Ease The Pain
Events in recent weeks have certainly had a negative impact on revenue for small businesses! With constraints on the top line, now is the time to focus hard on reducing expenses. Restrictions on travel and social distancing initiatives are already taking care of reducing your travel expenses. What about the money you pay your suppliers, though? Let's look at 7 ways to ease the pain you're experiencing ...
FinTeam is currently offering a 20% discount on services. Ask your suppliers if they are offering some sort of discount now, too.
Reduce the breadth of your services to temporarily eliminate the need for certain suppliers. If you run a restaurant, limit your menu for now.
Ask to put certain services on hold for 2-3 months. This approach may work best with advertising spend (radio ads, digital billboards, etc.).
Choose a less expensive package (best with things like internet and phone services) or cancel premium services for those that offer a free version i.e. LinkedIn, Alignable.
Combine like services with the same supplier for a bundle discount. Digital design, social media marketing and website maintenance with the same organization may be an option to consider. Bundling is also popular with utilities.
Fixed vs. Variable
Now that sales volume is down, any service that offers a variable option such as an hourly rate versus a set fixed fee each month could save your business substantial money.
Personally, I do not like this option but I'm including it anyway as some business owners like doing this. It consists of swapping services or products in lieu of paying for them. An example of this would be designing a logo for an accounting firm and asking that they do your income taxes instead of paying you.
In my experience, I have seen all of the above approaches work and save companies tons of money. Here are some other tips to keep in mind:
Review your supplier contracts to see if there is a notice required to terminate. Most contracts require 30 or 60 days. Ask your supplier if they can make an exception. If you have a good relationship with them, they will often comply.
It's a good idea to assess the playground periodically. Though your current supplier and service package made sense several years ago when you signed up, now there are likely new folks on the playground with new and shiny toys. Go check them out.
Sometimes you may stumble across savings. For example: You call to cancel a service and the Service Rep asks why. You say that you are trying to reduce expenses. The Service Rep then tells you there is a promo they can offer you which will allow you to continue receiving the service, but at a much cheaper rate. And guess what? When the promo runs out, call back and you'll probably experience the exact same conversation! SiriusXM is known for doing this.
So, start tackling your suppliers one-by-one and please let me know how successful you are by emailing me at: firstname.lastname@example.org