Register now or log in to join your professional community.
1. Reduce supply expenses. Save money on office supplies by contacting vendors to let them know you’re price shopping. Look outside your pool of traditional vendors. Large discount suppliers like BJ's, Amazon or Wal-Mart can often beat traditional office supply vendor prices.
2. Cut production costs. As a business owner, you're always looking for ways to cut material costs, and optimize your resources. Here are a few suggestions:
Try selling leftover cardboard, paper and metal instead of sending it to the recycling center. Also, consider ways to use your waste to create another product.
Make sure you're getting the most out of your production real estate. Centralize or consolidate the space necessary for production. Lease unused space to another business or individual—it can be as small as an office or as big as a warehouse space.
Track and measure the operational efficiency of your business, in order to adjust and optimize the use of available resources. Set performance parameters that reflect your efficiency goals and offer incentives when those goals are met.
3. Lower financial expenditures. Look at your insurance policies and financial accounts for places to save money.
Save money on insurance by comparing providers for the most competitive rate; then ask your current lender or insurance provider to match that rate.
Consolidate insurance policies or bank accounts if possible.
Evaluate insurance policies to make sure you're not over-insured or duplicating coverage.
Don’t take on unnecessary debt. Do a thorough cost-benefit analysis and future forecasting when considering business expansion. Consider the opportunity costs and the effect of debt payments on cash flow. Excess debt affects company rating, interest rates and the ability to borrow in the future.
4. Modernize your marketing efforts. Of course, you don't want to eliminate paid advertising that is working; however, it can be worthwhile to take a look at some cheaper alternatives.
Build your customer e-mail list and implement a referral program. A recommendation from a current customer is far more likely to result in a sale than traditional marketing.
Network more, advertise less. Clients are more likely to hire a business with a face they recognize.
Cut marketing costs by doing more in-house.
Increase social media use and reduce traditional marketing.
5. Use efficient time strategies. Optimizing productivity effectively lowers your cost of doing business. Remember, wasted time equals wasted dollars.
Minimize distractions and limit access to time wasters. Use apps like Focus Booster or Rescue Time to help employees focus and concentrate to stay on task.
Utilize software such as Paymo and Toggl to track employee time usage, time spent on different types of work activities or projects and billable hours.
Set expectations for a reasonable amount of time to complete certain types of activities or tasks. Offer incentives for meeting or exceeding those expectations.
Schedule business activities and encourage employees to adhere to the daily or weekly schedule.
Schedule a predetermined block of time for meetings. Make it clear that you expect participants to be on time, to stick closely to the agenda and to wrap up at the appointed time.
6. Harness virtual technology. Reduce business costs by operating in a virtual manner whenever possible.
Virtual meetings help minimize travel expenses and virtual offices can eliminate the need for physical space. While we certainly don't want to eliminate personal contact altogether, save it for the instances when it's most beneficial.
Technologies such as Google docs (soon to be Google Drive) or Basecamp centralize company documents and product collaboration as an alternative to paper documents and meetings.
7. Narrow your focus. As a small business owner, I find narrowing my business focus to be one of the most effective strategies to improving my bottom line. By limiting the types of services I offer and projects I accept, I am more productive and produce higher-quality work.
Another way to narrow your business focus is to subcontract. Rather than turn away business, maximize your capacity by subcontracting pieces whenever possible. More projects equal more revenue, while subcontracting equals lower expenses. The result is a better bottom line.
8. Make the most of your space. Analyze your current use of physical space. Overflowing storage, too many supplies, piles of paper files and inefficient placement of furniture and equipment are common space wasters.
Consolidate or centralize the different functions or departments of your business. Use space for dual purposes. A meeting room that doubles as a break room or a storage room that holds copy and fax machines for example. The opportunities will vary depending upon the nature of your business.
9. Maximize your employees' skills. Assess the current usage of employee experience and skills. Give responsibilities to the employees with the most skill and efficiency in those areas. Don’t use expert sales people for word processing or “numbers” people for design functions. It's often necessary for one person to be responsible for a variety of tasks, but consider exchanging some of those tasks with another individual who shows greater efficiency.
10. Focus on quality. Quality sells whether in the form of products or services. Satisfied customers increase sales through referrals and repeat purchases. Higher quality and a solid reputation allows you to charge higher prices, which equals higher revenue and a healthier bottom line.
Cutting cost can be done by better organization (i.e. giving different duties to the existing employees and if needed training them for additional duties). This means that each of them should put effort to cut the cost for the company, by search for cheaper solutions in company procedures. This will give them a feeling of respect (without increasing the salary) and also they will know that this way they will keep their job and make the company healthy. Of course, this is everyday's struggle, depending on the situation in the company, if somebody from the company is constantly putting money in his pocket you can not help the situation so easy.
One tool
Menu engineering
highly priced items make good revenue and are usually high in cost; in which you don't want cut, that tool pinpoints such variations and more, it's already integrated in new micros pos modules, need to know how to program it though
Hire skilled staff, maintain proper quality control system, streamlining of work flow and goods, optimize labor cost, reduce supply expenses, process optimization, automation of key functions, drawn clear marketing and strategy plans.
Maintane Smooth And Normal Operation Of Equipment, Preventive Maintenance, Those Can Reduce Of Costly Maintenance.
Proper Planning and execution/followup will reduce the cost
For Countries Like India & Pakistan Where Cost of Diesel is High & Labour Cost is less, you can control your spending by tracking machinery diesel consumption and try to finish work in/before schedule time.
For Countries like Saudi Arabia, Kuwait & Qatar etc. where cost of labour is high you can control your spending by tracking manpower or by recruiting honest & hardworking workers in lower & middle and of course by finishing project in/before schedule time.
In professional kitchen operations you have to keep focus from bottom to top and specially in the middle you can do all perfect things to cut your cost but you always dependent on your staff. The main things in operations which cause high cost and those we have to control are, make standard Portion Size of platter and very very important thing is wastage control, schedule a training and awareness lectures to food handlers that how to control on wastage, your staff is the totally responsible for internal operations so choose honest hardworker, educated and motivated staff and a highly trained Head of department your management must play an important role in your business. so always keep an eyes on their performance.
Hi,
If you are dealing with F&B operations please consider downsizing your team to the minimum. And work with company that could provide HR team for specific periods.
For example, you could consider stablish a contract with a hr company for the breakfast period only.
1. Benchmark productivity against LY, Industry and competition to have indicators for productivity.
2. Operational expenditure by line item have ratios compared in accordance with business, margin, break-even level and then push either bottom line or top line depending on market/performance to balance costs at ideal ratios.
3. Major cost measure put them under threshold and an approval process beyond threshold.
4. Improve product quality by developing vendors and reduce cost by exploring new vendors who are competent.
WELL to start with ... i wont agree on the phase of cutting cost ... cutting that's mean to reach zero cost and that's impossible or at least its a losing mission .. i will go with ( managing cost )
cost means i have base cost and i have expenses cost ..
base cost should be reviewed comparing to my selling price
and if its necessary to raise my price or to start to change my suppliers to get a better prices to keep my prices in the same level for my clients.
expenses cost:
means that i have to go through all my elements in the P&L statement
delegate targets
giving tie pound to achieve
action plans for the opportunities i have.
after getting the results of that i will decide to maybe change the team i have or some of them.
Do you need help in adding the right keywords to your CV? Let our CV writing experts help you.
