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In these difficult times it is really important to keep your administration costs to an absolute minimum. This means regularly reviewing all of your office costs, utility costs and the cost of your head office and administration staff.

Fortunately with modern technology developing all of the time there are countless ways in which you can reduce costs and increase efficiencies.In addition, many of these technologies allow you to reduce the time it takes to get information they speed up reporting for your business.

In the modern business you really need to take a zero base budgeting style approach to your business. With zero base budgeting you start with a blank sheet, forget about historical relationships and look at what you would need to operate your business.

So Where Should I Start?


Think about the 80/20 rule and go for the 20% of processes that consume 80% of the resources. Here are some areas to consider.

  • Your accounting system. Accounting systems have come a long way in the past few years and it is now possible to link the more popular accounting systems with your banking information and other data feeds. This can save a huge amount of clerical time.
  • Your stock control system. Make sure that your stock control system is fully automated and linked to all related systems. If you are still keeping manual stock sheets or trying to track stock in a spreadsheet then you are behind the times and need to improve.
  • Your POS system. Your point of sale system needs to be synchronised with your accounting system and your stock control system. This will save a huge amount of time that is wasted in double and triple entering data.
  • Use a shared cloud drive. There are a number of shared drives available online now. These include the Microsoft 365 offering and Dropbox. These products allow team members to collaborate on projects and easily share documents and information.
  • Outsource non critical jobs. Determine what the core activities are within your organisation and keep these core. Any other roles that are not core should be fair game in terms of outsourcing.
  • Review your office space. Take a good hard look at your office space needs and what you currently are using. Do you need a physical office or could you go virtual? Maybe you could have a mix of physical in some markets and virtual in others.

You will be surprised at how much money you can potentially save by taking a logical unbiased look at your overheads and stripping back the unnecessary costs.

Should I be doing it all at once?


As with the 80/20 rule it is probably best to identify the costs that will have the biggest impact on the organisation and attack them first. You can then work you way down through the smaller items.


What should I be spending on overheads?

It will vary by business. It may be an idea to talk to other people in the industry and to get an idea of what rate their overheads are running at. Regardless of your industry you should be setting some aspirational targets for reductions.


Who can I go to for help on this?

A good starting point would be your external accountant. You could also talk to your IT support people or your website designer to get an idea of developments in their industries.


How often should I be reviewing my costs?

We would suggest conducting a review annually. You may not want to change things every year however it is a good idea to at least look at where the market is trending.


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