3 Easy Cost-Cutting Tips for Your Remote Company

Simple changes go a long way. Use these proven methods to cut costs and improve your bottom-line.

Starting a venture from the comfort of your home (or local café) sounds like a dream, right? Well, it is, but here’s a reality check: while you’re saving on brick-and-mortar costs, remote work isn’t always the golden ticket to cheaper operations. In fact, hidden costs can sneak up, eating away at your profit margins.

When I ran a remote team of 40 people, containing costs made for boosted profitability. In this article, I will share with you three ways I kept those expenses in check.

The Reality of Remote Work Overhead

Remote work has its perk, but running a remote business isn’t automatically cheaper. Those software subscriptions? They add up. And oh, the inefficiencies from miscommunication? Those can cost you too.

First, you might be spending tons of money on tools that you don’t really need. It’s tempting to sign up for the latest and greatest software that promises to “revolutionize your workflow.” But think about it: how many of these tools are gathering virtual dust?

Periodically reviewing and auditing your tools can reveal redundancies. Every unused subscription is money that could be better spent elsewhere or even saved. Those little “$99/mo” subscriptions can really add up!

Speaking of which, while it’s great that everyone’s a message away on Slack or Teams, this can sometimes result in crucial details getting lost in a sea of notifications. And with everyone in different time zones, sometimes it feels like you’re playing a never-ending game of email tag. These inefficiencies aren’t just frustrating — they’re costly.

Cost-Cutting Tip #1: Smart Software Selection

At the risk of stating the obvious: No, you don’t need five tools doing the same thing.

This seems like common sense, but you’d be surprised at how many businesses have overlapping tools. For instance, if you’ve got a project management tool, do you really need a separate task tracker? Maybe, but probably not.

Start by making a list of every software subscription you’re currently paying for (tip: the easy way to do this is to just look at your monthly credit card bill). Now, categorize them by function. Some example functions include:

• Marking
• Onboarding
• HR
• Project Management
• Operations

After categorizing, look for overlaps within the category. If you have overlaps, it’s time to assess which ones your team actually prefers and uses. Sometimes, it’s not about the tool with the most features, but the one that fits seamlessly into your team’s routine.

Don’t forget about free trials, either. If you’re on the fence about a particular tool, make use of these trial periods to evaluate the tool’s fit for your company. Dive deep during this time. Involve team members and get their feedback. This way, you ensure that when you do make a purchase, it’s the right call.

Furthermore, tap into community resources. Online forums or software review sites can offer insights from other users that could guide your decisions. Real-life testimonials can often paint a clearer picture than promotional material.

Always be on the lookout for discounts or bundles. Many companies offer discounts for annual payments or for startup businesses. And don’t be shy — reach out and negotiate. The worst they can say is no, but you’d be surprised how often companies are willing to cut a deal, especially if you’re a loyal customer.

Lastly, explore open-source alternatives. While they might lack some premium features, they often do the job just as well. Remember, it’s not always about having the fanciest tool in the shed. It’s about having the right one.

For example, perhaps you like HelpScout for your support desk. Well, take a look into FreeScout instead. Most popular software platforms have open source alternatives available.

Cost-Cutting Tip #2: Optimize Your Remote Team Structure

Now, let’s talk teams. You’ve got a squad of talented individuals, but are they structured in the most cost-effective way? Remote work provides a unique advantage here: you aren’t bound by geography. This means you can find the right talent at the right price, no matter where they are.

The most efficient (and cost-effective) way to grow your virtual team is on a need-to-need basis. Sometimes, a part-time contractor or freelancer is all you need for a specific task, instead of a full-time employee. This isn’t about cutting corners on quality, it’s about being resourceful. Contractors don’t need all the extra benefit payouts. I’ve seen multi-million dollar businesses who use a team of mostly contractors. The amount of money they save on unemployment, benefits, and savings payouts can be reinvested back into the business to fuel growth.

Another consideration is the different cost of living in various regions. You might find incredibly skilled professionals in areas where living costs are lower, which could result in salary savings without compromising on talent.

Cross-training is your friend. If Sarah from Marketing also has a knack for design, maybe she can pitch in on some graphics. If Tom from Sales is great with numbers, perhaps he can assist with some financial tasks during off-peak times. When team members can wear multiple hats (even occasionally), you save on hiring additional personnel.

This cross-training isn’t just about filling roles temporarily. It’s an opportunity to upskill your team, making them more versatile and giving them growth opportunities within the company. Regular training sessions and workshops can ensure that everyone is up-to-date, thereby increasing the overall productivity of your team.

Communication is the backbone here. Ensure everyone knows their roles and responsibilities to avoid overlap, confusion, or tasks falling through the cracks. And remember: a happy team is a loyal team. Retaining talent is always cheaper than constantly hiring.

Cost-Cutting Tip #3: Implement Flexible Work Arrangements and Benefits

Being flexible isn’t just about making work more comfortable for your team, it’s also a golden key to savings. Traditional 9-to-5 might not cut it in the remote world, especially if your team spans different time zones.

Offering flex hours can reduce the need for overlapping roles. Say your customer support needs to cover 16 hours a day. Instead of hiring more people, why not offer flexible shifts? Team members might appreciate working hours that suit their personal schedule and time zone.

Plus, having flexible schedules can reduce burnout. Overworked employees aren’t just unhappy, they’re less productive and more prone to mistakes. By allowing your team to choose their work hours to some extent, you can ensure they’re working at their peak times, leading to better results for your business.

But here’s where it gets even better: think about non-monetary benefits. Sometimes, an extra day off, a learning opportunity, or even a wellness program can be more appealing than a raise. These perks can boost morale, increase productivity, and, you guessed it, save you money in the long run.

Tailor these benefits to your team’s needs. Periodic surveys or feedback sessions can reveal what they value the most. Offering tailored perks not only fosters loyalty, but also often ends up being more cost-effective than generic, expensive benefits that employees might not even use or appreciate. When employees feel seen and valued, they stick around. Reduced turnover equals reduced costs.

Conclusion

On the surface, it might not appear like these three actionable tips would have a big impact on your company’s expenses. But this isn’t theory. I used these exact tactics, and they worked wonders, helping to boost my startup’s profitability to 76%.

Remember, it’s not about cutting corners, but about being smart and efficient. Remote work has its challenges, but with a little bit of planning, you can stretch your dollar further.