Ep 44: The BEST Way to Keep Costs Down - Coaching Conversations
Are you struggling with expenses within your profit and loss? In the latest Coaching Conversations, Chris and Business Growth Expert, Tony Crossin, address the subject of business expenses. From rent to wages …. utility bills to indiscriminate purchasing, is it possible to reduce these expenses while still growing sales? Ask yourself, are you doing “spending audits” on your business every month - because that break-down can surprise even the most astute business owner. Don’t squander your profit on cumulative out-goings (they add up when you look ever so closely!) Today, you’ll learn why you need to challenge your levels of awareness. Coaching Conversations opens up the dialogue on what you can do to make even the smallest adjustment to your business expenditure. Here we go…. Time Code/Show Notes 0.22 Welcome to the show and intro. 1.30 Let’s jump straight in. Tony believes every good business must review its expenses every three months! Do you have a consistent approach to checking your expenditure? Tony explains the concept of managing “Two Lines Apart” What initiatives can you take to drive sales up – but what can you do to drive costs down simultaneously? 4.20 There are ways to target expenditure but make sure it has zero negative impact on your customers. Look at cost of goods, look at wages – your big ticket outlays. Tony’s previous restaurant business used 10k in electricity every quarter – he surmised that even a 5% reduction in his power bill would allow him to employ an extra person for the year! 6.05 Awareness is key. Pull out your profit and loss… fine-tooth comb your bank statements. What are you spending? What’s going “out”? Handy tip: Review your subscriptions every quarter! 7.30 Keep a keen eye on indiscriminate purchasing. That extra tool from the hardware… shouting the team lunch. It all adds up. 10.40 Who assumes responsibility? Who takes control of the money? Who pays the bills inside your business? Are they spending where they need to be spending? Chris suggests a weekly Finance Talk to get on top of what’s essential. 13.15 Put someone in charge to keep your eye on expenses and ask questions. Search for ways to systemize or automate so you can drive costs down in a short period of time; essentially, working smarter will reduce incidental costs. 15.50 Chris wants you to become more resourceful. To borrow a company’s mantra “Do More with Less”. Tony looks at how to add 10% to last year’s budget while keeping expenses the same. Is it doable? 18.00 What is the Art of Negotiation? If you’re not negotiating a “Win-Win” you’re negating the principle of “more for less”. You never know what can happen until you ask! If you need any help with P&L’s and reducing expenditure talk to us this week at email@example.com EPISODE SUMMARY It’s time to change your expenditure narrative. No more “Why are we late on this and why isn’t that paid”… No more freewheeling and ignoring the numbers! Keeping a keen eye on expenditure will make your business more profitable. With a greater level of awareness, you’ll know what you’re spending money on. So, think about how you can grow sales and reduce your outgoings – it can be done! Work smarter, not harder ? And lastly, negotiate. You won’t know “what you can get for less”, until you “ask the question”. From internet service to fuel cards, trim the fat where you can. Because that’s your profit. Good luck!