Outsourcing Payroll

The prize for the “worst single waste of time for a business” must go to those who handle payroll internally rather than outsourcing it. Payroll is the ultimate commodity where, for a miniscule outlay a month as a percentage of payroll, you can offload a complex, time consuming task.
 

Outsourcing COBRA Administration

One of the easiest and most important things to outsource is COBRA administration. Not only does it meet my VICE criteria, but it is something that carries a big potential liability and can create significant discord in the workplace.
 

Do You Over-Engineer Solutions?

When the US space program was sending people into outer space it was reported that $12 million was spent on a pen that would write at zero gravity. The result was a technical marvel that once again showed American ingenuity at its best……but the Russians achieved the same practical result at zero cost by arming their astronauts with a pencil.
 
How many things are you doing in your business that could be handled by another organization that specializes in just that task and does it better than you ever will? By insisting on handling it yourself, how much time do you waste and, more importantly, how much risk are you taking?
 

Whose side is the broker on?

In a real estate negotiation, the broker will lead you to believe that he is representing your interest.  While that may in some instances be the case, in most it is most certainly not because of some deep rooted conflicts of interest which exist.
 

Who benefits from a lease?

You are a tenant, your lease runs out and the landlord is in no hurry to give you a new lease.  Should you press for a new lease or not?  The conventional wisdom is that you should and that you really need to have a lease, but in recessionary times that may not always be the case.
 

Use a broker to negotiate your lease renewal

Many people seem to think that brokers only work on leasing new space.  In reality they are just as valuable when you are looking at renewing an existing lease and are an essential source of information, knowledge and expertise.
 
When leasing new space, the requirement to put up a security deposit can be a big drain on cash flow at a time when moving and setup costs are already creating pressure.  Obviously the best alternative is to negotiate a reduction, but this is not always a successful ploy and another alternative to consider is to offer a limited personal guarantee equal to the value of the security deposit that you are unwilling or unable to put up.
 

Negotiating build out costs

When you move into a new space, the friendly new landlord will give you a number of concessions. You will almost certainly get a rent free period and the landlord will probably bear the costs of a build-out to customize the premises to your operation.
 
People are often reluctant to ask for concessions in a negotiation because they don’t believe they will be successful.  They are worried the answer will be “No”, but if they fail to ask the question in the first place then the answer is most definitely “No”!
 

Are your real estate costs too high?

Every business is different and the real estate needs of a manufacturing business differ significantly from those of a service company with similar top line revenues.  This makes it difficult to create any kind of realistic benchmark as to where a company’s real estate costs should be, but a complex question can be reduced to some simple fundamental concepts.