CORPORATE FRUGALITY AND FINANCIAL SUCCESS
Frugality in business may be the most meaningful but largely undocumented characteristic of companies. Financial success is determined by how much you keep, not necessarily how much you made. Frugality in business is considered as a corporate trait of consistent and disciplined management of spending to achieve long-term strategic objectives and sustainable profits. This differs from budgetary control since companies control cost differently and make greater use of a broad range of cost management practices. Regardless of current economic challenges some choose to manage strict cost discipline and avoid waste as the standard in doing business; treating the assets with a sense of responsibility and stewardship throughout the business’s history and expansion.
One consideration when researching how to implement frugal practices in your enterprise is to consider investing in services over products. Services may provide resources beyond your capabilities taking your level to the next tier and will begin a history of professional relationships and networking that may provide an ROI through word-of-mouth and complimentary, rather than competitive, exposure. Products on the other hand often loose a large percentage of their value as soon as taken off the shelf or driven off the lot. The savings made and reinvested today has the potential to grow with compound interest to a sum that rivals the business’s profits in the future.
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Lawrence J. Spiegel is the author of Detours and Contradictions: The Challenge of Being an Entrepreneur. A nuts and bolts resource for the boot strapping entrepreneur who wants to start or grow a business. Lawrence J. Spiegel is also the author of Charlie’s Entrepreneurial Journey: A Guide to Success Through Entrepreneurship. His latest book provides 416 pages of insight into the world of an aspiring entrepreneur named Charlie. Charlie’s journey leads him through topics never discussed in business books but essential to success. Pick up your copy here.