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Home » Random

20 Days to Build a Better Business: Day 17 Turning costs into revenue

20 Days To A Better Business

Each Monday we focus on one activity you can do today or over the next week to build yourself a better business. These short, actionable posts will show you what steps you need to take to take your business to the next level.

In case you’ve missed the previous posts, you can catch up here: 20 Days to Build A Better Business.

This is Day 17: Turning costs into revenue

In most businesses, owners see staff as a cost to their business. However, professional services firms such as lawyers or accountants see them as revenue opportunities. The more time their staff spend on client related work the more they can bill the client.

Many businesses owners recognise that rent is a cost, yet add to that cost by hiring external meeting rooms to hold internal meetings or “away days”.

Looking at your costs as potential sources of revenue though could not only save you money, but generate a significant additional source of revenue for your business.

For example, if you have space in your office to hold meetings, you could hold customer seminars or workshops and charge attendees, the revenue earned could easily pay several months rent.

If you have capacity in your warehouse, maybe you could sub-let space to other local businesses needing maybe a rack or two?  Maybe you’re a garden furniture supplier and you generally have full a full warehouse in winter, but an empty warehouse in summer, by partnering with a retailers you could hold Christmas stock for gift manufacturers or retailers.

If you have capacity in your IT Development team maybe you could “rent them out” to other companies needing their skills but unable to afford their own.

Providing these services could bring you closer to your customers by providing really valuable services which will not only help them out but generate a useful source of income for yourself and reduce your own operating costs.

What do you think? Do you have any ideas you’d like to share to turn costs into revenue?

9 Comments »

  • BizSugar.com said:

    Turn Costs into Revenue…

    You can turn costs into revenue by looking at your costs as opportunities rather than expenses. Each Monday we focus on one activity you can do today or over the next week to build yourself a better business. These short, actionable posts will show you…

  • Rick Byrd said:

    Hey Matthew!

    If you are ever in the Atlanta area I have a great conference room in my basement that I can rent you on the cheap.

    This is an interesting concept and one that I will think about. Who wouldn’t want to turn costs into revenue.

    Take care!

    – Rick

  • Matthew Needham said:

    Rick, you should seriously consider an additional income source as a standup comedian!

    Another good example I have a client who is a printer he buys his raw materials (ie copier paper) so much cheaper than local companies he effectively wholesales it out at a profit.

    Thanks for the offer of your basement. Does it had video confernecing capabilities? 🙂

    Thanks for the comment, always appreciated.
    Matthew

  • Henway said:

    I think cloud computing is a smart way to not spend so much on computing resources. When you’re starting a business, you don’t need gigs of RAM and hard drive space initially, so you can just pay for what you need

  • Matthew Needham said:

    Hi Henway, thanks for the comment. Good point, you should absolutely keep your costs down as low as possible in the first instance, so there’s less costs to defer in the first place (or more potential profit to make!).

    Matthew

  • Steve@Internet Lifestyle said:

    Matthew,

    It has been a while, how have you been?

    I love this topic. It is thinking outside the box and is something that even the people working at home can turn an eye to.

    After all, even people making an online living should be looking to expand and give as many tasks to outsourcers as possible. There is nothing saying that once you create a viable system for some aspect of your work using outsourcing that this “cost” could not be used by others making you a small profit.

    Another example is fiverr. there are some people who pay for fancy SEO serices or back-linking programs like. Some of these are 100$ a month and outside of the budget of many people starting online.

    Some people offer their services to Provide detailed reports, or get X amount of backlinks form X number of sites. All they are doing is using their fancy programs and with a few minutes work, helping to defray the cost (and perhaps even MAKE money by having it)

  • Matthew Needham said:

    Hi Steve, great to see your comment! I’m well, thanks. Have been kept ‘ occupied’ writing a free report. Almost finished now and raring to go! Fiverr is excellent example in the online world especially if you’ve got something you can sell multiple times or effectively do at the same time (ie leverage). I’ve heard of many people earniing $60-$100 an hour this way.

    Good point about the outsourcers too, especially if you don’t fully utilise them.

    Thanks for stopping by, much appreciated.

    Matthew

  • Craig Langdon said:

    Converting appropriate warehouse space into offices (four walls and a wall door) then rent them out on a short term basis?

    See if you can get the landlord to pay for the construction work.

    Everything is negotiable in business!!

  • Matthew Needham said:

    So true Craig, everything is indeed negoatiable. I know of a local estate agent who had an overly large retail space/office. Because of the state of the economy, they have rented out space to a letting agent thus bringing in a sizeable contribution to rent and expenses as well as offering complimentary services for their clients who are unable to sell their property due to the state of the economy.

    Thanks for stopping by and commenting Craig!

    Matthew