If there has ever been a colossally terrible idea, cutting costs so that your business can grow takes the cake. In fact, it takes the bakery too. It’s a story you hear every now and again. A company has fallen on hard times and decides to cut costs in every avenue to grow, or even just stay afloat. Extraordinary.
What’s so ridiculous? Cutting costs doesn’t really benefit anybody. If costs are managed well, they can be controlled into the future, but that’s different. We’re talking cuts to areas without any real level of consideration. Sure, short term it might save a dollar, but what about the dollars that function generated, directly or indirectly?
A great example is sales. I’ve heard it many times. The sales department has been cut back because they weren’t making enough sales. Of course, this doesn’t work in the long term. If you cut off your arms, how do you expect to feed yourself?
What’s the point, then? Think. Spend some time considering how cutting costs will impact your business. Don’t cut things that will have a negative impact, cut things that will save compounding amounts of money into the future. Spending some time thinking about the problem always results in better decisions.