It’s no good lamenting your lack of profits at the end of the financial year if you’re responsible for wasting money on a regular basis.
And while you might protest your innocence, know that it can sometimes be the spending you do for the betterment of your business that could be classified as a ‘money waster.’
Here are some examples you need to consider.
#1: Always buying new
There’s nothing wrong with buying new, of course. If you have the financial means to pay for the latest and greatest computer technologies for your office, and the latest cars and vans for your business fleet, then fine. However, you need to ask yourself one important question:
Will buying new benefit my business more than something that is used?
If the answer is ‘no’ or ‘not really,’ then it might be wiser to save your money and buy something second-hand. Provided you buy something fit for purpose, and you use reputable companies such as Tradervan (for your business fleet), then you will have money remaining in your bank account that can go towards other facets of your business.
#2: Outsourcing when you don’t need to
There are times when outsourcing is a good thing. So, on those occasions when you have skills gaps within your workforce, you might outsource certain tasks to another company. And if your employees are working themselves to the bone, you might outsource some of their designated workloads to others to ensure your staff members don’t burn themselves out. However, if you do have employees able to take on certain tasks, and if they have the time in their working week to commit to them, it makes little sense outsourcing these things to others. Think about this the next time you consider hiring other firms to manage some of the responsibilities pertaining to your business.
#3: Hiring more staff than you need
If you have the work for new hires to do, then fine. But if your current employees can manage existing workloads, then you don’t need to bring new staff into your business. You see, not only will you then have to pay them a wage for doing very little, but you will also have to pay into their pension, cover their taxes, and manage those other expenses that pertain to employed staff. Only bring in new people when your existing staff are consistently overworked, or when you need to hire somebody on a regular basis for jobs that your current employees aren’t qualified for. And if it is more cost-effective for you to do so, consider outsourcing instead of hiring, especially for those tasks that are one-offs or occasional.
Finally
Your business will struggle if you make poor financial decisions, so work with an accountant, and consider other ways you might be wasting money in business. You will then be able to get to the end of the financial year, and instead of bemoaning money lost in your business, you will be able to enthuse about money gained.
Thanks for reading.
