Cut your monthly business expenses with our 10-item “no loss” checklist

Which expenses make you money? Which don’t? It’s crucial to know. As a business owner, knowing where you can cut waste can save you thousands of dollars per year.

With some expenses, you need an accountant to help you sort that out, because the connection isn’t so clear. For example, employee benefits can be a powerful way to reduce turnover. And in an indirect way, higher quality inventory can actually help with brand perception and loyalty. 

But some expenses are clear-cut—especially around utilities—and that’s this list. We call these “no loss” cuts and we’ve organized the top nine into a checklist based on our insights managing the books and accounting for 2,000+ small businesses and startups. It’s part of our new series where we aim to make managing your business’ finances a bit simpler.

10 zero-loss cuts and trims for common expenditures

1. Revisit all recurring credit card expenses

Go through your credit cards to cancel subscriptions to things you don’t use anymore. Virtually everything requires a credit card to sign up these days, and you or your team could have signed up for trials for things you’d forgotten about. Or, your team could be paying for multiple software tools that do the same thing, like Canva and Adobe Express. 

(You may also find some no loss cuts, like swapping Zoom web conferencing out for the free alternative, Google Meet.)

Create a recurring quarterly calendar reminder to investigate all credit card subscriptions. Enter this as the description:

Calendar reminder: Cut off old subscriptions

1. Check all credit cards for recurring subscriptions

2. What is no longer in use?

3. When in doubt, cancel it. If someone needs it, we’ll hear about it

You’re unlikely to lose your data by canceling. If anything, those providers will probably offer you a discount to stay or come back. You can “farm” these discounts for additional savings. 

2. Set hard budgets with virtual bank cards

Most businesses start out operating in the dim twilight of “I hope there’s enough cash in the bank.” But as those owners start to take things more seriously, they start to budget. The best modern way to enforce those budgets is virtual cards. 

Most legacy banks now offer these, and you can log in and create them now for free. Or, if you want even more control, consider a tech-enabled bank like Mercury, which some say has an easier interface.

How to set those budgets:

1. Plan all your budgets in a spreadsheet

2. Decide: Would you rather limit expenses per employee or per spend category?

3. Create virtual cards: Either one per employee or one per major category

4. Set monthly spending limits on each card

5. Distribute those virtual cards (a password wallet makes this easy) 

The result is full control over your overages. Nobody can spend beyond what they’re allowed. If someone runs over the search ad budget, you’ll get an alert, not a surprise bill.

Common budget categories to limit: Contractors, rent/lease, inventory, professional services, repairs and maintenance, travel and fuel, advertising and marketing, postage and printing. 

[Callout—Pull in the startup budget template until we build a new one for SMBs:

3. Cancel software licenses for past employees

If your team says they must keep paying for a crucial tool like a project management tool, or Zoom web conferencing, no problem. But do look into whether you are paying for licenses you no longer need. Did anyone leave the company, and you’re still paying for them?

Some services are more complicated than others. We wish every provider had a fair billing policy like Slack, the work messaging app, where you only pay for what you use. For all others, sweep through—$12 a month here and $25 a month there could add up to thousands of dollars per year.

4. Periodically renegotiate your internet and phones

We aren’t the first to say this: Big phone and internet companies operate like monopolies. We all rely on them, but only have a few choices. Which is why the costs seem to rise each year—14% last year alone, found U.S. News & World Report.

Make a calendar reminder to, each year, revisit your internet and phone lines to see if you can get a better deal, especially from lesser-known resellers. Because here’s a secret: While AT&T, Verizon, Cox, and Comcast operate the big networks, they resell unused capacity to resellers just like fashion brands offload unsold goods to bargain outlets. That means when you sign up for a reseller, you get the same network—just for less. (Technically your traffic has lower priority, but for office internet, Wifi, and credit card machines, you’ll never notice.)

Also look into Google Fiber and Google phones. Google built its own fiber network and gives discounts to undercut competitors, and their phone network runs on T-Mobile. 

If you’re really clever, your internet savings will allow you to maintain two internet lines per location—a primary and a backup. One on fiber, one on coaxial cable. If one goes out, you have a backup.

For your phones, consider switching to internet-based VoIP. It’s improved A LOT over the last decade and legacy phone carriers overcharge for copper landlines. You definitely should not be paying any long-distance fees anymore.

5. Slow down—stop paying your vendors so fast

You may feel a sense of pride and obligation to pay people quickly. But if you, in turn, are not paid quickly but your clients and customers, you are acting like a bank. You are lending others money each month.

This is a cash flow 101 topic and the key to a solid business: Enforce Net-30 payment terms. You’ll have more cash in the bank at any given time, and you also make more on the interest in those savings accounts, won’t need to take loans as often, or if you do need loans, you’ll pay less for those loans. 

‍6. Turn off old, underperforming ads

Advertising platforms like Google and Facebook are complicated, and it’s easy to accidentally allow old ads to keep running. Or maybe you feel like it’s nice to have them up, so something is happening. But every ad that does not convert at that platform’s benchmark (say, 1% clicks) is losing you money. In which case, you are just paying Google.

Log into your ad platform this week to turn off all ads below the benchmark. Also, consider consolidating ads—funnel more of your money into fewer ads so you have better data on what actually works.

If you’re an e-commerce store that runs a lot of ads, you can also: 

• Improve your landing pages—Ad networks actually review your landing page to determine what ads cost. Better design and writing pay for themselves in cheaper ads.
• Feed the strong—Don’t put more money behind low-performing ads to help them catch up. Put all your winnings behind those that already perform.
• Go ask a customer—Want to know if an offer resonates? Print it out and ask recurring customers to pick their favorite.

7. Consolidate line items on your invoices

If you run a services business and send invoices to customers, consider consolidating all those line items into just one package. Customers who were otherwise perfectly happy with the price may see those line items as an invitation to nitpick. They’ll say, “What is this?” and “Why am I paying for that?” This not only costs you money, it steals time from your sales and service departments.

Run an experiment: Bundle several services which you used to list separately together into one item. See if it reduces change requests.

8. Finally go paperless

Most customers are now comfortable with digital receipts. Some still want them, but that’s why most point of sale (POS) systems allow you to offer that option—but not as the default. Less printing means fewer printer rolls.

This is on a much larger scale, but the environmental group Green America finally convinced CVS to stop printing its ridiculously long receipts and saved enough paper to circle the world twice—and saved CVS $50 million. RIP a very fun meme, though.

CVS receipt jokes:

The same savings apply to your office. While people may prefer to read on paper, digital documents just have so many advantages: People can comment, share, and co-edit. At the very least, put a “Please consider not printing this” watermark on all company documents. It all leads to savings.

9. If you don’t have a bookkeeper, find one

Because, how else will you figure out what expenses are necessary as you grow? It’s one thing to DIY your expenses in a spreadsheet and catch things yourself. It’s another to be able to step back from the business and simply receive a monthly profit and loss statement with exact insight into the categories of spend you most want to track. 

Ask your bookkeeper how they can set up your chart of accounts to provide the insights you need.

Read: When is it time to stop doing my own books?

10. Request a credit line increase on every credit card

Your credit card company determines your credit line based on surprisingly little information—probably, just your self-reported income. If your limit goes up, the credit bureaus factor it into your credit score. 

It’s that simple: Increase your credit limit and you decrease the cost to borrow money. 

Best of all, requesting that increase is free and often quite easy: Log into your bank’s website, go to “Services,” “Account,” or the equivalent, and figure out how to make that request. It’ll likely ask you for your income. Or if you can’t find the option, call. Possibly on your new VOIP phone.

Stay vigilant and keep those costs down

Business expenses have a habit of forever climbing up. That’s why you need automatic and recurring systems to fight back—like this checklist, which we recommend linking as part of your annual year-end remainder.

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What other tips do you have? What else would you like to hear about? Write to us at hithere@pilot.com.

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