In your effort to cut costs, examine each expense, no matter how small, and determine which items you can do without. Don’t hesitate to cut items that don’t directly contribute to your bottom line. Consider trimming extras or perks, such as snacks for the break room.

Create reports every week to examine both your expenses and revenue. Make adjustments as needed, especially when you notice that you are spending more than your budget allocations. Areas important to your business’s revenue, such as production-related expenses and marketing should be among the last items cut.

When reviewing your expenses, consider cutting in the following areas:
Inventory: Review your inventory and determine which items are not selling as well as other products. Consider discounting products with slow turnover and only placing orders for products with committed orders.

Vendors: Consider contacting small-business partners or associates to ask if they’d like to share the expense of certain products to obtain quantity discounts. Contact longtime suppliers and ask whether you can negotiate payment terms and/or get a discount. If you’ve had a good relationship with suppliers, remind them that you’ve been consistently committed to prompt payment.

Reduce overall expense spend. We identified $3M at one retailer in discretionary spend which included annual departmental weekend trips, purchases at specialty retailers and a reduced level in charitable contributions – all of which was accepted by the executives.

Use the total cost of ownership (TCO) to determine materials purchases. One manufacturer reduced on average 5% across all categories for purchases by Levitra Professional incorporating these costs into their analysis – unit purchase price, transportation, purchasing and transportation administration, inventory carrying costs, shrink, damages, and warranty costs.

During these challenging economic times, managing expenses has increasingly become a priority for many small-business owners. In fact, many have taken inventory of their expenses and are taking steps to control costs in 2010.
Are your company’s Business Expense Management Solutions and is your Business Strategy Consulting Partner working to implement strategic plans that your competitors cannot implement as effectively? Our Expense Management Consulting Team understands that your competitive advantage is critical. It is the reason you are in business. It is what you do best that draws customers to buy your products and services instead of your competitor’s.

Extremely successful companies deliberately make choices to be unique and different in their cost control planning and they focus portions of their energy in Expense Management.

If you are a small business owner looking for ways to manage expenses, you can begin by reviewing your finances to determine if are you incurring losses, breaking even or just barely making a profit. If you are losing money, it may make sense to trim enough costs to counterbalance those losses.

Author Bio: Tom Mann

Business Operations Director who creates incredible overhead savings in: property leasing, employee benefits expense, equipment, office supplies, vendor contracts, phone systems/cell phones, general utilities, fixtures, facilities, fleet vehicle expenses, insurance policies, site cleaning – EVS cost, parking, landscaping/grounds.