6 Helpful Tips for Lowering Common Business Expenses
If you’re looking to make more money out of your business – or lease stay afloat in difficult financial times – one of your best options is to cut back on your most common business expenses. You’ll have more money to invest back in your business – or even to take home in your paycheck. Here are just six tips to help you lower common business expenses:
1. Find more affordable employees
For a majority of small businesses, payroll makes up the largest expense on the books. Yes, you need to have excellent employees to run an excellent business, but there are plenty of ways you can cut payroll expenses without harming your employees or your business.
For instance, you can outsource non-essential tasks, or hire interns to take care of these tasks. If you’re operating a small business with only a few employees, chances are that everyone is multitasking, anyway. You can remove some of the load from your employees’ plates (making them more efficient) and downsize your payroll expenses by contracting certain work (such as marketing copywriting, accounting, and social media management) only when you need it done.
2. Create a marketing plan
Too many small businesses market on the fly and end up spending much more on marketing than they should. Without a plan and a way to track the effectiveness of your marketing, you’ll have no idea what’s working or how you need to spend your marketing dollars to make them more effective. Simply throwing money at marketing is a terrible idea.
So if you don’t already have a marketing plan and some way to track your marketing success, get on it now. It’s time to start thinking about how you’ll market your business more efficiently so that you can spend less money but make a bigger difference for your small business.
3. Renegotiate technology costs
As a small business operating in 2012, you’ve got to pay for technology for your business. You need computers and internet access and maybe even a specialized telephone system or smartphones for some of your employees.
It’s easy to let these costs get out of hand by not thinking before you spend, and by not reevaluating costs annually. Every year, you need to be looking at new deals that are available for your high-speed internet, your phone system, and even your business cell phone expenses. Renegotiate costs with the companies you work with, and watch your business save.
4. Go green
Going green is all the rage around the world today, but it’s actually a great way to save your business money. Green practices that save energy and resources can help you cut back on the cost of overhead, as well as the cost of office supplies.
Implement new practices in your business that require lights and electronics to be turned off when they aren’t in use, and find ways that you can conserve office supplies. Require employees to scan key documents, rather than copy them, and consider signing up with a cloud service provider if you need room to accommodate all of your data. These services are cheap, and much less expensive than what you probably spend on computer hardware, paper and printing now. Any way you slice it, going green can make an impact for both the environment and your small business.
5. Shop around
When it comes to costs like bookkeeping, financial services, car rentals, automobile maintenance for your business fleet, insurance, and even office supplies, it’s important to shop around to make sure you’re getting the best deal. And don’t just shop around once and call it done. Prices fluctuate with the market, so make sure you’re shopping around for all your variable costs at least once a year, if not every six months or so.
If you find a better deal with a new credit card company, bank, or supplier but prefer the ones you have, consider approaching your current business partners to see if you can work out a better deal. Remember, it never hurts to shop around, and it certainly never hurts to ask if you can get a lower price for an item or service you need for your business.
6. Manage credit cards better
Many small business owners use credit cards as part of their overall money management system. And when used correctly, credit cards can be a great way to finance large purchases and smooth over potential cash flow issues. But if you aren’t taking full advantage of credit card deals like 0% introductory APR or cashing in on your available credit card points, you’re missing out and spending money you don’t need to spend for your small business.
So be sure you’re periodically checking out your credit card statements and looking at new credit card deals that might be available. If you can get a good deal on a balance transfer, it may save you a fortune in interest and monthly costs to transfer your balance to a new credit card.
Managing money well for a small business means staying on top of each and every expense your small business might have. Constantly evaluating your spending and finding ways to cut back on your business expenses will translate into a more successful small business in the long run.