What Can Small Businesses Do to Reduce Operating Costs?

Owning a business is the ultimate goal of many people. After all, such a career move gives you an unparalleled level of control over your professional life, allowing you to implement your vision however you see fit. You no longer have to worry about potentially taking the fall for the less-than-perfect business decisions of your superior or even losing the job because of someone else’s problems. No, this time, you are in control of every move being made. Welcome aboard, captain – the steering wheel is yours.

Bear in mind, however, that to run a successful company, you also need to optimize for efficiency. One of the crucial things to do is to reduce its running costs. To help you get started, we’ve prepared a list of several ways to decrease the expenses associated with operating your business, including automating menial tasks, outsourcing processes whenever possible, switching to a remote work model, and canceling unused services. Read on to gasp at how much you can save in terms of both time and money that can be directed toward growing your business.

Automate Simple Tasks

One of the best ways to reduce your operating costs is by automating menial tasks. While many of them are essential to the everyday functioning of your company, many can be performed with the help of suitable software. Financial processes are among the most commonly automated. In fact, the only reason you shouldn’t automate them is if you enjoy doing them manually – a luxury that you no longer have as a serious entrepreneur. You can easily generate paystubs, send and pay invoices, and perform other accounting tasks online with the help of suitable accounting software.

Another area ripe for automation treatment is your customer support. If your company relies on a website of any kind, you should turn to a powerful customer management tool that can take care of your customers’ questions and requests without needing your attention. This software can reduce the number of support tickets you have to deal with, allowing you to spend more time doing what matters most – business development – without sacrificing customer satisfaction.

Outsource Whenever Possible

While automating tasks can make your business more efficient by limiting the amount of work, outsourcing allows you to improve by eliminating the need for people to perform them entirely. Sometimes it might not be worth it to go through the hiring process and, then, keep a full- or even part-time employee. In such a case, you can turn to a freelancer or an outsourcing company that will be paid for the job done rather than a salary. For example, if your company relies on marketing, it might be beneficial to hire a marketing agency that can handle all of your web design, SEO, and PPC tasks. Working with an outside provider allows you to retain creative control over your product without dealing with employee drama and the issues of retaining workers.

Switch to a Remote Work Model

The development of technology has provided many business owners with the opportunity to move all their processes online and enable their employees to work from home – or any other place with a stable internet connection. In this model, employees are not required to come to the office every day in order to perform their duties. This allows people to save money on gas, provides employers with a more flexible workforce, reduces the costs of furnishing and maintaining an office, and more.

A lot of businesses use a hybrid approach that mixes in-office work with remote work. They all have offices where employees can meet face-to-face with each other, but everyone is allowed to work from home as well if they so choose. This gives their employees a greater degree of freedom and allows the companies to save on overhead costs. 

Cancel Unused Services

Another way to reduce your operating costs is by canceling unused services. You might’ve signed up for a subscription or a software license long ago and forgotten about it, but it’s still costing you every month! To remedy this situation, you should go through your bills every once in a while and cancel any unwanted services. After all, nothing stops you from signing up for them again in the future if you need them.

However, when doing this, you should consider two things. First, be sure that you actually don’t need those services anymore and won’t need them anytime soon. Second, check if there aren’t any contracts you might break by canceling the service. Otherwise, you risk having to pay more than necessary just because you thoughtlessly canceled a subscription without even reading the fine print first.


While reducing your operating expenses isn’t the same as making your company profitable, it’s a step in the right direction and can help you achieve your goal of running a successful business. By following the tips outlined above, you can significantly reduce the cost of processing your customers’ payments and running your operations. The quicker you start taking measures to decrease operating costs, the sooner you can see an increase in profits and the overall health of your company. Good luck!

Ajay Deep

Ajay Deep is the brain behind Coworking Mag. He founded this website to help startups and aspiring entrepreneurs find a coworking space in their city. He is a successful entrepreneur who started and scaled a bunch of startups – all from shared office spaces. He has visited hundreds of coworking spaces in different countries and is now an investor in this evergrowing idea of developing new coworking spaces. You may reach Ajay Deep at [email protected]
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