How-to to run a software consulting business

Keeping costs low

by shabda on January 22, 2012


As you start to scale the business, the overhead costs start increasing.

Eg. When you are self employed you maybe doing billable work 90% of the time. As your business grows, you will have to add admin staff, accountants and similar non billable staff. As a self employed person, you can afford to work from a really run-down office, but as you add employees it’s neither advisable nor fair to expect to ask people to work from such offices. Such costs can add to your overhead VERY quickly.

It’s possible to not be stingy, and still keep your costs low. The first step to keep costs low is know all your costs.

Ask these questions.

  1. Do you need to employ an accountant?
  2. Are all business expenses coming out of a centralized account?
  3. Are you keeping all your bills?
  4. If you are doing 3, what are the areas which cost you more than your expectations? What are your biggest expenses?
  5. Have you negotiated the biggest expenses? Can you move vendors to choose a lower priced expense for your biggest expenses?

Focus on the biggest and the least expected expenses. And you would be generally able to cut your costs while not skipping on the important items.

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