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In this tutorial, Simon demonstrates how to reduce the size of Excel files to improve performance and make sharing easier. Excel files can range in size from a few kilobytes to a few megabytes, which can slow down the program and make it difficult to share. To reduce file size, one method is to save the file as a binary spreadsheet by navigating to "file," clicking on "save as," entering the file name and location, and selecting the Excel binary workbook option.