FROM THE SUCCESS PEOPLETM
Eight How-To Small Business Tips For Cutting Small Business Costs
It’s the small costs that can sink a small business: Print cartridges, coffees on the company credit card, a new set of business cards- it all adds up.
There are a few simple small business tips to save on operating costs, and perhaps enhance your business while doing so.
You’re never going to make less money because you use the latest technology. There are always means of automating or enhancing your workflow, and it can be helpful to get in the habit of ‘auditing’ all of your processes to see if there are any ways of increasing efficiency and saving money. Find the places where mistakes are being made or processes are slowing down and search for technological solutions. If you’re finding that things aren’t being done because your way of keeping track of tasks is post-it notes then it might be time to invest in Slack or Facebook For Business. If you find that you’re spending a lot on phonecalls investigate an IP Phone system.
- Go Paperless
Paper isn’t just slow, it’s a liability. Receipts can get lost and with them the possibility of a tax rebate. Details on clients and sales can also disappear, leading to lost orders and customer dissatisfaction. You probably use a combination of paper and digital, but consider going fully paperless: doing as much as possible on computers, with any paperwork scanned and filed.
Let’s do some math: your company makes ceramic mugs for $2 and sells them for $10. If you were to buy a new kiln for $1000 you could pay with cash or in mugs, in which case the cost to you would only be $200. Bartering is almost always the more cost-efficient way of getting goods, and should be used wherever you can to keep costs down. As an added bonus, it will also forge bonds with other businesses in your area.
- Go Energy Efficient
Aside from shopping around for a cheaper energy provider, there are a million little ways for you to reduce your electricity bill. Turn monitors off overnight, relax the dress code during summertime so you can save on air conditioning bills and double-pane your windows.
- Telecommuting and Meeting
Meeting clients face-to-face is still the preferred way to do business, but meeting over the phone or video-conferencing software is often just as effective. You can save on fuel, food and sometimes even accommodation costs by meeting over Skype instead of driving (or even flying) out to meet clients. You can apply this to employees too: not all of you will need to be in the same room to do your jobs, so you can cut costs by allowing them to work from home if productivity isn’t affected.
In retail, it’s all about location, location, location- but for business-to-business companies, manufacturers or service providers there’s really no reason to choose premium office space. You can get by with a smaller place that may not be in an ideal location, but which will save you money. You can save more by thinking outside of the box: do you even need an office? Many companies can run perfectly well from home, with telecommuting allowing for your ‘office’ to expand indefinitely without a brick and mortar location.
- Pool Resources
There are likely to be organizations in your local area set up to help businesses like yours. These could include local chambers of commerce, cooperatives and trade organizations, but there are also more modern ideas like resource libraries (such as tool libraries) and buying groups in which companies pool orders in order to get reduced prices.
Everything is up for negotiation. It’s rare that you’ll be able to find a product or service that can’t be reduced in price by few percent, particularly when you’re buying from other small businesses. You won’t be able to haggle the price of Wal-Mart groceries down of course, but managers at other, smaller stores might have the authority to give you discounts.
Owning a business is exhilarating: being your own boss, making your own hours, even making your own mistakes. Make sure that one of these mistakes is not paying for something when you don’t need to. If you ever need advice, be sure to contact KAFT CPA and we’ll be here to help you with even more small business tips!
Need an accountant who specializes in medical practices, oil and gas, small business and more?
Book your free 30-minute "Success Check" today.