Leaders of small and large companies alike can struggle with saving money. With rising costs starting to strangle small businesses, it’s more important than ever to tighten your belt and pay close attention to what’s flowing in and out of your bank account.
Without a team of pricey accountants and financial planners, this can get difficult. However, with some trimming here and switching strategies there, you can get your costs under control and save some cash to keep your business thriving. Here are some tips to keep as much money in your bank account as possible.
1. Reduce Your Electricity And Gas Bills
Making small cuts where possible is the first step to reducing your bills. It’s like free money and takes little time to do! You can easily shop around and try to find lower prices on your utilities at least once a year. ElectricRate, an online tool that compares electricity and gas rates, is an example of what you need: clear comparisons between providers that will let you choose the lowest-costing service.
2. Switch Up Your Advertising
Thanks to the Internet and more old-school methods, it’s easier than ever to cut advertising costs without sacrificing consumer contact. Use SEO techniques to improve your web traffic and make YouTube videos related to your industry to increase awareness of your brand.
You can also use tried-and-true advertising methods that have been around for ages: tuck promotional materials into customers’ purchases, speak at a community meeting, or cheaply hire some on-the-street sign wavers. Get creative and don’t ignore what businesses have been doing for centuries to attract customers in a low-cost way. Save Money, the 2017 way to do it.
3. Team Up With Other Businesses
In a similar vein, you can cut advertising costs by splitting them with another business. By sharing consumer contact information, promoting each other’s events, and even sharing suppliers, you can save a lot of money. You can also build strong alliances with other businesses, which is never a bad idea.
4. Outsource When You Can
One of the biggest chunks of a budget includes employee-related costs: office space, salaries, insurance, and more. This is also a significant area for potential cuts, while avoiding layoffs.
Consider hiring consultants as needed instead of hiring full-time employees – this will allow you to negotiate lower rates and avoid paying full-time salaries year round. You can also hire independent contractors to avoid taxes, but be careful; they must match the IRS definition of contractors, or you can face a lawsuit or fine.
5. Negotiate With Vendors And Barter
You can negotiate on almost anything: leases, supplies, even utilities. Just take a deep breath and ask for a discount. Many retail space owners will consider renegotiating lease agreements when asked, and vendors will often consider counteroffers for their services.
If the negotiations don’t get the vendor down to the price you need, or your cash supply is especially low, the age-old practice of bartering can come to the rescue. You have marketable skills – that’s why you run a business. Use those skills to offer services in exchange for lower rates. For instance, if you run an interior-design company and need PR services, you can offer the PR company an office redesign in exchange for their expertise.
6. Use Open Source And The Cloud
Instead of spending hard-earned cash on servers and in-house software, consider a cloud-based solution. For relatively low, annual payments, you can host your data on the cloud and avoid hardware upkeep costs.
Also, using open source software (software with code that’s made public for anyone to use, test, and adapt) is a great way to cut costs, since you won’t need to purchase expensive office programs. You can find open-source software for nearly any task.
7. Go Mobile
Working remotely is getting more popular, which is great for a company’s bottom line. Although telecommuting isn’t possible for all businesses or all employees, there’s huge potential for savings if it works out. By keeping things virtual, you don’t need to pay for office space or the utilities that come with it.
If you need a physical space but aren’t tied to a location, you can also lease a temporary space like a kiosk or cart. This way, you can lease a mobile space, try it out for a short period, and decide if you want to stick with that location or move on. This avoids pouring money into a less-than-ideal location that you’re stuck with.
8. Go Green
Along with the good PR that comes with “going green,” environmentally friendly changes can also fatten your wallet. From simple shifts like turning off equipment at the end of the day to larger developments like switching to solar power, everything helps with monetary savings.
The Energy Star website provides great ideas to cut energy usage and costs.
9. Change Your Hiring Practices
It’s often worth it to give job applicants without much experience a shot. By welcoming recent graduates, you can pay entry-level salaries that you can’t get away with for more experienced employees. Further, you will benefit from employees who are up to date on the latest technologies and are hungry for a chance to prove themselves. We all had to get our start somewhere; let the process be mutually beneficial.
10. Be Smart About Taxes
Many small businesses are eligible for different tax deductions: rent interest, utilities, maintenance, transportation, client entertainment, and more. Go to the IRS website to learn how to apply these deductions for big savings.
Another option is to negotiate a better tax rate at your local city hall – community leaders often consider giving tax breaks to businesses they want to stick around.
Cutting costs isn’t always fun, but you’ll thank yourself when you need a little extra cash to cover an unexpected expense. Despite our difficult financial times, it’s possible for nearly any business to establish solid savings.
Brian is an international speaker and coach.