Every company needs to stay aware of their finances to make sure what they are spending is going towards improvements and smart investments. As an accountant, one of the things I love to find for my clients is money being wasted on unnecessary expenses. Most of the time, it’s on something they don’t even notice they are spending money on, or even forgot they subscribed to. This blog post is meant to serve as a housekeeping checklist for companies looking to start a new budget for the year or take inventory of their expenses to find those unnecessary money pits and get rid of them ASAP.
1. Cloud Apps
Everytime we get a new client, one of the first things we do is review their cloud apps. Why? Because you wouldn’t believe the amount of unnecessary subscriptions and software everyone is spending money on. Grey area charges like subscription fees and post free-trial charges are consumers’ top rated pet peeve, and we can all fall victim to them when we aren’t careful. Just last month, one of my buddies who I had gotten set up with Xero realized he had gone on paying for his Quickbooks Online consultant for nine months after he stopped using it. Cloud subscription automatically renew, so if you aren’t on top of renewal schedules and which apps you are using, then you are throwing money out the door. As a company evolves, your software needs are going to change too, and hopefully they will even consolidate. Doing an inventory of your cloud apps and immediately ending any subscriptions you don’t need is a huge money saver.
2. Unexpected Charges Treated as Normal
Another really important housekeeping tip is to review your bills regularly and stay on top of accounts payable! Common things to look out for are added fees and charges on regular bills, and late fees or unnecessary interest on credit cards. Automatic bill pay can be a great tool, but it can also lead people to stop reviewing their bills and spotting added charges that they can dispute with the vendor.. For ourclients, we set up a simple spreadsheet that is reviewed weekly to ensure bills are reviewed and paid on time and an accounts payable app such as bill.com that makes sure we review every bill before it’s paid.
3. Wasted Employee Hours
The last tip I give companies looking to do some housekeeping on their finances is to take a good look at their employees and how they are spending their time at work. When done correctly, an employee review can be a big money saver and make your team more happy and productive as well. This is not just the practice of “nickle and diming” your employees to make sure you are getting enough out of them. Instead, look at is as a way to make sure that projects and assignments are consolidated in such a way that every employee is making the most of their time and not stretching themselves too thin or wasting energy on working all over the map.
If your employees don’t have defined position titles and roles, now is the time to make those. If your employees don’t have set, written procedures for their work and a good project management system they enjoy using, make it a priority to get these in place. You’ll be happy with the increased productivity and less waste. Employees and company leadership both work better when people know what they are doing at work and what is expected of them. Your employees are usually your biggest investment, and not managing them well is one of the biggest money wasting practices I see with my clients, whether with start-up companies or larger corporations.
Housekeeping is all about not letting anything become too “automatic”. Whether it’s automatically renewed subscriptions, messy monthly bill payments, or employees on auto-pilot, getting in too much of an “automated” mindset can lead to big money problems for a company. Housekeeping is meant to keep you alert and make sure you are constantly viewing your finances from a fresh perspective.