You Sank My Battleship: How Runaway Expenses Doom Your Business

Most business owners remember their big expenses. But...it's the little ones that sneak into the budget like houseguests who refuse to leave.

Examples could include: a software subscription you stopped using six months ago;  an app that seemed like a bargain until you realized you have three others that do the same thing; or a monthly charge that makes you think "Waaaiiiit a minute...what is that?"

Those small expenses may not seem like much on their own, but together they almost certainly drain thousands of dollars from your business every year.

The interesting thing, though, is you don't need an entire weekend with a calculator to sniff out these troublemakers. Simply spending just a few minutes each month reviewing your expenses can help you keep more of the money you've worked so hard to earn.

Start with Your Bank and Credit Card Accounts
Take a quick look through your recent transactions. Do you recognize every single charge? Is everything 100% business-related? Did you accidentally pay for something twice?

Fraud, duplicate charges, and forgotten purchases happen more often than you'd think. Catching them early is much easier than trying to untangle them months later and leaves your pocketbook in a much better position each and every month.

Hunt Down, Then Chop Down Unnecessary Recurring Subscriptions
Subscriptions are cool...until they're not.

Many skincare businesses accumulate scheduling apps, marketing tools, photo editors, inventory software, educational memberships, and streaming services before anyone realizes how much they're costing and how little they're benefitting.

Ask yourself one simple question: "If I weren't already paying for this, would I sign up for it today?"

If the answer is no, it may be time to let it go.

See Where Your Money Is Actually Going
Looking at dozens of individual purchases doesn't tell you much. Grouping them into categories does.

Whether you use QuickBooks, Xero, or even a spreadsheet, organize expenses into categories like:
* Software
* Marketing
* Supplies
* Education
* Travel
* Utilities
* Professional Services

Once everything is grouped together, spending patterns become much easier to spot. You may discover you're spending far more on one area than you realized.

Compare This Month to Last Month
Business expenses naturally fluctuate, but large jumps deserve a second look.
*Did advertising costs double?
*Did supply costs suddenly spike?
*Did payroll increase because of additional hours?

Sometimes there's a perfectly good explanation. Other times you'll uncover a problem before it becomes an expensive bad habit.

Keep Your Receipts Organized
Your receipts may not be exciting, but they're incredibly valuable.

Good records make tax season smoother, support your deductions, and save you from scrambling when your accountant asks for documentation months later.

Future You will be grateful.

Ask One Final Question
Before moving on, look at each major expense and ask yourself: "Is this helping my business grow?"

The answer doesn't always have to be more revenue.  A worthwhile expense might save you time, improve your client experience, reduce stress, or make your business run more efficiently.

The key is making sure every dollar has a job (and then does that job as well as possible).

Small Reviews Lead to Big Savings

To get to where you want to be you don't have to slash your budget or eliminate everything that isn't essential.

Just paying a little extra attention each month often reveals easy opportunities to save money without sacrificing the quality of your business.

If you'd like someone to help you understand where your money is going—or you'd rather spend your evenings with clients than spreadsheets—we'd be happy to help. Keeping your books current gives you clearer financial information, better business decisions, and one less thing to worry about.