Business 101: Guide to Reducing Expenses & Increase Profits | Chris B. | Skillshare

Business 101: Guide to Reducing Expenses & Increase Profits

Chris B., Instructor, MBA and CFO

Business 101: Guide to Reducing Expenses & Increase Profits

Chris B., Instructor, MBA and CFO

Play Speed
  • 0.5x
  • 1x (Normal)
  • 1.25x
  • 1.5x
  • 2x
15 Lessons (36m)
    • 1. 039RCE30 Section 01a Course Introduction

      1:41
    • 2. 039RCE30 Section 01b Instructor Introduction

      2:02
    • 3. 039RCE30 Section 02a Overview and Intro to What To Know

      2:16
    • 4. 039RCE30 Section 02b Reducing Workforce Costs

      2:55
    • 5. 039RCE30 Section 02c College Interns

      1:06
    • 6. 039RCE30 Section 02d Tech Savvy

      2:09
    • 7. 039RCE30 Section 02e Office Supply Anarchy

      2:34
    • 8. 039RCE30 Section 02f Electric Consumption

      2:18
    • 9. 039RCE30 Section 02g Competitors Prices

      1:26
    • 10. 039RCE30 SEction 02h Goods and Services Trade

      1:24
    • 11. 039RCE30 Section 03a Action Plan

      5:01
    • 12. 039RCE30 Section 03b Overall Impact

      1:52
    • 13. 039RCE30 Section 03c Case Studies

      3:52
    • 14. 039RCE30 Section 03d FAQs

      3:10
    • 15. 039RCE30 Section 04a Course Conclusion

      1:59
  • --
  • Beginner level
  • Intermediate level
  • Advanced level
  • All levels
  • Beg/Int level
  • Int/Adv level

Community Generated

The level is determined by a majority opinion of students who have reviewed this class. The teacher's recommendation is shown until at least 5 student responses are collected.

75

Students

--

Projects

About This Class

Are You A Business Owner or Entrepreneur?

Are You Responsible For Ensuring Your Company Makes a Profit?

Are You Constantly Looking For Ways to Trim Expenses and Improve Performance?

Do You Want To Be Proactive In Running Your Company?

If You Answered "Yes" To Any Of The Above, Look No Further.  This Is The Course For You!

Start today and join the 100,000+ successful students I have taught as a Top Rated instructor!

Three reasons to TAKE THIS COURSE right now:

  1. You get lifetime access to lectures, including all new lectures, assignments, quizzes and downloads

  2. You can ask me questions and see me respond to every single one of them thoroughly! 

  3. You will are being taught by a professional with a proven track record of success!

  4. Bonus Reason: Udemy has a 30 day 100% refund policy - no questions asked and no risk for you if for some reason you don't learn from the course!

Part of being a responsible manager is consistently looking for ways to more efficiently run your company.  By continually evaluating your expenses and looking for improvements, you can help your company be more profitable, efficient, and ahead of the competition.  Please the management team and investors by doing the best possible job you can by implementing some simple yet very effective tips and strategies. 

In this course you will learn several methods you can implement immediately to help cut costs and expenses in your company.  Become more profitable and dynamic by implementing the knowledge learned in this course.  

What We Do In The Course:  

  • Learn best practices for approval

  • Determine that there are always opportunities to reduce costs

  • Learn how to create value for yourself and the company

  • Understand how to look at competitors for ideas 

  • Understand that cutting costs does not imply a bad thing

  • Look at multiple ways to cut costs and save on expenses

  • Create an action plan for you to determine and reduce costs immediately for results

  • Review 3 case studies of companies who implemented expense saving strategies

  • Review several FAQs regarding the reduction of expenses and cost cutting

  • And Much More!

At any point if you have a question, please feel free to ask through the course forum, I'd be happy to answer any and all questions.  

*** JOIN NOW AND LEARN HOW TO REDUCE YOUR EXPENSES AND INCREASE THOSE PROFITS! ***

About The Instructor

Chris Benjamin, MBA & CFO is a seasoned professional with over 20 years experience in accounting, finance, reducing costs, reducing expenses and increasing profits.  Having spent the first 10 years of my career in corporate settings with both large and small companies, I learned a lot about the accounting process, managing accounting departments, financial reporting, external reporting to board of directors and the Securities and Exchange Commission, and working with external auditors.  

The following 10+ years I decided to go into CFO Consulting, working with growing companies and bringing CFO level experience to companies.  I help implement proper best business practices in accounting and finance, consult on implementation of accounting systems, implementing accounting procedures, while also still fulfilling the CFO roll for many of my clients which includes financial reporting, auditing, working with investors, financial analysis and much more.  

Thank you for signing up for this course. I look forward to being your instructor for this course and many more!

Chris Benjamin, Instructor, CFO & MBA

Meet Your Teacher

Teacher Profile Image

Chris B.

Instructor, MBA and CFO

Teacher

Class Ratings

Expectations Met?
  • Exceeded!
    0%
  • Yes
    0%
  • Somewhat
    0%
  • Not really
    0%
Reviews Archive

In October 2018, we updated our review system to improve the way we collect feedback. Below are the reviews written before that update.

Your creative journey starts here.

  • Unlimited access to every class
  • Supportive online creative community
  • Learn offline with Skillshare’s app

Why Join Skillshare?

Take award-winning Skillshare Original Classes

Each class has short lessons, hands-on projects

Your membership supports Skillshare teachers

Learn From Anywhere

Take classes on the go with the Skillshare app. Stream or download to watch on the plane, the subway, or wherever you learn best.

phone

Transcripts

1. 039RCE30 Section 01a Course Introduction: how low everybody. And thanks for signing up for the course. Best tips, techniques and ideas for cost reductions. How to cut your costs by up to 30%. Your company. My name is Chris Benjamin, and I'll be your instructor in this course. In the next video, I'm going to do a bit more of an introduction myself in my background and sort of why I'm qualified to teach this course. But for now, that's what to give you an overview and sort of a road map of what we're going to be learning in this course. So, first of all, you know companies when it comes time to cut costs. Oftentimes that's sort of ah, a reactionary type of situation. No expenses were too high. Profit margins just aren't that great. Or maybe the company's losing money, and now you need to do something. And oftentimes people just look for drastic ways to, you know, kind of chop expenses, and it doesn't need to be that way. So through this course, we're gonna look at multiple ways you can reduce your costs, and the overall impact can really help out your company on encouraged people as well to do a lot of this stuff in advanced. You don't have to wait till there's an emergency to do these things. You can do them in advance and always be looking for ways to make your company more profitable. So after we look through multiple ways of doing that, we talked about the pros and cons of different ways. Bring a put together an action plan, a 10 point sort of checklist that you should go through in order to identify the areas that are most suitable for you and your company and how you should be saving money. We're also gets going talk about the overall impact and how this sort of impacts your financials going forward. There were also gonna look at three case studies, just briefly of three companies and what they did at what the results were once they went through the exercise as well. So that said, we've got a lot of information to cover, so I'm really excited to get in and and help you guys start saving money in your own companies. So let's go ahead and start the course 2. 039RCE30 Section 01b Instructor Introduction: so just a little introduction to myself again. My name is Chris Benjamin Thomas, chief financial officer. So CFO, having undergraduate degree in accounting and finance from the University of the Fraser Valley in Canada. And then I went on to get my master's in business from the University of Washington, where I focused on entrepreneurship. I really want to work with growing companies that were really doing cool things and needed help from the sort of finance and accounting side. So my entire career of 20 plus years, I've worked in large, publicly traded companies as well as the early stage start up companies, oftentimes as the CFO role. So the most recent 10 years I left the corporate life. That's when I really went into consulting. So I worked as this interim, part time CFO partnership basis, and I go into companies either on the board of directors. Ah, or is the CFO role sort of bring that sea level management abilities and experience to the smaller growing companies and really help set the tone and put things in place that they might not be able to do themselves from the accounting and finance perspective at this point? I've worked with probably close to 100 or more companies in different capacities. So again, sometimes it's that CFO role ongoing. It might be, you know, three months or it might be four years. A lot of times do, though I come in and just do one time project like I helped create a financial forecast, help create evaluation or other things. And, of course, sometimes that involves helping companies clean up their financials and looking at their financials from sort of, ah, an outsider perspective without any sort of inside knowledge and without any sort of bias towards different things that I can give them a very objective opinion of where they should be looking at cutting costs on saving company money. So it's been a big part of what I've done, and that's what we're gonna be talking about in the course today. And then, lastly, just I brought companies from seed stage to AIPO, which is publicly traded, so I've seen the gamut everything from those early stage companies all the way to publicly traded companies. So I had a lot of different experiences with different sized companies, but different industries as well. So I learned a lot over my years, and I'm looking forward to bringing that knowledge to you. So with that said, let's get started on the course. 3. 039RCE30 Section 02a Overview and Intro to What To Know: all right. So before we get too far into the content, it's want to start with a general overview, and then we'll talk in detail a bit more about several topics that we're going to go into. So, first of all, just to sort of set the tone, there's always opportunity for improvement. Very seldom can you find a situation where there's just absolutely nothing that can be done . There's always some way to come up with alternatives or cut costs. Second, you one improve the bottom line for your investors. They're ultimately the shareholders of the company. You might be a swell, but you have, ah, an obligation to do right by them. So you want to continually be looking for ways to do cost reductions. I wanna create value for yourself as an employee. And again, whether employees means you're the CEO. You know someone in the accounting department, whatever it might be by sort of being the hero, if you will, who comes and saves the day and find ways to save on expenses. That's definitely a benefit to you as well. It's a competitive market, always look to fine tune, so you shouldn't be just looking for ways to improve on your cost spending and the bad days . You know, when things there may be dire, you should always be looking for ways to improve. And cutting costs is not always as it does not have to be a bad thing Now there might be ways where you just you refined up a process that you do and it save time. Or maybe you automate some things that make your company more efficient. So it's not always a bad thing to to cut costs. So on this slide we have six different points, and we're gonna go into each of these in more detail. But I want to introduce them to you. So you have an idea on what we're gonna be talking about. But the first we'll talk about cutting costs by reducing workforce costs are considering personnel alternatives. We'll talk about kind of cost, but again tech savvy and implement technology cutting costs by getting rid of office supply anarchy. We'll talk without about that, I'll cut down on electric consumption. We'll see how that can save us some money. Ah, second last will cut some costs by keeping close track of the competitors prices. So get into that. And then lastly, we're gonna cut costs by trading goods and services. So we're gonna give you lots of different options on this is just the start. And then we're going to go into some more ah ways as well after these, so but for now, we'll talk about each of these six in more detail in the upcoming six videos. 4. 039RCE30 Section 02b Reducing Workforce Costs: Okay, So let's talk about cutting costs by reducing workforce costs and considering personal alternative kind of the go to, if you will, whatever there needs to be sort of bigger cuts to expenses. Personnel tends to be the first area that companies look to, and mainly because it is usually typically the largest expense for a company. So you can outsource employees or have part time workers. So a big benefit is this could be done bigger, small. You know, you could have just a few part time workers are a few positioned outsourced. Or you could have a company which is almost all virtually outsourced. They'll do the delegated, tedious, recurring tasks. We're looking at things where you don't need sort of a specialist, maybe in house there at your company. Just someone who's, you know, possibly even work somewhere else in the world who is willing to do the things that do take a lot of time. But maybe you're then paying them directly by the hour and by performance, rather than paying someone to set salary to sit in the office all day. There's more freedom, and the business could be run anywhere as long as there's available Internet access, So I've seen companies that were completely virtual. Basically, everybody was outsourced. Now, still, a lot of these people ended up just being full time outsourced employees. But in some ways, you save costs in other ways because there's no office to pay for when the company's virtual specialist skills that the business doesn't have are quickly accessible. So say, you just need a quick, you know, marketing campaign, and it's not something that you're doing every week, but maybe once a month. Maybe you have a specialist who you just hire once a month for one week to work on your marketing campaigns rather than have somebody in marketing who's sort of a jack of all trades and is okay at a lot of things. Have a few specialists that you can pay that are really great at the things they dio. Efficient, outsourced employees can always relieve stress. It's really once you kind of get over the hurdle of hiring somebody and paying someone else who maybe you don't really know or doesn't like physically at your office, but paying them to do what they're great at and you see the results and then it really does relieve stress and, you know, you'd be happy to use them again. It can reduce the impact of losing workers. So say you did have to lay off 10% your staff 20% of your staff. Well, maybe you then bring on a few outsource workers slash and part time employees to fill those gaps. You don't completely suffer in terms of the work that's being done and then, lastly, have more flexible hours and don't require benefits. So, uh, another benefit to using outsourced employees, Obviously, no benefits. I mean, they're just contractors, essentially. So you just pay them a set hourly wage or a fixed fee. However, you have it arranged, and that's it. So you're not paying for things like health insurance or having to buy them a computer. There's a lot of costs that go into having a staff, um, at your company. Uh, they say, typically costs about 20% of a person's salary on top of their salary in orderto have them on board, and that's things like health insurance. Getting him a desk, getting them a computer, you know, sick time, all that. So with outsource employees, you don't have to deal with any of that 5. 039RCE30 Section 02c College Interns: another way you can cut costs by reducing the workforce is to a suicide from outside outsourced workers. Now Internet workers, college interns. They could work for credit or a low salary on a short term basis, and they're very eager. They want to come in and work so they could work on specific projects or general research, highly motivating, capable and eager to learn and succeed within your company. Interested internship programs will save recruitment costs by allowing evaluation of potential employees before giving them a permanent position. So it's almost like there, Ah, auditioning for a job, even though that's not necessary. The end goal. And they know that they're typically there just for work experience. But as it says there, really eager to please, you know they're there in school. Still, they want to do well. They won't apply everything that they're learning in their classes, so you can leverage that as well. And so you just have to look to your local colleges and universities and see what internship programs they have, obviously, and work with them and figure it out. But it is a terrific way toe have you know, people on hand that really essentially are working for free, so definitely be sure to consider that as an option 6. 039RCE30 Section 02d Tech Savvy: So now let's talk about just some technology that could be applied to your company. We certainly you realize that, you know, having faster computers is more efficient, automating processes more efficient. But, you know, just trying to think of some other ways to sort of, you know, chip away at those costs up. One thing is transferring phone service to Internet voice over I. P. You know, using Skype are one of the other 1,000,000 services that are out there. Savings of 40 to 60 per spent 60% especially for companies with heavy, long distance call traffic. Think of the global company. You know, they're typically calling around the world and north, some type of industry where you're making a lot of phone sales. This will drastically cut down on expense that you have has much lower monthly fees for all calls in traditional phone service we used anywhere with Internet service. I mean the quality only gets better. I mean, these days you can't even tell the difference between someone using voice over I p versus just a regular telephone line. It's usually bundled with free features, so you get everything you would normally get color. I D. Colin and Conference column call forwarding. Um, you know, traditionally, you have to pay extra for each of those services with the phone company, like a normal hardline phone company with something like again, I just use Skype. It's sort of the big name, but there's several services out there. You can find some package deal that will just include everything, Um, definitely a low, low cost. And then I add, on top of that, which isn't mentioned here. But you get other features as well, Like video calling. You can't do that over just a hard, normal telephone line. Um, chatting. You know, you can use it as sort of a chap program as well. So again, if you're familiar with Skype, you could chat with people. You might have a quick question. You'd ask somebody. It's much easier to just quickly, you know, send them a message on. Have them reply back than having to call them way for them to answer or call you back. 17. I'll wait for it. Sometimes it's easier just to get that instant communication. When some providers have free PC, the PC calls, using their software will have a fee for a PC to phone. So you get if you call our landline or someone cell phone, it might have to pay a small permanent rate. But like Skype to Skype, call is completely free. So there's, like, literally zero cost there, and you're eliminating essentially your entire telephone bill. 7. 039RCE30 Section 02e Office Supply Anarchy: so another way is to cut costs. Is getting rid of office and equipment? Um, supply anarchy. So by bargains online are store brands at lower prices at shopping discount stores. Look for products that almost have the same quality as the branded ones. You know, Do you really need, you know, super fast, expensive scales laptop, for example, If all you're doing is, you know, someone's on the Internet entering orders? No, you don't need the latest and greatest. Do you need, you know, uh, a label type of paper when you could just use generic paper? No. I mean, sure, these air small costs, but every little dime adds up refilling recycled printer ink and save about 50% of the cost of that. If you go through a lot of printer ink, which you know most companies do, especially if you're you have an office setting. That stuff gets expensive. Some look for those suppliers where they refill for with generic, and it's much cheaper than buying new each time by from a single supplier who could supply all the required products again. So rather maybe then going, you know, to your local office supply store. Um and buying. You know something there and something at WalMart. It's such a just find a supplier online where you can order everything. Or maybe you buy everything off Amazon. Typically, cheap prices apply for it and use frequently customer savings current if the offer, if the supplier offers it so if you do go somewhere, stay. I'm just throwing out stories that you may or may not have in your area. But like Office Max or Office Depot are staples, You know, they all have rewards programs, so use those and definitely capitalize on them. If that's your option, purchase used furniture and refurbish equipment. You know you don't have to buy brand new desk for everybody or brand new chairs. If you live in a major city, there's always tons of office supply sort of warehouses, if you will, where they bought in bulk office equipment, office desk chairs, you know, watercolors, everything, you know, filing cabinets, everything you could need. So go check those out and you might build a negotiated deal there as well. Storage space is expensive, so seller donate excess office furniture and equipment, you know, basically want to run the minimal operation that you have to so you don't need a huge office if there's a bunch of empty space and again you could even go, so far as we talked about is trying toe you run a virtual company or run it partially virtually keep only supplies needed in stock to reduce overhead. You don't need to be loading up unless there's an obvious reason, like there's a huge bulk discount, but you don't need, you know, 50 cases of printer paper you know by what you need or same thing with Computer Inc. If you only go through, you know, one cartridge of whatever laser toner every month. You don't need to buy five of them just by them as you need them. 8. 039RCE30 Section 02f Electric Consumption: so another way to save costs cut down on electric consumption. You know, you might think Well, you know, we're talking pennies here, but not really. If you think of an office, it costs quite a bit. And if you're not familiar with how much it costs, definitely go Take a look at your electricity bill. You know, even first small office might be paying hundreds, if not $1000. That depends on your environment as well. If you live somewhere really warm, like where I do basically in the desert, the summer bill for all the A C. Give me astronomical. So imagine now you know, a huge office space you're talking thousands thousands of dollars cut down on electric concept consumption. Everybody must be involved for this to work, and we kind of have to have everybody's by and reduce heating temperatures by one degree in . The winner can kind of build up to 8% so you know that's not a noticeable difference in temperature, but you're saving almost 10% automatically when the heating or air conditioners on, make sure doors and windows are closed. You'd be surprised how wasteful people can be. Maximize natural lighting by keeping windows and skylights clean, and the amount of artificial lighting is decreased. Them use energy efficient appliances. So, as you do buy equipment by, you know, certainly one want to spend, you know, thousands dollars to replace your fridge, Uh, just to save a few pennies on electricity. But if you have to replace something lean towards energy, efficient office equipment should be switched off when not in use. You know over the weekend even is better than just leaving everything on all the time. How often do you go into an office and see, like, help? Everybody's screen monitors air lit up 24 7 Now have people set them so that the screensaver comes on and the screens go dark after 10 minutes. It does add up and save energy schedule equipment maintenance, so make sure everything is running properly. You know things like your printers and you're a C and your heating systems. You can actually get quite a bit of savings by making sure those things are running efficiently. Uh, recording meters regularly to know how the company is using energy and where it's being wasted. A lot of times. Two year your local power company will do sort of an energy audit if you will, and they'll come in and we'll tell you and run reports. You know, here's where you're spending all of their energy, so definitely look into those options again. You may. YOU'LL probably be surprised. Is that how much you're actually spending on energy and power and how much you could actually save there? 9. 039RCE30 Section 02g Competitors Prices: So next cut costs by keeping close track of competitors prices. So information is power. So to grow business, keep tab on an information of the competitors prices by calling them through the phone or going through the website. Basically, do a little bit of re kon record. Anything that log anything was learned about the competitors. Learn what and how they market, how they advertise their services of products, going their websites, eyes helpful. I mean, you'll see blatantly how there is like utilizing their website to market as well. If you do gurgle Google, search for them, they will, you know you might get prompted with ads or what not, so it's a good way to find out and then regularly checking the competitors. Prices will help the company evaluate whether companies pricings to hired or competitive or too low. So, basically, you're doing a few things here. You're checking out prices and want to see that your price properly. Second, you're checking out. What is your competitive doing? What are they doing on the marketing front? And maybe there's some things that you should be mirroring and, you know, maybe there's things they're doing that you didn't even think about doing and very, you know, cheap but effective. You know, a lot of social media marketing these days, fairly cheap to get into. You need people who are good at it, but the actual cost of doing of the marketing itself is fairly insignificant. And then that, and you get a large reach that way. So you definitely want to evaluate what your competitors are doing and maybe, you know, take a few notes other than our playbook. 10. 039RCE30 SEction 02h Goods and Services Trade: eso this next one brief on points. But we'll talk about these. So cut costs by trading goods and services, barter goods and services with entrepreneurs to reduce, cast a cash expenditures and offer service for certain goods that another business have. Or vice versus So you can think of this in a few ways. I mean, it depends partially on the size of your company, but if you provide a service or you sell some good, that's of demand. You know you might build to pay people with that and, you know, for their services to say you have a Web designer, come in. Well, maybe their interest in what you do, and you just offer them some some of your product or some of your service in exchange rather than paying them. Another thing that's not mentioned here. Sometimes you can pay people with equity. If you're a growing startup, Ah, and you're you know there's a lot of potential and you're attractive. Then a lot of times people will want to work for you just to take equity. You know they'll take some shares because they believe they're going to be worth a lot in the future. And to them, the tradeoff isn't a big deal, so to speak. So say maybe they were going to get paid, you know, $5000 for their services, or they can take, you know, x amount of shares, which is worth potentially a lot more down the road. And they're okay with doing that because they don't really need the $5000 right now. Or sometimes people will do half and half. Maybe they'll take 2500 and cash and $2500 worth of stock. So think about things like that way or as well as this slide actually does talk about exchange your services directly with the with people. 11. 039RCE30 Section 03a Action Plan: All right, So now let's talk about an action plan. What should you do? I mean, we talked about some different ways. You could save costs, you know? What process should you actually follow? So first of all reviewed the company's finances. You want to be looking at the financial reports that includes the income statement, the balance sheet statement of cash flows and you're looking. I mean, if you're familiar with the statements you know, on the income statement, you're looking at things like profit. 1,000,000,000. You're looking at the different expense categories and seeing what are the one of the big ticket items, whereas does a lot of the money's your company makes go. You're looking at the cash flow statement. They're also looking at like where does is the cash actually going out now? This will be closely tied to your expenses now, but maybe have big things like interest payments or loan payments that are not alone. Payment would necessarily an expense. They want to look for areas where the money is actually leaving. The company decided what costs are focused on cutting. So, you know, you look at all the expenses. Certainly the big ones will stick out and you always start there. But there might be some smaller ones. You know, We talked about saving on power and energy, you know, there might be, you know, that might be a relatively small expense. Relatives say payroll, but there might be a lot of opportunity there to save money. So look into those. Look at outsourcing employees and college insurance. Big way to save money there. I mean, that is typically one of the big areas where there is a lot of expense. So again, you know, nobody likes to lay people off, let them go. But if you're in a situation where you really do need to cut back on expenses, that's gonna be one area. And the way you can make it a little bit easier on yourself in the company is to outsource employees so you don't completely lose. You know that job, if you will, you can still have somebody do your marketing. But rather than have somebody in house, maybe you hire an expert who just comes once a week or is online or college interns. College interns are terrific at things like social media marketing. They very much have their finger on the pulse. They're good at it, and it would be essentially a free option for you. Research for excellent void prices and features Replace your telephone system basically and again. That could be an expensive item if you, especially if you have multiple offices. And if you are a company that tends to be on the phone, often make a list of all equipment and office supplies. Have a list of excess equipment and furniture. Yeah, basically, really focus on each of the sort of things we talked about and look for. Look for savings. Don't just brush him off and say, Oh, no, there's nowhere to save their Well, no, There probably is. Maybe, you know, or maybe just going forward, there's ways to say Maybe you always tended to buy new furniture for new employees. Well, it's time to sort of look to, you know, used furniture, which is still terrific quality on the next slide in just a second. So get the total on expenses on electricity, so create a list of ways to save energy to be implemented again. You know, it depends a lot on your consumption of where you are. You know, Do you need to cut back on? They see, or do you need to cut back on the heat? I mean, that's two different landscapes. Um, you know, things like the screen savers making sure the screen shut off overnight. People turn the printers off over the weekend during their computer off over the weekend. Lots of little ways that all that up, especially the more people that are involved in bigger company is the more impact that's gonna have on a number, research, competitive prices and keep reports on a regular basis. You know it, especially if they sell a very similar product or is the same product. You really want to be looking at that, um, and look for ways to be competitive there. You might also want to do some Ricana. You know where they sourcing their products, you know, where do they get it, versus where do you get it? Do they have a cheaper supplier? See, other companies are who are open for trading and services of goods. Exactly. I mean you want. So we talked about somebody taking equity instead of being paid in cash, definitely, and growing startup environments. That is definitely an option. Um, and then as well, there might be just companies who are willing to, you know, you can provide them with some service. Maybe you're a web design firm. Um, and you need some whatever worked on in your A C unit. Well, maybe the A C company needs their Web site redesigned exchange services and save Save yourself. Acosta Informant involved employees that made the list on cutting costs, you know, asked for their ideas. So, you know, well, typically, it's just one person sort of involved. It's usually, you know, someone in accounting and finance or the CFO or CEO Looking at all this, you know, don't be shy about asking other people as well for their ideas. I mean, you would be surprised what people can come up with and always look for other ways to cut costs without sacrificing the quality of your products or services. I mean, at the end of the day, yeah, you don't wanna have to started to grade your company by, you know, are you know, face reduced morale within your employees. In your staff, you want to make things go smoothly as possible without much, you know, Hiccup in your operations, but at the same time really cut back on those expenses. I think if you get everybody on board, you'd be surprised how helpful people will be just again those easy things. Turn the printers off, Turn your computer's off over the weekend at such a turn, the lights off as you leave the office. 12. 039RCE30 Section 03b Overall Impact: All right, So let's just address the overall impact of all this on your company. So at some point in your career, you may have to decide how how to help cut costs. So, you know, by taking this course, you're coming up with some valuable information ideas on how you'll go about that, Um, some you might have thought of are a like a typical one, as we always say is, you know, look for ways to cut down on payroll. But maybe you didn't think about, you know than outsourcing Some of those positions are bringing an intern stuff. Ah, you wanna have options at your disposal, CONST Reduction applies a penny saved is a penny earned. That old adage very much is true. So while these might be small cuts here and there, they truly can add up to quite a substantial amount of savings for your company. This can be accomplished by one person. The entire staff support is essential to make cost reductions successful. Now there's no, you know, whatever power you have over your company, unless your one person company you know you're gonna need other people involved in onboard with your decisions, the entire staffs. Recognition of golden objectives will reduce normal resistance to cost reduction. So, you know, you just want to get everybody on board. But really, you know, make it a team effort. You know, this is a good thing. We're looking to make our company more profitable so we could be more agile and dynamic and grow quicker. So and lastly, everyone should know that changes will effect and help the business and its people positively win and force. So again, you know, people here cut costs automatically. Assume it's a negative thing, and it really isn't again. We're talking about making changes to make your company a better company and be more competitive. So there's lots of great ways and benefits that you can put a spin, if you will, on on having a cut costs. If I mean, if it is for drastic reasons, maybe really do necessarily have to cut your costs, Um, or even if it is legitimately, just because you want to be more profitable, there's always a good reason to look at your expenses and see where you can save 13. 039RCE30 Section 03c Case Studies: okay, lets just We're gonna go through three case studies really quickly, just sort of ways that other companies that actually did work with ways they cut their costs and how it impacted them. So we have soon to be public companies. So they're a private company. There are growing quickly, and they're gonna be going public on the stock market so that they're definitely, you know, growing quick. But that's not a good, you know, excuse for being sort of loose with your spending and expenses. There's always room for savings. So they had already implemented cost cutting techniques to set the tone for from the start , they said, Hey, we're going to run a pretty tight ship around here. Um, they use VoIP instead of regular phone use. Google Voice is well for calls. They use Google's or email provider with a custom domain. You can do that. So rather than pay well, maybe in a more expensive option, Google does up offer the option to basically use their interface and whatnot. But you can still have your domain as the as the provider. I'm that flexible lease term so that could scale up offices. So, you know, they didn't get locked into long term leases, and they also didn't leaves out space that they didn't need thinking well, will grow into this eventually. Instead, they really kept it very short term. So they had that flexibility. Excuse me. And then, obviously, if the company didn't grow as quickly as they anticipated, you know they could work with that. It's much more. Ah, favorable toe. Have the short term leases than it is to have a loan term leasing a property that you may not need or you outgrow, but you're still stuck with it. So in the second case study, um, private company, it's based in Costa Rica. So they started savings by having a majority of workers in Costa Rica, and it was a software in a dot com company. So Ah, a lot of the staff was basically virtual, if you will. But they did have some sort of physical staff on site, and they were down in Costa Rica. Essentially all Gina is cheaper with general, general and administrative costs. It's a labor rent utilities. It's just cheaper based on the nature where they're located and sent, and Costa Rica versus being in the United States. They use Skype. Her phone If actor faxing, Um, that's both cost saving. And it's just it works better when the infrastructure down there isn't quite a no is up to powers that is in the United States. So it's almost easier toe have you know, a Skype to use. And then one thing we talked about earlier about voice. You know, with Skype, you can send messages. So the company relied heavily on that, just sending quick messages through Skype rather than calling and emailing employees were contractors, for the most part. So there you're saving on payroll tax and health benefits. So again they had their sort of work based in Costa Rica. But they still had employees worldwide. The one thing I should mention as well. They really use contract work often, so they're sort of regular contract workers who helped run the company. But they would bring in sort of one time specialist, maybe to run a marketing campaign. So, uh, they really leveraged the power of the Internet and and their location as well toe really learn, run a low cost operation, and then a case study Number three ah publicly traded companies that means they're on the stock market. Tend to be bigger. So 150 plus employees They had a policy that employees try to conserve energy again. It's all the things we talked about, guys. So turning off the lights when you leave the office, you know, monitors, printers, you know, shut them down. Have the monitors go to sleep after two minutes. Five minutes, whatever it might be turned the printers off. When you leave the office company wide, each person help save a little, and it adds up to a lot. It really, really does, um, as well managed over time of our only employees. That's one thing we didn't talk about, but over time definitely gets expensive. So, um, typically, companies will definitely have a policy where employees aren't allowed to work overtime. They have to get it approved, etcetera. So you don't want to be paying overtime unless you really, really need to 14. 039RCE30 Section 03d FAQs: All right. So let's just go over 10 general fax questions that get asked often times when it comes to cost reductions and savings. Um, so his management support critical for contradictions? Yes, because you're anytime you make a change in the company, you kind of need management's by off and need their support, like employees. You want to know that management is behind this as well? Does it always involve firing people? Sometimes it seems that way. But not always. I mean, if you're just looking to fine tune, maybe your income statement look to some of those other ways that we talked about. It doesn't have to involve firing people. Well, the strategies, when implemented, affect revenue. So, um, it depends if you employs some type of cost cutting that, you know, stay cuts back on your marketing expense. Well, that that might have an impact on your revenue. Um, but something like turning the lights off a night that's not gonna impact your revenue at all. So you definitely want to think those things through, though. Any time you're making a change, what other impacts does it have on the company? Does this involve changing suppliers? But sometimes that might. I mean, if it's one of those cost cutting techniques where you're looking at, you know, switching from buying name brand furniture and not name brand, you know, office supplies to just generic, then it may well involve changing suppliers. That's not necessarily a bad thing. How long will it take to see improvements and costs? Well, yeah. I mean, you typically have to go through at least one period. So if that's a month, so be it. So But it should be fairly immediate. Essentially, in that sense, something I mean pretty much any costs that you can, you should see the impact within the next months. Financials number six. Does the entire staff need meetings to understand the goals and objectives of cost reductions? If it's just small things, you know, you're changing suppliers. Um, you know, for your office supplies, you probably don't need to have a staff meeting. Um, if you're laying staff off, though, certainly you do. So it really depends on the nature of him. Are their taxes to be paid when trading services? So, technically, you are still trading something of value. So in theory, you would still have to assign a value to that and provide tax documentation Honestly, does it happen? Probably next to never just its companies don't want to deal with it. They don't even think about it, since there's no money exchange, you know, they're not thinking about the tax impact, but technically, yesterday, the should be taxes paid on something of value being exchanged. Does using available technology help cut costs? Of course, it depends, too. I mean, that's a situation where if you implement a completely new system, there might be a big upfront cost. But in the long run, it helps save. Does cost cutting hand negative impact on quality? Not necessarily. It depends on what you cut costs on. And then, lastly, are their expenses. When implementing cost cutting strategies, there may well be, I mean, there might be fines and penalties if you switch vendors. Um, that probably shouldn't be too much, though. In terms of expenses again, there might be expenses if you, um, have to spend money upfront in order to get a cheaper service, or maybe have to pre pay for a service. Maybe when you sign up for your VoIP voice over I p service, you pay up front of beginning of the year, so there's a bigger impact upfront, but over the space of the year it ends up being cheaper. 15. 039RCE30 Section 04a Course Conclusion: All right, everybody, that is it. Congratulations. You made it through the course. Let's just go over the some conclusions here, and we'll talk to a few other points before I let you go. So first of all, keep people informed and cost cutting plans. You want to let everybody know what's happening, but again, within reason depends on the nature of what you're cutting. And, you know, do you really need a staff meeting about something or not? Be open other employees, ideas or suggestions? I would actually open it up to other people. If you're really looking for ways to cut costs now, ask other people. What would you dio be ready for the outcome, good or bad and deal with it positively. So again, If it's one of those more drastic ones where you're having to lay people off and hire contractors, you probably feel a bit of backlash from that. So you have to be prepared for that. Always think that the entire staff and not a single point can make this work, and the cooperation is critical. So again you need everybody's by and not one person can make changes that globally affect the company and lastly make use of tools or people that can help cut accosting plan successful. You might have those champions in your company, um, or department heads or whatever it might be, um, that you can rally and get behind you. Or maybe, you know, it's the department heads who you talk to, and then they really relay information on to their staff. So with that said, there's me feel free to reach out. If you didn't heading questions during the course, hopefully sent me a message already, if you did not feel free to through the course website is, honestly the best way. But there's my contact information on the less two final points. I love hearing your feedback, So if you can go ahead and leave a review for the course, anything I can do for you to get those five star reviews much appreciated and love hearing what you have to say about it and then, lastly, I encourage you to check out my other courses have quite a few other courses, all about sort of entrepreneurial, um, items and revenues and, uh, accounting and finance and entrepreneurship. So I definitely take a look at my other courses. You might find something of value there. And I look forward to being your instructor on another course. Thanks, everyone.