"A penny saved is a penny earned", the old adage attributed to Ben
Franklin, only tells half of the story. A penny saved is really better
than a penny earned, because you don't have to pay taxes on it. Here,
then, are some time-honored ways for you to save money and improve the
bottom line for just about any business:
1. Review and Update Your Business Goals
Many
people are adept at staying very busy while accomplishing nothing of
value. Don't fall into this trap--and, if you do--dig out as quickly as
possible.
In order to succeed, you must set clear goals. If you
have employees, those goals also need to be communicated to them. While
there are many good and noble goals you can set for your business, one
of the most profitable that I often ask myself is "what can I do that
will make the most money the fastest?"
This doesn't mean that
other goals such as contributing to good causes or providing excellent
customer service aren't important. If you don't provide excellent
customer service you won't be in business very long anyway. But goals
can often be clarified by setting them in order, and determining which
will bring the quickest, most long-lasting financial results to your
business is a great place to start.
2. Find your Niche and Develop a Competitive Edge
While
it's hard to compete with the "big boys", there is plenty of room for
small businesses to find their competitive niche. My competitive niche
happens to be log furniture. While there is competition in that niche, I
don't have to compete with the "big boys" such as Walmart when it comes
to selling log furniture. Tracking down Amish suppliers on lonely
country roads, developing relationships with those suppliers, picking
up, packing and shipping log furniture just isn't part of their business
plan. And it probably never will be.
Your niche will probably be
something different than shipping log beds, but you can be sure that
there is a niche open to you. The key is to find the profitable
activity that your business does best, and focus on that.
3. Hire Superior Employees Who Share Your Company Culture
If
your business is large enough to require employees, be careful who you
choose. In my experience, it's better to pay more for top-notch
employees who won't require daily baby-sitting, than to nickel and dime
it with job-hoppers who are perpetually unmotivated, late to work, or
enmeshed in personal problems so deep that they can't perform their job.
Everybody
goes through difficult times in their life, and you need to be
sensitive to that. Your company will be miles ahead, however, if you
can find employees with the emotional energy to buy into your vision and
get excited about their jobs.
You can find, develop and keep that
kind of employee by investing significant amounts of time to recruiting
and training. Make sure your compensation package is attractive, and,
if at all possible, offer health insurance. Incentive compensation or
profit-sharing plans can also be quite helpful in motivating employees
to previously unheard of heights of achievement.
4. Standandize and Simplify your Procedures
It's
amazing how much time developing a simple form can save a company. The
more people involved in your business, the more important it is that
you have a set of standard procedures to follow. This will reduce
training time when employee turnover occurs, lower the chance of errors,
and increase efficiency in all aspects of your business.
5. Measure the Results of Your Efforts
Company
and personal goals need to be quantified to determine if the desired
results are being achieved. Key areas of measurement include the cost,
quality, quantity and timeliness of work to be done. Each of these
areas can have a profound impact on the bottom line of a business.
Cost:
It goes without saying that if two Amish furniture suppliers offer
similar quality, furniture design and delivery timing--but one is
substantially lower in cost than the other, I go with the lower cost
supplier. There are a few exceptions to this rule, but not many.
Quality:
Quality is everything in most businesses, and log furniture is no
exception. I'm not the least bit interested in shipping defective
furniture from Michigan to California and back again, all because a
customer wasn't happy. That is a total waste of money, and hits the
bottom line directly. This is why we are such sticklers about quality
control, and why it's been nearly four years since a customer even
thought of returning an item.
Quantity: Generally speaking, if
you sell more, you make more. This is certainly the case with rustic
furniture suites, especially with the high cost of shipping today. As a
result, our website is focused around selling larger orders. We're
always happy when somebody orders a log bed, but we try to make it
appealing for them to buy a nightstand and dresser too, by offering
truly significant discounts. Regardless of your business, you can
likely do the same. It's generally easier to sell more product to an
already existing customer, than to go and find new customers.
Timeliness:
Late deliveries cost money--at least they do in our business. It
costs money to overnight packages that could have been sent by UPS
ground or the postal service. It costs big money to expedite pallets of
furniture. In addition, there is the stress, hassle and
disorganization that comes with rushing around to do things at the last
minute. This is why I try to leave a timing "cushion" in every
furniture order I process. Regardless of what you're selling, you
should too.
