Reducing Infrastructure Costs: 8 Tips To Put Into Practice

Written by: William Garriell
06/10/2019

business-infrastructure

Typically, infrastructure costs are analyzed in isolation, which may not give a real measurement of the volume of spending that could be eliminated or reduced. Hence it is important to join together all the elements that make up the business infrastructure and check the numbers that the costs represent.

But what, after all, is a business infrastructure? Basically, it is the set of assets that make possible the flow of the business operations, from the manufacture of products to the provision of services, through the day to day administration, customer service, etc.

Enter the infrastructure, for example, the machinery of the production area, the technological and telecommunications services, the fleet of vehicles, the offices and so on. Everything the company maintains for its operation to remain active is considered its infrastructure.

Tips to reduce infrastructure costs in your business

From failing to buy cleaning supplies at a grocery store and switching to wholesale to modifying the telephony plan, there are many tips for reducing infrastructure costs. Here’s the practical list of tips to be followed:

  1. Reduce small expenses

Grain by grain the hen fills her belly. Have you ever thought that the “chicken of the expenses” can be very chubby because it eats discreetly enough corn spread by the company?

Well, monitoring all the small expenses, which often go unnoticed, can help reduce costs. So make sure that the modern coffee maker that the company’s offices use could not be replaced by a traditional one – that with a colander – whose cost would be much lower. Can’t the already used sheets become drafts? Could not the reverse of these sheets be used for prints of non-documentary materials?

  1. Re-evaluate the size of the vehicle fleet

Mechanical maintenance, insurance, IPVA, depreciation, vehicle fleet expenses, if properly evaluated, can result in a significant cost reduction for companies.

More and more companies are outsourcing their fleets. There is also the possibility of leasing, which is when the company rents a vehicle and can buy it at the end of the contract. Another way to cut down on fleet spending is to check the real need to have so many cars.

  1. Review telephony expenses

With the fierce competition in the telecommunications segment and the already established portability, it is no longer necessary to remain faithful to a single telephone operator. A review of contracts can help you cut costs down considerably.

Another way to reduce these expenses is to use software that controls the use of landline and mobile phones. Thus, it is possible to verify that employees are not “abusing” the phones for personal reasons. In fact, there is research that indicates that the implementation of a policy of using cell phones can reduce costs by up to 12%.

  1. Evaluate the effectiveness of the productive area

Lowering production costs also helps a lot to save money. Traditionally, jobs are cut off. But if a thorough evaluation of the machinery cannot be detected, is it time to acquire more modern machines and tools?

In a productive area, it is also important to control employee turnover. Doing good talent management can prevent employees from getting in and out and thus reducing expenses with terminations and hires.

  1. Optimize water and energy costs

Water and electricity are two fixed costs that can fetch a considerable budget. These resources have suffered large increases in recent times.

Reassessing water and energy use can help reduce infrastructure costs. Simple measures like reusing water, including rain, can bring good results. Changing lamps and luminaires for more modern and eco-friendly lightening models, such as those with LED technology, is another important thing to consider as the generated savings can be up to 90% in the light bill.

  1. Make logistics smarter

The amount of money that is spent on transportation and delivery services can leave any manager worried. Making adjustments, improving planning, and even outsourcing some services can help you cut down on expenses. It is advisable to invest in technology as well as in governance to make logistics processes more efficient and intelligent.

  1. Rent equipment

Another smart strategy to reduce infrastructure costs is to opt for equipment leasing instead of purchasing it. Of course, this measure needs to be evaluated on a case-by-case basis. But in general terms rent is indicated for used equipment only a few times or for specific jobs, which would not justify immobilizing capital to have these machines continuously.

It is worth remembering that it is the company that owns the depreciation, preventive and corrective maintenance, as well as the downtime of its machines. So when you rent equipment on demand, you reduce the weight of these costs.

The opposite is also valid. Instead of being the lessee, how about being the lessor renting underutilized equipment to generate more revenue for the company? With this output, if machinery is stationary, you can reduce costs not only relative to idleness, but also to the maintenance and storage of equipment. 

  1. Invest in digital technology

Finally, good advice for reducing infrastructure costs is investing in digital technology. Here are a few examples: scan documentation to reduce printing costs, acquire software in the SaaS model, make mobile management systems (applications and mobile software), extend the use of free applications such as WhatsApp for internal communication and with customers, etc.

As you may have noticed, there are several ways to reduce infrastructure costs in the company. It is up to the entrepreneur to analyze which ones are best suited to his/her business, thus gaining competitiveness in the market!


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