It’s spring! Time for the annual ritual of “spring cleaning.” But don’t just clean out your kitchen cupboards. It’s time to clean up—and pare down—your small business expenses. Give me half a day, and I’ll put more money in your bank account.
When you’re running a business, you have fixed expenses that you routinely pay month after month. Perhaps you wince when you see the bill, thinking “this just seems too high.” But you’re busy, with customers, employees, doing the things that make you money. And then you have to juggle your family obligations. And spending time with friends. And how about exercise? Taking a frustrating hour or more out of your work day to spend negotiating with your internet provider or your insurance agent just doesn’t seem worth it.
But these bills add up. Perhaps you chose a company because of a tempting “introductory offer” three years ago, but that $39 a month is probably $150 a month now. Here’s a dirty little secret: companies know you get busy, and they slowly raise prices, especially on long-term customers. I’m betting your insurance—whether it’s health, liability, vehicle, or fire—has increased substantially since you chose your provider.
Moreover, since you first set up your company, there have probably been a whole raft of new, less-expensive options, especially for services that are now cloud-based. For example, if you’ve been in business for years, you can get an entire small business phone service from a cloud-based VoIP provider (“voice over IP”), ditch a traditional phone company, and still keep your business phone number.
Let’s get started on “spring cleaning” your small business expenses:
1. Collect the most recent statements of 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’re using and if they’ll share costs. These give you ammunition when negotiating.
3. Set aside a few hours, preferably in the morning, to make phone 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 ‘X.’ You’re offering a lower rate to new customers; I’d like that rate applied to me.” Or, “I’m considering switching suppliers, (cancelling 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 by 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.
4. Be certain to look at all recurring expenses—any bill you pay at least once a year and especially once a month—including:
- Business services
- Credit cards
- Internet provider
- Website hosting
And while you’re making calls, why not negotiate with some of your home expenses, particularly your internet/television/cable company? Yes, this is a personal expense, but if your cable bill is like mine, the cost has creeped up substantially.
OK, so get your paperwork together, pour yourself a nice cup of coffee, and get into a relaxed state of mind. It’s time to save some money!
Copyright Rhonda Abrams, 2019
This article originally ran in Her Money on May 10, 2019