Exam Officer

3. Phasing Out Redundant Technology

“We first look for redundant costs in technology and services. Do you really need a service or some cool tech? If that is not enough cost, you can often renegotiate somewhat more expensive services with suppliers.” ~ Peter Boyd, PaperStreet Web Design

4. Rethink Marketing Strategies

“Limit marketing without impacting overall results. There are probably plenty of areas that you can cut down or cut out and replace with a heavier social media presence, which is largely a free marketing strategy. This budget line is usually where you can identify areas of overspending to cut without affecting the ability to meet your goals. ~ Andrew Schrage, Money Crashers Personal Finance

5. Slash Paid Advertising Fee

“If there were to be cuts, I would cut back on our paid advertising budget and go for cheaper alternatives. For example, we can create referral programs to get recommendations. We can set up rigorous social media marketing campaigns and encourage all our employees to participate to increase visibility. A good email marketing strategy can also help create low-cost promotions.” ~ Thomas Griffin, Optin Monster

6. Compare short-term and long-term goals

“When we cut costs, we do it by looking at the long-term goals of an expense. For example, when we started out, the bins we wanted to use for our inventory were very expensive, but the alternatives would have been less efficient in the fulfillment process, so we decided to spend the money and buy plastic folding tables and chairs for the staff. instead of getting more luxurious furniture.” ~Vanessa Nornberg, Metal Mafia

7. Look at overhead costs

“We will monitor (quarterly) all spending across the organization to see where we can reduce our overhead and reduce wasteful spending. Often times, we sign up for technology tools we don’t use that cost tens of thousands of dollars a year, so those are the first items to diminish.” ~ Kristin Kimberly Marquet, Marquet Media, LLC

8. Cut Subscriptions

“You sign up for so many programs that you think you’re going to use. When you can check the bank statements, you will see programs that you have not used in months. Cut those off first, then dive deeper into your current platforms and research whether or not you currently have the most cost-effective plan for your business. ~ Mary Harcourt, CosmoGlo

9. Reduce Network and Event Memberships

“If you have multiple networking group memberships or plan to attend an event, consider cutting back in these areas. It is important to keep marketing in general and you can opt for direct means of expanding your customer base such as cold emails and advertisements. However, you can end up with expensive network tasks, especially if they can cost thousands of dollars.” ~ Syed Balkhi, WP Beginner

10. Use AI

“If you want to cut costs, you should consider adding AI to your business model. We use AI for some customer support functions and as a way to track data and security on our site. You may have to pay a little more upfront, but this technology will pay for itself in a few months. It won’t be long before you start saving money on this seemingly minor change.” ~John Turner, SeedProd LLC

Image: Depositphotos


This post Do you need to lower your budget? 10 ways to get started was original published at “https://smallbiztrends.com/2022/03/cutting-down-on-your-budget.html”

Leave a Reply

Your email address will not be published.