As the end of a calendar year quickly approaches, many small businesses are reviewing budgets and expenses for the new year. Between inflation and economic uncertainty, recruitment firms are wise to review all of their spending to see where some easy savings might be realized. Our president Dave Nerz likes to say, “You can’t save your way to prosperity” … but it’s still smart to manage what you can. Here are some cost-savings tips to consider:
Subscriptions
Review everything you currently purchase on a subscription basis. Not using something at all anymore? Drop it. Using it less than anticipated? See if you can purchase a less-expensive option. Review monthly versus annual payment options. Make sure you aren’t doubling up on subscriptions, especially among remote staff. If someone is purchasing a service that allows more than one person to use it, make sure those extra “spots” are being filled as opposed to purchasing multiple subscriptions. It seems like virtually all recruitment firms are paying for LinkedIn – can you cut back to a less expensive version and augment that with a smaller spend on a platform like Shortlyst? A service like AppSumo can help you find great deals on software and apps at better pricing, often on a lifetime basis.
Auto-Renewals
Check a whole year’s worth of credit card statements for any auto-renewing payments that you may have forgotten about. Did you sign up for a free trial that required a credit card, and then forget to cancel it? Did something auto-renew at a higher price? These are so easy to overlook that it’s worth spending a couple of hours scrubbing your statements.
Overhead
When is the last time you really looked into overhead costs? Obviously many small recruitment firms have downsized their office space since the pandemic, but what else are you paying for that you’ve forgotten about? We discovered not too long ago that we were still paying a monthly line fee for a fax number, even though we hadn’t had a fax machine for several years. What about email addresses? Can you reduce your office space or storage footprint even more by going paperless? We made a concerted effort to digitize paper records last year, which eliminated almost 50% of the items we had in storage. Can you sell or donate any unused furnishings that would allow you to utilize less office space? How about a co-working space that offers shared administrative services? Can you bundle any services to save some money?
Automation
Like many businesses, your biggest expense is likely your people. Can you automate any manual or duplicative processes that use a lot of people power? Reducing wasteful processes could allow you to retask your employees to activities that generate revenue. For example, have you automated your billing and payroll processes? If you have contractors, have you moved to electronic time cards? How much additional revenue could you generate if you had more people working closer to the money? Can you create a job-share opportunity that would allow you to streamline some expenses?
Insurance
When is the last time you reviewed your insurance coverage? Are you paying for coverage that is no longer needed? On the flip side, are you sure you have adequate coverage where it’s most needed? Errors and omissions still occur and can be financially devastating for small recruitment firms. Do you have modern cybersecurity coverage? Ransomware and DDOS attacks are increasingly impacting small businesses. This is an area where spending more on proper coverage can save you thousands in the long-run. Make an appointment with your broker before the end of the year.
Marketing and Advertising
Where are you spending your marketing and advertising dollars? And what kind of return are you getting on those? I recently learned that 92% of job seekers abandon online job applications before submitting their information. If you are paying for each “click to apply” but not actually getting any applications, you could be wasting an enormous amount of money. Tools like Canva offer a very affordable option for creating visual marketing/advertising content – the free version is excellent, but the paid version is even better and costs around US $13/month for up to FIVE users. With the paid version you can upload company logos and branding standards, making it easier to ensure a consistent visual theme for your efforts.
The suggestions above are easy ways to streamline costs without cutting people or necessary purchases in your business. If this kind of review isn’t something you currently do on an annual basis, now is the time to start!