It’s true. You can’t save your way to prosperity. But when markets go sideways, it is the instinct of nearly every contractor to look around madly for expenses to cut. Too often, the cuts go too deep or are made in the wrong place. Cut the business’ muscle and its strength is hurt.

This doesn’t mean there is nowhere to make reductions. It is like weeding a garden. Doing it right takes constant attention. If you haven’t done it in a while because you’ve been too busy harvesting, this is the time. However, be sure you are not reducing the fertilizer, which is your marketing. After all, when it is hard to make a sale, put for more effort, not less.

Here are 82 ways to reduce your expenses prudently, not in a panic.

  1. Take advantage of any special government programs like the Payroll Protection Program, where a loan can turn into a grant if you meet a few requirements.
  2. Make sure your pricing is up-to-date. Prices change constantly. Many contractors are using old, out-of-date pricing that results in reduced margins. Of course, to avoid charges of price gouging you should never change prices in the midst of a national emergency or immediately following a natural disaster.
  3. Make sure you turn off all lights and equipment when closing the shop for the night. Computers and some electronics are not truly off and will leak “vampire” energy unless you do a full shut down.
  4. As incandescent bulbs wear out, replace them with LED lights. They cost a little more up front, but only use a trickle of energy and last long enough that you will probably never replace them.
  5. Make sure lighted exit signs are LED.
  6. If you can, install skylights to reduce the need for lighting during daytime hours.
  7. Use occupancy sensor switch plates for all offices and storage rooms.
  8. Use rechargeable batteries around the office.
  9. If you have a choice in electricity providers, shop for better rates each year. Often electricity providers offer lucrative incentives to new customers.
  10. Tune-up your building HVAC system. Of course, you know that this will restore your system to factory fresh conditions, reduce energy usage, prevent breakdowns, and extend equipment life.
  11. Upgrade your HVAC equipment. See if you can get special pricing or can apply co-op dollars towards it since it’s your own building.
  12. Install an economizer, ERV, zoning system, or other accessories to reduce energy usage.
  13. Raise your thermostat setpoint 2°F in the summer and lower it 2° in the winter.
  14. Use a building automation system, or at least programmable WiFi controls, to reduce energy usage when the building is unoccupied.
  15. Check the building envelope for leaks and seal them.
  16. Dye test toilets and repair any leaks.
  17. Replace toilets with high efficiency, dual flush ones.
  18. Repair or replace any leaking faucets or outside spigots.
  19. Plant native landscaping around the building to reduce watering needs.
  20. Refinance your building. Rates have never been better. You might be able to lower your payments or receive an infusion of cash.
  21. Conduct a lease/buy analysis on all major equipment and vehicles.
  22. If you have not done so already, go paperless. Go paperless for invoicing and transmitting work orders, for payments, and inside the office.
  23. Be sure to match vendor invoices to authorized purchase orders before making payments.
  24. Create a process and assign a person to review phone, credit card, merchant services, and bank statements to identify any unnecessary or mistaken charges.
  25. Ask for early pay discounts, such as a two percent discount if you pay within ten days. Without a discount, wait until the bills are due to pay them.
  26. Negotiate for cash discounts with your suppliers.
  27. Attempt to strike late payment penalty and fee language from any agreements you sign. When you are faced with a penalty, challenge it and see if you can get it waived.
  28. Look at your inventory as a stack of cash that is not working for you. See if you can return any inventory that is not absolutely necessary to your suppliers.
  29. Ask your suppliers for consignment inventory or a vendor managed inventory program on site.
  30. Bar code inventory to make counting it easier. Inventory each truck monthly.
  31. Reduce inventory by using universal parts that can be used on different brands of equipment.
  32. Write off obsolete inventory (i.e., use it as a tax shield), donate it, sell it on eBay or Craig’s List, or scrap it altogether.
  33. Use a credit card that offers cash back for all payments, and pay the credit card on time.
  34. Take advantage of loyalty marketing programs where you can receive gift cards from a retailer based on your purchases.
  35. Use business coupon sites for savings on office products.
  36. Assign someone responsibility for filing and tracking all rebates.
  37. Join a buying group like the Service Roundtable’s Roundtable Rewards program, shift your purchases to the Preferred Partners and get cash back every quarter.
  38. Make sure all company vehicles receive an oil change every 3,000 miles, a tune-up every 30,000 miles, and that tires are checked weekly.
  39. Delay replacing vehicles for a year.
  40. For older vehicles, with little resale value that would not be worth repairing if in an accident, consider eliminating collision insurance.
  41. See if you can lower your auto, life, and business insurance premiums by paying semi-annually or annually.
  42. Have everyone who drives company vehicles take a defensive driving course to save 10 percent on insurance.
  43. If you expect a vehicle to be idle for more than a month, park it, remove the tags, and cancel the insurance. Redistribute the truck stock to other vehicles or return it.
  44. Adopt a 100 percent COD (cash on delivery) policy for residential work. Demand payment at the time service is rendered. Accept credit cards, checks, or cash.
  45. Investigate whether you can find an alternative merchant services company with a better rate and/or fewer fees. This includes portable or field machines.
  46. Bill new construction and commercial work as soon as possible to shorten the collection period.
  47. Charge a penalty to commercial and builder accounts for late payments, such as "...a late payment penalty fee of ten (10 percent of the total invoice) will be assessed on all invoices that are not paid within thirty (30) days..."
  48. Sweep cash from your checking account to an interest-bearing account whenever cash exceeds a predetermined level.
  49. Make deposits daily, if not in real time.
  50. Buy checks from third parties that cost less than your bank.
  51. Track all marketing with unique numbers or identifiers so that you can determine what is most effective and what gives the biggest bang for the buck.
  52. If you have extra space, consider subletting an office to a plumber or electrical contractor who is just starting.
  53. When office vacancies are high, renegotiate your lease.
  54. Use a service to contest your property tax valuation annually.
  55. Work with your CPA to anticipate your current year income and make quarterly tax payments in line with expectations, not based on last year.
  56. If you have overpaid the IRS with your quarterly payments, work with a CPA to see if you can get a quick refund.
  57. Buy used office furniture from thrift stores.
  58. Barter your services with other small businesses. Make sure the value you provide matches the value you receive.
  59. Review mobile phone contractors for possible savings, including new carriers.
  60. Use a voice over Internet protocol or VOIP phone system. These cost less, have more functionality, and can be used from any location with Internet access, such as a home office.
  61. Consider raising the deductible on health insurance, paying the increased amount out-of-pocket.
  62. Add a Section 125 cafeteria plan to your insurance where benefits can be paid for out of pre-tax dollars.
  63. Before laying employees off, consider reducing office hours, offering early retirement, or offering managers an unpaid or reduced pay sabbatical.
  64. Be open book. Share company financial information with your employees to keep them alert to the need to generate more sales and hold the line on costs.
  65. Stress incentive pay. Use performance pay for technicians and full commission pay for salespeople. Shift management and office pay to a lower base, but with a higher bonus potential based on performance.
  66. Try to lower worker’s comp insurance by reclassifying employees.
  67. Consider using an employee leasing service.
  68. Sell or dispose of items in storage units to eliminate storage rentals. If you cannot eliminate the items in storage, change to a rural storage unit with lower rental costs.
  69. If your technicians’ phone or truck GPS does not find lower priced gas, use GasBuddy or a similar service to find the best prices.
  70. Use Fuelman or another gasoline management service for fuel purchases.
  71. Eliminate parts runners by using Uber or Lyft for parts delivery to the jobsite.
  72. Keep the spare vehicle keys in a lock box in your office. Add copies of all lock and facility keys. This will reduce locksmith fees and the need to replace broken windows.
  73. When practical, use open-source or public domain software.
  74. Use part timers in the office. If you can offer flexible hours to accommodate professionals who want to be at home when the kids get out of school or who need to be available to take care of an elderly parent, you might find you can attract more talented people that you could otherwise.
  75. Reduce direct marketing expense by cross marketing with other service companies to split the cost of printing and mailing. A number of cross marketing pieces are available on the Service Roundtable.
  76. Reduce marketing expense to newcomers by picking up newcomer lists from the various town halls of the communities you serve. Usually, they’re free. Then, mail you own welcome gift and letter.
  77. Concentrate your marketing in a tight area around your shop. You may serve a larger area, but the goal is to reduce travel time and benefit from the billboard effect of your vehicles in a concentrated area.
  78. Contact radio, cable, and TV stations to see if you can purchase remnant advertising. This is unsold advertising time that is frequently offered at the last minute at 50 percent of the normal price.
  79. Try to buy media advertising on a per inquiry basis. This is comparable to Internet pay per click marketing.
  80. Use co-op funds in ways that benefit your company. Take reduced co-op amounts if that means you can use the funds in your advertising, promoting your brand first.
  81. Ask your equipment suppliers to advertise in your consumer newsletter.
  82. Start a gainsharing program. Solicit employee involvement in the creation of the program where measured gains in productivity and/or cost savings for a period of time are split with the employee. Because the gains are split after the savings have been realized, gainsharing costs nothing. After the gainsharing period ends, the company continues to realize the benefits.

In all likelihood, you are already doing many of the things on this list. Add a few that you are missing. These are relatively painless ways to economize. While the savings are small, they will add up.