The economy hasn’t been particularly great lately.  That’s not likely to be news to any retailer: we’re often the first one to notice when there’s less money floating around. 

This is the environment where, even though we should be doing it all the time, retailers start focusing on controlling expenses.    Today I’m going to talk about two areas where you can really save some money — if you’re willing to take the time to do some research.

These two areas are utility bills and credit card processing.

Utility Bills

Recent governmental deregulation means that suddenly, there’s dozens of ways for a retailer to get the power that runs their store. There are real savings to be had — but it’s difficult to find out who is offering the best deals.

All of these utility companies are telemarketing. I know — you have a dozen other things going on during the day. However, you should take some calls and get quotes for two or three competing utility companies. Consider those quotes — and give your existing utility company a call to see if they can match what you’re being offered. You can save a ton of money, with just a little time on the phone.

Credit Card Processing

I’m not a betting man, but I’d be willing to put down some serious money that the average retailer gets a call an hour from telemarketers promising that it’s possible to save a gazillion dollars on credit card processing.

Every day, more and more customers are paying for their purchases with credit cards. Processing fees can take a huge chunk out of your sales. It is well worth it to take a few calls to see what the offerings really are.

The only way to really tell what is a good deal and what is just a bunch of high-powered sales spiel is to send the potential processing company a couple of months’ worth of statements and ask “What would it cost me, if we gave you this amount of business?”

Their answers will allow you to make apple to apple comparisons: you’re moving past the hype into actual nuts and bolts, real life numbers. You might discover that it is possible to save a lot of money by switching processors — or you might discover that you’re fine just where you are. The key is this: you’ll KNOW.

Bear in mind that this is a very dynamic industry. Things change all the time in the credit card processing word. It would be prudent to check these numbers on a regular basis: it’s just as important to save money when times are good as when they’re tight!

This post is for any retailer, any where — in fact, it might be fair to say this post is for anyone who owns a business, period!  There are the Ten Commandments we’re all familiar with — but there’s another one, an eleventh one, that we’re going to study today.

The Eleventh Commandment: Own Your Building!

Here’s why:  If you are a typical business owner you will never get enough out of your business to retire comfortably.  It’s next to impossible to accumulate a nest egg, especially if you’re a typical Mom and Pop style store. 

If you’re living in the moment, but want to keep one eye on being prepared for the future, there’s only one to make sure you’ll be okay in your later years.  That’s to own your building!

Nineteen years ago, I bought a building for one of our stores.  It has not appreciated one cent since I bought it — which really doesn’t sound like good news, does it?

But for nineteen years, I ran my business there.  Instead of paying rent, I paid the mortgage.  Now, we’ve decided to change locations, and I’ve sold this building.  At closing, I was handed a check for EXACTLY what I paid for that building, nineteen years ago.

Which means, you know, I pretty much operated rent free in that location for close to twenty years!

In one of our other locations, I pay $20,000 a month for rent.  Assuming everything stays at that level (which is doubtful, to say the least!) in twenty years, I’ll have paid 4.8 million dollars to that landlord, and when I close that store, I WALK AWAY WITH NOTHING.

You have to own your building.  Let’s say you don’t close your business, or move your store.  Owning your building is still a great idea.  After the mortgage is paid off, you have one huge expense off the table, which obviously means better numbers for your business!  Or, you could refinance the building, which gives you a huge glut of cash tax free.  That can be pretty handy in a pinch.

And then, when you do decide it’s time to close or move or retire — YOU STILL HAVE THE BUILDING TO SELL!

I can’t stress this strongly enough.  Learn and listen to the eleventh commandment: Own Your Building!