Most entrepreneurs and small business owners are only too aware of how high costs eat away at profits. In tough economic times squeezing every penny is important.
Luckily, lowering business expenses is easier than you think and these three money-saving hacks will help you kick high-cost habits quickly and easily.
1. Stop Being ‘Brand Lazy’
As individuals, we tend to develop our own brand loyalty profile. We like these shirts. That phone. That car. Whatever. Brand loyalty is great for you or me personally.
This is a business. In business, it’s all about ruthlessly cutting costs.
From a business perspective, being ‘brand loyal’ is the same as being ‘brand lazy’.
Competition to supply small businesses (that constitute 44% of the American economy) is fierce. There are big players and hungry smaller, online players all competing for market share. It’s a massive industry. The U.S. office supply industry is worth $11.5 billion a year.
At any given time there are massive discounts and amazing deals on different office supplies and business equipment. Some suppliers may be offering huge discounts on printers, ink and toner while others may be discounting office electronics.
There is no value in being loyal to one office supplier. You don’t owe them anything.
Shop around and explore deals from top office supply stores on a regular basis to ensure you are always getting the best possible deal on whatever you need. Every time.
2. Drastically Lower Delivery Costs
How are you optimizing your fleet for deliveries and pickups? If you’re still planning routes and delivery schedules by hand or with basic tools, you’re probably spending 20% — 40% more than you need to on fuel, wear and tear and driver salaries.
Don’t believe me?
Check out this map that shows one hundred delivery locations that need to be visited by a small fleet of five vehicles.
What’s the best way for the available vehicles to make those deliveries? Is it even possible for them to get to each location in the timeframe given — 9 am to 4 pm?
Any idea of how many potential solutions there are to this everyday problem?
The number is huge.
7.88 x 10⁶⁹ x 9.33 x 10¹⁵⁷= 7.36 x 10²²⁷
To put it in perspective, the number of Hydrogen atoms in the Universe is approximately 10⁸⁰.
For a human to attempt to come up with really efficient route optimization, given the astronomical number of possibilities, is simply not possible within a reasonable time-frame.
Last mile deliveries can consume up to 30% of the entire supply chain cost.
Here’s the optimized result generated using cutting edge heuristic algorithms (taking about a minute to calculate).
All vehicles managed to complete their routes in under the scheduled time frame.
This is an important result because, if this was your company, you would know it is possible to meet your delivery obligations without having to expand the fleet — at great expense.
Operating a smaller, more efficient fleet means massive savings.
All you need do is import delivery locations into a route optimization system, configure the schedule and click a button. In minutes you have an optimized route plan for the entire fleet. This saves both time and money simply planning routes that are far more efficient and lead to significantly lower transport costs.
3. There’s a Tool for That
There’s an important lesson I learned (the hard way) when it comes to starting and growing a business.
Time is your most precious asset; not money.
It’s far more valuable to reach goals and objectives quickly. Hitting targets almost inevitably means your business will start making money (or increasing existing revenue) much faster.
It’s vital for startups, in particular, to secure a stream of income as quickly as possible. The alternative is almost always a failure.
Trying to save money by doing things for free can be far more costly in the long run because you end up wasting precious hours that end up being far more valuable than the few bucks spent using a tool to increase productivity.
Arguably the best example of startups wasting time is trying to manually develop a company website for free, instead of using a website builder to get up and running quickly.
Here’s a trick you and your employees can use to work out where productivity bottlenecks are occurring.
Monitor daily activities over the course of a week or two and take note of anything that is time-consuming, a real chore, or repetitive.
Any business activity that is time-consuming or repetitive is a good candidate for automation.
Spending too much time trying to reconcile and balance the books, doing taxes or paying salaries? Explore a wide range of business software and services aimed at streamlining virtually any type of small business activity for a fraction of the cost of hiring on personnel to manually perform those tasks.
Spending hours trying to build relationships with influencers and valuable business connections online? Trying to work out why competitors rank better in Google? Still using spreadsheets to manage email lists?
Established marketing tools can do a far better job than any individual SMB could do with the resources at their disposal.
The right tools and services make your business more competitive. Helps you grow faster. Streamlines operations. Helps generate revenue and lower costs (i.e. by saving on labour).