5 Big Costs Every Business Should Reduce Immediately
COVID-19 has deeply impacted industries around the world, with job markets everywhere being hit, hard. Layoffs, furlough, and government assistance have become the new norm for millions. The US is currently poised to break unemployment records with at least 22 million unemployed, and counting.
No one knows how long the pandemic could last, so organizations need to figure out what costs they can cut to halt the loss of jobs and rapid saturation of unemployed people on the job market. The question is, what business costs should your organization reduce immediately to ensure it survives the COVID-19 storm.
A lot of organizations rely heavily on professional services to expedite or alleviate the issues that they face in the business world. Consultants across all industries are an excellent example of this. While they’re hugely beneficial during times of prosperity, when cash flow is stable, they’re an unnecessary expenditure when times are hard. Nobody needs to spend $500+ a day on a specialist in a specific niche while their income is faltering, and fulltime employees are at risk of losing their positions. Keep it in-house for a while.
Marketing, Advertising, and Entertainment
Alongside wages, organizations put a lot of money into their marketing campaigns these days. Short, engaging clips on the TV, radio, social media platforms, YouTube, you name it, organizations have tapped into it. Well, in a pandemic, people are losing their jobs. They’re cutting back on personal spending and non-essential goods. Your business could probably do the same if you stop advertising your world-class, futurist vacuum, too. And, if you’re helping out the government during this crisis, then your advertising is done for you: you’re already being recognized for your commitment to fighting our newfound invisible enemy.
Soft Spend or Overall Indirect Spend
To avoid staff cuts, you can go down various other routes to save money. The first aspect of your business outgoings to consider is your “soft spend,” or the bits needed for business operations that you can pause for a time. For example, if you’re a skeleton-staff for the coming months, you probably don’t need to order in the same amount of stationery you usually would. If you have subscriptions to non-vital software, tech systems, and overspends on your utilities, find and address them. Every little bit helps.
Wages & Benefits
While nobody wants to make staff redundant, unfortunately, wages tend to take up a huge chunk of any organization’s outgoings. So, if you have numerous employees who aren’t imperative to everyday operations, it could be time to review your staff roster and make cuts where necessary. This should be a last-chance saloon option, though. Always explore the other options available before making dismissals, and take a look at what the government is currently offering employers and employees to help in these trying times.
In most businesses, some excesses aren’t needed—particularly lavish furnishings, the newest expensive software on the market, subscriptions to services that aren’t required for the job at hand—those sorts of things. There are probably a few within your workplace. If it’s not an absolute requirement to get the job done, you don’t need it! Make the cut.
Times are hard right now, and at AMPlify, we understand that. Our team of specialists is looking to provide the most valuable articles to ensure that you, your organization, or the organizations around you survive through the pandemic. Keep up with our blogs, and you’ll find that we’re offering you a helping hand—with sound, business-savvy advice in support of your business longevity.
Stay safe out there.