Cutting costs is easy. Cutting the right ones isn't

Cutting costs is the easiest thing in the world.

You open a spreadsheet, pick a red pen and start crossing things out.

Cutting the right ones is a different sport.

The red pen is a trap

This year we gave up our office. What was inside went into a storage unit. I've already told that story, so I won't tell it again.

What I didn't say is how good it felt. One line gone from the monthly costs. Clean. Visible. The kind of cut you can point at.

And that's the trap. The cuts that feel best are the visible ones. Square metres. Subscriptions with a logo. Anything you can photograph.

The costs that really hurt a small company are often invisible. An hour a week lost to a tool nobody understands. A supplier who's cheap until the day they go down. A client who pays, but costs more in attention than they bring in.

Those don't show up in red. They show up as tiredness.

The most expensive costs in a small company aren't on the bank statement. They're in the calendar.

Decoration or structure

The question I've been asking myself is a simple one. Is this cost decoration or structure?

Decoration is anything that makes us feel more like a company without making the company work better. The office, for us, turned out to be decoration. I didn't like admitting it.

Structure is anything that, if it fails, a client notices. Hosting. Backups. Security. The boring stuff that keeps websites up and fees collected.

And here's the uncomfortable part. Structure is exactly where the temptation to save is strongest, because it's invisible when it works. A cheaper server looks identical to an expensive one. Until it doesn't.

This spring we've had more hosting outages than I'd like. I'm not going to retell that here either. But it reminded me that a cost you cut in structure doesn't disappear. It comes back later, at a worse time, with interest.

The cost nobody budgets

There's one more category I've learned to watch: things that cost us focus.

Last year we left the Kit Digital programme. On paper it brought in work. In practice it was pulling our attention in directions that had nothing to do with what we want to build. That's a cost too, even if the spreadsheet called it income.

I think the same applies to suppliers and channels that aren't working. The monthly fee is the small part. The big part is the hours you spend managing something that should be managing itself.

So when I go through costs now, I try to look at three things, not one:

• What it costs in money.
• What it costs in attention.
• What breaks, and for whom, if it disappears.

The first column is the one everyone looks at. The other two are where the real decisions are.

Why this matters more without investors

We've never had anyone else's money. That means nobody will cover a bad cut for us. If I save on the wrong thing, the bill arrives at our door, not at a fund's.

It also means I don't have to cut to impress anyone. No board, no runway slides. I can keep an expensive thing that works and drop a cheap thing that doesn't, and I only have to explain it to Yeray.

That's a privilege. I'd like to use it well.

Cutting costs is easy.

The hard part is not cutting the ones you'll miss at three in the morning.

P.S. The storage unit, for the record, is one cost I'm happy to keep. It's the cheapest way I've found of not deciding.