Welcome to issue #29 of Pondering Leadership: A Deliberate and Thoughtful, Yet Informal Look at Leading and Managing. Last week, I wrote about some ways to use technology to save some time which saves money. I hope my ideas sparked some creativity that you can use in your organization. This week, I am writing about a couple of ways to save money by reducing costs.
Go Out for Bid
One way to reduce costs without reducing service levels is to go out for bid for current services. Most contracts have an end date. At that time, the contract is subject to a price increase upon renewal. Before you renew, take a look at what else is out there, especially if you have some long time vendors. If you were following my Monday Productivity Tips over the holidays, you may have sorted through your files and have a great system, so you can easily pull out your contracts. Or have the bookkeeper run a report of vendors by contract end dates. I would recommend a timeframe of starting at least six months before the contract is up. Using your network or an official RFP process, if you have one, put the call out and see what else is out there.
When I ran a unit of local government, we were taxpayer funded, so we liked to shop local, so to speak, with our vendors as much as possible. If you are a corporation or non-profit and want to be a good community partner, you may feel the same way about keeping money local. But, if you can get a much better deal in the next town over or with a regional vendor, that might be better stewardship of taxpayer dollars for at least a few contracts.
To get your business, a new vendor may throw in some bells and whistles you do not have with your current vendor. Think carefully about these incentives. If these extra shiny things would benefit your organization or customers, great! But, if they are not critical to your mission, they are not worth the work you will have to go through to change vendors.
If you think you can get a better deal from a new vendor, do not just switch. Let your current vendor know that you went out for bid and received some interesting offers. If it is a matter of money, they may be able to meet or match a competitor’s pricing to keep your business. Or, they may be able to add in a service that a competitor includes in their package.
Throw In with the City
When I ran a unit of local government, we needed our parking lot restriped. The city was also restriping several of their parking lots in the area, so I reached out to the city engineer to see if we could get in on the project. We paid for the work done on our parking lot, of course, but we were able to take advantage of the deep discount in price that the city got for such a big job.
If you are not a unit of local government with natural partners, work with your neighbors on big outside projects like landscaping and snow removal. Reach out to the organizations around or near your building and see if they want to share costs of improving parking lots, painting fences or other big budget items.
Your Turn…
How have you gone out for bid or joined with neighbors to save money on big projects? You can comment in Discussion.
Thank you for reading issue #29 of Pondering Leadership. Thank you for reading and supporting my writing.
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