It is obvious that everyone in our companies wants to payas little as possible, and we are constantly looking for different alternatives that allow us to heal our accounts and reduce fixed costs, with the aim of making the most of the revenue earned.
That said, cost reduction is one of the biggest headaches for companies,to the point that many companies follow a strategy focused on increasing revenue rather than reducing costs, as in most cases it is easier.
Aware of its difficulty, from AYCE Laborytax we will show different real ways to reduce fixed costs in your business without losing resources or lowering productivity.
You are interested in:
Guidelines to reduce fixed costs in a company and earn more by spending less
> Improve inventory and inventory management
One of the most important points for a company is the correct management of stock and inventories,being advisable to prevent production from being stored for too long, since in this way the capital used in production would remain frozen, which would entail higher storage costs.
The higher the rate of stock rotation or inventory, the higher the surplus obtained,and therefore the less the costs. In addition, we must try to reduce as much as possible defective stocks,which are an unrecoverable cost to companies.
> Collections and payment management
Most companies care about sell as much as possible without paying attention to the conditions ofsale, which is a serious mistake, as poor conditions could lead to liquidity problems, amongother things, because suppliers will have to be paid before they have charged customers.
Here it would be ideal to charge the products sold before paying for them,in order to avoid having to use money from our reserves.
> Reduce financial expenses
Possibly reducing financial expenses is the mostcomplicated, mainly because small businesses and businesses do not have the power to negotiate with banks, which in many cases face virtually unsusumable conditions that could create serious economic problems.
Attention should also be paid to overhead,which is those that go unnoticed within a business, but at the end of the month they are a significant expense.
Some of these overheads would be expenses for electric bill, water, Internet, telephony, cleaning services, etc.
You are interested in:
> Optimize the logistics cycle
To reduce fixed expenses, the logistics cycle of thecompany, which is understood as those processes that occur from the time the company receives the products, should be optimized until the customer finally buys it.
One of the most effective things is to eliminate downtime, toavoid losing efficiency and those costs related to delays in deliveries, machine breaks,… Etc.
Here you also have to pay attention to the staff errores, which can also generate significant additional expenses. The main problem is that controlling personnel errors is complicated, finding awareness and incentives for workers the best option to re-manage them.
> Workers’ commitment
Having the commitment of workers is essential to reduce fixed costs,and to promote such a commitment, one idea is to value and incentivize those workers who act in favor of the savings of the company, whether with benefits within the company, vacation days, etc.
> IBI and IAE
Local taxes such as the IBI and the IAE are an important expense for companies,so it is recommended to review them carefully and try to optimize the cadastral value of the property, which is the basis for calculating both taxes. If achieved, economic savings can be very significant.
> Savings on staff costs
Without a doubt, the biggest expense of companies is on their employees,and therefore, when we try to reduce costs in the first thing we look at is our workforce.
With this we do not mean firing workers to save costs, but we do refer to hiring multidisciplinary and specialized employees in different areas,in order that they can fulfill different functions within the company, without the need to hire extra workers.
Also, a good option to reduce fixed costs is to outsource different tasks, such as payroll, personnel or tax management, which will offer you significant savings in addition to the security of having a specialized service.
These are just a few of the real ways to reduce fixed costs in your business or business, without productivity being harmed.