Friday, May 31, 2013

How to improve the efficiency of your small business

Business efficiency means making the most out of what you have; a fundamental discipline of running any company. As a small business owner, your key assets will include things like cash, employees, vehicles, premises, and access to products and services, but how often do you check to make sure they are delivering maximum efficiency for your business?

Outsource for efficiency

Outsourcing business functions such as HR and bookkeeping can create real cost-saving opportunities by freeing up a business owner's time that could be better spent on finding ways to improve the company's prospects.

Richard Contreas and Mark Findlay, founders of luxury floor company Harvey Maria, outsource almost all their business processes to operate with a team of just three full-time staff. Using an online portal to outsource their accounting, CRM, e-commerce, warehouse, and stock level processes has enabled them to focus on growing the business and boost turnover by 50% year on year.

Time to switch suppliers?

While it makes good business sense to have reliable incumbent suppliers, over time they will be looking to increase their prices for the products you buy from them, so they should be reviewed on a regular basis. You may find cheaper prices from fresh suppliers you haven't used before, while improved overseas trade could make an international supplier more viable and cost efficient today than previously.

Similar principles should be applied to business utilities, such as telecommunications and energy. Christian Nellemann, CEO of business services firm XLN Telecom, says: "Since the government did away with monopoly providers in favour of central regulation, a number of smaller suppliers have emerged to offer exactly the same products but at a lower cost."