Costs, Costs, Costs - Small businesses get complacent!
Why is it that so often small business owners really only sit down and review all of their business expenses when they are experiencing a downturn or slump in business income? Sure, it is the perfect time to be evaluating staff requirements, as well as contracts with telephone and internet providers and so on. However, as a small business accounting specialist I would advise you to maintain this practice on a permanent and regular basis.
With small business struggling in our two-speed economy every business owner must take an active interest in their daily expenses to make sure they are maximising every hard earned dollar of income. Often we get too comfortable in our relationships with suppliers and our favourite local stores to see that there may just be a better deal around the corner. Every small business must have a regular plan to evaluate all of their business costs and eliminate what is not necessary to the operations of the business and then re-negotiate all essential expenses to ensure that you are getting the best possible deal from your suppliers.
In terms of negotiating with larger suppliers, it may not always be about price either. Often, it may just be an extension of your credit terms or perhaps improved delivery service that can make the difference.
Remember that if you are able to survive with a lower amount of total expenses now try and keep it that way as your business grows. This will allow your business to flourish when sales improve, as you won't have all those unnecessary costs soaking up your hard earned sales.