Five Creative Money Saving Strategies

1. Ditch Assign Seating

Private offices are an expensive addiction. Ask John DeHart, co-CEO of home health care provider Nurse Next Door. The company reduced office space while expanding from 28 people to 45 at its Vancouver headquarters last year. How? By making all desks available on a first-come, first-served basis. “Even I don’t have my own desk,” says DeHart. The company saved $60,000 in rent and $40,000 in IT infrastructure costs.

2. Sell Faster

Why wait until products are in stock to promote them? Steve Hall, founder and president of Dallas’s Driversselect, peddles the used cars on his website from the moment he purchases them at auction instead of waiting till they’re delivered. That cuts the time cars sit in his lots from 44 to 36 days, saving $14,400 a month on interest, insurance, and storage. Sales at the company which he says is like “a Zappos for used cars” are on pace to reach $91 million in 2011.

3. Ask For A Better Deal

It’s easy to fall into the mindset that routine expenses like utilities are nonnegotiable. Frustrated by the monthly cable bill at Denver’s Cherry Creek Dance, Lee Prosenjak asked Comcast for lower rates and got them minutes later. Doing the same with most recurring bills, he reduced monthly costs by $1,650 at the firm, which had more than $1.6 million in revenue for 2010. “We negotiated a better rate every single time,” he says.

4. Reduce Debit Card Fees

Jason Canapp saved $30,000 at Veterinary Orthopedic & Sports Medicine Group in Annapolis Junction, Md., by changing transaction-processing firms. “It really is a commoditized service,” says Canapp, a founder of the profitable clinic, with about $6.5 million in annual sales. He took advantage of an offer to shave another 1% off transaction costs by getting debit card users to enter their PINs on a keypad instead of swiping them.

5. Try The Cloud

Many business owners are still uneasy about hosting sensitive data off-site. But it’s brought savings of almost $33,000 annually to Choice Translating, which has offices in Charlotte and Lima, Peru. Since getting rid of seven servers and two firewalls, co-owner Vernon Menard III no longer pays $15,600 annually for IT support. Other savings: cheaper backups, lower electric bills, and no downtime caused by hardware and software problems.

–Verne Harnish is the CEO of Gazelles Inc., an executive education firm.

2011-09-01T17:56:52+00:00 September 1st, 2011|

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