Did you know some of the world’s most successful – and profitable – businesses are also the most frugal? Chances are you’ve heard – and hate – the term “cost cutting.” Similar cost vigilance entails maximizing your resources through intelligent spending, not cutting costs altogether…unless you’re buying your employees lunch every day!
Five Ways to be Cost Vigilant in 2013
Hire Contractors – Not Employees
Unfortunately, benefits are very expensive for small businesses. You can achieve the same results by using a different segment of the workforce: contractors and interns. Contractors work the same hours and wear the same uniforms but aren’t privileged to the same benefits as their full-time counterparts. This includes health care, paid time off and other perks.
Furthermore, unless you specify hours in the contract, your workforce can be on demand. Why pay someone to work full time when you find you only need them 20 to 30 hours each week? Contractors may cost more per hour, but save you thousands of dollars in the long run. And since you’re not paying benefits, they pose less of a burden on your organization.
Train Future Generations
Educate the future workforce of America by providing an intern program. First, don’t treat interns like unpaid contractors. Laws vary by state, but for an intern program to be unpaid, it must be an enriching learning experience for them. Thus, you can’t have an intern to do your grunt work, but you can mentor them into performing your tasks, such as office management.
While you have to spend money to make money, consider streamlining your purchasing department by not buying in bulk, shopping from discount retailers when possible and avoiding finance charges. Contrary to common belief, purchasing in bulk doesn’t save you money in the long run. Why? Because, chances are those 1,000 pens you bought will dry up before you use them.
And to this effect, why pay market prices for pens? Shop at bargain basement stores whenever possible, whether it’s the 99 cent store or a surplus supply store on eBay. Unless it’s pertinent for your company’s success, don’t pay “premium market value.” Pens are pens, right? The same doesn’t apply to pricier items, such as printers or copiers.
Don’t Use Paper
Speaking of paper, don’t use it! Rather, eliminate the need to use a printer altogether. By going “green,” you can save green in the process. Printers and their toner are expensive, not to mention unnecessary in this day in age. With iPads, fancy laptops and gigantic monitors, who needs to hold a physical piece of paper? Encourage your employees to read long PDFs or memos on their screen rather than printing them.
Encourage Employees to Work from Home
The cost of office real estate is rising and isn’t going to decrease anytime soon. As such, consider encouraging your employees to work from home. Studies have shown time and time again that certain employees are more productive in their own home. Plus, you’re not paying for their electricity, Internet, furniture, or workspace.
While not advisable for everyone, consider offering the privilege to your top performers. Set goals that hold them accountable, so they have hard objectives regardless of where they’re performing the work. Use technology, such as Skype, FaceTime and Google+ Hangouts for face-to-face meetings.
This article is part of the Drive Your Business Forward series. Check out allvoices.com/smallbusiness for more tips and advice on how to succeed as a small business. This series is supported by Mercedes-Benz Sprinter.