Every business owner wants to be able improve profitability to do but it’s not an easy task.
Increasing sales is the ideal solution but this can be tricky depending on market condi-tions which is why it makes sense to try and find ways to reduce costs, more specifi-cally overhead expenses.
Here are a few effective ways to trim your controllable overheads and improve your bottom line in the process:
Rent can be a huge business expense which can eat into the company bank balance, so it’s worth considering cheaper alternatives. There are many examples where businesses could run more efficiently in a smaller premises which could help you to make some worthwhile savings.
Additionally, encouraging staff to work remotely can help because it means that you do not need as much space in the office and less energy is being used so you are sav-ing in terms of both rent and utilities.
Consider Energy Efficient Appliances
Leading on from this, you can reduce your utility bills by using energy efficient appli-ances and lightbulbs – this is also a good way to reduce your carbon footprint. It is also a good idea to switch lights and appliances off when not in use to reduce energy consumption.
Business heating costs can be a headache and it doesn’t help when your premises are served by ancient and inefficient boilers and heating systems.
It’s worth looking at purchasing more modern energy efficient commercial heating equipment which although involves an initial outlay could help to significantly reduce your energy bills over time.
With so much attention placed on environmental damage, many businesses are now making huge changes when it comes to how they operate to be more eco-friendly. One of the most common ways to do this is to switch to alternative energy, such as solar power. In addition to the environmental benefits, this can allow a business to make huge savings over the long run (although it can be expensive up front).
Switching Energy Provider
It is good practice to review your gas and electricity contract annually to see if you could make any savings by switching provider – you could be surprised at how much you can save by doing this, plus it’s a pretty quick and simple process to switch to a more cost efficient deal.
Keep Insurance Costs to a Minimum
Every business needs a variety of types of insurance cover but the cost can vary mas-sively from provider to provider. You can often make worthwhile savings by shopping around for lower premiums or perhaps consolidating insurance policies and by making sure that you do not have duplicate coverage across multiple policies.
Reducing overheads is a smart way to increase your bottom line as it is an area which you are in complete control over (unlike increasing sales).
These are a few of the best ways to reduce your overhead expenses and when com-bined could help you to make significant savings.
Just be sure that any cost cutting does not have a detrimental effect on the business or reduce the quality of the product or service that you provide.
- Club Rewards gives M&S Credit Card Customers 3% in reward points, £65 in quarterly vouchers, £12 birthday treat, 32 hot drinks vouchers and unlimited free next day delivery. - June 16, 2021
- Fixed Rate Savings Bonds – Competition Driving Rates Higher - May 21, 2021
- High inflation and low interest rates: A worrying combination for savings? - April 25, 2021