Looking for simple ways to cut costs? These tips will help you make a noticeable difference to your bottom line.
1. Reduce staff costs
Help with routine tasks can greatly improve productivity, but hired help is often too expensive for small business owners. Internships can be a real win-win – a student gets hands-on experience assisting with marketing, accounting or admin while you get time-saving help – and engaging a qualified remote worker is another cost-effective way to bring on support for administrative tasks.
2. Think thin
Owners are often advised to trim their offerings to a niche; apply the same thinking to how you operate. Subcontracting lets a service-based business keep a narrow focus while attracting more customers – taking on more work and paying someone to do it at a lower rate than you charge increases both capacity and your bottom line, while you stay focused on what you do best.
3. Network more
Forget expensive print ads and direct mail. You can save a lot getting the word out by connecting directly with your target market – co-host an event with a business whose customers would be interested in what you do, connect with your local chamber of commerce, attend referral events, run a social media contest, or sponsor a community fundraiser. Trade shows and industry events are great for meeting partners and customers without costly advertising fees.
4. Embrace co-opetition
Buying in bulk to save money can backfire if cash flow is tight and the cheap supplies never get used. A better strategy is to buy only what you need and share costs with other owners. Co-opetition – forming alliances with other businesses – can lead to lucrative partnerships while collectively saving everyone some cash.
5. Save time with technology
If you haven’t yet, adopt cloud-based software to improve efficiency. Free collaboration tools cut down on paper, virtual meeting technology saves a fortune on travel, and a free trial of accounting software shows how automating routine tasks like invoicing and payroll improves accuracy and frees up hours.
Final tips
Review your expenses regularly to track rising costs and find more savings. A few costly pitfalls to avoid: always pay vendors and lenders on time to dodge late fees, interest and a poor credit rating; shop around for the best deals on everything from software to inventory; and hold off on renting space for as long as you can – encourage remote work, meet clients in cafes, and remember that a home office can be an eligible tax deduction.