Six ways to cut business expenses in a time of rising costs.

Business budgets are being stretched further than ever by increasing costs for everything from labor to energy. Discover a few tips for making your money go further.

Buy used equipment and furniture

Make it part of your purchasing process to ask if used or refurbished products could meet your business needs. In addition to taking advantage of lower purchase prices, you’ll also save money on sales tax.

Audit energy use and take advantage of rebates

No matter what your business produces, you need energy to make it happen. To ensure you’re using energy wisely, consider an energy audit.

Consumers Energy provides advisors to identify ways businesses can increase energy efficiency while offsetting the cost with rebates up to 35%. For example, the energy company worked with McLaren Healthcare to achieve $1.6 million in annual energy cost savings and earn over $230K by simply switching to LED lighting.

Evaluate your space

The COVID pandemic changed the ways we work. In many workplaces there’s a significant amount of unused or underused space.

If you lease space, consider whether you could make do with less space thereby saving on lease payments.

If you own your space, can you reduce the area designated for your operations and lease out excess space to another business?

Analyze the profitability of each customer

Evaluate how much time and money you spend on each customer. Compare this investment of resources with how much profit each customer brings in. Consider letting go of less-profitable customers so you can focus efforts on your most profitable accounts.

Ask for discounts

In some cases, you can get a business discount simply by asking for one. Other ways to save money on a bill include offering to pay in full right away or offering to pay by check. For vendors, fast payment means better cash flow and paying by check allows them to save on credit card transaction fees by 1.5% to 3.5%. 

Use ACH debits and credits

Eliminate the expense of paper checks by paying employees and suppliers electronically. ACH debits and credits also improve efficiency and cash flow management.

Do you have business banking questions? Contact our knowledgeable Commercial Loan Officers online or call 800-991-2221. We’re also available to help in person at your local office.

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