Here are ten tips to trim the fat from your expenses and turn your small business into a lean, mean, money-making machine.
Looking for ways to cut costs and boost profits for your small business? Here are ten tips to trim the fat from your expenses and turn your business into a lean, mean, money-making machine.
1. Go Paperless
If you haven't already gone paperless, there's one question: why not? The cost of a single sheet of paper may seem insignificant, but if you're using traditional, paper-based methods for communication, billing, accounting, etc., your costs for paper, ink, stamps, and envelops will have an impact on your bottom line. Print hard copies only when absolutely necessary, and move your invoicing, accounting, and filing to computer-based systems. You'll not only save money, but will reduce clutter, make things easier to find and organize, and save space. Mother Earth will thank you, too.
2. Lose your Landline
Nowadays, having a landline phone service is not a necessity for many businesses. While it still may be expected for a shop or other location-based businesses, for many mobile businesses, freelancers, or self-employed professionals, a separate landline is simply superfluous. Between your cell phone, VoIP, and virtual phone lines, a landline may be a redundant expense, especially if your small business is one where you're frequently on the move or if you work from home.
Related: Find a new phone system for your business!
3. Explore Open-source Software
In our tech-based world, there are plenty of options when it comes to getting the software support that your business needs, and a surprising amount of it is free, thanks to the dedicated (and generous) innovators behind open-source software. Just be sure to do a little research before downloading anything you're not familiar with-check that the software has a good reputation and reliable recommendations so you don't waste time trying to figure out a useless product, or, worse, end up with an infected computer.
4. Rethink Your Location
Premises for your business can be a huge burden for your budget. In certain circumstances, such as retail or food service, paying for prime location may be an unpleasant but crucial part of success. But if you have some flexibility, consider sharing space with other businesses, working from home, or relocating to a less pricey part of town to cut down on your costs.
5. Track Your Money
It may seem obvious, but looking over your finances at the end of each month is the simplest way to identify and eliminate excess expenses. Take the time to examine each line of your accounting: certain expenses, like energy costs, may seem unavoidable, but it may still be possible to reduce them, for instance if you live in a deregulated state and can choose a different energy provider with cheaper rates.
6. Track Your Time
Keeping track of how you spend your time can be immensely useful for a small business owner. Just like with your finances, at the end of each month, review where your time has been spent and how it could be spent more efficiently. There are many time tracking tools available, including apps for your phone or tablet so you can track time on the go.
7. Buy Used
Shiny new equipment may be tempting, but for many purposes, pre-owned and refurbished furniture and equipment is just as good and can save you a bundle.
8. Do Your Marketing Online
Having a website and taking some simple do-it-yourself steps for marketing your business, like creating a blog and updating it regularly, is a low-cost way to get your business's name out there and build a following. There are thousands of tutorials and guides online to get you started.
As your business grows, you may feel the need to hire employees for functions from public relations to accounting. However, many of these functions can be performed just as well and at less expense by outside firms or contractors. This also eliminates many of the legal and tax obligations that having employees entails.
If your business has a significant amount of debt, it may be worthwhile to look at refinancing options to consolidate debt and reduce your overall interest rate. Talk to your accountant or banker to see if refinancing could help you save on interest.
(Image Source: freedigitalphotos.net by Stuart Miles)