Costs can creep up through the years, so it’s worthwhile to canvass, compare, call.
It’s nearly spring, time for the annual ritual of spring cleaning your small business fixed expenses.
Give me half a day, and I’ll put more money in your bank account.
While you’re running a business, you have fixed expenses that you routinely pay monthly. Perhaps you wince when you write the check or pay the credit card bill, thinking, “This just seems too high.”
But you’re busy—with customers, employees—doing the things that make you money. Taking a frustrating hour out of the work day to spend negotiating with your Internet provider, even if it’s your office manager’s time, just doesn’t seem worth it.
But these bills add up.
Perhaps you chose a telecom company because of a tempting introductory offer three years ago. That $39 a month is probably $150 a month now.
And here’s a dirty little secret: Companies know you get busy or lazy, and they slowly raise prices, especially on long-term customers. I’m betting that your insurance—whether health, liability, vehicle, fire—has increased substantially since you chose your provider.
Moreover, since you first set up your company, a raft of new, less-expensive options probably have been introduced, especially for business services that are cloud based or provided over the Internet. For example, you can get your entire small business phone service from a cloud-based Voice over Internet Protocol provider, save money and ditch a traditional phone company.
Of course, you’re not going to make a switch on something as important as your phone system in just half a day, but spring is a good time to look at all of your fixed expenses—what some businesspeople refer to as their “nut”— and dedicate time to lower them.
Let’s get started on spring cleaning your small business fixed expenses:
1. Collect the most recent statements.
Include all accounts you pay regularly—not just monthly, but quarterly, semi-annually and annually. Remember to check your credit-card statements for accounts that bill automatically, such as online services or Web hosting.
2. Do research.
Gather prices, advertisements and promotions for all the services you use, both from your vendors and their competitors.
Through social media, ask other business owners which services they use and whether they will share how much they pay. These give you ammunition when negotiating.
3. Set aside a few hours.
Preferably choose the morning, to make phone calls.
Now get ready to make calls. For each account, call your sales representative, agent, or the customer-service number, and do the following:
• Ask to lower your rate. Yes, this seems daunting, but it’s surprisingly uncomplicated.
Just say, “Hi, I see I’m paying a rate of …You’re offering a lower rate to new customers; I’d like that rate applied to me.” Or, “I’m considering switching suppliers, (canceling my service, credit card, whatever …), unless you can offer me a substantially lower rate. What can we work out?”
• Negotiate. Don’t take a simple “no,” or “that’s our standard rate” for an answer.
Ask to speak to someone who has authority to discount your rates. Most companies will offer you something, especially if you’re a good customer. Mention the other prices or deals you’ve seen or been offered from other companies.
• Be willing to switch. You may get a much better deal from a different company, and it helps your negotiating stance if you’re truly willing to leave your current provider.
If changing providers is not very disruptive to your company and you save a lot of money, be ready to make that step.
• Be courteous. The goal is to have vendors want to keep you as a customer.
If you’re belligerent, they’ll be happy to see you go.
Be certain to look at all recurring expenses, any bill that you pay at least once a year and especially once a month including these:
- Business services
- Credit cards
- Internet hosting
And while you’re making calls, why not negotiate with the cable company? Yes, this is a personal expense, but if your cable bill is like mine, the cost has crept up substantially.
OK, so download my worksheet below, get your paperwork together, pour yourself a cup of coffee, and get into a relaxed state of mind.
It’s time to save some money.
Copyright, Rhonda Abrams, 2015
This article originally ran in USA Today.