10 Ways to Save $ on Business Expenses

The Business Opportunities Weblog has a great post on 10 ways to save money on business expenses, which originally comes from this article on BusinessTown:

1. Develop a budget for each department.
2. Develop a list of what employees are allowed to purchase.
3. Know how much cash you have in the bank every day.
4. Read and approve each expense.
5. Stay on top of and try to collect as quickly as possible your accounts receivable.
6. Extend your accounts payable.
7. Barter for services and products.
8. Only buy things you absolutely need.
9. Ask every vendor for advice on how to save money on products you purchase from them.
10. Put out a bounty on internal savings by rewarding employees with 10 percent of whatever money they can save the company

This list is great and very useful, but let me make it more basic: Act as if.  Act as if it was your own money that you were spending.  Would you stay in a suite or in a basic room?  Would you drive the luxury car or the mid-grade?  Would you order the $150 bottle of wine or the $50 bottle of wine if you were out with your significant other?

I especially think that number 10 above is the most important: Inspire your employees by paying them for saving money.  Imagine if everyone in your company allowed people to stay in their spare bedroom.  The person who provided the free lodging should be paid a small fraction of the money saved on what a hotel room would have cost and, chances are, if you are staying with an employee, you are going to the same place and might not need a rental car.