Saving money for your business is a priority, but with prices constantly rising, it can be difficult to continue saving as much as you had planned. For instance, you might have planned to save a set percentage of your net income this year, but only ended up saving half of that amount due to a rise in the cost of doing business.
Businesses across many industries have been feeling the effects of rising costs, especially companies that use vehicles. While the cost of various materials has been rising, the rise in the cost of gas has been extreme. This has hit owners of vehicle fleets the hardest; businesses like taxi services, long haul semi-truck transportation, mobile repair businesses, and food delivery companies.
If you’re facing rising costs in your industry that make it hard to save as much money as you’d like, try the following tips for maximizing your yearly savings.
1. Pursue all warranty reimbursements
Chances are, you have some type of equipment or machinery under warranty in your business, whether it’s a copy machine, a computer, a server, or internet hardware running your network. Technology tends to malfunction periodically, and if it malfunctions while under warranty, pursuing a reimbursement will save you money.
If you’re wondering whether or not some warranty reimbursements are worth pursuing, the answer is yes. The key is to track your opportunities so you don’t lose sight of them. When you track your warranties, you can save a lot of cash. That’s what Gulf Relay did to increase their reimbursement by 782%. Using fleet management software from Cetaris, they increased their reimbursement and also their annualized ROI by nearly 153%.
Every warranty reimbursement is worth pursuing, no matter how small. You might only save $200 on a repair, but those repairs will add up over time. Over the course of several years, you could end up saving tens of thousands of dollars.
2. Reevaluate your savings goals and plans
If the cost of goods, materials, and other supplies needed to run your business has risen significantly, it’s time to reevaluate your savings goals. In this case, it’s time to create a plan that aligns with your current situation. If your finances aren’t what they once were, you can’t keep saving like you did in the past without suffering consequences. For example, you might feel the need to cut payroll to keep saving the same amount, but that can damage your customer service experience.
First, figure out exactly how much your costs have risen. Then, see if you can recuperate some of that money in other ways, such as canceling unnecessary software subscriptions, outsourcing projects to cheaper firms, or downgrading services you don’t really need. From there, cut your savings goal by the percentage you can’t recover through other means.
3. Get organized
One way to maximize your savings is to maximize productivity and efficiency. When your teams are functioning efficiently, you aren’t wasting payroll dollars, projects get completed faster, and customers and clients are happy.
If you don’t already have a clear view into what tasks are being worked on daily, who is responsible for each task, and how they’re being managed, you need task management software. You’d be surprised at how much of an improvement it will make in your teams workflow.
Task management software increases collaboration, facilitates frequent communication, and attaches deadlines to tasks so that nothing gets left behind. Manual task tracking isn’t the same because it’s missing the collaborative aspect software provides.
4. Get a business savings account
Last, but not least, get yourself a business savings account that will earn interest. You’re going to keep your money in the bank anyway, so you may as well put it into an account that will generate money for your business.
Before opening a business savings account, do some research and learn how to earn the highest interest on your account. Then, consider how much you’ll have to pay in fees compared to how much money you’ll earn over the course of a year. Make sure the fees aren’t higher than what you expect to earn.
Also, make sure you know your transaction limits. In 2020, the Federal Reserve lifted the limits on the number of withdrawals and transfers from savings deposits, but each institution has their own regulations. Choose an account with an institution that allows you the amount of transactions you’ll need to make without being charged a fee.
Spend less, save more
Generally speaking, maximizing your savings is a matter of spending less. The less you spend, the more money you’ll have to save. However, don’t cut corners just to save a few bucks.