What's the best way to budget for fluctuating expenses?

Answered by:

Don Hoeppner

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Paladin Associates, Inc.
18 Questions answered
Answered on September 18th, 2019

The best way to control expenses is to review your Accounts Payables.  Print a report of your payments by supplier in descending order of dollar amounts.  Then review each one and ask yourself how you can reduce payments to that supplier in the short term and long term.  For example:

1) A large expense is probably employees salaries.  Some questions:  Do I need all the staff all the time?  Are they always busy?  when they are not busy with customers, can I have then do other things such as clean, restock, take inventory, make Marketing calls, stuff envelopes with direct mail flyers and coupons.   Should I change my business hours?   do I need more staff because customers are walking out??  Maybe more staff can sell more!!

2) Space Rent is another large expense.  Will the landlord reduce the cost per square foot?   Will they reduce the space I have?   Maybe I need more space to add more products to sell more to increase sales.   Can I sublease part of the space to another non competing retailer?   Maybe add a coffee shop to increase Sales per Square foot.

All of this effort is time consuming and really requires a 'new look' and someone to ask 'why not' over and over and over.



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