10 Ways to Reduce Costs


Save your business money by becoming more efficient

Benjamin Franklin once said, “A penny saved is a penny earned.” This statement still rings true, as business owners examine where their hard-earned pennies are going. Here are 10 ways businesses may be able to “earn” some of those pennies back.

1. Preventative maintenance

Most businesses do a great job of completing daily preventative maintenance on their equipment—at least, they think they do. The reality is that most businesses do the bare minimum to keep their equipment running. They clean filters, change a spark plug, grease a few fittings and take the unit to the dealer for an annual or semiannual maintenance, which is not cheap. A great way to cut down on repairs—and maybe to even eliminate the annual maintenance bill—is to simply call the dealer’s service department and ask how you should maintain the equipment and what you can do to make it last longer. Follow up with employees to make sure that they are completing the maintenance.

2. Fuel purchasing

Every business is set up differently, but chances are they all need fuel. Most small businesses start out fueling up at the gas pump down the road each morning, or whenever necessary. They might even be set up with a monthly billing statement from the service station. Would it make more sense to have fuel at the place of business? Convenience is the largest money saver here. In fact, fuel at the station may be a penny or two less than the price a fuel supplier charges. However, fewer trips to the gas station mean less fuel burned and less downtime for employees. There are initial costs to consider here, such as tank purchases, fuel filter maintenance, and hose and handle issues.

3. Increase fuel efficiency

With fuel prices fluctuating as they have over the past several years, businesses are forced to keep close watch on the amount of fuel expended for each dollar earned. A great way to monitor how much fuel you are burning is to have employees complete a daily vehicle report. They can note their beginning and ending mileage, as well as other things, such as oil level, tire wear, etc. Another way to increase mileage is to replace older gas-guzzlers. Not every business can afford to replace vehicles, but if you are in a position to make a purchase, now is the time to do it. Auto dealers are doing everything possible to move vehicles, and there are fantastic deals to be had, as well as some great financing options for businesses.

4. Do repairs in-house

Keeping equipment repair jobs in-house will save on expensive labor rates. While hiring a full-time mechanic isn’t a realistic option for most businesses, tweaking the duties of an ambitious employee or hiring a part-time mechanic may help cut down some of these costs. The employee that is looking for extra hours may be the answer with a little training and some extra time in the garage. There are also a lot of full-time mechanics looking for side work. Often, it works out well to have a mechanic come in after hours or on a Saturday when all the equipment is on-site.

5. Watch those trips to the dump

It is no surprise that the price to get rid of clippings, limbs and most green waste is going up. Businesses need to look at all viable options for their waste. Check to see if there is a local compost company that takes green waste. There may even be an organic farm that will take certain types of waste. Look at all the options, even the not-so-obvious ones.

6. Don’t buy retail

Most small businesses start off by paying retail for just about everything. From fuel to small engine equipment to seed and fertilizer, most companies don’t get a price break until it’s given to them. These days, it is OK to ask for a better price. If a business spends a considerable amount of money at any one supplier, it may be time to sit down with the sales manager or owner and talk about a discount. Anyone asking for a discount should know how much money they have spent and the products they have purchased over the years.

7. Look out for morning downtime

An efficiently run business will have employees that start work on time every day; they know what to do, where to go, and what the day’s job entails. One of the best ways to get this daily scheduling to the employees is with a clipboard or a bulletin board. The employee walks in, looks at the clipboard or bulletin board and knows where they are going and what they are doing that day. No time is wasted waiting for someone to tell them what to load or what vehicle to drive.

8. Supervise closely

Most business owners and supervisors think they supervise closely. The reality is that most of them only have a general idea of what it takes for their employees to succeed each day. It never hurts to spend more time in the field. Working alongside employees keeps performance, technique and technology issues close. Knowing the specifics of these issues gives management the information they need to make business decisions, such as when to get a mower replaced or when to hire another employee. The more a direct supervisor knows about the day-to-day issues a crew is faced with, the better.

9. Outsource paperwork

Lots of owners and management personnel find the paperwork associated with running a business a full-time job; it often is. These days, there are a variety of options when it comes to outsourcing these tasks, such as payroll, insurance and benefits. The transition to one of these companies may be a headache at first, but once these duties are no longer the management’s daily responsibility, they can spend more time on the actual business. A lot of research should go into choosing one of these service providers, and they should be a good fit for your company. It isn’t something that a business should change on a regular basis.

10. Downsize

It is usually a last resort for most businesses. Adding to the unemployment line is never easy, but, unfortunately, this is part of business. One of the most important responsibilities the management has is making sure that tasks are performed in an efficient manner. If there is only enough work for a five-person crew and there are six employees, something needs to change. Can you reduce maintenance costs if an employee works as a mechanic three days each week? A business may be able to cut a few hours from several employees in order to keep everyone employed. These are tough decisions, but some are necessary to stay afloat. Look at all the options.

The author has a Bachelor of Science degree in Botany from Iowa State University and has worked in the green industry for more than 12 years.