Sometimes It Takes Money to Save Money

Unless you’ve been living in a cave all of your life, you’ve probably heard the old line “It takes money to make money.” There’s a lot of truth to that statement, especially as it would pertain to business. But there is also another principle that’s similar and that’s “Sometimes it takes money to save money.”

In business, your profit margin is determined by how much money goes in and how much goes out. If you have more money coming in than going out, that’s your profit. If more is going out than coming in, you better make some changes or start looking for another job, because it’s just a matter of time before the doors close for good. It’s a pretty basic concept to comprehend, even if some in our government don’t. I guess that’s why we have the federal budget deficit.

It’s even more important in hard economic times to cut back on expenses, since you may not have as much money coming in. Some businesses do that by laying off, reducing inventory to basic levels, delaying equipment or other purchases. Some will even reduce employee benefits or cut back on hours. They may even try to find ways to streamline processes or operate more efficiently. After all, inefficiency is waste.

I’ve realized, though, in my own business related experiences, that sometimes in order to save money, you need to spend some cash up front. Now, in my little tiny business, I really only employ myself. So my operations are pretty small and even amounts like $50 a month makes a difference in my bottom line, since my business only supports myself. Now find a number of things that are $50 in savings and then you will really have some significant savings.

On my websites, I have a number of features. Among them are slide shows and music players. I was using an online service that was charging me a monthly fee for those features. For the same amount I was being charged a month, I bought software that allowed me to create my own flash slide shows and I also found software available to make my own music players that allowed me to play mp3 files I upload to my site. Sure I had to put some money down, up front, but after I took the embed code out of the websites that used the aforementioned service and replaced it with my own, I immediately canceled the service.