Our local weekend newspaper had a lengthy article about market trends this past quarter and the past year, as well as suggesting that at a minimum, the first quarter of next year all business owners should exercise “caution”. The word caution came into the article because of the status of the economy – sales are down among the retailers, who are having to give huge discounted prices just to get people into their stores, and manufacturing companies stating that their usually “good” customers have purchased only about 30% of what they’d purchased in past years.
For those of us who work out of our homes, we are very fortunate not to have to deal with store rent, store utilities, large inventories, etc. However there ARE things that we do need to consider in order to increase the bottom line, or at least keep from losing money in our business.
One of the biggest expenditures we’ve routinely had were high power bills. Of course when you have sewing machines, embroidery machines, computers, and probably a room or window air conditioner to help keep the work rooms cool / warm, etc running almost non-stop, a high power bill is to be expected. Well, a few months ago we decided to take a look at all the machines we had to see what we could do to conserve a little. We started turning off all equipment that wasn’t in use at that moment, (turn them on when needed for use, then back off again), turning out lights in all rooms that weren’t being used, and a few other conservation details. We are now saving around $150.00 per month on our power bill, which is huge!
Another area to be “cautious” about is hiring either part time or full time help. Do you really need the extra help? Could you extend yourself just a little and take care of those extra details? Perhaps the Post Office run could be set up at the same time that you’re running other errands to pick up sewing supplies, or running to the grocery store or bank, instead of heading out of the house several times a day.
Back to the hired help — A couple of years ago I hired a relative (high school girl) to come after school to do data entry for me. She was a good worker, but I noticed that she kept getting phone calls on her cell phone almost the entire time she was here. Even though she explained to each of the callers that she was at work and that she’d call them back later, she’d spend two or three or four minutes telling them the situation, then writing herself a note so she wouldn’t forget to call them back. This just kept on and kept on, and finally I had to ask her to please leave her cell phone in the car while she was here working. Well, within a few days she said she really was pretty busy with school stuff and wouldn’t be able to work any longer (I guess those friends were more important than making a little extra money).
Another time I hired a friend to come help half days with a project that I was working on and needed some help. This friend was very prompt – got here exactly at 8 am, BUT she always brought her breakfast (fast food biscuits, coffee, etc), and ate before she’d be ready to start work. Once again I had to be the “bad” guy and ask her to eat BEFORE she came, because 8 am was the time to begin working, not coming in to eat first. Once again, that work relationship only lasted another week or so before she had a “reason” why she couldn’t come work any more.
The point of those two examples is this: are you spending money on part time help that really is not the help you were looking for, and is the work being done in the manner that you’d expect it to be done? Would you be better off just figuring out how you can work in an extra 30 minutes here and there to take care of the items that the paid help are really not doing? The money you could be saving by not having to deal with inefficient help, or where the hired help is taking advantage of you, could be enough to raise your profit considerably.
Take a look around your business to see where you can cut back in order to save some money to help increase the bottom line. There may be other areas in addition to the couple I mentioned. Let us know what you’re planning to do to “cope” with the market trends in order to keep your bottom line stable or increasing.