How to increase company revenue without cost cutting in 2024: 4 Steps

After the pandemic, the world, including businesses, has entered a recovery phase. Although progress has been evident, it has not been easy.

Companies around the world have been struggling to keep their profit margins positive and maintain business revenue while keeping costs down in these unfavourable conditions. A cost increase in one area would be accompanied by a cost reduction in another in order for them to stay afloat and keep growing. But is this always the only solution?

This article will provide actionable tips for global businesses on how to improve company revenue without cutting costs traditionally, such as layoffs, project cuts, reduced marketing spending, or limiting company travel.

There are several challenges businesses are facing:

Shortage of labour caused by increased costs and difficulty acquiring and retaining talent

Disruptions in supply chains caused by pandemics, geopolitical uncertainty, strikes, and natural resource shortages

Inflation and currency fluctuations due to geopolitical instability can have a devastating effect on businesses, leading to lower profits or even bankruptcy. Companies must stay up-to-date with the latest developments and be prepared to adjust their operations accordingly.

Understanding market trends is crucial for businesses to adapt and innovate in response to these challenges, helping them meet evolving customer needs and capitalise on new opportunities.

Automating routine financial operations such as payables, receivables, and payroll requires initial time and money investment. You need to identify the correct software, implement it, and train the staff. However, the ROI is worth the effort. Financial automation can help with the following:

Reduce time spent on manual tasks, allowing the finance team to engage in value-adding endeavours.

By reducing the need to hire additional staff, as well as improving efficiency and reducing mistakes, companies can expect significant cost savings.

Uncover missing revenue.

A Deloitte report found that automation can result in cost savings of 25% to 40%. By automating payables and receivables, you not only reduce errors, but also free up your team's time to engage in more value-generating tasks such as analysis, forecasting, and reporting. If you want to save money, rather than hiring additional staff to manage an increasing number of bills and receipts, you can pick an appropriate automation tool and save up to €40,000 per year.

Additionally, automating AR allows you to uncover late or missed payments and ensure you get paid on time, which will greatly improve cash flow, generate revenue, and help you access working capital. CICM and Pay UK reported in 2020 that UK businesses were collectively owed £17.5 billion, while the average amount overdue was about £20,000.

The best strategy may not be to cut costs immediately, but to identify areas where budgets are exceeded. There are several areas worth examining:

Expenses incurred by employees, such as travel and fuel

Subscriptions and software purchases

Equipment, inventory, and other business expenses

Identifying overspending can be challenging because many expenses are out-of-pocket, requiring reimbursement, or made with company cards linked to multiple accounts and assigned to individuals rather than teams. If you lack a central spend management system, it may be hard to determine which team or project is overspending, whether you have multiple subscriptions to similar types of software, or even if you have inactive subscriptions from continued trials that were never cancelled.

Centralising and optimising expenses through an expense management platform may be a wise investment, similar to automating other financial processes. While it initially signifies setup costs, training, and implementation, it will allow you to get a complete view of all spending across all individuals, teams, and projects in one place. In addition to setting policies and approvals to prevent overspending, you can even issue single-use cards to prevent automatic renewals when using software trials. By doing this, you will be able to increase revenue without sacrificing much on costs.

Adding new revenue streams without cutting costs is the best way to increase revenue without raising costs. Consider these two ideas for generating revenue now:

Take on New Customers in a New Geography

Expanding your services or products into new geographies may increase your customer base and growth potential. This comes with its challenges, as you may need to create additional websites, checkout experiences, and hire a multilingual team. Expanding into new geographies can attract new customers and increase sales revenue.

One simple solution is to open a virtual bank account in the currency you wish to receive payments in and offer your services. Your return on investment will help you deal with the logistics associated with optimising the experience if it works. Additionally, expanding into new geographies can help build a base of loyal customers who drive repeat purchases and enhance customer retention.

To accomplish this, you should partner with a financial provider that allows you to access different currencies and bank accounts from the same platform without worrying about additional work from a disjointed financial system. With Fyorin’s unified treasury solution with multi-banking, you can do just that.

Make Use of Cash Rebates on Virtual Cards

Virtual card vendors sometimes offer cashback on purchases made with their cards. Pay for business and employee expenses, especially larger ones such as marketing or hosting, with virtual cards to earn rebates, which effectively turn costs into earnings. Fyorin’s virtual cards come at 0% transaction cost and offer cash rebates. One of our clients saved €12,000 per year just from using virtual cards.

The working capital of a business is the amount of money it has on hand to carry out its day-to-day operations. When your working capital is managed and optimised effectively, you can reduce immediate pressure and focus on growth and revenue generation instead of cost cutting.

Here are some steps you can take to optimise it:

Make sure payments are not overdue and that money reaches you as soon as the sale is complete by improving the receivables process.

Improve your relationships with suppliers to get better payment terms. For example, by consistently paying on time, you can ask to extend Days Payable Outstanding by paying the vendor later and temporarily generate free cash. Conversely, paying early can earn you an early payment discount, effectively reducing the cost of goods sold. Maintaining strong relationships with repeat customers can also enhance revenue growth.

Control outgoing payments by taking a better look at spending

Diversify liquidity risk

With the right financial partner by your side, you can accomplish all of these things. In the long run, working with multiple tech companies and financial firms will inevitably strain your bottom line due to fees, subscription costs, and the burden on your team. Another option is to choose a comprehensive, centralised solution for financial operations. This solution will help you automate financial operations (payables, receivables, expenses), diversify liquidity, and multi-bank from one platform.

Fyorin has built a platform to fulfil all these needs and empower you to grow without borders. Interested to see how we can help you? Send us an email at [email protected] or book a free demo.