Businesses are all about making profits, which is why whether you’re part of a small start-up or a multinational corporation, you’ll have to stick to a tight budget in many areas. While it’s good to cut down on expenses wherever you can, cutting down too much can be counterproductive and end up costing you more in the long run. Here are five particular areas where you should never underspend, and should maybe even consider investing more money.
Marketing
Whether it’s getting the word out about a new business, or finding new customers for your product, marketing is essential for any business. There are lots of reasons why marketing is so important, from brand recognition to reputation, and if you’re noticing a slump in sales then a new marketing campaign can really perk up business. Cutting money in this area could mean fewer sales, and therefore it’s counterproductive when your company is going through a difficult financial time.
IT and IT support
Cutting back on IT staff and not upgrading IT equipment is a recipe for disaster. This could mean
- You fall behind the competition
- Your website suffers downtime
- You leave your network and data vulnerable
- IT issues take longer to resolve
This can leave you, at best looking unprofessional, and at worst dealing with viruses and data leaks. In the long run, this could mean lost business and endless stress.
Recruitment
During difficult times, companies may decide to stop using recruitment companies and do all the recruitment themselves. However, they don’t always realise the sheer number of services that recruitment firms, such as Goldmills or hays, offer to their clients. From finding the best talent in your industry, to fielding endless phone calls and e-mails about the job, recruitment consultants save your company lots of man hours during the hiring process, and cutting them out can cause major headaches.
Training
In the age of online reviews, it’s important to have knowledgable, well-trained staff, otherwise you can soon develop a reputation for bad service. There are lots of benefits to staff training, and investments in this area usually pay off well, helping you build an excellent reputation in your industry.
Wages
As the old saying goes; ‘if you pay peanuts, you get monkeys’, and companies should be aware that they often get what they pay for when it comes to staff. Offering decent salaries will attract a wider pool of candidates, including the most qualified and talented staff. Some companies try to save money by replacing senior staff who are leaving with juniors, but this can be a counterproductive move, as they’ll take longer to do tasks and won’t offer the same professional standard.
There are many ways that businesses can save money, but certain areas should be protected from budget cuts. You need to ensure your business is still marketing itself, and that you have professional, well-trained staff at the helm to keep things running. You should think carefully about any budget cuts and any impact they might have down the line, so you can be sure whether you’ve made the right decision.
