The Who, What, When, and How of Cutting Expenses
Today, more so than ever, businesses are making hard decisions while reviewing their books. COVID-19 has rocked our economy and impacted businesses, small to large, and is proving to leave lasting impacts/changes to the world.
WHO? Expenses should be reviewed by department chairs, management, leadership teams and bookkeepers. Yes, I listed a good bit of people. Why? Communication on all expenses should be communicated up the organizational chart. Said differently, the CFO has no clue if the software purchased for the secretary is working properly, without proper communication and insight from the secretary. Consider working with your leadership team or department heads to include discussions on expenses in their scheduled staffing meetings. Again, communication is critical.
WHAT? Having a clear and concise list of expenses is key. Work with your bookkeeper to capture a spreadsheet/list of all the expenses for your department.
TIP: Plan ahead and schedule time on the calendar for your bookkeeper to pull a list of your active expenses prior to your scheduled meeting. Having time to review the list prior to the meeting is helpful.
WHEN? We encourage you to review your expenses every six months.
TIP: Do not get yourself locked into contracts on new technology, software, etc. Always ask for month to month contracts to ensure what you are purchasing is going to be in your best interest of your staff and/or consumers. If month to month contracts are not an option, make sure to do your due diligence.
HOW? Ask yourself a series of questions when considering cutting expenses:
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