Here’s a big list of 50 tactics you can use to help manage your costs:
Financial Planning and Cash Flow
1. Develop a precise budget and regularly track all business expenses.
2. Consolidate debt or refinance loans to secure lower interest rates.
3. Implement spend management software (e.g., Ramp, Bill’s Spend & Expenses) to enforce budgets at the employee or vendor level and gain real-time visibility into cash flow.
4. Hold a weekly meeting to review a rolling 13-week cash forecast, proactively addressing any near-term liquidity issues.
5. Schedule monthly or quarterly reviews of all expenses to identify new savings.
6. Use a modern banking solution (e.g., Relay Bank) to create multiple accounts aligned with Profit First principles, ensuring you allocate profit and limit overspending.
7. Consider using debt to fund strategic initiatives, focusing on low-interest options such as SBA loans, or loans from trusted sources like friends and family.
Vendors and Suppliers
8. Negotiate discounts with vendors or suppliers to lower procurement costs.
9. Conduct regular price comparisons for essential services.
10. Bulk-purchase frequently used items to take advantage of volume discounts.
11. Shop around for better shipping and logistics deals.
12. Consider bartering or trading services with other small businesses.
13. Defer or float certain accounts payable invoices as long as possible unless they offer discounts for early or on-time payments.
14. Arrange contractor agreements to receive payment after the related sales invoices have been collected.
15. Have controls in place to ensure payables are not accidentally double paid.
Operations and Efficiency
16. Automate repetitive processes to reduce labor costs.
17. Consider hiring a Lean Six Sigma consultant or similar expert to streamline processes and reduce operational waste.
18. Implement energy-saving measures to cut utility bills.
19. Leverage cloud-based solutions to reduce hardware and maintenance expenses.
20. Encourage employees to adopt cost-conscious behaviors.
21. Cross-train team members to minimize the need for specialized contractors.
22. Monitor and manage inventory to avoid overstocking or spoilage.
23. Conduct routine equipment maintenance to prevent expensive breakdowns.
24. Manage travel costs by booking in advance and leveraging virtual meetings.
25. Encourage digital record-keeping to reduce paper and printing expenses.
26. Use dedicated spend management platforms (e.g., Ramp, Bill’s Spend & Expenses) to automate expense approvals, set spending caps, and minimize administrative overhead.
Workspace and Workforce
27. Outsource non-core tasks to save on hiring full-time staff.
28. Adopt remote or flexible work policies to minimize the need for physical office space, thereby reducing overhead and utility costs.
29. Negotiate favorable terms with landlords when leasing workspace.
30. Invest in employee training to increase overall productivity.
31. Work with your benefits broker to ensure you are not overpaying for health insurance or retirement plan costs.
32. Consider using high-quality, cost-effective payroll platforms like Gusto rather than traditional options such as ADP or Paychex.
Overhead and General
33. Use free or open-source software instead of paid solutions where possible.
34. Review and eliminate unused or redundant subscriptions.
35. Regularly review insurance policies to ensure competitive rates.
36. Bundle services (phone, internet, software) to qualify for package discounts.
37. Utilize credit cards over paying directly from your bank account for a 30-day interest-free loan.
38. Sign up for credit cards that have a high percentage point for cash back rewards or points for expenses you are likely to incur like airfare or lodging.
Marketing and Advertising
39. Track and measure ROI for all marketing campaigns to focus on effective channels.
40. Use loyalty and referral programs to foster cost-effective customer acquisition.
41. Implement strict campaign budgets and caps.
42. Use detailed analytics for data-driven optimization.
Products and Services
43. Evaluate and discontinue low-margin products or services.
44. Negotiate bulk discounts for raw materials or key inputs.
45. Adopt lean inventory methods to reduce storage and spoilage costs.
46. Standardize product designs or packaging to cut manufacturing complexity.
47. Assess automation opportunities in production to improve efficiency and lower labor costs.
Sales
48. Implement a lower base salary with a higher commission structure to align sales rep pay directly with performance.
49. Tie commission rates to profit margins to encourage sales of higher-margin products or services.
50. Link sales commissions to collected invoices rather than just closed deals to mitigate unpaid revenue risk.
