6 Ways to Reduce Your Small Business Expenses

Looking to grow your business profits? Improving the bottom line of your business doesn’t always require a large-scale overhaul. In uncertain economic times, even minor reductions in expenses can go a long way in impacting your company’s profitability. Sometimes, it’s as easy as getting better at small business expense tracking. Knowing how to track expenses for a small business can go a long way toward making sure you’re maximizing profits and minimizing expenditures.

So, whether you’re taking a fresh look at your small business expenses list or just increasing your efficiency, these six simple changes to reduce small business expenses can make big a difference for your company. And if you want to explore how you can lower your costs on insurance coverage, reach out to Farm Bureau.

Strategy #1: Ditch the Paper

Small business costs can stack up when you’re using items that you could do without. Thanks to email and file sharing, there are very few tasks that can’t be done electronically. If you haven’t done it already, now’s the time to switch your invoices, bills and other documents to a digital format.

Not only will you reduce business expenses on paper and postage, but going digital can increase efficiency, too. Software like Google Drive, Dropbox and Basecamp can help you centralize company documents and product collaboration — and can be an alternative to paper documents and meetings. 

Plus, sifting through paperwork for specific dates or keywords is a snap. All you need to do is search.

Strategy #2: Improve Energy Efficiency

You don’t have to add solar panels to your office space to lower your energy bills. Small changes like adding occupancy sensors for lights, using power management features on electronics and properly maintaining your HVAC equipment can make a noticeable dent in your annual utility costs. And with power costs rising, that can be a huge help to your bottom line.

Strategy #3: Go Organic

Not pesticides — we’re talking about organic outreach. Paid media will always serve a valuable purpose, but savvy business owners know how to amplify their paid efforts with organic efforts. Consider implementing a referral program that rewards existing customers for recommending you to others. Focus on networking to increase familiarity with your business among your target customer bases.

Recommendations from current customers are more likely to lead to a sale than cold calls, and prospective clients are more likely to hire a business with a face they recognize.

Strategy #4: Optimize Productivity

There are a lot of apps and tools on the market to help you create efficient time strategies for your organization. Software such as Paymo and Toggl can track employee time usage as well as time spent on different types of work activities and billable hours, giving you a better sense of where your time —  and money — are being spent.

Strategy #5: Perform a Software Audit

Are you actually using all those programs you’re paying for? Annual auto-payments can add up, so it makes sense to regularly wade through your software subscriptions and cancel those you simply don’t use anymore. (Check out services like RocketMoney, which hunt down subscriptions you might not be using and help you cancel them.) 

And remember, new apps and software are developed every day. So, there may be a new, more cost-effective option that could work just as well as your existing programs. Take advantage of new business tech that can not only help efficiency but also reduce business expenses. Take a little time to read some publications and chat with others in your field about what’s worked for them.

Strategy #6: Cut Supply Costs

It can be easy to fall into the trap of using the same service simply because that’s what you’ve always done. But you could be leaving money on the table if you aren’t regularly shopping around for better prices on the basics.

Don’t overlook the power of simply asking for a discount — many suppliers will be willing to work with their regular customers, especially if you’ve been consistent with paying bills on time or early. You won’t know if you don’t ask!

Maximize Your Coverage

Get the most out of your business insurance with BusinessMax® coverage from Farm Bureau. Reach out to Farm Bureau to learn which coverage options are best for your business.