Utilize Technology
9 Tips for Reducing Small Business Costs
Being a small business owner is hard. It’s even harder when you try to do it all. People often believe they’re saving money with penny-pinching strategies that cost much more in lost time and opportunities than what’s saved.
These nine tips will help you be smarter, wealthier, and less stressed out as you strive to make your small business a more successful
Embrace Online Marketing Opportunities
Eliminate Credit Card Debt
Create a Budget
Rethink Office Space Needs
Refinance Loans or Lines of Credit
Stop Wasting Time
Contract Out Specialty Work
Focus on Work Activities You Enjoy
- Embrace online marketing opportunities: There are a lot of low or no cost ways to get your business in front of prospects online. Pick a couple of places that are popular with your prospects to be active. Professionals should consider Linked In. Highly visual businesses will benefit from Instagram activity. Those selling products can see increased sales on Pinterest. Don’t spread yourself too thin, but be consistent where you do decide to focus. If you haven’t set up a Google My Business Page, do it now. It’s free and gives you top search visibility.
- Eliminate credit card debt: One of the most expensive ways to borrow money is with credit cards. Consider securing a line of credit for short term needs or term loan to pay off all credit card balances. Better yet, amend your billing practices so you’re not floating out-of-pocket expenses made on clients’ behalf. Strive to pay credit card balances down to zero each month.
- Create a budget: It’s amazing how few small business owners take the time to craft a yearly budget and review it against actual income and expenses each month. This is an extremely important step toward achieving success. If you don’t know where your money is going and haven’t predicted where it will be coming from, you’re at a disadvantage. Take a few hours before the new year starts to think about your money.
- Rethink office space needs: the pandemic accelerated a shift that was already coming. Now’s the time to reconsider how much office space you really need. Does everyone in the company need a designated office or desk? Can space be shared with sales reps who are mostly on the road or employees who are spending some days working from home? Is it time to downsize your office space to reduce a big monthly expense? Or maybe just-in-time isn’t working with production delays and you need more warehousing space? These are things to consider as we’re seeing big shifts in what “business as usual” means.
- Refinance loans or lines of credit: Borrowed money is inexpensive right now. If your loan is more than a few years old, ask your bank if they can do better or shop around for a better deal. You can borrow money from another bank offering lower interest rates to pay off your current loan. Check on lines of credit too. Banks vary a great deal in what they charge for this service so it makes sense to shop around.
- Stop wasting time: most small business owners start out trying to handle items and issues beyond their expertise. As entrepreneurs get more seasoned and savvier, they learn to delegate to others who are specialists. Whether you do this with a w-2 or 1099, consider bringing in help so you’re spending your high-value time on what you do best.
- Contract out specialty work: most small business owners take too long to make the decision to hire their first professional service provider. The time, frustration and money trying to do everything yourself is costly. Once you take the plunge, though, you’ll kick yourself for not doing it sooner. Whether it’s legal, financial, or marketing help, hiring the right expert to do the job a lot faster and better than you can translates to a lot more money in your pocket over time. It’s also a big stress reliever.
- Focus on work activities you enjoy: smart small business owners realize it doesn’t make sense to be mired in tasks that make you miserable. That’s not why you decided to go into business for yourself. You and your clients will be a lot happier if you spend majority time focusing on what you do best. Delegate the rest.
- Use technology: Decisions you make about how you handle your business operations, record keeping, and financial tasks can have a huge impact on your bottom line. When you think you’re pinching pennies, you might be missing out on much bigger money.