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Is Downscaling the same as Cost Cutting?


The answer is NO.

Businesses have been confusing these two terms or combining them to save money, but this has in most cases, been unsuccessful.


For a business owner to decide what he needs to do next, he needs to know the difference between the two:


“Downscaling- reduce in size, scale, or extent.”

“Cost Cutting- the reduction of costs”


Here are 10 suggestions for Cutting Costs:

  1. Reduce unnecessary expenses like that unnecessary fast internet connection that is used for emailing purposes only

  2. Switch to prepaid electricity if possible, to manage it more effectively

  3. Compare suppliers and subcontractor fees and negotiate the rates and pricing

  4. Use a system that can identify the slow-moving and dead stock as well as fast-moving stock items to assist buyers in making profitable decisions

  5. Be determined to consolidate any supplier debt asap

  6. Drive an affordable car to bring down expenses

  7. Reduce business software and technology costs where possible

  8. Compare insurance expenses

  9. Sublet office space for a few months to use for debt repayments

  10. Sell tools and equipment that is not in use and invest the money in a marketing campaign or to reduce debt

Downscaling should be the last option because a business does not want to decrease its capabilities. Keeping up with customer demands is most important for the survival of any business.


Ethos Software pricing starts at R200 ex Vat per month and has features that can provide you with the relevant information to assist with business decisions as mentioned in tip nr 4.


Could Ethos save your business money?



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