Cloud services have grown exponentially, and software as a service led in 2017. This sector registered almost 30 percent growth last year alone.
With growth comes competition. The market for SaaS and other cloud services has become much more crowded in the past few years. To compete, you have to be lean and flexible.
That’s why you want to know how to cut expenses. Not only will it help you compete more effectively, it will also help you grow and maximize earnings.
If you’re looking for ways to cut costs in your business, try one of these seven tips on for size.
1. Focus on Your Design
Have you given much thought to what your interface looks like lately? If your customers are always calling in for help, you may have a poor design.
You can save yourself some time, money, and frustration by putting a little bit more into your UX/UI efforts. A good design is intuitive for your clients. In turn, they need less training and support to use your product or service efficiently.
Just how much is better design worth? Experts estimate each extra dollar you put into your design now will yield $10 to $100 in savings later on.
The reason for this? Fixing a problematic design is going to cost more than creating a great design at the start.
2. Think about Energy When Asking How to Cut Expenses
When Bitcoin took off, one of the most interesting stories was how much energy the company was using. Some reported it was using as much power as Denmark.
You might wonder how a company could use up so much energy. The answer lies in the inefficiency of the network and equipment.
You might not be using as much power as a small European country, but you should take a good look at any equipment you buy. Also, think about how you configure your network.
If you rent from someone else, ask about how efficient their network is. The price you pay reflects their costs.
3. Question the Budget Breakdown
How much do you spend on any one budget item line? Some think they must invest a particular percentage into sales and marketing.
In all truth, the right amount varies for every company. Most experts say SaaS companies need to invest more in their sales and marketing. They look to SalesForce and others as examples, since they invest heavily in this area.
How does spending more on sales and marketing help you when it comes to cutting expenses? It helps you strategize.
If you want to invest 10 percent of revenue in an activity, you’ll need to adjust the budget accordingly. This encourages you to look for efficiencies and cost-cutting measures.
With a goal in mind, you’ll be able to find more ways to cut spending.
4. Embrace the IoT
As a SaaS company, you likely know about a bit about the Internet of Things (IoT). You may not have thought of IoT enabling smart devices to help cut costs and save money.
Smart devices can do things like sense low network traffic and engage in energy saving. This helps with utilities and associated overhead costs.
The IoT can help in other ways as well. You could use it to monitor your security or assist with network maintenance. It could assist with compliance tasks, which can be time-intensive and costly.
5. Think about Outsourcing
Outsourcing is considered one of the great ways to cut spending by most business leaders. It works for SaaS companies too.
Ask yourself if you have all the in-house experts you need. If not, consider sending part of a project out to another team who does have the expertise and skills. You might also consider getting access to technology you don’t have in-house.
Think about customer service as well. Could you deliver better service to your customers if you had around-the-clock care? Outsourcing can help you achieve this goal.
Other aspects of your business can also be outsourced, such as HR, payroll, IT, and so on. Outsourcing frees up your time to focus on your areas of expertise.
6. Look at Your Insurance Bill
Another of the tried and true ways to cut expenses is to revisit your insurance. Insurance can be a large cost for businesses. Some businesses will have to carry several types of insurance.
Depending on the state, you may need business property insurance or commercial auto insurance, for example.
As a provider of technological solutions, you also want liability insurance. If something goes wrong with the product, you’re protected from customers who were harmed and seek to sue you. This is important in a world where data breaches happen all the time.
Look at your insurance policy. Are you paying too much for what you have? Look to bundle different types of insurance to get the best deal. Don’t be afraid to shop around, especially if you’ve been with the same company for some time.
7. Move to Remote Work as Much as Possible
Take a page from your own book and work remotely as much as possible when cutting expenses. This reduces your investment in property or rent.
It’s cost-effective to rent a conference room as you need it than to own your own building or pay rent on a regular basis.
See also if you can save on space for your servers if you own your own. It may not always be possible, but cutting property costs can be a great way to keep overhead down.
There Are Many Ways to Cut Costs
Now you’ve seen how to cut expenses in a variety of ways for your business. These aren’t the only cost-saving measures you can take.
By taking cost-saving measures, you can free up capital and use it to reinvest in your business. This, in turn, can power your growth in a competitive market.
If you’re looking for additional ways to both grow and cut your costs, ask the experts. They can help you discover new ways to continue growing your business.