Three Easy Ways to Boost Profit
Too often, we see businesses whom believe an increase in sales is the only way out of profit problems!
It’s true - growing sales is one part of the equation to expand profit. But many times, when sales expands, business owners typically find ways to spend that extra money.
There is a way to expand profit, you can implement tomorrow, without hustling to grow sales: cutting costs and doing things cheaper (or finding ways to manage expenses more efficiently).
Our trick? Check your subscriptions and monthly fees, first!
Local Union always encourages you to review your subscriptions and monthly fees from time to time and identify opportunities. Internally, we are about to lap our annual launch date (the time we signed up for numerous annual subscription). So before they charged our credit cards, we reviewed what we’d been paying and found out we could save more money!
Three, super-easy cost savings initiatives saved us $431! Check out the three easy was ways below to manage your costs.
Switch to annual memberships vs. month-to-month
Start by looking at all of your monthly subscriptions. When you start a business, month-to-month seems like a better option because it’s less initial upfront cost, but in the end you will pay ~20-30% more for the service over a 12 month period. Here are two examples for our own business:
Squarespace Savings: Local Union switched from paying $26 per month with square pace to $216 for an annual subscription. That’s $96 in savings
Canva Savings: Local Union switched from paying $12.99 a month for Canva to $120 for an annual subscription. That’s $36 in savings
Review your expenses. Say good-bye to no value add
Before a service auto-renews, you’ll typically start to receive emails alerting you of the upcoming renewal. Take this opportunity to consider whether this expense you’re paying has provided you the value. If the answer is no, then eliminate the expense and capture the cost savings.
Our recent example :
When we formed our business, we signed up for a registered agent because we didn’t know exactly what to expect in terms of requests or notifications. The Registered Agent service was up for renewal and we decided we could do it ourselves, so we eliminated the expense and will save $299.
Negotiate lower terms or find cheaper alternatives
Another great way to save money is to look at all of your expenses and review suppliers, shop for different insurance providers or even negotiate with your landlord for stable rent or discounted rent. We’ve seen businesses physically move right down the road to get cost savings, so don’t be afraid to consider all options.
Even if you make one change to your business to manage costs, that’s a net positive to your future profitability. As entrepreneurs, we need to be long-term focused and realize that the decisions we make today will impact our future businesses.
A former colleague of ours always said, “Do something today that your future self will thank you for.” Reviewing costs and identifying savings is exactly that.