The worries over inflation are not off the mark. Rising costs (even with gas prices bottoming out; watch out, they're headed back up if OPEC has anything to say about it) are chief among the concerns small businesses face in these uneasy times. So, how are you going to cut back, keep it lean, and make it through?
Invest the time and energy into research before you spend. It's too easy to just head to the local discount store believing they have the best prices on all the supplies you'll need. You need to invest some time to really find out if you're getting best deals on office supplies, health insurance, even compensation packages for your employees. How to do that?
1. Read the fine print on your health insurance coverage. Do they offer health savings accounts or health reimbursement accounts? If you give out raises, can you afford to give out 4 percent raises plus rising health care costs? Do the math now, or be sorry later.
2. Don't get swayed by the first sales person who calls wanting you to stock up on a year's worth of paper (even if it is Jim from Dunder-Mifflin on The Office). Put them off while you call a couple of other suppliers and compare prices. You can't afford not to. It's worth your time.
3. Be aware of the rising costs. If you are assured that the price of your supplies will stay the same for the next year, don't be too quick to jump on that bandwagon. Everything is going up. Prepare your budget for rising prices and be judicious about how quickly you pass that price increase on to your customers.
Keep your eyes and ears open regarding expenditures across the board. Do you keep a close eye on who has access to the company charge accounts? Do you really need to order double or triple every time you stock up on office supplies?
Include your employees in on cost-saving incentives. Make sure employees know to print on both sides of paper (if you print a lot) or consider going to a paperless invoice system. Invest in power strips and turn off equipment each night before leaving the office. Question every purchase and make sure the expense can be defended with a valid reason.
Above all, don't be known as a penny-pincher, but as a wise manager of the company funds. If it has to be spent, don't bemoan it, just suck it up. But if you don't have to spend, now is the time to take another look and/or shop around.