C Is For (General)

Costs – Controlling and reducing your costs is the fastest way to generate cash-flow. When you reduce costs by $1, it drops immediately to the bottom line. Trying to generate that same dollar through selling may require $10 in sales. While you need both efforts to maximize income, examining your costs and reducing expenses is the place I always start. When times are good, we tend to add expenses in areas that are nice to have, like that additional cell phone, the gourmet coffee service, or the entire list of cable channels. When economic times get tough, it is time to get tough on your expense account. Examine every expense. Ask your staff if there are expense items that can be trimmed, and review all your invoices to insure that they are accurate. You may even want to contact your suppliers to inquire about your pricing to see if you might qualify for discounts. Ask yourself what you need to have to run the business, and what expenses are just “nice to have”…and you guessed it… get rid of anything that is not essential. Tough times call for getting tough on expenses.