Ways To Improve Your Bottom Line

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A universal truth of life in business is that your costs will always rise in one
way or another. Wages will increase in line with minimum wage restrictions or
market expectations. If you work in any area of business where you deal with a
physical product, you will undoubtedly understand how costs change. While over
time the cost of manufacturing a specific product might drop, due to economies
of scale, the age of the technology involved or the prices of parts, the demand
for that product may fall. The market expectations for newness drives you to
find products that are more expensive to produce, and add to this the
ever-rising cost of shipping due to fuel price rises, or environmental taxes.

So
what controllable costs can you reduce to protect your bottom line? Having a
strategy of waste reduction can improve the profitability of your organization
significantly while instilling a culture of responsibility and conditions
within your team.

Payroll Overspending

One of your most significant budgeting areas is probably payroll. By re-evaluating budget spending, you can save considerable amounts of money. Analysis of productivity across your schedule can highlight where you are paying for staff that you are not fully utilizing, versus being understaffed to the point that you are not efficiently meeting demand. Consider a more flexible approach to staffing, moving your team based on need. If you have staff working during times where there is little to do, find ways of making them useful.

Use
a clocking-in system to ensure that you are not losing money through staff
lateness.

Avoiding Damages

How
much product do you lose through damages? By training your team effectively,
you can reduce the amount of stock you write off through neglect. This can be
improved through better organization, maintaining safe warehousing standards,
not overloading pallet trucks or forklifts, and using safe manual handling
procedures.

Where
you do have damages, look for salvageable items that could be used as spare
parts. These can at least be useful for after-sales support and may minimize
potential customer returns.

Measuring Usages

By
fitting flow meters on any water or gas pipelines used within
your business, you can monitor usage. This can help see where you are using too
much. There are environmental benefits to saving resources, and having a
wastage policy surrounding these in place will make your staff more aware of
the amount that they are using.

Reducing Packaging

Not
only will a reduction in the amount of
packaging you use
 help save you money, but it’s also beneficial to the environment.
Customers are getting more aware of the impact of packaging on the environment,
and for many, it has become a consideration when making a purchase. If there is
a way of using less plastic in your packaging, then you should be looking to do
this.

Reduce Consumption of Electricity

Employing
a policy of turning off lights when out of the room, or fitting motion sensors
will help cut your electricity bills considerably. Powering down computers and
other equipment when not in use is also beneficial.

Again,
saving electricity is also a great help environmentally.

Change Your Suppliers

Who
supplies things like your electricity, gas, phone lines, and broadband? It’s
worth periodical shopping around to see if you can get a better deal for your
business by switching providers.

Modernizing Your Systems

Is
the software your company is using the most efficient? Does it meet all of your
needs, while integrating seamlessly with other applications needed within the
business?

You
might find that since starting to use your current system, others have
developed rapidly and will be more beneficial to you.

Having
technology on hand that automates much of the administration process can save
you time and money.

Review Your Product Range

What
worked for you last year might not work this year. Often businesses carry stock
and services with them long after their shelf life out of a belief that because
it worked in the past, it should always work. If demand is falling, it is time
to think about replacing the line with something new.

Renegotiate

Whenever
you get to a break in a contract, be it with a landlord, a supplier or a
manufacturer, review your terms going forward. Look around for offers from
others to give yourself something to barter with, but you should always be
looking for a better deal. If you’ve been a good customer, they will want to
keep your business. Be realistic and polite about it, and respect their
business, but don’t blindly continue into another contract with a company
without making sure you’re getting the best deal possible.

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