Many businesses focus heavily on getting as many sales as possible, generating recurring sales and generating new leads, and this is all good. Infact it is a truism that without selling things your business cannot operate, so to focus on them is important. But an often overlooked side of running a successful business is focussing on your overheads - in particular rent, communications, stationary(including mailing costs) and to a lesser extent marketing. I say marketing to a lesser extent because this cost is usually associated with the practices of increasing turnover that I described at the start of this article.

It has long been my belief that if you neglect your overheads you will quickly lose touch with your business, and as your sales increase, so your overheads will balloon, swallowing up a large percentage of what should be profits. It is for this reason I set aside time every month to access my overheads, and see if anything can be done to reduce them. In this article I will deal with communication costs, as this is an area I have recently had a lot of success with and am quietly chuffed with a little known company that saved me over 40% in this area.

Communications is a very dynamic market at the moment, with VoIP in particular leading to some massive changes in the way we will stay in touch in the future. The references I make in this article are specific to my home market - New Zealand, but apply equally to most developed markets in the world.

For the longest time here the communications market has been dominated by a privatised State carrier, in our case Telecom and more recently TelstraClear. This has lead to a monopoly on pricing structures which until very recently has meant to businesses - high communication costs and little choice in provider. The past 4-5 years has seen a dramatic change in this, with internet communication exploding and toll prices on the decrease. My companies first move away from the mainstream communication providers involved setting up internet based communications channels with our regular suppliers.

In our case we simply used the inbuilt voice functions of MSN messenger, which is usually efficient and has the huge advantage of being free and having a fallback(if voice communication drops out there is still the option to exchange typed messages in the traditional messenger format). This is still something we use, but the one major drawback is that it requires arranging beforehand and the quality(as with all internet based solutions I have tried thus far) is of variable quality and totally dependent on factors outside your control, such as traffic flow across the internet. The results are good enough for parties you have established contact with, but not worth the risk of using when attempting to forge new partnerships and appear professional.

Our next step was to look at direct dial calling. We approached the two main carriers with a summary of our usage and asked them what deals they could do for us. It's amazing how few people do this. It signals to the Telco's that you are aware there are options and you are prepared to make a move if they are not the best. In my experience in all the sectors I mentioned in the opening paragraph, if you make this known the chances of the supplier returning with a better offer are extremely high. In the case I'm discussing I was temporarily satisfied by a reduction of some 10% from our current provider, including a very good deal between our offices.

When we revisited this several months later we had been referred to a small toll provider called Gumption Communications. This company has now been carrying our toll calls for eight months and has saved us between 40-60% each month on some quite large bills. For ease of communication and pricing this is the best option that we have come across.

One further option that we have tried and eventually discarded is prepaid phonecards. Companies such as Easycall and GoTalk provide unbelievable savings on your toll calls, especially suited to a small office run by 1-2 motivated people who have an interest in controlling costs. I strongly suggest anyone looking at reducing communication costs do a google search on prepaid card and your local area. While the prices are unmatched by anything I have come across there are several drawbacks. The prepaid balance needs constant monitoring, your call records are harder to come by(Easycall's online interface counters this), you need to dial a number before dialling out(Try getting your staff to do this for more than a few weeks!) and the market can be very dynamic, seeing even quite large carriers disappear overnight.

I hope that the points I briefly touched on here will help you and your business curb your communications spending, and that this will help you see that keeping an eye on your overheads can be as critical to a business as keeping an eye on your sales data.