Inflation isn’t going anywhere – what should business owners do?
Many of us have crossed our fingers in hopes that inflation wouldn’t be a long-term consequence of the tumultuous global economy. However, it seems the verdict is in on inflation; it’s here to stay, and we will be feeling its effects for several years.
So, as a business owner, what do you do? How do you adjust your plans – which have already likely faced a lot of changes in the past three years – to account for climbing, potentially unpredictable, inflation rates?
There are wrong answers.
You can make decisions that might pad your bottom line initially but, at the end of the day, aren’t in your business’ best interest. You can upset your customers by raising prices, upsetting your investors – or your own bank account – by cutting margins, or upset practically everyone by cutting corners to cut costs. The latter option potentially includes layoffs, which lead to understaffing, an issue that can be fatal for many businesses.
Most owners will ultimately resort to raising prices, then look for clever ways to mitigate the fallout. And, while this might be the decision that keeps your business afloat, it’s not your best option.
Focus on your indirect operational expenses instead.
Indirect expenses are costs not associated with your cost of goods sold or labor; this includes cost categories like telephone and internet, credit card processing, waste disposal, facility supplies, uniforms, and more. Altogether, indirect costs can represent around 15% of your business’ operating budget.
Indirect cost procurement is the process of finding sustainable reductions to these costs; meaning the reductions increase your bottom line without impacting your business’ operations.
If my experience as a cost reduction expert has taught me anything, it’s that far too many business owners take their indirect expenses at face value, because they simply don’t have the time or resources to do the necessary investigation and negotiation to reduce them. But freeing up any of your funds is critical as inflation persists and could be the difference between your business operating profitably.
Schooley Mitchell reduces these expenses by an average of 28%.
Schooley Mitchell ensures businesses and organizations are getting the best services at the best price – all while identifying billing errors, eliminating redundancies, and improving efficiency. We leverage proprietary software, best-in-class pricing databases and long-standing relationships with service providers to find savings, and monitor your accounts on an ongoing basis so they remain optimized.
Schooley Mitchell’s work is based on a symbiotic, mutually beneficial model – we are driven by producing results for our clients and have no ties to vendors or service providers. Our fees are self-funded by a portion of the savings we find – no savings, no charge to you.
As a Schooley Mitchell consultant, my job is to spend the time and resources reducing your indirect operational expenses, so you don’t have to.
Instead of cutting staff or services in the face of rising inflation, give me a call, and let’s talk about a risk-free way of protecting your business’ bottom line.
