Razor Thin Profits? Entrepreneurs Share How to Cut Costs and Improve Margins

6. Hire vendors on a pay-for-performance basis.

“This way our incentives and our vendors’ incentives are aligned, and if they succeed we succeed and vice versa. Most vendors that are confident in their performance are willing to work on a performance basis.  And if a vendor is not confident enough in their performance that they wont work on this basis you probably shouldn’t hire them anyway.”

– Sara Shikhman, President of BedroomFurnitureDiscounts.com: @BedFurnDiscount

7. Don’t overpay for marketing that isn’t targeted.

“While it can be tempting to dish out a lot of cash to get your name out there, you can achieve the same effect for a fraction of the cost. Creating social media buzz and virality is much more effective at getting your company’s name into the minds of your target market than advertising campaigns directed at the general public.”

– Michael Brennan, Founder of The Virtual Attorney: @TheVirtualAtty

8. Use free and open source small business software.

“You can find great free programs for document and spreadsheet creation (Open Office), photo editing (Gimp), cloud computing (Dropbox), and document sharing (Google Drive). It’s a great way to save money without sacrificing quality.”

– Feoshia H. Davis, Owner of Wr!teUP Creative Copy: @feoshiawrites

9. Improve your sales capabilities.

“If your good in sales, you will not have to cut costs to improve profits.  I would recommend taking a seminar on how to sell. The investment in yourself will positively impact your bottom line.”

– Josh Lannon, Founder and CEO of Journey Healing Centers: @JourneyCenters

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