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This year is proving to be a difficult financial hurdle for a lot of businesses. Whether you\u2019re heading up a small business, or handling the bottom line at an enterprise, there\u2019s a high chance that boosting cash flow and profitability is at the top of your priorities list.\u00a0<\/p>\n
With tech layoffs at an all-time high, bank scandals dominating our headlines and an impending recession on the horizon, you\u2019ll likely be looking for ways you can reduce business expenses this year\u2014cash is still<\/em> king.\u00a0<\/p>\n You\u2019ve come to the right place. We\u2019re sharing seven ways you can cut costs while remaining operational, innovative, and even continuing to grow throughout this cash crunch.<\/p>\n Since the pandemic, the gig economy has boomed. Close to 40%<\/a> of the entire American workforce now identifies as independent workers<\/strong>. This is thanks to a 9% increase throughout the pandemic years\u2014there are now 58 million <\/em>gig workers in the US!<\/p>\n From entrepreneurs to CEOs, hiring freelancers, contractors, and gig workers is now more common than ever. The gig economy is a great way for businesses to reduce expenses on salaries, benefits, and training\u2014especially<\/em> for non-essential business functions, trialing new roles, strategies, or growth methods.\u00a0<\/p>\n While gig providers certainly provide cost savings opportunities, they also provide a direct route to hyper-specialized talent<\/strong>. So, rather than training a new starter to be a \u201cjack of all trades\u201d you can work with multiple gig workers that are masters<\/em> of one.<\/p>\n Now small business owners and finance managers know that most marketing efforts and high-vis marketing real estate don\u2019t come cheap. It\u2019s often the bane of a finance manager\u2019s to-do list to benchmark ROI against costs and accurately run spend forecasting for growth marketing teams.<\/p>\n However, marketing doesn\u2019t need to be a credit card sap. Here are a few alternative marketing avenues to consider outside of throwing cashing at ads.\u00a0<\/p>\n We\u2019re now well and truly in a hybrid working world: a healthy split between in-office and at-home life is the norm. How can you capitalize on this to cut business costs and trim down expenditures?\u00a0<\/p>\n Consider \u2018collaborative consumption\u2019 as an active form of cost-cutting measures. For example, rather than having your own office space for five days a week, look at reducing this to two or three days and ensure your work from home policy<\/strong> never leads to an empty office again.\u00a0<\/p>\n When you allow full-time employees limited days a week at the office, they\u2019ll soon be packing it out on allocated days, allowing more room for real-life, water cooler-style collaboration; while appreciating their work from home days even more\u2014and keeping your costs low.<\/em>\u00a0<\/p>\n If you\u2019ve got a smaller team, explore coworking space options. There are plenty of flexible hot desk options that make for a great work perk.\u00a0<\/p>\n The initial upgrade to energy-efficient equipment and appliances is well worth it if you\u2019re in it for the long run and own your own business real estate. Add to this by considering renewable energy sources in replacement of current solutions\u2014solar panels, for example, are becoming more and more common.<\/p>\n Asides from this, implementing a company-wide energy-saving policy,<\/strong> and incentives<\/em> if teams or the entire business hits certain goals, can truly help to create a more energy-conscious workforce. If your team is traveling for business, consider implementing a more sustainable travel policy<\/a> too.\u00a0<\/p>\n There are plenty of high-quality energy-saving apps on the market to help you maintain this initiative and keep staff engagement high.\u00a0<\/p>\n Software is a game of wins and losses. Some help you save money, while others can be a financial burden\u2014especially when you\u2019re not actively using a paid plan that\u2019s slipping under the radar.\u00a0<\/p>\n This year, take a look at software tools that you\u2019re no longer using. Do your teams truly need the subscription? Or is the free plan<\/em> enough to get by? That\u2019s certainly the case for many small businesses using Zoom or Calendly, for example.\u00a0<\/p>\n In addition to this, AI has come a long way in 2023, and will continue to rapidly evolve. Use free AI models to automate mundane tasks, keep optimization tasks low-cost, and outsource to the bots those time-consuming tasks the humans just don\u2019t enjoy doing.<\/p>\n Use financial management software to keep track of your expenses across the board: track everything from office supplies to work perks. For example, if your team has a travel budget, incentivize employees to stick to that budget<\/em><\/strong> when they\u2019re on the go.\u00a0<\/p>\n If you\u2019re serious about reducing costs, then track spend across all<\/em> employees: from contractors, to part-time to full time employees. Smart expense management software<\/a> will be able to break down your most expensive assets, people, and teams, so you can review and find ways to minimize your spend in those budget-biting areas.\u00a0<\/p>\n It may seem counterintuitive, reading about cutting down on your investments and then a heading like this one, but investing in your people is worth <\/em><\/strong>the investment. <\/strong>Whether the bulk of your workforce is in the gig economy, or you\u2019ve got full-time hires onboard and in-house\u2014you\u2019ll need to invest in them if you want to keep them.\u00a0<\/p>\n Hiring is expensive and<\/em> time-consuming. Replacing an employee can cost a business around 6-9 months of that employee\u2019s salary<\/a>, on average.\u00a0<\/p>\n If you are investing in training and skill development so employees feel valued and continue to grow, then it may be worth sending out a survey to better understand what employees are using vs. what they actually need. If you do end up swapping around your benefits to be more people-centric, here are a few initiatives to consider:\u00a0<\/p>\n Whether you\u2019re working with service providers or a full-time, employed team, strive to keep them all<\/strong>, you\u2019ll be saving your business thousands in the long-run.\u00a0<\/p>\n Whether you\u2019re a pre-seed startup or already have your feet firmly in the ground, it\u2019s no surprise you want to lower costs. Hopefully, you\u2019re walking away from this article with some actionable ways you can start cutting costs and start saving today.\u00a0<\/p>\n Remember to track your business expenses, and look for optimization opportunities every step of the way, although these points are the starting blocks to saving, it’s down to you, or your <\/em>finance manager<\/em>,<\/a> to continue the journey.<\/p>\n<\/p><\/div>\n7 cost-cutting ideas to reduce business expenses<\/h2>\n
1. Embrace the gig economy<\/strong><\/h3>\n
2. Consider more cost-effective marketing strategies\u00a0<\/strong><\/h3>\n
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Finance Managers, looking for smarter ways to work?<\/h3>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n
3. Try sharing an office space and hybrid work for better expense reduction<\/strong><\/h3>\n
4. Implement energy-efficient practices and initiatives<\/strong><\/h3>\n
5. Embrace technology and digital transformation for cost reduction\u00a0<\/strong><\/h3>\n
6. Keep track of your expenses and look to optimize spend<\/strong><\/h3>\n
7. Invest in your people to proactively save\u00a0<\/strong><\/h3>\n
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Start reducing your business expenses today<\/h2>\n