When dealing with increased competition either locally or nationally, small businesses are facing having to be more efficient than their competitors to give them more options. Squeezing out as many improvements on expenses and deriving larger benefits from staying a loyal customer to a supplier helps leave spare funds for increased marketing spend or to retain money in the business for bad times.
With that in mind, here are a few ways to make your business operations more efficient and get the most value from your tools and operations.
Switch from Data Centers to Virtual Data Rooms
Previously, the use of data centers operated on the premise that network engineers ran their fiefdom and watched over it like a hawk. However, in recent years, some progressive sectors, like corporate finance and intellectual property managers have seen that using virtual data rooms makes life easier.
Secure virtual data rooms allow for the access of important files and databases from anywhere in the world. Certainly, having to manage a team of IT personnel or deal with hardware failures or connectivity issues is a headache that small businesses can do without. Instead, they can go back to focusing on their core competencies and driving the growth of their business forward while streamlining their operational expenses.
Triple Net Lease
Some businesses that operate long-term but wish to release capital tied up in their real estate holdings can seek to sell their property to specialist real estate investment trusts (REITs) that acquire buildings and then lease them back immediately to the previous owner. The idea is to release capital tied up in real estate that’s inaccessible without taking on debt with a lien or loan against the asset.
For the triple net lease REITs, they acquire a quality piece of real estate at a fair market value and sign a 10+ year long-term lease with a reliable business that’s been in operation there for years. The deal works best for retail stores and mixed-use structures, but companies with offices can also decide to release capital via a triple net lease, pay off company debts, lower expenses, and simplify going forward.
Negotiate Harder with Suppliers
All businesses are having to find ways to offer more in their deals to retain their customers. The same is no different for suppliers that have provided goods or services to your business in the past. With growing competition, not only is your business revenues under threat but theirs is as well. It is incumbent on your business to negotiate hard to secure discounts for loyalty, early settlement of invoices or other beneficial terms beyond what’s presently being offered. Put out projects or large purchases to a form of competitive bidding to drive costs down and balance out any slowing growth from other businesses putting the same pressure on your company.
Companies tend to only look hard at how efficient their operations are and what they’re spending when tough times hit. Unfortunately, this often means the first thing they do to slash costs is lay people off. Instead of doing this, if the business always runs lean – not only when it’s necessary to do so – it provides increased profitability in good times to weather the stormy business seasons to come.