For any company, finding ways to reduce costs is paramount to company growth. Specifically for labour intensive industries, an emphasis is put on shredding staffing costs. Generically speaking, one might shout back the simple answer which includes the word ‘cutbacks’. However, for your business, that may just not be feasible. So you need the hands, but how do you get more for your buck?
Companies that simply reduce compensation or simply fire employees invariably suffer from poor team morale. Furthermore, they risk falling into a downward spiral where there is no recovery. Therefore, use other methods to improve your employee output. These will save you time, money, and build a thriving workforce to increase your turnover.
Ways to decrease your staffing costs
1. Give Incentives and Commission some validity
Try to spend some time researching the things that matter most in terms of growing your business. Is it direct sales? Perhaps it could be improving your service? Make these metrics measurable, and produce models which incentivise your staff to achieve them. As a result, you know that money being spent results in money being gained.
2. Reduce Employee Turnover
Excess costs in your operation can arise as a result of increased recruitment, selection and training fees. Furthermore, a settled staff complement will improve morale, team ethos and productivity.
3. Hire diverse players
Based on the economies of scope principle, using a single wage bill to cover multiple tasks is a great way to reduce labour costs. Focus on hiring people who have a diverse skills set, think on their feet and can add immense value to your company.
4. Use Technology
We’re still a long way from using robots to stock your shelves. However, the internet century has provided assistance with getting the most out of your staff. Are you currently using organisation, payroll, or talent software? If not, then you are burning through costs in terms of time spent doing it manually. See how an App-based staff management tool can save you time and money by driving both yours and your staff’s efficiency and productivity.
In conclusion, it’s clear that we don’t put enough time and effort into finding ways we can reduce our staffing costs. The easy solutions can have adverse consequences which come back to bite us. However, by developing a credible incentive scheme, hiring smart and using technology, you can build an efficient business that gets the maximum return using the resources it has.