Reduce Operating Costs

A recent article, Top 8 Tips to Reduce Operating Expenses in Small Businesses by Amit Sen says that one of the critical reasons why startups fail is lack of proper capital management basics.  How you control your operating expenses has a huge impact on your business.

Here are ways to reduce the operating expense for your small business to thrive.

  1. Create a budget plan

Prepare a budget plan for your operating expenses based on detailed calculation of all your cost centers such as marketing expenses (e.g. advertising and promotion) and general and administrative expenses (e.g. office space rental, salaries, insurance, travel and office supplies). Then every month compare your budgeted expense against your actual expenses. Review and analyze the variances, the lower the variance, better for your business.  

  1. Develop a strategic & calculative cost control

Identify operating expenses that could be avoided or reduced so that you can have savings. For instance, would it be economical to have some part-time workers rather than employing them for full-time? Could renting a commercial office space or renting a virtual office reasonable? Could outsourcing save you on some employee compensation?

  1. Reduce business travel and meeting costs

Meet clients virtually via videoconference or live chat to conduct seamless meetings and maintain vital connections with all the people who help make your business grow without travelling to the actual location.  

  1. Consider outsourcing

Outsourcing will save you from mandatory expenses like employee benefits, compensations and other incentives.

  1. Negotiate with vendors

Don’t hesitate to bargain with vendors and use your skills to reach a reasonable price.

  1. Save on insurance fees

One way to lower small business insurance fees is to locate your office in a safe district as crime prone areas usually demand higher premiums.


Learning different measures to cut your operating expenses will help improve your profitability. Do you want to reduce your expenses on renting an office in South Park? YourOffice South Park is a leader in providing the most prestigious fully serviced office space South Park and meeting space South Park for any size business. Convenient, hassle free, and move in ready- our offices, meeting rooms, and conference rooms are designed to meet your business’ every need.

How do you control your operating expenses?  Feel free to share your ideas. You can also visit us on Facebook and Twitter.


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