Is your company wasting money without realising? Here are a few common ways in which companies needlessly fritter away their funds.
Splashing out on equipment beyond one’s needs
Having flashy equipment can help you project a positive business image. However, practicality should take priority. There’s no use splashing out on an industrial carpet cleaner that you’re only going to use once or twice, or buying a 3D printer with a hundred more features than necessary. Pay for equipment that you’re going to get use out of – otherwise you’re just wasting money on gimmicks.
Marketing without a strategy
A lot of companies pour money into marketing without having any real strategy. This could include promoting random posts on social media or handing out flyers to everyone and anyone. This often results on marketing being wasted on consumers that would never be interested in your product in the first place. By planning your marketing, you can focus it on the consumers that are most likely to convert to customers. A marketing consultant could be worth investing in so that your can personalise your marketing to your product and your key demographic. You can also use market research tools like analytics and surveys.
Hiring the wrong employees
You also don’t want to waste money hiring employees that aren’t fit for the role. This could include employees that are slackers or keep making mistakes or simply don’t have the right personality. They could drive away customers and fellow employees or they may leave quickly after hiring them, causing you to spend extra money recruiting someone else. By pouring more time into the recruitment process you can gather a better spread of applicants and test them more thoroughly in order to find the perfect recruit for the role.
Outsourcing too many tasks
Some businesses go overboard when outsourcing tasks. While it can be a cheaper alternative to hiring full-time staff, you should be careful of outsourcing too many individual tasks that you could easily handle yourself. For instance, you don’t need to waste money on outsourcing a phone answering service if you barely get any phone calls throughout the day. Only outsource jobs that are a real chore or are too complex to handle yourself.
Relying on credit instead of savings
Almost every business borrows money at some point, but there are times when you should try to save up money instead. Every time you borrow money, you’re paying back interest. By saving up money, you don’t have to pay interest. In fact, you’ll earn money in interest. A classic time when people should save instead of borrowing is filing tax – this is something that happens every year, so you should be able to prepare for it by saving up.