Small businesses and startups can transform and become highly profitable very quickly if they get their strategy right.
However, whether they grow fast, or steadily, and regardless of industry, SMBs face some big challenges.
In the early days of a business, getting it off the ground and making it profitable can be tricky.
Small businesses have less resources and savings than large ones. Any successful companies, apart from charities, want to product more revenue than they pay out. Easier said than done. As the old adage goes, you must spend money to make money. For small businesses it becomes a delicate balancing act.
Fortunately, there are some simple techniques that can help small companies reduce their costs, spread large expenditures, and ensure healthy cashflow, so they can boost profit-driven expenditures.
How Small Businesses Can Save Money
1) Embrace Remote Workers – The pandemic was devastating for many businesses, yet for the savvy companies, it also provided valuable lessons, including how to save money. Renting office space and the bills that go with it is one of the biggest costs for a small business. It is a huge drain on resources.
By letting staff work remotely, businesses gain three major benefits, including two huge cost saving methods:
A) Less in-office staff equals fewer space requirements. Businesses can rent or buy smaller properties and spend less money in the office.
B) Less in-office staff equals less need to spend money on utilities such as heating, electricity, air con, cleaners etc.
C) Businesses can take advantage of hiring talent from a larger pool of qualified candidates based anywhere.
2) Outsource – Rather than having a staff member or whole department dedicated to each aspect of your business, consider outsourcing. While agencies can be perceived as expensive, they are much cheaper than a complete salaried employee or several. You can outsource for your accountants, legal team, digital marketing and much more to save on internal staff salaries. For small businesses this keeps the core team lean and gives access to experts at the same time.
3) Lease Computer Hardware – Having a healthy cashflow is essential for small businesses. With tight budgets and fewer resources, big expenditures can be a major strain on the business. It then takes time to recover from a big payout, preventing further investment. By leasing hardware and other company items, a small business can spread the cost of expensive equipment into small manageable monthly payments. This leaves a steady stream of cash for profit driven campaigns.
4) Use Flexi-Lease – Of course, not all leasing solutions are the same. Small businesses can stand to receive more benefits than merely spreading the cost of their hardware. Hardsoft’s Flexi-Lease makes it even easier for small businesses as it offers so many options for change as your business circumstances shift. With a three-year lease, you have the option to cancel, continue working towards ownership, or change i.e., upgrade the devices after two years. Not only that, but Flexi-Lease also provides a 360-degree support wrapper. With experts on hand to help small businesses with maintenance, advice, and device strategies, you can do away with the IT department altogether and make huge savings on operations.
5) Embrace Cyber Security – While it may seem like an additional expenditure and hurdle at first, taking extra steps with cyber security now could save small businesses thousands in the long run as data breaches become more prevalent.
6) Utilise Cloud Based Services Where You Can – Cloud based services save lots of money on infrastructure and on the installing of on-site software. It also makes their use a great deal more flexible for remote staff. Subscriptions to cloud-based services also tend to be cheaper than developing new onsite infrastructure or developing your own programmes.
7) Reduce Power Consumption And Waste – Going green can actually save money for small businesses. Simple methods, such as keeping all equipment on a power strip and turning them completely off when not in use rather than on standby is a big saver.
8) Keep Meetings Short – Save money by making more money. The best way to make money is to increase productivity and reduce downtime. Try to keep meetings short, to the point and only host them if essential. Ensure only staff who are absolutely required attend the meeting.
9) Automate – Wherever you can, embrace automation. Anything that can save staff time or eliminate the need for an extra staff member is a money saver. Whether it’s email campaigns, ad creation, programming, consider researching if there is software to automate that process. The less manual processes in your day-to-day operations the better.
10) Detailed Financial Planning – The best way to save money is to maintain a detailed budget allocation and financial plan that is regularly tracked and reviewed. This will reveal opportunities for saving and profitable spending for small businesses to grow.