Especially if you’re a startup, saving money and cutting costs can be difficult. Here are 6 money-saving tips help you to cut the costs and still reach your target audience and build your business.
Running a business is expensive, and money can sometimes be tight. This is especially true if you’re just starting out and your outgoings are higher than your profits. Smart entrepreneurs should actively seek ways to cut costs within their business and maximize revenue.
Reducing your overheads is a simple way to increase profits and avoid issues with cash flow. Luckily, there are countless ways to save money without making big sacrifices. With that in mind, here are some of the most effective money-saving tips for small businesses.
Tip 1: Switch to working remotely
Allowing your employees to work remotely can be one of the most effective ways to slash your overhead costs and save money. When you allow your staff to work from home, you won’t need to rent a large office space, and you will also save money on utilities.
Along with cost-savings, remote work can also increase productivity and boost employee morale. Gallup’s recent survey found that a massive 54% of office workers would leave their current job for one that offered remote working. Offering flexible work can be an excellent way to attract top talent to your company and retain skilled staff.
There are some massive advantages to working remotely, but a transition to remote working must be managed well to ensure that it is a success. For example, you will need to install a hosted desktop platform where employees can access operations, systems, and software remotely. You must also ensure that you provide your employees with adequate support and guidance, especially if they are new to remote working.
Tip 2: Try low-cost marketing alternatives
Traditional advertising and marketing campaigns can be extremely expensive and cost thousands of dollars. This investment can be worthwhile if you get the results you want, although it can also be a huge, wasted expense if the campaign is unsuccessful.
Fortunately, the internet has opened up many low-cost marketing options for businesses. Digital marketing strategies are much more affordable, and they can be just as effective when harnessed correctly.
If your small business is strapped for cash, then try experimenting with low-cost marketing techniques. According to thebalance.com, some of the best low-budget marketing ideas for small businesses include creating a blog for your company, posting content on Facebook, posting about your company on Twitter, and creating an email newsletter to send to your customers.
There is no doubt that low cost marketing is one of the best money-saving tips.
Tip 3: Negotiate better deals with vendors
Money spent on supplies and services with vendors is a large monthly expense for many small businesses. Renegotiating prices with your vendors can be one of the best ways to cut your overheads and increase your bottom line.
Vendors want to continue doing business with you, and most will agree to cheaper deals to keep you as a customer, especially if you spend a lot of money with them. You won’t lose anything by trying to agree to lower prices with your vendors, but you could save hundreds of dollars each month if you’re successful. You can search online to compare prices for different vendors and find the cheapest deals.
It is always worth speaking with your current supplier to see if they will renegotiate your contract and offer a price match before switching. There are lots of blogs offering tips for negotiating better deals with your suppliers.
Tip 4: Keep permanent staff to a minimum
You need employees to get work done, but employee salaries can take a huge chunk of your profits. If you are running a small business, then it is a good idea to only hire the permanent staff that you need. Keep full-time contracted employees to a minimum by outsourcing certain tasks to freelancers and independent contractors.
This can work out a lot cheaper than hiring permanent members of staff. Plus, you will have important tasks completed by industry experts, i.e., you can hire a social media expert to create and manage your digital marketing strategy. It also reduces the risk of you needing to make redundancies if your business stops bringing in enough money to pay your permanent staff.
Tip 5: Save money by going green
Most companies know that going green can boost their brand image, but you should also be aware of the financial rewards of becoming more eco-friendly. Adopting green habits in the workplace can be an excellent way to reduce your energy costs and cut the expenses associated with waste management.
Some of the top ways to make your business more energy-efficient include switching to LED energy-saving light bulbs, installing a smart thermostat, adding extra insulation, and replacing old windows and doors. These simple upgrades could save you hundreds of dollars on utilities each year. Using digital processes can also save your business significant amounts of money on office supplies such as paper, pens, etc.
Take a look at this article by the LA Times for examples of companies who have saved money by going green.
Tip 6: Make smart hiring decisions
Recruitment is a big expense for small businesses, so you must make the right hiring decisions. When you hire a new staff member, you will spend money on job advertisements, recruitment, and training. Having to hire new employees regularly is a massive unnecessary expense for companies. You can avoid this and keep recruitment costs to a minimum by making smart hiring decisions.
Write detailed job advertisements and take the time to find the best candidates for your position. It is also important to check that a potential employee is going to be a good long-term fit for your company, i.e., will they work well with your current team.
As a small business owner, you must learn to manage your finances well and keep costs under control. Minor changes to your habits can have a big impact and lead to massive cost-savings. This will allow you to increase profits and invest more capital into growing your business. Try some of the above money-saving tips to reduce overhead expenses and save money in your small business.