There comes a time in any company’s lifespan when the dreaded budget cuts become inevitable. What distinguishes a well-run company from a short-sighted, short-lived business operation is the way in which its management handles financial hardship.
When faced with the task of finding ways to cut costs and focus on maximizing profits without too much expenditure, businesses turn straight to laying off their employees in order to make that balance sheet look better. The truth is, however, that while firing people might result in a short-term financial boost, the long-term consequences of such a decision might completely eradicate the gains made in the weeks following a mass layoff.
Firing staff leads to a situation where, sooner or later, these professionals will have to be rehired once the organization gets back on the right track. Since the relationships with former workers are severed, it means having to replace every laid-off employee with a new one, which in turn is associated with a lengthy and costly onboarding process. Not to mention the fact that even after thorough training, new employees tend to take time to adjust to their new surroundings and work at maximum capacity.
How, then, can you decrease your business expenses and fix up your budget without firing people? As a business owner, there are quite a few things you could do to achieve just that, and even increase productivity while you’re at it.
Ditch the Landline
Of course, we don’t mean removing all of your telecommunications capabilities altogether. However, it’s been a long time since landline companies were the only way of implementing integrated phone systems in offices. Switching to a VoIP service with virtual phone numbers might prove to be cheaper and more functional than the traditional means.
What is a virtual phone number? It works just like a regular telephone number, except the fact that it isn’t tied to any geographical location as it is routed via the internet instead of a traditional phone line. This means that you won’t have to worry about redirecting or the high costs of interstate or international phone calls. With VoIP, you’ll be able to cut your phone bill by quite a lot, which will amount to a small fortune in the long run.
If you want your business to grow (who doesn’t?), then you’re probably aware of the fact that as your scope and profits increase, so does the number of tasks and responsibilities that you and your workers will have to handle. In these instances, most businesses tend to hire more full-time employees, and while that is the ideal situation, it may not be the best thing for your company if it’s in a financial rut at the moment. Outsourcing certain creative tasks, such as content creation or social media management to freelancers can keep your payroll relatively low compared to what it would be if you expanded your on-site team.
Dire financial situations for most businesses most often come as a result of poor planning and shortsightedness. Of course, there are instances when hardship is brought about by an external factor, such as a global pandemic or a financial crisis like the one we’ve all experienced in 2008.
Dealing with any sort of crisis requires resources. Preparing a business continuity plan that would guide your firm out of the rut in case an unexpected disaster strikes could prove to be absolutely crucial in terms of long-term savings. This particular tip might be one for the future, but it will still end up saving you a lot of money without having to resort to aggressive cost-cutting when things don’t go your way.
Saving Trees = Saving Money
Most business owners don’t realize how much unnecessary spending is caused by continuing to use outdated technology, such as the aforementioned landline telephone services. Another one of such unnecessary operations that cost your business money on a daily basis is using paper for internal communications, dealing with customers, or passing out agenda sheets during client meetings. Businesses use up tons of unnecessary paper, which is not only harmful to the environment but very costly in the long run due to the price of toner, printers, and increased power bills due to printing and copy machines being left on standby overnight.
Minimizing, or even eradicating paper use is no longer an outrageous, radical idea. Digital signatures work just as fine when finalizing contracts, customers can be notified digitally, rather than via fax or traditional letters, and meeting agendas can be e-mailed to clients who can then view them on their mobile devices.
2020 has proven that most office work can be done completely remotely and that having every employee show up at the office every single day isn’t really necessary. Getting your workforce to switch to a more permanent remote work mode will allow you to move the business to a smaller, cheaper office, as well as reduce equipment costs by a significant margin.
The Bottom Line
As you can see, there are plenty of ideas you can explore when it comes to reducing your company’s expenses without firing people or even removing financial employee incentives. Even if your organization isn’t going through financial hardship at the moment (in which case, you should consider yourself very lucky), incorporating some of these ideas into your company’s culture can help you increase cash flow and utilize those cost savings in many ways, such as improving your products or investing in better equipment for your workers.