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How To Cut Banking, Business Insurance, and Health Care Expenses (Series Part 5 of 5)

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During this final post on saving business expenses in the new year, we are going to discuss savings on banking fees, business insurance, and the health care plan.

Monitor and Adjust Your Banking Fees

You have many banks to choose from and they know it. Work with several banks to find out which bank will work with you and be the most willing to negotiate your banking fees. If outsourcing your payroll provider, see if there are ways to waive fees based on direct deposits and other services.

Business Insurance

As you’re preparing for 2010 consider reshopping your Errors and Omissions policy along with any other business insurance you carry. Consider using services like NetQuote to garner quotes from various competitors.

Save on Health Care

The Wall Street Journal offers viable solutions for businesses to save on health care for their employees. Some of the suggestions they offer include:

  1. A high-deductible health plan combined with a health savings account (HSA). This approach helps keep spending in check because it puts the onus on the user to think about cost. HSAs allow individuals with high-deductible health insurance plans to use employee pretax money to pay for uncovered medical costs and carry over unused funds to future years. You can require employees to fund the account, or fund it yourself.Health reimbursement accounts (HRAs) are also often coupled with high-deductible insurance plans. In an HRA, employers set aside money to reimburse employees’ deductibles or qualified out-of-pocket medical expenses up to a predetermined amount. Employees can generally roll unused money over from year to year, though the money technically belongs to the employer.
  2. Purchasing cooperatives. Small companies can gain bargaining power with insurers by banding together in health-insurance purchasing cooperatives. Each cooperative is structured differently, and whether it offers better insurance rates than businesses could get on the open market often depends on local insurance-underwriting laws.
  3. Company wellness programs. Wellness initiatives run the gamut from offering employees free gym memberships to providing healthy snacks in the company kitchen and health screenings that can result in lower insurance payments for employees.
  4. Flexible-spending debit cards. Flexible-spending accounts (FSAs) allow workers to pay for medical expenses that aren’t covered by health insurance with pretax dollars.Employees can use the specialized debit cards to pay for co-pays or over-the-counter medication not covered by their insurer. The money is automatically deducted from the pretax funds employees have set aside. The cards typically cost $1 or $2 per month per employee, but some FSA vendors package them into their offerings.

As you spend some time to reevaluate your business expenses, you’ll likely find areas where you are able to save significantly. In the process, it’s always a good idea to find an appropriate way to get your employees on board, so that everyone together is mindful of the company’s expenses.

© 2011 Generational Equity, LLC All Rights Reserved

How to Cut Expenses and Save Money on Payroll, Mail, & Office Space (Series Part 4 of 5)

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In part 4 of a 5-part series on saving on business expenses, we are going to discuss how to save on payroll, mail and office space.

Payroll Service Provider

If you are having payroll outsourced, a quick review of the services they are rendering in comparison with the competition and their rates will show you if you are getting the deal you deserve. Payroll Finders offers valuable information on what to look for when you are looking for a payroll provider. A few of their key points are listed below. The complete source can be found on their website.

When reviewing and negotiating the quote:

  • Services reflect local conditions; make sure your quote is locally competitive.
  • Beware of those costs that get “overlooked” when they are quoting per pay period costs, such as year-end W-2s.
  • Know the specifics of what you need and ask the company to quote your specific list. This will give you the advantage at comparing “apples to apples.”
  • Ask about tax filing fees.
  • Ask about all Direct Deposit fees.
  • Ask about initial setup fees and fees for adding and/or dropping employees.
  • Ask about fees for updating or adjusting employee information.
  • Ask about any additional fees.

Payroll companies will be diverse in their offerings, so it is of utmost importance that you are asking the right questions. There is no need to pay for services you do not need, and there is no need to pay additional fees when you can negotiate out of them.

The Mail Room

This may be an area where your company can cut back. Spending money on overnight mailings when a 2-day service would be sufficient could be an area to cut back. The world is well into the digital age; thus, if your company has not fully integrated, it may be time to do so.

Some questions to consider:

  • Have you given your customers the choice to opt out of direct mail in lieu of electronic mail or even faxes?
  • Are you sending items overnight that could be sent by way of a slower service?
  • Have you compared your overnight shipping rates with their competitors?
  • What is your ROI for every mailing you are sending out? Make sure it makes sense.

Negotiate Your Office Space

According to a Wall Street Journal September 21, 2009 article: “Commercial real-estate prices steepened their dive again as transaction volume dried up in July, falling 5.1% month-to-month after only a 1% decline in June.”

Commercial real state is still struggling, which means you have negotiating room as you renew your lease. Find out what other comparable office spaces are offering their clients and negotiate your lease with yours. Remember, you signed your contract when times were better, so renegotiate based on the times of today. At the same time, maintain fair practices in your negotiations as every industry is struggling, and that is simply the right thing to do.

© 2011 Generational Equity, LLC All Rights Reserved

Focus on the Electric Bill to Cut Business Expenses in 2011 (Series Part 2 of 5)

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During part one of this series we discussed the importance of re-negotiating rates you are paying for your general business expenses. For the remainder of this series we are going to focus on specific areas to consider cutting costs and some strategic ways to be able to do so, along with additional advice and information regarding specific cost savings strategies in each area.

Today we are going to focus on the company electric bill, where saving money is a two-fold process: rates and services comparison and energy efficiency practices.

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