For many entrepreneurs, Dave Ramsey's famous money principles are life-changing on a personal level, but they can also truly transform a company's financial situation. Just ask Brian Croker, president of Little Rock Printing.
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Croker is a huge Ramsay fan and has implemented the finance guru's cost-cutting strategies across his commercial printing business. The result? A whopping $8,000 to $16,000 in monthly savings. Thanks to smart frugal habits, his company is saving up to $192,000 a year.
So what exactly are Ramsey's frugal habits that have enabled Little Rock Printing to save so much money? Croker breaks down the biggest savings into three areas:
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Always negotiate everything
“We save between $8,000 and $16,000 a month, and that's primarily thanks to a few key methods,” Croker says. “We focus a lot on negotiating with our suppliers. Dave always says, 'If you don't ask, you won't save.'”
He's right: Securing discounts through bold negotiations, whether for personal or business expenses, is something Ramsay can't stress enough — and Croker is reaping the benefits.
“Certainly, even securing a 5% discount on major expenses can make a big difference,” he says. “Especially in the case of [because] In our industry, we are constantly in need of supplies to keep our printing operations running year-round.”
The costs of Little Rock Printing's industrial equipment, materials and services are high. If they could reduce those numbers by 5% simply by asking their vendors for better terms, it would save them tens of thousands of dollars a year. As Ramsey says, it never hurts to ask.
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Buy quality products over cheaper alternatives
Another great Ramsay thrifting habit that Croker espouses is buying high-quality items that will last, rather than cheap, throw-away items.
“We don't hesitate to pay more up front for quality equipment that will last,” Croker says. “It's an approach that pays off in the long run, reducing the need for replacements and costly repairs that can be costly to your business with extended downtime.”
The printing industry requires large industrial machines to run at full capacity every day. Replacing these machines with cheaper models every few years would save money up front, but would cost much more in the long run. Kroeker wants to invest in equipment that will last 10 to 15 years with minimal maintenance and repairs.
Generics for big savings
Ramsay doesn't believe in paying top dollar for name brands, and Croker has taken that frugal philosophy to heart at Little Rock Printing.
“And when it comes to ingredients, I often choose generic over branded if the quality is right,” he says. “If the product is the same, why pay more for the branded product?”
By purchasing generic versions of the materials he needs, Croker ensures he and his team get the same quality products and services without paying the higher prices.
Sustained profitability and growth
Overall, Croker's work habits, born out of Ramsay's teachings, have helped Little Rock Printing to remain on strong financial footing.
“These strategies have significantly improved our financial position and enabled us to expand steadily without sacrificing quality or financial stability,” Croker said.
Instead of profits leaking through wasteful spending, exorbitant brand taxes, and a disposable mentality, Little Rock Printing makes the most of every dollar. Money saved is reinvested in capabilities, service delivery, and team growth.
With many commercial printers struggling with razor-thin profit margins, Ramsey's basic financial principles have been this Arkansas company's secret to sustained profitability and smart growth: Frugal habits can save up to $192,000 a year, money that can be invested in strengthening the business rather than wasting it on wasteful spending.
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This article originally appeared on GOBankingRates.com: I Follow Dave Ramsey's Frugal Habits and Save My Business Up to $192,000 a Year
