Have you ever wondered where your money is going every month? Being in control of your business spending is an essential component to the health of your dealership. No matter how minor they may seem, expenses will quickly add up and if left unchecked, can eat directly into your profits. By taking the time to identify which areas of your dealership are generating the greatest charges, you can find ways to save money. Here are some tips on how to make sure you’re controlling your expenses:
Make Efficient Changes to Operating Costs – While certain expenses like rent and payroll for your employees may be fixed, there are other areas where you could be saving money. Doing simple things like installing LED lightbulbs and fixing leaky faucets can help keep your utility bills down. If you outsource services like lawn maintenance and snow removal, make sure you’re paying the lowest rate possible by shopping around for a vendor with the best pricing. While it may not seem like much, things like office supplies and break room snacks are also areas where you can save money by reducing waste.
Evaluate Your Technology Needs – Internet pricing can range anywhere from $35.00 to upwards of $500.00 a month and it’s easy to assume that the most expensive service is going to be the best for your business. But that’s not always the case, especially if you’re using older technology or don’t have multiple people online at the same time slowing down your internet speed. Make sure that you’re using your current service to its full capacity and if not, look into getting a cheaper service. Thanks to advances in technology, there are a lot of options available to you (DSL, cable or fiber) at different price points so you can find the right service tailored for your current dealership needs.
Optimize Your Advertising Dollars – Be money-wise when it comes to buying ads to market your dealership. Digital ads are a fraction of the cost compared to traditional print, TV and radio. You can also target specific types of audiences so that you know your ads are reaching the right customers. Use your social media channels to showcase your inventory and link to your dealership website where customers can start the buying process. If you need help getting started, there are several articles available online with tips and best practices on how to implement digital marketing into your sales process.
Re-evaluate Your Need to Travel – With so much available online, you should ask yourself if you really need to leave your dealership for certain purchases. Whether it’s picking up office supplies or buying inventory at an auction, you can save both time and money by buying online. Additionally, make sure that you’re keeping your personal and business travel expenses separate. It can be easy to write off a fuel receipt when you’re out running personal errands on your way back from an auction but keeping tabs on this type of spending is another way you can help protect your bottom line.
Save Time and Money – Time is one of your most valuable resources and you can’t afford to waste it. Make sure you’re delegating day-to-day tasks as much as possible to other employees if possible. You should also ask them for their feedback on ways to save money as they may have noticed additional areas you haven’t thought of. If you’re a one-man show, take advantage of tools you already have at your disposal like your email calendar and apps on your phone that you can use to set reminders and help you project manage. If you use a floor plan, NextGear Capital’s Account Portal can help you streamline your business by helping you to do things like clear audits and pay off inventory in real-time.
Just like creating a budget for your personal expenses, taking the time to thoroughly examine your business spending allows you the opportunity to make any needed adjustments to increase your profitability. And no matter how small the savings may seem, they can quickly add up to generate the same amount of additional income equal to making an extra sale each month, helping your dealership thrive.