Episode 81: We Slashed Nearly 30% From Our Business Expenses—Here’s How!

Most business owners don’t realize how much money is slipping through the cracks—until something finally pushes them to take a closer look. Maybe it’s a slow month, a surprise bill, or just that nagging feeling that profits aren’t where they should be. That’s where smarter financial management comes in, because earning more doesn’t help if you’re bleeding cash on the back end.

In Episode 81 of the Babies and Business Podcast, Avram and Rachel share the small but powerful shifts that helped them cut nearly 30% of their business expenses—without sacrificing quality.

What started as a curious look into their monthly spending turned into a game-changing habit that now saves them thousands every year. This episode is packed with practical tips that any entrepreneur or family business owner can use to boost profit, reduce waste, and take control of their finances with confidence.

Show Notes

Key Highlights from this Episode:

• How Rachel cut 27% of their business expenses without compromising quality

• Why financial management is about intention—not deprivation

• How to conduct a quarterly expense audit (even if you’re not the numbers person)

• Questions to ask when reviewing subscriptions

• How Rachel approaches subscription management with objectivity (and zero emotional attachment)

• Examples of unnecessary expenses in business

• Tips for communicating money concerns with your partner

• How to reframe costs in a way that makes the impact feel real (percentages, time equivalents, etc.)

• How financial check-ins can lead to major profit shifts

Mentions & Resources

Profit First – A book by Mike Michalowicz that teaches entrepreneurs how to prioritize profit by managing finances through percentage-based allocations. This method helped Avram and Rachel restructure their spending and create a sustainable, profitable business model.

Empire State of Mind Podcast – Hosted by Matt Williams, this podcast for home inspectors inspired a key insight in the episode: your business should support the life you want to live.

Episode Transcription

Below you will find a transcript of this entire podcast episode. Enjoy!

Avram: Your life and business will hemorrhage money if you’re not fully aware of it, in what’s going on? Oh my gosh, Rachel, how much money do you think you saved me personally when we met six years ago, almost seven years ago.

Rachel: Oh my gosh. On the personal side or the business side?

Avram: We’ll just start with personal.

I mean, this is the Babies and Business Podcast.

 We play in both lanes. You can’t really separate business from the family, but, I just posed that for you because you’ve really wrangled our household finances over the years, and the business stuff as well.

Rachel: Well, you know, what I’ve done is I came in and I shed light.

 I exposed some of the things that were invisible to you. And I asked you questions about it, and I challenged why those expenses were being paid. And that’s really what I did is I just invited change. But I know that I cut our business expenses by, was it like 27%?

Avram: Yeah, we, you know what? We did record an episode about that almost two years ago

Rachel: Yeah.

Avram: About how you cut.

Rachel: remember the exact percentage.

Avram: Yeah. How you cut 27% of operational expenses within like a year.

Rachel: And the reason why I did that, and I had some, well, I just love to do money stuff. I love to move money around and look and, and dream and strategize about that stuff.

So when it comes to money, I am a totally different animal. But I was able to just look at the stuff and have objectivity, but also because of, Profit First.

Avram: Sure.

Rachel: So reading that book and understanding those principles, I understood that coming in, in order for us to implement Profit First, which means you are going to allocate your money that you get in as a business in certain percentages. And if you’ve never done this, you start at a very low place. Like profit is 1%, but it’s 1%. And then you go up, you move profit up 1%, and then you move other expenses down in order to keep the percentages the same but just rearrange them. And you rearrange them slowly so that over time you come to an equilibrium that is more acceptable, your expenses are lower and your profit is higher. You actually have profit now profit first, meaning you don’t have to wait five, six years. You don’t have to wait 10 years and wonder when is the profit going to start rolling in. So what I did is I used his methods of cutting costs.

So I went in and I was ruthless. I took a list of, all the expenses that you had, and basically I highlighted the things that I didn’t know what they were for, so I identified what those expenses were because you know, you go in and you’re like, Sucuri, what is that?

Avram: So quick pause.

Where we’re headed right now. Is one part of the method that Rachel used to drastically reduce our overall operating expenses.

Rachel: Yep.

Avram: And this is something that we now do on basically a quarterly basis automatically and all the time. And what I want you to get from this episode is this one small method is gonna get you back thousands of dollars per year. So keep going.

Rachel: Yes. So I was going through these expenses and my job was just to simply have them on a sheet and then ask you questions I didn’t need you to go and do homework. So I was objective because I had no attachment to these expenses. And then I would ask you, what is this for? And you’d tell me. And I made notes.

So then I said, okay, so we have three subscriptions that do the same thing. Which one you would you like to keep because we’re only keeping one. And then I made you choose, and I went down the list and that is the method that I used to cut our expenses, I think was like 27, 29%, whatever it was.

But it was massive.

Avram: And the business continued to provide the same and better level of service.

Rachel: Absolutely.

Avram: So money in the bank for our household.

Rachel: Correct. So with our business, we are prone to having, ge
tting on a new software because we heard that it’s really good. But when we get this new software on, oftentimes you can forget to go and cancel the one that you had, and maybe you think, well, maybe in the future we’ll need it, whatever. There’s all sorts of reasons, but regardless. Now, there’s one thing that I do on a continual basis for us that keeps us on the right track because over time you’re going to accrue subscriptions. For us that’s one of the things our expenses is we have different softwares and those come in the form of a subscription. So what I will do is I will go through the bank account very same way, and I’ll actually ask you again, okay, what are these for? Okay, we have three that do the same thing. Which one are we going to keep, and then I reduce it. Now there’s also another method, so it’s do we use it? So I see this is a new subscription as of when I last looked at the thing. Do we use it? Tell me how we use it. Tell me how often we use it. Do you think we’re getting the most out of it? Is there a better one that we could use as opposed to this?

Is there one that offers this in conjunction with, with what we have? Could we take one subscription that we currently have and add a fee to it that would be less than this and get the same functionality? So I look at those things, creative ways of making sure to cut the costs, but keep the functionality.

And then I also look at, okay, do we like this subscription? We’re currently on a monthly subscription basis with them. I like to start out monthly because I’m not going to get locked into a year of subscriptions. Now, this is something that I learned the hard way because we locked ourself into a year subscription and we hated it.

So then moving forward I said, okay, you know, it’s cheaper if you go for a yearly cost versus

Avram: You pay like 10 month to get 12.

Rachel: Yeah. So what I do is I’ll pay for like three, four months. We’ll check out the software, see if we like it. If we like it, then I move to a yearly subscription because yes, we are saving it and we know we’re not getting rid of it.

So that’s one of the hacks. And then simply, cutting it. So there’s the, can we combine it? Do we need to cut it and do we want to move it to yearly

Avram: Yeah. Well I think the great question that you posed was, are we still using it? Um, because I think any industry is prone to having significant changes in process. And right now most businesses are figuring out and implementing AI solutions that are really changing the entire process and how we do business or how we deliver the service, how we sell the service.

All these different aspects of the business are being impacted by this new technology. So you take a look at it every quarter and you ask. Are we still using this? Even the ones that you assume that we are, it’s worth asking because we find it every time, we have changed something.

Rachel: Well, there’s times that.

Avram: And forgotten.

Rachel: Yes. There’s times that we’ve taken this subscription that we use that’s really important and we’ve increased that service that we have with that business so that we can provide more things.

But what I ask is, okay, so we have this really large expense here with this, with this software, Avram. When was the last time we used that feature that we increased for? And you’ll tell me, oh, I mean it’s only used for one client, but not really, and blah, blah, blah, blah, blah. blah.

Avram: Or we, or sometimes we have to ask a team member because we’re not even using it at all

Rachel: Exactly, exactly. So then we become clear on that and we decide, okay, we are going to keep it, or we’re going to switch to a different thing altogether. But what I’m saying is, your expenses change all the time. If you run a business, you also may not be the one that is starting a subscription, increasing a subscription.

But if you’re the one looking at the money and you want to get to the bottom of maybe why you have less in your operation expenses account, which we have an account specific for that, you need to be doing, I would suggest you do a quarterly audit and if you’re, I mean that’s where we’re, we are.

Maybe if you’re a bigger company, it needs to be more frequent. Maybe if you’re smaller, maybe less frequent, or, but it’s up to you. I say quarterly is a must.

Avram: End of the day this stuff may not kill your business if it goes, you know, without being looked at. But you know what it does do. It dramatically impacts your profit.

Rachel: Sure. Yeah, exactly.

Avram: And, I was sitting with this gentleman this last week, Matt Williams from the Empire State of Mind Podcast. He’s a local podcaster here, does this great podcast for home inspectors all over the country, and he says that the purpose of your business is to fund your dream life or your best life. I’m probably butchering his quote, right. But the purpose of business is to provide the life that you want to live. And if you’re letting these subscriptions and other expenses impact your bottom line and your actual profitability, you’re not allowing it to function at the highest level it could in serving you and your family.

Rachel: Right.

Avram: And that’s what this is about. It’s like, how can you get more money back in your pocket? It is worth it to go through and do this.

Rachel: Yeah. Well, and yeah, man. I mean, if there’s one resource that I would suggest is Profit First. It really changed our business. It gave me a direction, it helped me have some of the tools that I needed.

 I already have those inclinations for money and making things work with money. But it can really make a difference for you if you don’t have profit in your business right now, this is definitely the way that we got to where we have a quarterly profit draw. Our business is profitable and we have a really great service that we offer for our clients.

Avram: Gonna leave you with a funny story that I think encapsulates everything that we’re talking about. So, when Rachel first came in and did this initial audit, one of the things that was a line item item on our books was, uh, an executive office space. Okay, but it wasn’t just an office space that we paid a flat amount per month, and you could just go in whenever.

It was like one of those flex spaces where you paid an amount per month and then when you wanted the space, you booked it and you paid by the hour, a small amount. And Rachel comes in and she’s like, what is this for? Do we really use it? You know, and I said, yeah, this is our office like

Rachel: It took me about six months to get him to cut it.

Avram: That’s the, the end of the story, right? She had to then calculate, she had to go in and look at all of the money that we’d spent on this office space in the last like two years. Then she went on my calendar and looked at all the meetings that I had actually had there. Let me give you the summary ’cause it’s really all it, all it needs. I was spending about $127 per meeting or per time that I went and visited there.

Rachel: Well, the way that I arrived there was, first off, I came to you with the amount that we’re spending each month and you felt like that was just negligible? I was like,

Avram: 50 bucks? 60 bucks?

Rachel: Okay. How can I put this interest perspective about the actual cost that this is costing us? And I found a different way to say the same thing. I found that you like to see things as parts like you like to see percentages, real numbers for
a time. So I found a different way to say the same thing to you that you would actually hear and say, oh my gosh, because I’ve heard you say multiple times. Oh my gosh. When I was working in carpet, in flooring, while I was in college, you know, I would go out and spend X amount of money for lunch and I didn’t think anything of it, and it was like two hours of my time. So when I was able to put it into terms where you’re like, oh, so this is X percent of our whole money that we get in, or this is this, this amount.

So there’s different ways. So what I’m saying is, and what you can maybe get out of this is if you’re the one with the money and you have someone else that you’re talking to, and you’re trying to decide yes or no about this expense, just say it a little bit differently maybe.

Avram: Mm-hmm. Yeah. Yearly always impacted me in a pretty significant way. The monthly, you know, 30 bucks in a subscription, you don’t think anything about it. But when you look at it as like a $400 a year thing, it’s like, okay, well that’s

Rachel: that’s significant it adds up. Yeah.

Avram: Yeah. So this is episode number 81. If you wanna check out the show notes and other related episodes, things that we talked about, people that we mentioned, podcasts, we mentioned, go check out the show notes at babiesandbiz.com/81.

We’ll have all that stuff over there for you. I got a question for you this week. If you scroll down to the bottom of that show notes page, we’ll have this question for you.

What’s one subscription or one expense you are gonna cut this month after listening to this episode?

We wanna hear it. What’s the thing that you no longer use? Why aren’t you using it? You know, let us know what that thing is. Take action on this information right now. Save yourself on some money.

Build your profitability, build your family along the way. Uh, with that, we appreciate you for listening, and we will catch you in the next episode.

Rachel: Bye for now.