Quick Methods For Businesses To Reduce Costs

Owning or running a business can be a daunting endeavor. You have to gather resources, make sure financing is adequate, pay labor, strategize, and prove substantial revenue and growth. That last one, the bottom line, is the most important. The two ways to improve the bottom line are growing revenue or decreasing costs. While growing revenue may be pretty straightforward in that you can sell more products, increase your geographical or demographical base, or add new ventures, decreasing costs is a little more complicated. There are some costs that absolutely cannot be removed. This might be the electric bill if you have workspace. Others need to be measured as to whether or not the benefit of decreasing the cost outweighs the detriment to the business. This would include layoffs or decreases in necessary labor, or maybe the use of inadequate or cheaper materials. DJJ Events and Consulting in Baltimore, Maryland, has zeroed in on a very painless method to reduce costs. The Cash Discount Program or Practically Zero Program is a way to decrease costs for everyone through the use of liquid cash.

The Dodd-Frank Act was a monumental piece of legislation, passed and signed into law in 2010. It was sweeping legislation that covered a lot, including revamping many aspects of the financial regulatory system. One section of the law included regulation that would rein in abuses from credit card companies. This fell under the purview of the newly formed Consumer Financial Protection Bureau (CFPB). Giving people options on how to pay, or encouraging them to use cash can reduce costs dramatically for a business. One example is Merchant Pro’s Practically Zero Cash Discount. When a purchase is made, credit card processing companies will charge a large percent to complete a credit transaction. This costs businesses a large piece of their possible revenue. Under this program, at the point of sale, a credit service charge is automatically added. A suggestion to pay cash is automatically offered to the customer at the POS. If they take this route, they will be given a discounted rate, as the credit service charge is taken away. With this system, the customer can choose to pay using credit, but the processing fee is passed along to them, instead of the business losing a large percentage of the sale amount. Signage needs to clearly mark this policy, in order to remain compliant with the Durbin Amendment.

Transparency is a huge part of abiding by the rules when offering cash discounts. Not only is signage required at the entrance and POS, but any cash discounts need to be clearly marked on the receipt. Businesses can charge up to 3.99 percent to help pass along the credit card processing fees, so they also need to verbally offer the cash discount for all rules to be followed.

There are, of course, other ways to decrease business costs. A consultant such as DJJ might point out a property where the space will suit that particular type of business better, yet the rent is cheaper as well. There are almost always ways to decrease costs where the benefit far outweighs the negative. Consultants are also good at finding grants, funding, and capital which can be used to pay off debt and save on interest. If manufacturing is expensive, it may be necessary to wait for a lease to end to move operations. Even then, moving large businesses may turn out to be an exorbitant cost.

The one method that quickly decreases costs, but that everyone wants to avoid is decreasing your labor force. No one wants people to lose their jobs. That is why using a consultancy, or at the very least investigating your possible cost decreases is prudent and sometimes necessary.