12 Cost-Cutting Methods For Your Small Business
No one ever enjoys making budgets. It’s rare that someone is going to wake up and say, “I am ready for today’s budget meeting and can’t wait to pour over the nitty-gritty and face all of our financial problems.”
Every business is looking at how to turn maximum profits each month, quarter and year. Reaching that next level is often much easier said than done. The main option is to always bring in more and more money, growing your business at a steady pace where you can start to see the hard work paying off.
There is no perfect answer to magically make more money and if there was, no one would ever be looking at help articles or examining their budget with a magnifying glass.
Besides simply “making more money”, there is always another way to increase your profit margins: by cutting back on expenses. The wise founding father Benjamin Franklin is often attributed with the saying, “a penny saved is a penny earned”. While you may not see amazing savings and better profit immediately, practicing these tactics is bound to lead to a healthier business, larger profit margin and a happier you.
It’s Easy to Be Green
Even though you may not be the world’s biggest tree-hugger or recycle junkie, you can still save your company some money by going green.
Buy a water cooler for the office instead of having water bottles out, turn off all electricity at the end of the night and think about how you could go paperless. Not only are you helping the environment, but you’re also helping your business.
If you can afford it, purchase a smart thermometer. These will help regulate the cooling and heat in your building, meaning you’re not using any energy unnecessarily.
It’s tempting to always want to buy the latest and greatest for your office, but you don’t need to. If you have to buy a laptop, look at refurbished options and buy within your means. If you need a laptop for email, budgeting and the internet, there’s no reason to spend $1000, no matter how much RAM it has.
You can always upgrade at a later point, but for starting out there’s nothing wrong with going second-hand.
We’re all familiar with the traditional ways of advertising. It works, but it’s still pretty expensive. To reach a lot of people consistently without burning through your wallet, why not start advertising on social media?
With over half the world’s population using some form of social media, that means you can reach out to thousands quickly. Making a business page is free and options for promoting your page or improving visibility are quite inexpensive.
Free Online Software
No, this doesn’t mean you have to go around pirating software, but swapping out your traditional Microsoft Office package for something like Google Drive is an easy way to save a bit of money.
Each user gets 15 GB of space for free, meaning you’ll be able to store plenty of documents, pictures and spreadsheets. If you want to upgrade, it’s only $5 per month.
The Telecommuting Craze
While many employers may bristle at the idea of telecommuting, it’s becoming a more accepted trend among business owners. It doesn’t have to be everyday, but even letting your employees work from home just once or twice a day is a way to save on electricity and transportation costs.
Rent or Share
It’s no secret that renting something for a period of time will be cheaper than buying it outright. Think about renting larger pieces of office equipment or other items instead of bringing home the whole thing.
You can also find an office-sharing option for your business if you don’t mind working in close proximity with others.
No doubt you have some kind of backup software on your phone for your photos, but using a cloud service for your business is a great idea to keep everything offline and safe. Hard drive failures can happen at any time, so make sure you’re keeping everything backed up.
Like Google Drive, there are plenty of free services out there with a small price to upgrade and get more space.
Fans of the popular TV show 30 Rock may be up to date on their negotiating tactics, but those who aren’t can still negotiate to lower prices or help find deals in certain places.
You might not be the most comfortable negotiating like you’re shopping in a Middle Eastern bazaar, but finding a deal can help you save some money up front.
Buy in Bulk
Just like buying from Costco, buying things in bulk is cheaper than buying individual items when you need them. The easiest thing to buy in bulk would be your office supplies, just make sure you have somewhere to store them.
While it might be great to have a full-time marketing team on hand, chances are you don’t need someone for every department possible. Find firms in your area to outsource your non-essential work.
Even if you use them sparingly, they may be able to come in and provide fresh and new ideas if you and your coworkers and becoming an echo chamber.
Comb Over Your Financial Statements
When you’re reviewing company credit cards and financial statements, look a bit closer than you normally would. See if there is anything else small you can cut out. Maybe you don’t need to cater lunch every week for the staff meeting or buy the best coffee at the local supermarket.
Those little cost-cutting measures can add up after a time.
Pay Off Any Debt ASAP
Interest charges are the bane of anyone’s existence, so it’s best for you and your business if you make sure you’re paying off everything as soon as you possibly can. There’s no point in letting an outstanding charge sit around if you can pay it off now.
Those interest charges can add up quickly and if left ignored, can be an insurmountable hill later.