8 Ways To Reduce Your Monthly Business Expenditure

Even the most successful of businesses inevitably face a cash crunch or two during their lifetime during which paying bills, giving employee wages, handling operational costs, etc become a nightmare. Here’s how to avert such adverse events through cost-cutting strategies.

We’re not talking about laying off employees or cutting corners from an already tight budget. We’re talking about practical ways like the ones below to save your business a substantial sum of money every month.

Make friends with technology

Is that document submission process taking too long? Is accounting eating into your team’s valuable time? Use technology! Many companies feel that investing in such products is a waste of money but very few realise that time is money. Using products and services saves time and minimises instances of manual error, making work smooth and thereby, giving more room to creativity.

Test before you buy

Seasoned shoppers all have one mantra; “One needs to shop around before buying.” Similarly, companies too should not jump on a product and purchase it for the entire team. Most products offer free trials or discount offers for the first month which gives your team to test it out and then purchase it. In case the tool does not offer free trials, buy it for an individual before purchasing for the entire team. Make sure to compare different products available in the market, consider their pricing, read reviews by peers, etc before making a decision.

Buy in bulk

Buying in bulk is a money-saving principle used by businesses, big and small. Be it the retail shop owner across the street or designers who bulk buy fabrics to make profits, it is always cheaper to purchase in bulk. Buy essentials like office supplies, like paper, printer cartridges, etc or products like tissues, coffee, etc. in bulk. You may be able to save thousands this way.

Track every little expense

Keep a record of all miscellaneous expenses or buy tools to track every kind of expense no matter how small or insignificant they look. Small expenses often add up and create bottlenecks when claiming taxes. The best way to track these expenses is to save all the receipts and review credit card settlements at the end of the month. There are many apps and service products that can help with this.

Review expenses every quarter

Purchased a SaaS tool last quarter? Don’t forget to stop the subscription once you no longer require it! If you forget, you will find that your business is burdened by services you never use that simply weigh down the balance sheet.

Find creative alternatives to traditional vendors

Some services are required by every business irrespective of their size. If you are looking for HR and Recruitment services don’t just rely on conventional options but explore and then select the agency or services based on your requirements.

Apply credit card rewards points for gift card purchases

Use your credit card reward points to purchase gift cards to minimise business expenses like employee gifts, office supplies or travel. You can save thousands with these points.

Renegotiate your payment terms and timelines with clients

If yours is a B2B Business and your clients ask for payment terms of 30-90 days, offer them a discount on their next purchase in exchange of timely payment. Alternatively, you could also give a discount on current invoices in return for early payment that can boost your business growth and maintain a healthy cash flow through invoice discounting platforms.

Developing Innovative Products

Phase 0: Feasibility Analysis

The goal of this phase is to identify existing technology to achieve the intended high-level function. If technology can be purchased as opposed to developed, the scope of subsequent development phases changes.

Simply put, product development companies research and assess the probability that the current technology can be used to reach the intended functionality of the product. By doing this, the development efforts are reduced, which in financial terms represent a great reduction in development costs.

Moreover, if the technology is not yet available, then the assessment can result in longer development cycles and the focus moves into creating the new technology (if humanly possible) that can accomplish the functionality of the product.

This is an important part of the in any product development process because it is safer and financially responsible to understand the constraints that a product can have prior to starting a full development cycle. A feasibility study can cost between 7 -15 thousand dollars. It might be sound very expensive for some, but when it is much better than investing $100k+ to end up with a product that no manufacturer is able to produce.

Phase 1: Specification or PRD (Product Requirements Document) development

If your product is feasible, congratulations! you are a step closer to creating your product and you can move into documenting what is going to go into the product itself, aka the guts (product objective, core components, intended end-user, aesthetics, User interphase, etc).

In this phase, product design and engineering focus on documenting the critical functionality, constraints, and inputs to the design. This is a critical step to keep development focused, identify the high-risk areas, and ensure that scope creep is minimized later.

This document will help you communicate the key features of your product and how they are supposed to work to all members of your team. This will ensure that you keep everyone involved on the same page.

Without one, you are more likely to stay off track and miss deadlines. think about the PRD as your project management breakdown structure (BDS)

Phase 2: Concept Development

Initial shape development work identifies options for form, as well as possible approaches for complex mechanical engineering challenges. Initial flowchart of software/firmware also happens here, as well as concept design level user interface work. Aesthetic prototypes may be included in this Phase, if appropriate. Prototype in this phase will not typically be functional.

Phase 3: Initial Design and Engineering

Based on decisions made at the end a concept development phase, actual product design and engineering programming can start. In this phase, Level 1 prototypes are often used to test approaches to technical challenges.

Phase 4: Design Iteration

This part of the project is where we focus on rapid cycles, quickly developing designs and prototypes, as the depth of engineering work increases. This phase can include Level 2 and 3 prototypes, typically through multiple cycles. Some products require as many as twenty prototype cycles in this phase. Others may only require two or three.

Phase 5: Design Finalization / Optimization

With all assumptions tested and validated, the design can be finalized and then optimized for production. To properly optimize for production, product design and engineering teams take into account the target production volumes, as well as the requirements of the manufacturer. Regulatory work may start in this phase.

Phase 6: Manufacturing Start and Support

Before production starts, tooling is produced, and initial units are inspected. Final changes are negotiated with the manufacturer. Regulatory work also should wrap up in this phase.