To say that the coronavirus pandemic has hit businesses hard is a huge understatement. When the lockdowns implemented and social distancing was put in place, it has been hard for businesses to stay open, let alone operate.
All industries were affected, not one profession was spared by the pandemic’s adverse effects. Physician, baker, commercial roof installer, divorce attorney, real estate agent, almost everyone felt the negative impact that COVID-19 has brought with it.
Even after the states reopened and several businesses resumed operations, business owners and proprietors have struggled with making ends meet and keeping their businesses afloat. If you’re a business owner, especially if you belong to the SME category, you need to be wiser with how you allocate your budget and cut down on your expenses for your business to survive.
5 Ways to Cut down on Business Expenses during a Pandemic
Take a closer look at your supply chains and make an evaluation to see if you need to renegotiate with your suppliers or look for new ones.
When the coronavirus went global, the world’s supply chain experienced a strain that it never had before, especially since a big chunk of it is coming from China. Other than factors such as reduced workforces and delayed shipping, some supply chains are having a difficult time meeting client demands and deadlines due to economic crises and public safety protocols.
You need to, first, re-evaluate your supplier if you need to look for a new one, and second, re-evaluate your product needs. At this time, you might not need to acquire the usual amount you would normally order. Perhaps you can cut it down by a certain percentage to help bring down your costs.
Check if your service suppliers are offering temporary discounts or assistance programs and make use of it.
Because of the pandemic’s worldwide economic impact, many service providers started offering temporary discounts, payment deferrals, and other means of assistance to help people cope financially with the situation. Check with your utility providers and see if they have something similar that you can take advantage of.
Cut back on any unnecessary expenses for the time being.
Now’s a good time to bring out your budget and see how you’re doing. It is a good practice to evaluate your expenses regularly, not just during a pandemic. Take a closer look at your business’ top three expenses and see how you can bring it down a bit. In business, the top three are usually rental, supplies or inventory, and utilities. See how you can make adjustments or negotiations on these three areas.
Lower your overhead costs by making flexible working arrangements that allow your employees to work remotely.
Allowing employees to work from home is a great way to reduce your monthly expenses if your business model allows it. It significantly lowers your utilities, food expenses, janitorial services, and more. You just need to ensure that your employees have access to all the tools they will need to stay productive at home and that they stay connected to each other and to the company.
Eliminate as much paper trail as possible.
Going paperless will save you not just money but time, too. This means you no longer have to deal with managing payment processes with file cabinets and paper checks. The less paper you use, the less paper you buy. Plus, it’s also a wise thing to do during this pandemic since it lessens the risks of contracting the virus. No physical deposits or exchanges are made, very minimal out-of-office trips are taken, and very low instances of interacting with people who may or may not be infected.
We hope that the above-mentioned recommendations can help you and your business stay above water despite the ongoing condition.