This is either the most difficult lesson in business or one of the best ones to learn...
Maybe, just maybe, it's both...
I know I've learned some tough lessons over the last 15+ years in business.
Some have been harder to take than others. Bottom line, I'm learning every day.
Yesterday, I was reading an annual SEC report for a large company that sells envelopes, among other things.
(I'm in the market to make a big purchase for envelopes and wanted to see what one of the companies I used to do business with was up to.)
I was impressed with the CEO's candor and tough choices they made and how he acknowledged his cohorts in getting the company through its rockiest times, ever. Certainly the rockiest times I can remember.
One of the things he beat on pretty hard was their unwavering commitment to keep costs down and to continue to look at ways to reduce costs. It's pretty simple if you think about it. Every dollar you trim in overhead that does not affect sales, goes to your bottom line.
Let's put this in terms of dental offices: If your overhead averages $50,000 and you find a way to cut just $1,000 a month on average from that number, you literally just put $12,000 in YOUR pocket that was going to someone else.
For big companies (also, for big dental management chains), every time they save 1% on supplies, or 1% on credit card charges (merchant fees), or 1% on their leasing fees, or whatever, they are seeing that savings go right to the bottom line.
If you are in a tight spot right now, every single line item on your expenses needs an analysis. It needs review. It needs your attention, because, it can and will, greatly affect your profits. Now, and who knows how many years into the future.
For me, it was one of the more difficult lessons to learn. It's one to revisit at least every 6 months. You, your bookkeeper or accountant, and going over each line, one at a time, to see exactly where you are now and what you could easily shave to get costs down, profits up. It's more money for the same amount of risk.
How can you go wrong?
Reviewing, asking questions about and cutting overhead costs -- probably the most difficult lesson to learn and repeat often, in business. It's rarely talked about and rarely done. Be the exception. Now.