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Published on: How-To

3 Ways to Reduce Operational Costs

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As you grow your business, it is a given that certain operational costs will increase as well. This is a natural growing pain for most businesses. If you are a leader/manager who is intent on lowering operational expenses and thus increasing profit margins, there are a few areas within your business that you can focus on in order to reduce costs.



As you grow the demand for your product or service you may feel as if you immediately need to hire additional human beings in order to handle the workload. That is the natural thought process for any leader. However, have you considered streamlining the processes or workloads that your current team handles, which in essence, will free up their time and energy to accommodate a fraction more of the increased demand? Just because what and how your team does things now works, does not mean it is the most efficient way of doing things. You or another decision maker may not be privy to taking the time and energy to discover the bottlenecks and develop processes to eliminate them. But, you can save an additional $30k – $100k in yearly salary by just taking a month or two to address your operational optimizations.

Office Supplies

No one ever talks about how many pens, sticky notes, toner, ink, paper clips, staples, etc. that businesses go through. It’s outrageous! And if you offer coffee or snacks, it can result in a significant amount on your P&L at the end of the year. One business we worked with in the past spent over $20k in office supplies or what we at Initial Approach consider consumables. How can you implement operational cost reduction in such a necessary aspect of the business? We recommend signing up for Capital One’s Spark 2% Cash Plus Credit Card. Capital One has an integration with Amazon that lets you use your cashback points to purchase the things you’re going to be purchasing consistently throughout the year – consumables. All you have to do is put as many of your payables on the credit card as you can. It’s a simple tactic that has an impact on the bottom line.


The price of natural gas and electricity are rising, and unless you have insider knowledge that they will be decreasing in the near or distant future, they are an aspect of your business that need a little attention. Natural gas is used to heat our office space and the water in our hot water heaters. In the winter your team might be leaving your furnace running and that water heater is turning on periodically to keep that water in the tank at a preset temperature. Electricity is used to power the lights and the Air conditioning in our offices. During the winter your team might be bringing space heaters to make up for the lack of a working furnace and during the summer, your air conditioning is probably running non-stop. We had a Real-estate client who had one side of their building that stayed uncomfortably hot during the summer for a few hours before the sunset. The zoned A/C never turned off and it was costing quite a bit. Our solution was putting UV-reflecting vinyl on the large exterior windows which was fairly cheap and the more expensive option was adding architectural corrugated exterior wall panels to keep the direct sun off the building exterior. For a more modest approach, leaders can ensure the space they occupy is sealed as much as possible by putting weather stripping around doors and windows, patching holes in ceilings, or placing foam insulation on top of ceiling tile. You can also get a smart thermostat that you can program with a working schedule and train team members on a realistic policy for keeping a comfortable climate around the office.

Operational costs can get out of hand if they are not addressed periodically or if they are the responsibility of leaders or team members who are not aware of the impact doing nothing has on the business’s bottom line.


If you have additional cost-saving strategies, please leave them in the comments and we will address them in this post and credit you.