An entrepreneur's guide to cutting costs, not corners

ACCRA - The New Year is full of many opportunities to start afresh in your business, one way in which this can be achieved, is with costs. Uncontrolled costs can be your worst enemy. When left unchanged they run the risk of driving your business into the ground.

How can this be fixed? There is no quick fix, blanket solution to cost issues, these vary according to businesses and their needs and often require custom consultation. To get started however, there are a few easy steps you can take:

1. List your expenses for the last 3 months- Over the last few months, what has your business spent money on?

2. Divide these expenses into recurring and one time expenses and provide descriptions and justifications for each? This will help you to determine future expenses to expect.

3. Divide your costs into fixed and variable costs? Which costs do you incur regardless of how whether or not you produce (for example rent and licensing fees)? Which costs change according to how much you produce?  

Now comes the most difficult part, what can you get rid of? Are there duplications? Are there inefficiencies? As I mentioned earlier the process of cutting costs and maximizing profit is complex and for each business requires a more customized approach. However these steps do serve as a valuable starting point.

Juliana Taylor is the founder of Start Smart Ghana Ltd. She can be contacted on email :info@startsmartgh.com