10 Ways to Reduce Your Small Business CostsPosted by Factor Funding Co. on June 11, 2015
The future success of your small business relies greatly on your current cash flow. When your business has high expenses, you must spend money you ideally may prefer to invest back into your company. Ensuring your business' future calls for you to keep these expenses as low as possible. These 10 strategies can help you keep your small business costs as low as possible.
1. Use Interns or Freelancers
When you lack the cash flow to hire and train new workers, you can still keep your business running by bringing in interns or contracting with freelance workers. Freelancers often get paid per task that they complete for you rather than by the hour.
Similarly, interns often work for lower wages or even for free if they are college students earning class credit. This tactic spares you from paying out salaries and having to provide benefits like sick leave and insurance.
2. Switch Insurers
Staying with a longtime insurer may be comforting, yet costing you money at the same time. You may not realize that your insurer is charging you higher premiums than other companies.
To save money, you can shop around and find insurers that offer lower rates. Before you switch, you should make sure the new insurer will provide you with the same protection and coverage, however.
3. Go Paperless
Paper is expensive and can make a big dent in your budget. You can save money by using paperless alternatives like:
- Using cloud storage
- Keeping electronic records on your computer
- Offering discounts to customers who choose online statements
- Only printing off paperwork that you truly need each day
These options will reduce the amount of paper you have to buy and put some much-needed money back in your budget.
4. Pay Bills on Time
Late fees and interest can add up quickly. You can save money by paying your bills on time and by paying them through the least expensive option.
For example, some creditors charge customers to make over-the-phone payments or payments in person. You can save money by paying your bill on or before the day it is due online. Many companies let people pay their bills online for free.
5. Ask for Discounts
You never know if you can get a discount until you ask. Many stores and vendors are happy to give you a discount if it means they get to keep your business.
Even if the savings is only a little at a time, these discounts add up quickly. Those reductions in price put money back into your business' budget.
6. Factor Invoices
One of the best ways to get money for your business now is by factoring your unpaid invoices. When you factor these accounts receivable, you:
- Avoid having to take out a bank loan
- Get money upfront that you can use for any purpose
- Retain assets because factoring does not utilize collateral other than the invoices
- Get cash without having to wait for clients to pay their outstanding balances
Factoring is quick and easy, often only taking a few days to complete. You also get more cash upfront than if you were to apply for and receive a bank loan.
7. Use a Cell Phone
Landline phones today are pricey. With more people using cell phones, landline carriers must charge higher rates to stay in business.
When you want to save some cash, you can switch to using a cell phone exclusively for your company. This option lets you take calls anywhere and anytime without being tethered to your landline phone.
Bartering for goods and services is just as relevant today as it was 100 years ago. When you connect with other new business owners and exchange goods and services with each other, you save money and still get the goods you need to stay operational. Furthermore, bartering lets you make important contacts in your local business community. These contacts could help you grow your business later.
9. Buy Used or Refurbished Equipment
Business equipment like computers and printers is expensive. When your flourishing business cannot handle the expense of buying new, you can get what you need and keep cash in your pocket by purchasing used or refurbished equipment.
This equipment often comes at a much lower price. Used equipment dealers also routinely provide warranties and repair services for their products.
10. Use Social Media to Advertise
Many new business owners do not have money to waste buying advertising space on the radio or TV. You can get free advertising when you use social media.
By opening and maintaining active social networking accounts, you can connect to your customers and let them know about your products, services, and sales. You likewise can engage them without having to spend any money out-of-pocket.
These 10 money-saving strategies can help new business owners like you survive and grow in today's competitive market. Keeping your business costs low can be vital if you want to ensure your company's future.