You’re Still Paying for That? 3 Sources of Cost Creep & What You Can Do

Between my two Netflix accounts, Hulu, three Prime subscriptions, Apple Music, and whatever else I’ve apparently signed up for, I’ve hiked the Paramount+ mountain more times than I care to admit this year, and it’s only August.

This is also true in business.

Nobody ever says, “I think I’ll slowly make my business less profitable this year.”

Yet here we are.

The expense made sense when you added it. The vendor was worth it. The inventory felt necessary. The software solved a problem.

But you haven’t stopped to ask whether that reason is still valid.

That’s cost creep.

Here are three places it happens, and what you can do about it quickly.

CRM. Pipeline manager. AI subscriptions. Video conferencing. Project management. Payroll. Merchant processing. Bank fees.

There are 100 more things I could put on this list, but you get the point.

Over time, we accumulate more systems and processes than we need. And the systems we do need quietly increase their rates.

Do this: Call your banker.

Ask them to review the last two months of your business bank statements with you. Look for duplicate services, unnecessary fees, and expenses for services your bank may be able to provide through one of its core relationships.

Many banks have relationships with merchant processors, payroll companies, HR providers, and other business services. There may be a better or less expensive option available to you.

Here’s the best part: your banker has a reason to help you. If they can save you money and move another service to their bank, that’s a win for both of you.

What if you’re under contract? Ask anyway. Some providers will offer incentives to help cover the cost of switching from your existing provider. You won’t know until you ask.

Give your banker five minutes and ask them to find the leaks.

Your loyalty to a vendor is valuable. Their automatic price increases are not.

If you haven’t negotiated your pricing lately, email your major vendors and ask for a pricing review. This isn’t a threat. It’s a business conversation: “We’ve been a loyal customer for several years and would like to make sure our current pricing and service still match our needs. Can we do a pricing review?”

Then be willing to negotiate outside the box. “If we committed to another 12 months, what could you do on pricing?” Or: “If we increased our volume, could you improve our unit pricing?” Or simply: “Can you walk me through what has changed in our pricing over the last few years?”

This works. Most vendors don’t wake up thinking, “How can I make this customer less profitable?” These are symbiotic relationships. You need them. They need you.

Sometimes nobody thinks to revisit the arrangement. You should.

Different purchasing models work for different businesses, but I think more businesses could benefit from examining the principles behind just-in-time inventory.

If you have $100,000 of inventory sitting on your shelves, that’s $100,000 of cash tied up in inventory instead of being available for something else. We do this naturally. We like having enough. Enough supplies, enough parts, enough product. It feels safe.

But sometimes “enough” becomes way more than enough.

Hospitals and manufacturers have used just-in-time principles to rethink how much they keep on hand and when they replenish it.

Your business may not need a true JIT model. But you should question the norm.

“Why do we keep this much inventory?”

“How quickly can we replenish it?”

“What does our historical usage actually tell us?”

Do this: Review what you actually need on hand. Look at your historical purchasing and compare it with your current forecast. Then make a business decision about what level of inventory is healthiest for you.

Don’t automatically accept “the way we’ve always done it” as the answer.

Cost creep is rarely one giant expense.

It’s a hundred reasonable decisions that nobody ever revisited.

• A software subscription here.
• A 7% vendor increase there.
• Extra inventory sitting on a shelf.
• A fee you stopped noticing six years ago.

Individually, they don’t feel significant.

Together, they can quietly eat into your profitability.

So here’s your assignment:

Find one area of your business this week where you’ve stopped asking, “Do we still need this?”

You might be surprised by the answer.