Running a business of any size costs money. It is one of the biggest truths of entrepreneurship.
From materials and training, to marketing, payroll, and more. There is always going to be a steady outflow of cash from any business.
The positive side of all this is that with proper planning and smart spending, you can avoid spending more to run your business than you absolutely have to. In this article we will examine some ways to reduce the cost of business expenses.
Frugality
A good place to start is by considering what the needs of your businesses are, and what your wants are. More simply, if it is not completely essential to operating your business, then chances are you can do just fine without it. Before you make any purchase for your business, it is essential that you consider your options and compare different products or services to find the best value.
For example, to run any kind of business in today’s digital age, a dedicated work computer is essential. However, you may do well to weigh the cost of the machine that you want, versus the cost of a comparable, yet less popular name brand. Not only is it good practice to compare price points but it is also good to compare hardware specifications and overall performance. With a few quick google searches, you can find helpful reviews and find out how well the top products stack up against each other
While many people are quick to gravitate towards Macbooks and other Apple products, you may find that a comparable Windows machine can suit your needs just as well. Granted, there are some areas where a Macbook will outperform a competing brand, but for some applications, it really makes no difference. Depending on what you do, and what kind of specialized tasks you would need to use the computer for, you should examine all options to make the the most economical purchase for this stage of your business.
Alternately, a coffee machine is arguably one of the most important necessities of any small business. Nothing gets the brain moving like a good cup of joe in the morning (or all throughout the day, no judgements here.) But while you may be tempted to buy the newest Gevalia espresso machine with the detachable steam wand and all the bells and whistles, chances are that unless you run a coffee house, you don’t need to go all out. A Mr. Coffee costs a fraction of the price, and brews a darn good cup. You don’t always have to spend the most money, to get the most function out of your purchases.
Also important to keep in mind, is that small expenses can add up quick. Lunch for the whole office can get pricey, and in short order. So, while you may want to treat your employees and colleagues to lunch every now and again, you shouldn’t do it too frequently on the company account. Before you know it, you’ve eaten half of the marketing budget. This is the same for any kind of small purchase. Benjamin Franklin said “Beware of little expenses. A small leak will sink a great ship”. And the same is true of any business as well.
Outsourcing
There are some aspects to running a business, such as payroll management and other clerical duties that may be time consuming, and pull you away from places where your attention would be more prudent, and your time more effectively used.
Anything that a business owner does should generate income for the company, but unless you are an accountant, there are quite a few reasons why you should outsource payroll functions with a company like Excellent Admin.
By outsourcing payroll, not only can you save time, but having that time to dedicate to other aspects of business like new client acquisition will guarantee that you are making money.
Another area where outsourcing is beneficial is for short term jobs such as copywriters. If you have a website, it is important to post original content that showcases the value of your business.
By hiring freelance writers from sites like upwork, not only can you save time by not having to write the content yourself, but you can usually save money compared to the cost of hiring a large scale marketing agency to generate your content.
All things considered, outsourcing small and short term jobs is an effective way to free up even more of your time to focus elsewhere within your business.
Use Less Ink and Paper
Not only is this good from an economic standpoint, it’s good from an ecological standpoint as well. By using less paper, ink and other office supplies, as well as monitoring waste, you can mitigate costs of office essentials by a potentially large margin.
Furthermore, in this age of digital communication, most people worth reaching can be reached by email. By forgoing the old “snail mail” of the postal service, and corresponding with clients and customers by email whenever possible, not only saves you money on paper and ink, it also saves on postage and helps to keep your company’s carbon footprint much smaller in terms of consumption of natural resources.
Other Ways to Save
- Pay invoices early – many suppliers and service providers offer premium rates for those who pay their invoices well before the due date.
- Negotiate lower credit card APR – If you’re paying a high annual percentage rate on your credit card purchases, try to negotiate a lower rate with your provider. You can save significant money over the long term.
- Hire interns – This is a win win situation for all parties. Not only do young Interns get valuable experience in your field, but they also tend to be willing to work for a minimal salary compared to people who are already skilled and qualified in the field. By hiring interns, you are making an investment in your future, as well as theirs.
- Buy used equipment – Used equipment can be just as useful as new equipment, but even at a few months old, these products will come at a significantly lower price.
Conclusion
Whether it’s a brick-and-mortar retail store, a service provider, or a small e-commerce company, every startup has its own set of expenses. It’s unavoidable that you will spend money in order to operate. These are just a few ways that small companies can save on the cost of business, but they aren’t the only ones.
What are some helpful tips and tricks that you have found for saving on business expenses. Leave us a comment with your best suggestions in the section below.