Is Your Business Wasting Money by Making These 4 Business Mistakes?

If your business expenses have been high enough to affect your bottom line, then you need to get a handle on them. Especially for a startup, it is important to control business expenses. Here are some pointers that you will want to consider.

Not Tracking Supplies

You would never let products leave your facility without knowing where they are going. Yet, many businesses do not track when supplies come into the building and how fast they are used. Fishbowl explains, “reduce instances of lost items, inefficiently used resources, and other problems that lead to higher costs by properly tracking your supplies (those used by employees and those used for production). Create an accountability system so if something goes missing or product is used up too quickly you know where it happened and who to talk to.”  This often encourages employees to develop a wasteful mentality where they think that these supplies are free to waste. Instead, consider implementing inventory control on these items.

Not Maintaining Your Building

There is a lot that can go wrong with a building. If you own it, then you need to make sure that you are taking care of little problems before they turn into big ones. Verdant explains, “Predictive Maintenance allows [businesses] to use sensor data to identify wasteful or hazardous trends and alert maintenance staff before the issue escalates into a much more costly one. For example, as an HVAC system fluctuates through different levels of performance based around occupancy needs, there will be more or less wear-and-tear on its different physical components. So rather than waiting for a component to break down before being maintenanced or replaced, predictive maintenance allows engineering staff to predict maintenance needs based on system usage, prevent system failures, and reduce the costs of operating a faulty system.” While you may not be a building maintenance expert, leveraging smart new technologies can help ensure your building asset is well maintained.

Not Checking Credit Card Receipts

If your employees have business credit cards, then ensure that they are filing receipts to show where each penny is going. Furthermore, you should set up formal rules on what they are allowed to spend on common expenses and what they will need to pay out of their own pockets. You or a key employee needs to review these reports on a monthly basis.

Not Managing Your Company Fleet

If you own vehicles that you let employees use on company business, then you need to ensure that they are being used for their intended purpose. While you are not an automotive technician, you will also want to make sure that drivers are keeping fluid levels at the right level. You will also want to make sure that the oil is changed at appropriate intervals and that new tires are installed when needed. Taking care of vehicles makes them last longer, saving you money in the long run. Fleetio explains, “a responsible fleet owner or manager has learned that preemptively acting is far better in the long run that reacting. You also need to set goals and expectation for driver usage, for example, setting rules for anything that could be considered abuse or misuse should be strictly forbidden.”

While these tasks are easy to overlook, assign someone to be responsible for them. Then, hold that person responsible if the job is not completed. Since many new businesses fail simply by not having checks in place, you need to control expenses to make sure that yours is not one of them.

There are many ways a business can make, save, or lose money, and it all comes down to your plan. Coming up with an effective business plan and keeping your company accountable to that plan can be difficult. Let Plan Thy Business help with all your business plan needs and ensure you and your business are successful.

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