Cutting Out Deadwood
By Gail Doby, ASID
Co-Founder of Gail Doby Coaching & Consulting
Small businesses tend to run on slim margins. That makes efficiency a high priority if you want to hit your profit targets. After the plans have been made and the budget set, you have one more important task to undertake to prepare yourself for the year ahead—root out any problems that are slowing you down or holding you back…simply Cutting Out Deadwood.
By now, you’ve had time to review and reflect on the year that just finished. You’ve probably identified some areas where your business is not operating as efficiently or effectively as it could. In making your business plan you have, I hope, eliminated some tasks, strategies, duties or responsibilities to stop doing that aren’t producing the results you’re seeking. Let’s consider some other possible places to cut.
An easy place to start is with expenses. Every expense is taking money out of your pocket. Some expenses are essential, of course, but others can be trimmed without affecting your business. Are you over-stocking or paying too much for office supplies? Are you paying for subscriptions or services you rarely use? Can you reduce travel, gift and entertainment expenses? When is the last time you compared what you’re paying for outsourced services, including internet, payroll and bookkeeping? Are you getting the best bang for the buck from the marketing you’re paying for?
Next take a look at your client roster. Do you have deadbeat clients who pay late or haggle over every item on the invoice? Don’t overlook the ones who take up a lot of your otherwise-billable time with lots of questions, requests and stewing over details. Use that time more constructively to get more of the clients you really want and bill more hours.
Although never an easy cut to make, do you have employees who are not carrying their weight? Could you outsource some tasks and eliminate that position instead?
I’m not advocating austerity, but you want your business to be lean and mean. By cutting the deadwood from your firm, you’ll increase your profits and be more agile, better able to respond to ups and downs you may encounter throughout the year.