Reducing company costs: Measures for SMEs

Written by Sara Amati 07.09.2026

Swiss SMEs are facing increasing cost pressure. 65 percent of businesses cite rising costs – from higher tariffs to price increases for IT goods – as the biggest financial concern over the past two years. These are the findings of the AXA SME labor market study 2026. While sweeping savings initiatives can make things easier in the short term, targeted cost management can contribute to savings and greater efficiency in the long term. Read about the measures SMEs can take to reduce their costs in a targeted manner.

Read the study (in German)

Key points at a glance about company cost reductions.

65 percent of Swiss SMEs are growing increasingly worried about rising costs.
74 percent of Swiss SMEs are already using or testing artificial intelligence. 35 percent use AI specifically to optimize work processes.
Saving money on health management can incur high additional costs in the future.
Targeted cost management helps SMEs exploit potential savings without compromising performance, quality or ability to act.

Why are rising costs a key issue for Swiss SMEs right now?

The current AXA SME labor market study 2026 (in German) shows that rising costs are by far the most cited financial burden for the companies surveyed. A total of 65 percent say they have been worried about rising costs over the past two years. Ranking second in the list of worries is the increasing competitive pressure from Switzerland at 29 percent. The uncertain order situation is a problem for only 21 percent of SMEs, and exchange rate risks for only 14 percent.

One explanation lies in the uncertain economic outlook. For example, 43 percent of the companies surveyed consider the economic situation in their sector to be uncertain. Small companies in particular are concerned about the future. This is because they generally have fewer resources and options to hedge against negative developments.

What measures can be taken to lower a company’s costs?

Under high cost pressure, SMEs are looking for savings potential in many areas. However, it is important that such savings exercises do not weaken the company, but rather improve its ability to act in the long term.

Four specific approaches help companies reduce their costs in a targeted manner:

More efficient processes
Optimized procurement and review of fixed costs
More flexible work models
Stronger staff retention

Instead of implementing broad savings programs, targeted cost management is advisable for SMEs. This includes the systematic planning, management and control of all expenses in the company with the aim of optimizing the relationship between cost, performance, quality and risk . This way, tangible efficiency gains can often be achieved, even with individual measures.

Making processes and work steps more efficient

With increasing digitization and the optimization of recurring processes through artificial intelligence (AI), there are numerous opportunities for SMEs to reduce operating costs. For example, work steps can be accelerated, information made more accessible and sources of error reduced.

In the AXA SME labor market study 2026 (in German) , 35 percent of SMEs surveyed stated that they purposely use AI to optimize work steps – up from 22 percent in 2024.

59 percent of companies actively using AI expect to benefit from time savings within the next two years. For most SMEs, this is not about job losses: only 12 percent of SMEs expect staff reductions due to the use of AI. However, the vast majority of SMEs that use AI do not expect to change their workforce requirements.

Reviewing fixed costs and procurement

Companies should systematically question their regular expenses and fixed costs. This includes, for example, rental, energy, IT, insurance or supplier costs. Targeted procurement management, comparing offers, renegotiating contracts, reducing dependencies on individual suppliers or optimizing warehousing can reduce running costs and increase financial flexibility.

Introducing flexible work models

Flexible work models can help companies retain staff and thereby indirectly reduce costs. They increase your attractiveness as an employer and can help reduce staff turnover. This means less time and effort spent on recruitment and onboarding.

Strengthening staff retention and reducing recruitment costs

Retaining existing employees is often cheaper than constantly recruiting new staff. A high turnover not only generates direct costs for job advertisements, selection processes and onboarding, but often leads to a loss of knowledge and productivity.

By contrast, those that invest in good management, in-house talent management and a stable working environment can retain valuable know-how in the company and safeguard efficiency over the long term. This is all the more true in the current environment. Of the companies that had vacancies in the previous year's survey, around half stated that they had difficulty finding staff either generally or all the time. Only around 12% of SMEs had no problems filling vacancies.

It is striking that in the manufacturing sector in particular, SMEs are finding it increasingly difficult to recruit. The proportion of companies in the manufacturing sector struggling to fill vacancies has been rising steadily since 2022. In the 2026 labor market study, it was 65 percent. For companies in the service sector, the situation is less dramatic – here, the proportion of companies with recruitment difficulties only increased from 37 percent to 45 percent over the same period.

Do savings in health management make sense over the long term?

The pressure to save money in SMEs does not stop at health management. At the same time, AXA’s SME labor market study 2026 shows that various measures against mental health-related absences are being used less frequently today than in 2023, although the number of such absences has increased.

Such cost-saving exercises in health management relieve the strain on the budget in the short term, but could prove to be a boomerang in the long run. After all, rapid savings only make sense if they do not result in consequential costs. Anyone saving on health management should therefore not only take into account the immediate relief, but also the possible consequential costs due to staff absences. Read our article Rising absences in SMEs to find out how absences are affecting Swiss SMEs and what measures companies can take to counteract them.

Staff absences as a cost factor for SMEs

Staff absences of any kind not only cause organizational problems, but often tangible additional costs as well. This is clear from the SMEs surveyed: for 42 percent, the cost of staff absences has risen in the last five years. For large SMEs, as much as 62 percent report increased costs due to staff absences.

Frequently asked questions about company cost reductions

Measures to reduce costs that can be implemented in the short term include:

Using digital meetings to reduce travel costs
Renegotiating existing contracts with suppliers and terminating unused software licenses
Postponing planned investments

However, caution should be exercised when postponing investments in particular – the investment backlog could eventually become a long-term problem.

Long-term measures can help companies reduce their costs more sustainably than short-term savings exercises. These include, for example:

Automating processes through digitization and AI integration
Reducing office space required by introducing flexible working models
Outsourcing non-core tasks to external providers

However, these steps often cannot be implemented immediately and need a clear plan and strategy to be successful.

In general, companies should first reduce costs where the measures have the least negative impact on employees and day-to-day operations. For example, by eliminating unnecessary process steps or optimizing purchasing costs.

However, companies should carefully consider savings in health management, as staff absences can result in additional costs.

Digitization and AI can help, among other things, optimize work steps and make more efficient use of data analyses. This allows companies to save time and use their resources more effectively.