When we think of growing a business, we tend to think of how we can boost revenues. And when we think of boosting revenues, we usually think about where and how we can invest in the business. We all know it takes money to make money, so this makes sense, but you need to be careful about doing this, as an increased investment doesn’t always lead to a proportional increase in sales.
In fact, it’s basic economic theory that as you grow your returns will start to diminish. So if you don’t take up good cost management techniques, then your overhead will explode, and you’ll soon find yourself running out of money. And this is a common problem business owners run into. In fact, the number one reasons small businesses fail is because of improper cash flow management.
As a result, the trick is to not only find ways to cut costs but also to find ways to reduce expenditures that can boost profits. In other words, you need to find ways to optimize your business for maximum efficiency and productivity. And here are some ways you can do just this.
Whether you like it or not, the AI revolution is here, and employing some of these solutions can help transform your business. And there are many different aspects of your business you can automate. For example making use of a payroll automation system will allow you to reduce your accounting team’s workload, keeping this department lean, and also helping to avoid costly mistakes.
But another area where automation can save you tons and also help boost your business is in customer relationship management. These programs can collect all sorts of information about your customers and those who visit your site, and then they can offer you solutions that can really change your business.
To give you an example, most CRM software can be integrated with your email client, and this will allow you to send target email promotions to your customers, encouraging them to complete a sale or to follow up a purchase with something else. It’s a great way to maximize the value you get from each lead, and by automating it, you can do this without really having to lift a figure. Check out this great resource from Neil Patel to help you find the CRM and marketing automation software that can work best for your business.
Next to automating, outsourcing is one of the best ways you can help your business grow while also cutting costs, especially in areas of your business requiring hefty infrastructure investments, such as IT and customer service.
Doing these functions yourself might be okay in the beginning, but as you get bigger, it’s going to get harder and harder to keep up. Specialized firms can incur the required infrastructure costs because they can spread them out among many different clients, so it makes sense to do this as early as you can. This way, when you grow, your overhead won’t expand as rapidly, helping to keep margins high.
And this can often lead to you providing better service. For example, with customer service, using an outsourced firm can give you access to a 24/7 call center, something you could likely never afford on your own. But your customers will appreciate this level of service, and this should translate into better sales and better brand loyalty.
Office space is a huge expense for most businesses. And not just the monthly rent payment. You’ll also need to pay for utilities, supplies, insurance, and much more. But when you consider the fact that most people prefer to work from home at least some of the time, then it seems kind of silly for you to incur this expense.
As a result, it might be smart to turn some or all of your operation over to the cloud and become a remote business. You may still want to keep a small office somewhere so that you can meet customers and clients, but the sooner you go remote, then the faster you’ll be able to save. And when you grow, you won’t need to add more space, meaning you won’t need to spend more money.
This is also something your employees will really appreciate. Remote work allows for greater flexibility, and in some cases, it actually leads to higher levels of engagement and productivity. So on top of helping you cut your expenses, this move can also help give you a productivity boost, making it much easier to grow revenues and profits.
A Culture of Feedback
These three solutions will help you trim back on your business’ expenses while also promoting growth. But while you implement them, you should be working to build a feedback culture in your company. Ultimately, your employees will know where you can most effectively cut costs and become more efficient, so it’s important they feel empowered to speak up and let you know where you can be doing better. But start by making these changes and make sure to continuously audit your operation for efficiency and productivity.
Kevin is the founder and CEO of Vast Bridges, which is a customer acquisition and lead generation business that works to help companies find new customers. His passion is helping businesses develop and implement a strategic vision. But in addition to Vast Bridges, Kevin also runs Broadband Search, a service dedicated to helping people find the best value broadband internet in their area.