You don’t have enough people to get the job done, do you? There comes a time when a small business owner takes a step back, looks at his business, and realizes that his team isn’t large enough to permit growth. However, often times he hasn’t hired more people because it isn’t financially possible. So, he’s stuck between a rock and a hard place. Hiring before the finances permit can be frightening. In fact, any investment that needs made before we’re ready can be.
But there must be a way to afford growth without killing the finances!
There is. Just like when things are tight at home, it’s time to figure out how to make appropriate cuts to free up a budget. We’ve all got some level of waste in the business, so we can all find areas to free up dollars somewhere. We just have to look at what we’re spending with rational eyes and a head full of information. If we still can’t find a way to cut spending, we need to look at alternatives. Let’s run a quick checklist of commonly overlooked financial waste, shall we?
- Do you do your own marketing? Unless you’re a marketing company or a very large company, it’s probably not in your best interest to run with an internal marketing department. Chances are, your budget isn’t big enough to hire the kind of person on staff that can make the sort of impact you need made. Outsourcing your marketing allows you to leverage much greater talent at much lower costs.
- Your IT department doesn’t work every day. If you have a 40 hour per week IT person on your staff and don’t have at least 100 computers on your network, there is a strong chance that 15 of those hours are spent on Facebook or some tech blog. Add that to the bathroom breaks, the probable smoking breaks, and the regular time wasting that all employees do, and you probably only have an IT guy that works 2 days a week. Get rid of in-house IT until your internal network is huge.
- Do you have the right team? Lets pretend for just a minute that you have a social media team on hand. It is comprised of either minimum wage employees or unpaid interns. Unless your interns are going to school for journalism, you don’t have the sort of content creators that are doing any good for your business. Get rid of that team. Hire the right people at the right pay, and a team half the size will do twice as much.
- Is your equipment (computers, vehicles, etc) poorly maintained or outdated? The cost-to-benefit ratio of proper equipment maintenance is huge. Fixing problems as soon as they are identified – and fixing them the right way – will save you huge amounts of money over the long term, no matter how much the current cost. And, if the equipment isn’t worth fixing, replace it asap.
There are probably tons of other areas that can be looked at, but this article would be way too long if I went over them all. Suffice to say, though, that a lean expense sheet is the most profitable way to run a business, and you’ve got to think outside the box if you want the sort of resources available to a larger budget than you have. Take a look at this CNBC.com story. Elaine Pofeldt shares how a one-man-show can turn $1M in revenue by keeping expenses lean.