Running a small business comes with its own set of challenges and keeping your expenses low is imperative if you want to thrive in the business world. When times are tough, unnecessary spending can be the difference between keeping afloat and closing down, so we gathered together five tips to help you cut some of your costs, so your small business has a better chance of survival.
Consider Allowing Employees to Telecommute
Thanks to the rise of the Digital Age, businesses no longer need to invest huge amounts of money into brick-and-mortar shop fronts or blocks of office space in order to be successful, which is a good thing because one of the main expenses of a small business is often rent for a commercial property.
Telecommuting or making use of technology in order to work remotely or from home has become a popular choice for many businesses with some data suggesting that, worldwide, almost 70% of people work remotely at least once per week.
Businesses who have transformed some of their staff to this style of work have found that teleworkers are often more productive than their office counterparts, the quality of their work is better, and there is increased staff retention as workers often feel a greater sense of motivation and freedom due to being able to work from home.
You don’t have to transform your entire business model in order to take advantage of telecommuting. By closely examining which of your employees could perform their tasks remotely, you could start transitioning your business slowly, reducing the amount of floorspace required for your business to operate as you go.
Take your Marketing Digital
Traditional marketing strategies often centre around the use of print media, television, direct mail, telephonic marketing or billboards and flyers in order to reach clients, all relatively expensive options that often require at least one person with a degree in marketing to put together in order to be successful. Thankfully, we live in a world where reaching people and making connections is easier than ever before and digital advertising has made it possible for businesses to cut back on expensive marketing costs by putting the tools to succeed in the hands of everyday people.
Digital marketing does not only mean marketing your business on social media. It also encompasses any type of marketing that uses electronic devices, so things like content marketing through blog writing, influencer marketing, which is focused on identifying a key influencer in your sector and hiring them to promote your business, search engine marketing through platforms such as Google Adwords, mobile phone advertising, as well as email marketing and more.
Outsource Where Possible
Employees are the lifeblood of your business. However, they are also one of your biggest expenses. As a business grows and requires more staff, it can be a major blow on your bottom line when you need to hire a professional for a particular role. That is why many companies are opting to outsource some of their work.
One of the main advantages of outsourcing work is you can hire an experienced freelancer who may be an expert in their field for far less than it would cost to hire a full-time specialist. Hiring a part-time consultant only when you need them will allow you to expand and improve your business without taking on additional staff. An example would be hiring a management consultant in order to improve your business’ processes and to help solve issues you may not have the skills to do.
Before you go out and hire a freelancer, be sure that you have a clear idea of what you need them to do and what skills they require to get the job done. Let’s take your management consultant as an example. Make sure the freelancer you hire has experience in their field, has a good reputation, and is qualified, for example, they have an MBA through an accredited online business school like Aston University.
One of the easiest ways to cut back on your expenses is to try and get the best deals possible when it comes to your suppliers, and that includes your freelancers and utility suppliers.
The goal of all businesses is to maximise their profits, however, many vendors and suppliers will be willing to negotiate their prices with you, as they want to keep your business as well. Don’t go into your negotiations empty-handed though, even if you have no intention of changing suppliers, it is always worth getting multiple quotes from companies in order to leverage your request for better pricing.
The bottom line is you shouldn’t ever just accept a price when it’s given to you; you will certainly not lose anything by trying to get a better deal.
Cut Back on Software Costs
We’ve spoken a lot about making your business more digitally focused, however, taking this step often requires you to invest in specialised software to make it possible.
Stock control software, user licenses for accounting packages, even your Microsoft Windows software for each of your employees’ computers adds up quickly, especially if you have a large staff contingent. In order to reduce this cost, you should regularly evaluate what staff requires access to what software in order to perform their job and only purchase or upgrade the exact number of licences you will need.
In addition to making sure you don’t have more licences than you need, another easy way to cut back on your software costs is through the use of open-source software alternatives.
Open-source software is defined as software that is released under a specific license type that allows the source code of the software to be edited and modified to suit a programmer’s needs. Many small IT companies take advantage of open-source software to create cheaper alternatives to big brand software and often only charge their clients to maintain and edit this software so it can work out far cheaper than traditional software options.
At every stage of your small business’s life, the ability to save money on your expenses will have a direct impact on your bottom line and give you a better chance of survival in the business world, so always be on the lookout for ways you can reduce your spend.