As price hikes continue to hit the economy, small business owners are fighting to keep their heads above water. Now, more than ever, it’s vital to cut unnecessary costs and examine all areas of a business to see where savings can be achieved.
Overhead expenses, which take up a significant chunk of revenue, are an obvious place to start, but your most significant cost savings could come from making a series of smaller cuts and implementing innovative solutions.
Go paperless
The cost of paper and ink may seem insignificant, but it can add up to a big business expense over the course of a year. It’s a commonly recurring business cost that you can reduce by encouraging employees to be mindful of paper wastage and to stick to the following rules: Reuse waste-paper for notes instead of throwing it away; set all work computers to print double-sided by default; print documents in a smaller font, and file important documents on your computer instead of in a portable file.
Rent furniture
Furniture and electronics can be a big expense for a small business, but it doesn’t need to be. Teljoy offers a flexible, convenient way to get access to brand new furniture for home and office, as well as electronics and appliances on a month-to-month basis, with the option to take ownership after a certain period or cancel the contract at any time. This offers a flexible and affordable way to get the things you need with maintenance and risk cover built into the monthly cost.
Reconsider traditional services
A long-term contract for cleaning and maintenance can result in expensive monthly bills and may not suit your small business’s needs. A cost-efficient alternative is to hire cleaners or handymen only when you need them to come in. A service like SweepSouth allows you to book pre-vetted, trustworthy cleaners and handymen as and when you need them.
Their Connect app also caters specifically to business owners, with a list of service professionals that range from web developers, tax and accountancy services, graphic designers, and social media, to video marketing facilities.
Leverage social media advertising
Truth be told, traditional advertising is so expensive that many small businesses can’t afford it. Paid social media advertising is much cheaper and will provide a savings opportunity, but if even that is too much for you to afford right now, you can build your company’s social media following organically on Facebook, Instagram, LinkedIn, Twitter, and YouTube.
It is a much slower process, but it won’t cost you anything. You will also be able to authentically express your brand’s personality and build trust with your audience. The only cost will be your time, and a firm commitment to be regularly active and proactive on the accounts you’ve created.
Use freelancers and contractors for non-core work
Contracting out the jobs in your company that doesn’t require full-time employees can help cut overhead costs. Freelancers and interns are useful for one-off projects and non-core activities, such as data entry or document processing. They’re easier to hire and cheaper to employ, as you’re not expected to provide them with costly benefits like medical aid or leave.
Make sure though, that you have proper contracts in place to set expectations and mitigate risks, for both parties. Bear in mind that freelancers may not share the same loyalty and passion for your business as full-time employees, so it makes for sound business practice to balance your staff complement by hiring a combination of both full-time employees and freelancers.
Switch off lights, machines and computers after hours
To help keep energy costs under control, make it a company policy to switch off air-conditioners, non-essential lights, gadgets and equipment before staff head off home each day. Putting computer monitors into sleep mode will also cut down on unnecessary energy consumption and save money.
If you run your business from a home office, make the switch to LED bulbs and opt for energy-efficient appliances to help reduce your monthly electricity costs, says Matthew Cruise, lead campaign manager for Hohm Energy. For a longer-term solution, consider a hybrid solar system that includes batteries for backup, while keeping a lifeline connection to the grid. This will make it possible to use essential appliances, such as a laptop and routers, during load shedding, with minimal disruption to your business.
When in doubt, go without
If you’re struggling to allay costs, make it a practice to constantly ask: Do we really need to buy this? Do we really need to replace something? Think every purchase through instead of just spending the money on buying bigger and newer things. Even when times aren’t tough, it’s prudent to use what you already have until you are certain you need something new.
Cutting costs shouldn’t just be a periodic exercise to improve your bottom line. Good business practice dictates that you should regularly evaluate all operational expenditures. This will assist you in growing your bottom line and reducing the risk of cash-flow trouble in the future, as well as helping you become a more efficient business overall.
