How To Reduce Overheads and Build a Profitable Online Business
Learn how 3PL and outsourced logistics can help your business reduce overheads and support growth
Maximum revenue and minimum cost. It’s the premise of business growth, and in theory it sounds simple enough. But the ongoing costs — or overheads — that business owners face can too easily become an anchor, stopping your progress before you ever get to set sail for new horizons.
While any enterprise will incur expenses, it’s important that these be reduced wherever possible so they don’t become an unnecessary and ongoing burden to a growing business.
Here are some simple, practical tips you can use to reduce your ongoing business costs:
Embrace the Tech Age
The online revolution has changed the way we live. It’s also changed the way we do business. While giving businesses more networking and marketing power than ever before, technology also has the potential to significantly reduce ongoing business costs.
Cloud computing can help you save on data storage and email servers. Online platforms and automation have made finance, payroll and accounting easier than ever. Meanwhile the emerging freelancer economy gives you access to a global network of consultants and specialists ranging in everything from IT to web development. Rather than absorbing the ongoing costs of staff, you can outsource key projects on an as-needs basis.
Streamline Your Supply Chain
An online eCommerce enterprise involves many moving parts, covering point of purchase, storage, transport and distribution. When starting out it’s common for each of these key steps to be managed independently. But if not adequately scaled for growth, it’s easy for inefficiency to creep into the supply chain, hindering your bottom line.
Outsourced logistics can help by giving you a central location from which you can manage the key components of your supply chain, making sure everything is running smoothly and efficiently.
Explore Bulk Purchasing
There’s no avoiding it — at some point you need to purchase essential supplies for your business, whether it be stationery or office equipment. Rather than going it alone, many small and medium sized businesses form clusters based on geographical location or industry. This cluster gives a group of businesses access to bulk purchasing, meaning recurring office expenses can be bought at a cheaper rate.
Get A Handle On Your Inventory
Stock that sits in storage or takes up space on your shelves is a financial black hole. You’re paying for it to gather dust. Third Party Logistics companies will be able to give you real-time reports on the state of your inventory so you can remove excess merchandise, free up valuable storage and dedicate more resources to the products that generate revenue.
Review Your Essentials Regularly
It’s all too common for business owners to sign up to a phone and internet plan or electricity package and then never revisit what it’s actually costing them. Many utility companies offer attractive sign-up deals, only for the discount terms to expire after a certain length of time. In many cases the costs increase without the business owner ever realising. It’s the same for insurance companies where you may end up paying for cover you don’t need.
Make a habit of reviewing these essential, ongoing costs regularly and don’t be afraid to shop around for rates and packages that suit your business and budget.
Reduce Business Costs With 3PL
3PL can help your business reduce costs and operate at maximum efficiency. Take our quiz to see if it’s time for you to scale up and outsource your logistics.