Quick Changes You Can Make To Reduce Business Costs

Running a business can feel like a constantly uphill battle, especially when it comes to balancing the books.
This is especially the case for SMEs, where fluctuating unit rates, an unexpected staff departure or supply changes could be hugely consequential.
With that in mind it’s extremely important to stay on top of things, and make sure that you’re not only in the green, but have enough wiggle room and contingency funds.
In many cases, you have to invest to make more money, whether that be marketing, sales, or moving your business online if you haven’t already.
However, there are some tried and tested ways that you can cut costs right now. Let’s have a look at some of your options.
Draw Up A Budget; Build In A Contingency Fund
Many business owners will be well-aware of their ins and their outs, but it’s not until you draw up a full and comprehensive budget that you know how much you have to work with.
Rather than just looking at things on a monthly basis, understand how much money you have to work with on a weekly, and even daily basis. There are tools that can help you with this like quickbooks.
That will help you trim costs more effectively, as like all things the biggest overall expenses are the ones that are actually very small, but build up over time.
When setting a budget, chop your allowance down as much as is feasible, and the extra money that you have can go into a contingency pot, which can go to repairs, recruitment, or any other critical action. Doing so this way means that you can deal with unexpected changes without having to off-balance your books.
Make Use Of Freelancers
If you’re looking to hire a specialist, whether that is a marketing person or a website developer, really consider how long you will need this person for.
The answer likely isn’t ‘all day, every day’ and with that being the case, it’s much more worthwhile bringing on a freelancer.
With a freelancer you only pay for what you ask for and no more, and if you develop a good relationship with a freelancer that is a great asset to have in your back pocket as it isn’t necessarily a recurring cost.
While there are sites like Fiverr that can help you find someone, it’s always worth asking around locally, as local knowledge is a highly valuable resource – especially for marketing.
Stay On Top Of Utilities
Yes, something of a boring one, but at this point there are so many comparison tools that are sector and region specific that you should not have to pay a penny over the going rate.
Use these tools to find your best possible deal, but instead of going straight for it, haggle with your current supplier to see if they’d be willing to get you a better deal.
One utility that businesses might neglect is their water supply, because unlike domestic water you can switch your business water supplier, and in many cases you can cut fixed costs significantly.
Cut Costs – But Don’t Over Do It
While this may seem a bit contradictory to the above, it’s really important when setting out your budget to be careful not to cut key costs.
For example, if you run a retail operation and you do business with a cheaper courier for deliveries, but that courier provides customers with a worse service, that could impact your sales as some customers might (incorrectly) correlate that poor service with you.
When setting a budget consider what needs to be of the highest quality (products, equipment, sales teams, etc.) and try to cut as little as possible from these expenses.
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