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100+ Ways to Reduce Expenses and Increase Profits

100+ Ways to Reduce Expenses and Increase Profits

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These are 100+ innovative solutions to help leverage your expenses to produce more profit.
These are 100+ innovative solutions to help leverage your expenses to produce more profit.

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Categories:Types, Business/Law
Published by: Sapient Business Solutions, Inc. on May 16, 2010
Copyright:Attribution Non-commercial

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09/27/2013

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 1 www.Sapientbizsolutions.com
100+ Ways to Leverage Business Expenses And Increase Your Profits
Payroll1.
 
Cut back principals' salaries. Pay yourself last, after paying all other expenses.Although this may seem obvious, many companies have developed seriousfinancial problems because the owners kept taking out large salaries.2.
 
"Lease" your employees. Instead of laying off an experienced secretary, leasehim or her to another company until business picks up again.3.
 
Change from a weekly pay period to a biweekly pay period to give youbreathing room and give you more days of interest.4.
 
Use temporary help whenever possible when your business substantiallyincreases. You can first let go the temps, then the permanent employees.5.
 
Use part-time support staff. They don't require benefits and usually have moreflexible hours. Laying off a part-timer, or cutting back their hours, is much easierthan a long-term loyal, full-time employee.6.
 
Have a cost cutting brainstorming session with your associates and support staff.If you're working alone, set up a lunch with your accountant or other businessowners to swap ideas. You'll get many ideas you've never thought about before.7.
 
Use an outside payroll service such as Paychex , ADP or other payroll companiesto cut bookkeeping payroll costs. Or, do it yourself by using a simple softwareprogram like Quickbooks. Don't use a CPA to do your bookkeeping. (Or useMint.com)8.
 
Broaden staff responsibilities/Cross Train. For example, instead of paying anoutside bookkeeper, have your secretary do it. If you have to lay off a full-timesecretary because your work has dropped, consider letting a less experiencedassociate do part-time clerical work. At least they'll have some income. Insteadof having outside firms do janitorial and delivery services, have your employeesdo it. It's better than getting laid off, or sitting around worrying about getting laidoff.9.
 
Cut your FICA and FUTA by setting up non-cash compensation, such as a"cafeteria" benefits plan with such benefits as health insurance and paid time off.10.
 
Use college interns or co-op students for research, setting up databases, etc.They work for credit or a low salary on a short term basis and can work onspecific projects, or on general research.11.
 
Get free or low cost consulting from a local college business school's smallbusiness consulting programs, or the SBA's SCORE (Senior Corps of RetiredExecutives) program. They can give you advice on such topics as marketing,collections, and cost accounting.12.
 
Changing monetary incentive or perks program to reduced or non-monetaryincentives for employees.
 
 2 www.Sapientbizsolutions.com
a.
 
Change bonuses to other non-monetary incentives (i.e.: gift certificates,recognition, corner office, CalPerks, etc.).13.
 
Use reward points from credit cards to fulfill needs for the organization.a.
 
I.e.: Buy a new printer with points, buy gift cards to use for incentivizingemployees, etc.14.
 
Train employees to be more efficient with time, effort, resources and money.a.
 
Instead of hiring a manager or additional employees to meet the needs ofthe business, thereby incurring more expense, train employees toleverage their time, talents better to accomplish more (i.e.: 80/20 rule,etc.).15.
 
Find interns to work in your industry who will work for free.a.
 
Use an internship program from an accredited school with liabilityinsurance coverage.16.
 
Convert pay scale to a commission based, or a per diem (per item) system.a.
 
Works for new hires, sales positions, collections, etc.17.
 
Hire all new employees as part-time or temporary employees.a.
 
Saves money on benefits.18.
 
Recruit employees for temporary work through a temp agency.Insurance19.
 
Review coverage - Check for unnecessary or repetitive coverage.20.
 
Negotiate rates.21.
 
Increase deductible.22.
 
Lower coverage for employees.23.
 
Ask employees to pay more for coverage.24.
 
Establish health savings accounts for employees.a.
 
Set up a so-called flexible spending account, which allows youremployees to pay their share of health-insurance premiums and un-reimbursed health-care expenses with pretax dollars. A flexible spendingaccount could save employees 20 cents to 35 cents on the dollar,because state and federal income taxes and Social Security taxes are notimposed.b.
 
Moreover, the company saves by reducing the employee's base salaryon which it pays Social Security and other taxes. Hire an outside payroll
 
 3 www.Sapientbizsolutions.com
accounting firm to handle the paperwork. You can pay the service feeand still come out with a net savings. The monthly administration feewould run between $2 and $5 per employee.25.
 
Change to an HMO.26.
 
Join a group - business associations (Chamber of Commerce).27.
 
Bundle/Split insurance for a discount.28.
 
Be sure you're not overpaying for workers compensation. If your insurancecompany insists on classifying them in a high rate category, change insurers. Ifthis year's workers comp is based on last year's employment, be sure to notifyyour insurer if this year's payroll is expected to be lower.29.
 
Transfer your employees to a professional employment organization and havethem leased back to you (reduces worker's comp insurance premiums).30.
 
If justifiable, make employees shareholders with responsibilities commensuratewith stock ownership (Owners are not required to carry workers compensationinsurance).31.
 
Separate your low and high risk employees into separate entities. Must be donecorrectly.32.
 
Look at your auto insurance coverage. Consider dropping collision on oldervehicles. If the car is only worth $1,500, why pay $200 per year extra forcollision?
33.
Raise deductibles on such coverage as auto collision, disability,property/casualty, and liability insurance. For example, have disability insurance"kick in" after 90 days instead of 30 days.
34.
Evaluate all your insurance policies for their risk/benefit, and decide which onesyou think you will really need. Don't overinsure.Cost of Goods35.
 
Negotiate a temporary discount for period of time.36.
 
Negotiate flexible terms - More expense during busy months, less expenseduring slow months.37.
 
Outsource - manufacturing and distribution.38.
 
Do not make it in-house - outsource and drop-ship.39.
 
Dollar Cost Average - Buy expensive items while getting discounts on others.

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