How to Cut Your Business Costs to Turn Profit: 5 Ideas to Try Today 35

How to Cut Your Business Costs to Turn Profit: 5 Ideas to Try Today

This is a guest post by Diana, a full-time mom interested in topics related to marketing and latest business technologies.

Trimming down your business costs is just as important as earning in the world of business.

In fact, regardless of how big your income is, there is no guarantee that you’ll turn profit without finding a way to decrease your costs.

If you are on a shoestring budget, these tips will help you trim down your costs without too much effort!

1. Cloudsourcing.

Let’s not kid ourselves, we’d all like to be our own bosses!

Luckily, the current business climate has provided many professionals with an opportunity to achieve this dream.

People can now earn their wages by working as freelancers online and even post their portfolios and CVs on websites that specialize in freelancing, such as Freelancer, Elance, iWriter and many others.

But what does this mean for a business owner? Well, the benefits of freelancing extend into the traditional business world.

Outsourcing, or cloudsourcing allows an entrepreneur to hire professional help based on their own needs and timing.

This is perfect for positions such as website designer and graphic artist, which don’t really need to be on your full-time payroll. Cloudsourcing allows you to be flexible and invest in accordance with your own needs!

2. Interns.

Even though they aren’t your employees, freelancers are professionals; and professionals tend to charge heftily.

For a well-established, medium to large-sized company, this isn’t really a problem, but small businesses will be looking to trim down their costs even further.

Luckily, there is a way to get by even cheaper and possibly even hire people for free!

Sounds too good? Well, although hiring temps does come with its downsides, sometimes this is a valid means of saving up some money.

On the other hand, some jobs are easy to perform by anyone and there is no reason why you should use your paid personnel or hire additional workforce to perform them.

Going around local colleges and looking for interns can solve this problem. They will likely ask for nothing more than a recommendation from you and will definitely be able to perform tedious tasks that you or your full-time employees don’t have the time for.

3. Discounts.

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Always being on the lookout for discounts might take time and dedication, but it will definitely pay off in terms of cutting business costs.

This is exactly why many top retailers won’t actually advertise their discounts, which is why you need to show initiative here.

Instead of waiting for a retailer to shower you with discount offers (which is highly unlikely to happen), simply going ahead and asking them might get things rolling.

4. Careful with Buying in Bulk.

On the other hand, wholesales are a slippery slope. Sometimes, a retailer will offer a bunch of items for a ridiculously low price, and this is exactly where you need to be very careful.

For example, if you receive an offer for a thousand pens for $500, you need to ask yourself whether you really need so many pens.

Sure, this price might be ridiculously low, but once you are left with so many items, you’ll quickly realize that you won’t know what to do with them and will end up with a bunch of items you don’t really need and a wallet that is significantly lighter.

The best solution here is always knowing what you may need and what you really need.

5. Storage Space Efficiency.

Customer satisfaction is crucial and if they aren’t satisfied with your deliveries, your client base won’t keep coming back for more.

In fact, delivery efficiency is so important that your customers are more likely to disregard an occasional mistake than to tolerate not making deliveries on time.

The largest factor behind delivery efficiency is storage space efficiency. Which means that your warehouse won’t be able to function properly without adequate paraphernalia, such as an elevated work platform or two, a couple of forklifts, and a few other necessities.

This means that you should either invest a part of your budget and buy new equipment, or opt for renting.

Increasing your income is extremely important, no one is denying that. But without trimming down the business costs, a large part of your income will pale in significance.

Outsource where you can, hire interns or temps, run an efficient storage, look for discounts (but be careful when buying in bulk) and keep in mind that profit is always more important than income!

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Becoming Your Own Boss: Tips on Getting a Business Off The Ground 16

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Becoming your own boss is a complicated process, and not everyone does it the same way.

I got lucky. I was still working when I got my business off the ground, so I had a source of income while I was working the kinks out of my business. I did most of my work for the new business when I got home or on the weekends. I asked for a change in job responsibilities at the office so that I didn’t have as much on my plate.

This all gave me a chance to start earning money without going into debt. When it was feasible, I stopped working my regular job and transitioned into working for myself full time. It took about a year and a half.

Establish clear boundaries.

 

Sometimes people don’t take you seriously when you tell them that you work for yourself. They think you are always available to chat or have lunch.

I had a number of friends that would call me at all hours, assuming I was available because they wanted to talk. Granted, it was nice to have that freedom at first. But, I soon realized that if I was going to be successful, I couldn’t let those kinds of distractions interrupt my workday.

Save before you start working for yourself full time.

I was in pretty good shape when I made the transition, but looking back, a few more months with a paycheck would have been wonderful.

When you start your own business, money can be very tight. You never know what you are going to make month to month.

I had one customer that initially made up most of my revenue. That customer only paid on a quarterly basis, which meant that times were tough in between payments.

I had to spend money to build the business, which meant there wasn’t a lot left over. If I didn’t get a payment right on time, it was very difficult to deal with.

There were times when I had to ask for a loan from family members simply to pay my bills.

Reach out and build a support network.

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It can be really difficult to adjust at first. You have great days and you have terrible days. You meet goals some months, while other months you are left wondering where you went wrong.

If you make a mistake, you alone are responsible for it and your business and reputation can suffer. It is easy to feel depressed at times. You may even start to feel like you can’t handle running a business and that you made a big mistake when you left your office job.

Remember that you are not alone. All entrepreneurs have these moments, which is why it is so important to connect with others in the field.

Take time for yourself.

I had a honeymoon period of about half a year. It was really exciting to see the business get bigger. Each milestone that I met was a reason to celebrate.

However, heading into the second year, it was more difficult. I was tired. Things weren’t as exciting because they weren’t new anymore. And then, year three came along. I was done with working such long hours.

I was done with having no time off. Burnout is certainly an issue in this business, so you have to figure out how to balance your personal and your professional needs.

It took me a long time to get where I am today. I had to do a lot of research. I had to educate myself on business. I had to find an SEO expert. I had to figure out who my main competitors were and keep an eye on them. I also had to stay current with what was happening in the field so that I didn’t fall behind.

No matter how hard I worked, it seemed like I could never get caught up. Running a business is a big responsibility.

If you are interested in starting your own business, you want to set yourself up for success. Try to cut back on your living expenses. Make sure you have substantial savings. Set up an area in your home where you can work, free from distractions.

If you are married, get your spouse on board. He or she can help pay bills while you are getting your business off the ground.

Your business is only as good as you are.

Make sure you have a support system of other business professionals. These people can help you acknowledge your weaknesses, encourage you to keep moving forward and advise you on common mistakes.

You can try and go it alone, but it will be very difficult for you. As with anything else in life, your support network has a lot to do with your success. You are probably strongly invested in your business; after all, it is something that you created. Make sure you have people that you trust to help you along the way.

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Grace Lee has been practicing in the field of digital marketing for several years now. She has already brought numerous sites in search engines’ first pages in search results. In her spare time, she loves listening to podcasts about Google algorithm updates and other matters related to SEO.