Many of us hire consultants or vendors to look out for our best interests, but in reality, we, as business owners, need to be minding our own stores, and sometimes checking up on our own “trusted advisors.” Just because our advisor may not have mentioned a particular cost-reduction strategy, does not mean we need to close our ears and not be looking for additional methods during these trying times in our economy.
Here are several things you may want to be reviewing in order to further reduce the cost of running your business:
1) Take a look at your existing contracts to insure that your vendors are giving you the most appropriate level of service, for the most appropriate rates. For example, if you are using a particular waste management provider, examine whether they are coming to dump too often and is the dumpster only half full? Collecting fewer times should cost you less!!
2). Consider consolidating similar services. For instance, you may have several loans from several banking institutions. It may make sense to consolidate them in an effort to achieve better interest rates from a single source. Similarly, several waste management providers may be serving several of your locations. Maybe one provider can handle everything and then some, like adding recycling and liquid waste disposal services, in order to achieve greater cost savings.
3) Are you taking credit or debit cards from your customers? Check to see if you are being charged fair merchant service fees. Are your merchant service statements clear and easy to understand, or are they difficult to read by design? Are the new reductions in interchange fees being passed on to you from your processor? You may want to hire a consultant on a contingency basis to find your hidden charges.
4) Keep your eyes open for publications that discuss all of the available tax advantages of which you can benefit. Don’t just assume that your accountant has considered everything as it relates to your business. For example, if you have purchased a building within the last 15 years, there may be some ways to significantly increase your cash flow by implementing a different way of handling how the asset is depreciated. (And when I say “significant”, I mean significant!)
5) Review your shipping vendor agreements. Are you aware that between three and five percent of shipping transactions result in error, and you are entitled to refunds because of it? Check to see if you are capturing all of the errors and subsequent refunds by hiring a consultant (on contingency) to review your contracts and their errors.
All of these are simple cost-reduction strategies that can be overlooked by your existing vendors and/or consultants. Always be looking out for minding your own store, because cost savings strategies are simple and just around the corner!