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Forbes
6 days ago
- Business
- Forbes
How To Cut Costs While Maintaining A High-Quality Customer Experience
Tough times often force entrepreneurs to consider making strategic budget cuts in order to sustain the business. This typically leads to select products or services being axed, as well as non-essential departments or roles being eliminated. While these changes are effective for trimming costs, the removal of certain offerings and key positions can result in disruption in how the business runs and irreparable damage to the customer experience. Before deciding on any concrete business changes, it's best to consider the short- and long-term effects on both the business and customers. Below, 20 Forbes Business Council members share fruitful ways to cut costs without drastically impacting the quality of your customer experience. 1. Prioritize The Features That Matter Cost-cutting doesn't have to mean compromise. When you prioritize the features that really matter, strip out the noise, and invest only in what your customers most value, you can save money while actually improving loyalty. Audit expenses with fresh eyes and ask, 'How does this serve the needs of my most valuable customers?' If it doesn't, that's where to trim. - Chris Fosdick, PA Consulting 2. Ask Customers For Feedback Ask your customers. Find ways to be more clear about the "wow" factor in your products or services. I'm quite astonished by the number of companies that do not take consistent steps to measure and recognize what customers value most. Once you know, you'll have a better idea of your clients' nonnegotiables. You can then begin to plan based on what you must have rather than what would be nice to have. - Loubna Noureddin, Mind Market Forbes Business Council is the foremost growth and networking organization for business owners and leaders. Do I qualify? 3. Tighten The Belt At The Top Most company profits go to upper-level management and senior executives. However, cuts usually occur among line staff, customer service and marketing budgets. Great leaders reverse those priorities, tightening the belt is at the top, while ensuring the marketing and customer service budgets remain unscathed. - Charles Stanton, Transient Consulting 4. Trim Non-Customer-Facing Costs Start by trimming non-customer-facing costs, including rent and travel, and pause hiring. For essentials tied to the customer experience, optimize without removing them. Instead of layoffs, consider flexible shifts or reduced hours across the team. The goal is to stay lean while still honoring the trust and experience customers rely on. Kushal Chordia, VaaS - Visibility as a Service 5. Make Employees Part Of The Process Invest in people, not just processes. Empowering frontline teams to identify waste and streamline workflows protects quality while reducing costs. In healthcare, especially in surgery, small efficiency wins. Things like smarter supply use or better coordination preserve excellence without compromising outcomes. - Paula Ferrada, Inova Healthcare System 6. Improve Internal Efficiency Focus on improving internal efficiency before making cuts that affect your customers. Eliminating wasteful processes or automating routine tasks can lower costs without changing the quality of your service. This way, you maintain a strong customer experience while operating more leanly behind the scenes. - Quanique Johnson, LQ Logistics LLC 7. Streamline Internal Processes When times are tight, we cut costs by streamlining internal processes, not customer value. Automating routine tasks or pausing non-critical projects helps us stay efficient while keeping the same quality and service our players expect. - Denys Kliuch, WHIMSY GAMES GROUP LTD 8. Implement Energy Efficient And Smart Management Upgrades In multifamily investments, one effective way to cut costs without drastically impacting the quality of experience for residents is by implementing energy-efficient upgrades and smart utility management. Energy and utility costs are a significant portion of operating budgets. Reducing these costs preserves net operating income without slashing staff, deferring maintenance or closing amenities. - Veena Jetti, Vive Funds 9. Audit For Inefficiencies Audit for silent inefficiencies, such as tools, subscriptions or processes that add cost but no real value. Trimming these invisible money drains keeps your customer experience intact while boosting operational health. It's like cutting weight without losing strength, making the organization leaner but not weaker. - David Price, The Price Group 10. Renegotiate Supplier Agreements One effective way to cut costs without hurting the customer experience is to renegotiate agreements with suppliers. For example, request temporary discounts or additional bonuses. This helps maintain service quality while reducing expenses during tough times. - Jekaterina Beljankova, WALLACE s.r.o 11. Optimize Spending For Packaging And Materials Optimize your business's packaging design and use more affordable materials. For example, you can use fewer packaging layers or replace complex packaging shapes with simpler, more technologically advanced ones. The quality of the product remains the same. - Anton Alikov, Arctic Ventures 12. Consolidate Software Tools Consolidating software tools is a smart way to cut costs without affecting customer experience. By reviewing and eliminating redundant subscriptions or licenses, you can reduce overhead while streamlining operations. This not only saves money but also simplifies your tech stack, making it easier for your team to manage and maintain the quality of service your customers expect. - Sabeer Nelliparamban, Tyler Petroleum Inc. 13. Align Spending With Things Users Value When resources are tight, we align spending with what users tangibly value. At Bitget Wallet, cost control comes from strategic automation—like using cloud credits and auto-KYC—without sacrificing the core experience. By prioritizing high-impact systems, we trimmed 20% of operating expenses while keeping speed, uptime, and security intact. - Alvin Kan, Bitget Wallet 14. Offer Flat, Fixed Rate Prices Our business model indirectly cuts costs for our customers. We offer flat-rate, secure transport services, which are typically billed by the mile. We've found that offering a fixed rate enables our clients to bring predictability to every part of their profit and loss statements. This pricing levels the playing field for smaller operators, giving them access to enterprise-grade logistics without the variable cost burden. - Ari Raptis, National Secure Transport 15. Leverage Automation We automate backend workflows and customer support using AI. This reduces overhead while maintaining fast, high-quality service, enabling customers to still get white-glove care but at a fraction of the cost. - Haokun Qin, Gale 16. Outsource Tasks Outsource smartly. Hiring offshore talent lets you reduce costs while maintaining service quality. The key is training and integrating those team members fully. When done right, your clients won't feel the difference, but your budget will. - Braden Yuill, Virtual Coworker 17. Streamline Customer Support Processes Customer support is one of the most expensive functions, but also one of the easiest to make more efficient. You don't need 24/7 live agents if 90% of your tickets can be resolved with one article. Build a smart help center. Use asynchronous channels like email or ticketing, and streamline resolution paths. Keep the human layer for critical issues and precisely automate the rest. - Ran Ronen, Equally AI 18. Enable Users To Independently Resolve Issues The best customer experience enables users to resolve issues independently and quickly. User-centric design, AI chatbots, help pages, video tutorials, community forums, intuitive error messages, and comprehensive documentation cut costs and increase customer satisfaction. For example, our 24-hour toll-free hotline runs under $5K each month, including platform fees and Philippines-based contractors. - Ozan Bilgen, 19. Cross-Train Employees To Handle Multiple Tasks Tough times come and go, but tough people endure. One effective way to cut costs without impacting your customers is by cross-training employees to handle multiple roles internally. This strategy reduces hiring needs, keeps customer service consistent, and boosts team morale. Pairing this with AI automation tools that streamline workflows helps avoid employee burnout. It's a clever, in-house win. - Simbiat Adighije, Conscientia Health 20. Make Advance Plans One of the most effective ways to cut costs without affecting customer experience is to plan ahead. By maintaining healthy cash reserves and operating lean at all times, you're less likely to pass the pressure onto the customer when times get tough. - Andrew Lopez, 1000 Media
Yahoo
7 days ago
- Business
- Yahoo
Jacobs Solutions Inc (J) Q3 2025 Earnings Call Highlights: Record Backlog and Raised EPS Guidance
Adjusted EPS: Increased 25% to $1.62. Net Revenue Growth: 7% year-over-year. Backlog: Grew 14% to nearly $23 billion. Adjusted EBITDA: Increased over 13% to $314 million. Adjusted EBITDA Margin: 14.1%, up 80 basis points year-over-year. Gross Revenue: Increased 5% year-over-year. Free Cash Flow: $271 million in Q3. Share Repurchases: $101 million in Q3, $653 million fiscal year-to-date. Dividend: $0.32 per share, representing 10% year-over-year growth. Book-to-Bill Ratio: 1.2x trailing 12-month. PA Consulting Revenue Growth: 15% year-over-year. Adjusted Net Revenue Growth for Water and Environmental: Over 5% in Q3. Adjusted Net Revenue Growth for Life Sciences and Advanced Manufacturing: Approximately 5% in Q3. Adjusted Net Revenue Growth for Critical Infrastructure: Over 6% year-on-year. Fiscal Year '25 Adjusted EPS Guidance: Raised to $6 to $6.10. Warning! GuruFocus has detected 9 Warning Signs with J. Release Date: August 05, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Positive Points Adjusted EPS grew 25% to $1.62, supported by 7% net revenue growth and meaningful year-over-year margin expansion. PA Consulting delivered double-digit revenue and operating profit growth, capitalizing on strong demand. Backlog grew 14% to nearly $23 billion, setting a new record for Jacobs Solutions Inc (NYSE:J). Strong performance in life sciences, semiconductor, data center, energy and power, and water sectors, driving upward trends in spending. The company raised its FY '25 adjusted EPS guidance for the second time this year, reflecting confidence in future performance. Negative Points The environmental sector experienced a slowdown due to regulatory uncertainties, impacting year-on-year comparisons. The pace of IIJA funding allocation has been slower than anticipated, affecting infrastructure project timelines. There are concerns about potential impacts from state and local government budget adjustments, particularly in Medicaid and education programs. The company is still incurring onetime restructuring costs related to the separation, although these are expected to decrease significantly. The adjusted net revenue growth guidance for FY '25 was slightly reduced, implying a deceleration in Q4 compared to Q3. Q & A Highlights Q: Can you expand on the data center submarket growth and the type of work involved? A: Robert Pragada, CEO: The growth involves all aspects, including design, power, and water requirements. We're seeing increased scope in projects, moving from just design to full program delivery. Our partnership with NVIDIA is transformational, as it will serve as a reference design for their customers, leading to more inquiries for Jacobs. Q: Can you discuss the backlog growth and the pace of burn expected? A: Robert Pragada, CEO: The backlog is growing fastest in advanced facilities and water sectors, which have longer burn profiles. Venkatesh Nathamuni, CFO: Life sciences and advanced manufacturing have faster burn rates, and we expect strong growth in these areas in Q4 and into fiscal 2026. Q: How does the One Big Beautiful Bill impact Jacobs, especially with federal government policy changes? A: Robert Pragada, CEO: The bill provides stability in state and local government spending, particularly in transportation and water. It also supports DoD infrastructure and FAA opportunities. While there are concerns about Medicaid cuts, the secular trends and needs are expected to prevail. Q: What are the expected one-time costs associated with the separation, and how will they impact fiscal 2026? A: Venkatesh Nathamuni, CFO: We are on track with our guidance of $75 million to $95 million in one-time restructuring costs, significantly reduced from the previous year. We expect these costs to decrease further in fiscal 2026, with more detailed guidance to be provided next quarter. Q: What gives you confidence in expecting FY '26 growth to be ahead of FY '25? A: Robert Pragada, CEO: Confidence comes from growth in life sciences, data centers, and water sectors. These areas have shown consistent backlog growth over the past four quarters, and projects are now moving into material burn phases, supporting strong growth projections for FY '26. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
