Read this BEFORE paying your next bill02nd June 2021
Years ago, I was talking to a client who boasted that he never paid the first price he was quoted for anything. It was a point of principle for him.
So when we needed to raise our fees, I quoted him just a bit more than usual...
...And allowed him to negotiate us down to the price I would have charged him anyway.
It was win-win.
He was thrilled that he’d got a “discount.”
And I was thrilled that we could charge him what we needed to maintain our profitability...
...Because he was a terrific CEO of a fantastic company, he just made one little mistake by telling me about his pricing principle.
The truth, though, is that I fully support that client’s approach.
As a business owner, your job is to maximise your company’s profits.
Over the past few weeks, I’ve been talking about all the good reasons to raise your prices, and why this has an outsized impact on your margins.
This is the flip-side.
You should also be constantly questioning the bills and expenses that cross your desk.
You see, your providers have the right to charge whatever makes sense for them - and to raise their prices when necessary. They need to look out for their own profitability.
But equally, it’s your right to push back if it doesn’t make sense to you.
There is often room for negotiation with the prices you’re quoted.
But too often, we just accept the quote without any challenge, because we just assume it’s final and don’t realise we can demur. Or perhaps because we feel uncomfortable “haggling”.
Yet negotiation is part-and-parcel of doing business - you don’t have to feel bad about it!
And I would argue it’s your duty (not just your right) to achieve the best price possible for your company.
Questioning your outgoings isn’t just about new quotes.
You should take the same approach with all your business expenses –
- Regularly reviewing direct debits, to make sure that they’re still relevant and competitive...
- Looking at the bills your suppliers send, to make sure there are no mistakes - or that you’re not paying for products and services you no longer want...
- Ensuring that there are strict processes in place, to control your staff’s expenses. Make sure you approve their spending before they’ve committed to it - it’s too late once they’ve already spent your money!
Every penny you save helps your bottom line.
The buck stops with you - quite literally - so this is your responsibility.
But that doesn’t mean you have to do this financial work yourself.
You can delegate it to your finance department - it’s a key part of good financial management.
And it’s exactly what we do for our own clients...
...because as an Outsourced Finance Department, our job is also to maximise your profit.
So if your bookkeeper or accountant isn’t regularly reviewing and challenging your expenses, it’s time to upgrade the way your finances are handled.
Hit ‘reply’ to this email or call us on 01279 647 447 to get in touch today, and let’s discuss how we can help you become more profitable and grow much faster.
Outsource my finances | I need an FD | I'm looking for a Finance Director | My business is struggling | I want better financial management | I need better accounts software | I need a better accountant | My financial systems are a mess | my business is failing | Interim FD | I need help with business development | I want help with my accounts | I want to replace my bookkeeper | I'm looking for an outsourced finance department | Accountants in Essex | Stansted Accountant |