COVID-19 has forced businesses across the globe to truly evaluate their needs.
As unemployment grows - we hit a record high for newly unemployed Americans - consumers are decreasing their spend. With changing consumer habits and COVID-19’s far reach, analysts predict American GDP to fall 30 percent in Q2. This means many businesses are looking to cut unnecessary costs to ensure they continue thriving, even in times of uncertainty.
One common concern we hear from businesses looking to tighten their budget is about losing momentum in the process. They don’t want to cut headcount or overwork their team members for fear of errors and low morale. They don’t want to put out a sub-par product that isn’t worthy of their brand or let down customer expectations.
Thankfully, there are a few things that you can do to cut costs without sacrificing quality. Read on for a few of our top tips.
Step one should always be figuring out where each dollar of your budget is spent. Audit your books - how much you’re spending on your software, machinery, packaging, overhead. Break the numbers down by department and by line item. It’s critical to know exactly where your money is going before you start to make cuts.
Then look for waste - are there computer programs you aren’t utilizing, or vendors who aren’t following through on their promises? Are there materials that aren’t being used? Duplicate resources? For a lot of businesses, cuts like these have very little impact on their day-to-day but a big impact on the bottom line.
People in different roles may have completely different views on your company’s efficiency. The workers who are part of your fulfillment process likely know where they lose the most time, and those managing inventory know off the top of their heads where the imbalances are. Talk to your managers and top performers in each role about the inefficiencies in their processes and what tools they use most. Then, trim what’s unnecessary and inefficient.
You probably know what your best revenue-generators are… but has that changed? Consumers across the nation (and across the world) are changing their behaviors and reevaluating their needs. So your business needs to modify priorities as well. When you’re judging the value of your products and processes, be sure to take recent trends into consideration. For example, if you have products that sell best in retail - rather than online - you’re likely to need less inventory while retail locations are closed.
There are a lot of inevitable expenditures that you encounter in the day-to-day of your business. Which ones aren’t worthwhile? Moving forward, it’s important to keep a critical eye on spending.
One thing we’ve noticed at Bluecrew is how much employers waste trying to recruit and employ their own hourly workforce. It can cost more than $8,000 just to replace one worker who’s earning $14 per hour! Using a platform like Bluecrew, you can instead fill that position in just hours with no added costs.
Get in contact with one of our account reps today to learn how we can help your business cut recruiting and employment costs and keep a high-quality workforce.
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