Sneaky Budget Hijackers
When you are in charge of making a company budget work, or you own a business, it is easy to focus on the major components of income vs expenses. Companies often assume the labor pool is the most significant budget blow. However, there are some subtle players that can hijack your budget and escape your notice.
The Unnecessary but Required Expenses
You might be confused because required seems to indicate a necessary item. However, consider the utilities of your company. Without an energy efficient heating and air unit complete with an HVAC air filter housing system, your electricity bill might be doubled in expense because of the inefficiency. If your company has unnecessary equipment use drawing voltage after business hours, you can be increasing your power bill. Have a plan to turn off machinery and lights, as well as establish a routine HVAC inspection, to lower your utility costs.
The Needs Against the Wants
When it comes to office supplies, break room aids, and other purchases strictly for employee consumption, are you buying according to need or want? It is a small area, but over time, frivolous purchases can quickly add up. If special requests for just one department add an extra fifty dollars a month the bill, this is $600 for the year. Imagine if everyone got their needs met.
Dated Purchase Contracts
Perhaps you got locked into a supply contract early on during your operations, but it has been quite some time since you spoke to your supplier. Without shopping around for prices or looking to renegotiate your charges, you could be leaving money laying on the table. Visit your supplier or shop for comparisons in order to have more negotiating power. Check on your pricing continually and keep your ear open for a new opportunity.
Paying attention to the details of your budget can give you more insight into the areas that are slowly siphoning funds from the company. Make strategic changes and work to conserve your financial resources.