There’s nothing better than working for yourself.
It’s why the Dot Com lifestyle is such a coveted goal.
And at no time in our history has it been so attainable.
One of the most important factors in keeping it attainable is to manage your costs, and this is where small business owners need to be resourceful.
Implementing these effective cost management techniques are ways to keep your operation afloat, even in a tough economy:
1. Minimize overhead
One of the quickest ways to get in over your head financially is with exorbitant overhead costs.
If they’re eating away your profit, you should brainstorm some ideas to cut back.
You should look into dropshipping for your online sales. Rather than having to pay inventory storage costs, a manufacturer or wholesaler will send products directly to the consumer. This can lead to substantially higher profit margins while improving efficiency.
2. Capitalize on technology
The right technology can be an entrepreneur’s best friend.
Not only does it streamline many business operations, but it levels the playing field and allows small businesses to compete with much larger ones. There are numerous options you can implement and customize to meet the specific needs of your business.
Here are a few possibilities.
- Customer Relationship Management (CRM) Software – This revolves around software to streamline and automate areas such as managing contacts, customer service, email, social media, and technical support. By keeping things organized and spotting trends, you ensure that your business is equipped to keep customers happy while increasing productivity.
- Enterprise Resource Planning (ERP) Systems – Using this type of technology helps you create a solid infrastructure while maintaining steady operations. This often covers the financial/accounting side of business, sales, inventory control, and customer service. There are even vendors like Exact Globe and NetSuite that are specifically designed for small businesses.
- Cloud Apps – Cloud computing has become an increasingly popular option for businesses because of its safety, security, scalability, and convenience. While the term cloud computing can encompass numerous processes, cloud apps like Google Drive, Evernote and Dropbox are simple solutions for small businesses. They allow you to create and store documents, spreadsheets, slideshows, images, and other items with ease. Rather than backing them up on traditional hardware devices like disks and USB sticks, everything is securely saved in the cloud, where it can be accessed on a variety of devices from anywhere in the world with Internet access.
3. Outsource projects globally
This is another of the cost management techniques that’s become possible, in part, thanks to the Internet.
If you have certain tasks that don’t require employees to work in-house, outsourcing projects to workers around the country or even the world can be a lifesaver. Not only can this save money, it gives you access to some of the brightest talent there is. Platforms like Skype and Google+ Hangouts offer face-to-face interaction to provide effective communication.
While small businesses don’t always have the deep pockets of larger businesses, it doesn’t mean they can’t thrive. Being smart and optimizing your business’s efficiency can quickly elevate you above competitors who use outdated techniques.
By cutting your costs, you can drive larger profits while building a strong foundation for the future.
Author Nick Mann has covered the business world for the past four years.