How often do you review each line item within your financial statements? Taking a detailed look into your reports can help to shed light on opportunities to increase efficiencies and/or reduce expenses. Just think, within your profit and loss statement there may be 50 line items. For each line item, how many ways are there to improve?
As an example, here are 20 ways to reduce fuel expenses (thanks to some of the contributors in our Facebook group: “Landscaping Accountant”):
- 1) On-site fuel tank
- 2) Fuel card for employees
- 3) Reduce idle time
- 4) Improve route density
- 5) 4 day work week (less fuel and OT)
- 6) Fuel efficient vehicles, especially when getting quotes/performing
- administrative work
- 7) Reducing number of bi-weekly lawns
- 8) Increase pricing to absorb more of the fuel expense
- 9) Electric equipment (try starting with the hand held tools)
- 10) Picking a day each week to quote instead of swinging by each site on way home
- 11) Combining quotes with days I’m working in the area
- 12) Planning a strategy for the day to minimize vendor trips
- 13) Better communication and execution, less call backs/visits
- 14) Improved fleet management
- 15) Getting materials delivered to the shop before the job
- 16) Utilizing equipment with electronic fuel injection (EFI) vs. equipment with carburetors.
- 17) Using sprinter diesel vans instead of trucks
- 18) Be smart about the gas station that you go to
- 19) GetUpside app, or other apps that allow for cash back
- 20) Make a mobile office in your van
Fuel is just one line item, think about the possibility! With just a conservative 5 improvements per line item, there could be 250 opportunities to reduce costs and/or increase efficiencies. It can be overwhelming if you are not making the profits that you want, especially when viewing a detailed/long financial report. Take it one line item at a time, and you will see improvements!