If you are a small-to-medium-size business (SMB) owner, your goal is to generate a healthy cash flow while reducing expenses. This is often a struggle while trying to remain competitive in the fast-paced SMB environment. What can you do to start reducing your costs?
Re-Evaluate Your Expenses
Take a close and objective look at where you are currently spending your money. Are you spending money on unnecessary things? Only spend your money on what you need to effectively run your business. Before making any new purchases, ask yourself if you really need it, what are the benefits to your business, and will it help increase your profits.
When building your website or online store, rather than paying a developer a lot of money to build it for you, use a website builder and build it yourself. When looking into hosting plans, examine what functionality your business needs, select the plan that meets your requirements, and compare the price of cloud vs VPS hosting.
Don’t Buy New
You can reduce your costs for print cartridges by almost 50% if you purchase recycled or refillable ones instead of new ones. For SMBs trying to reduce costs, previously-used office furniture and equipment can save you a lot of money. Whether you need to purchase printers, scanners, desks, lighting fixtures, or copiers, used models can be bought for just a fraction of the cost of purchasing new models.
Make sure you understand the difference between refurbished and used so you don’t waste your money trying to save money. When buying used furniture or equipment, it is usually sold “as-is” meaning it is sold without a warranty and hasn’t been inspected. You will certainly have the option to look at anything you are considering purchasing.
However, you won’t know anything about the history, problems, or maintenance of the item. Furniture is easier to see any imperfections like scratches whereas equipment is more difficult to “see” if it will work properly. On the other hand, refurbished equipment is reconditioned and inspected and might come with a warranty or a full report of its condition.
Buy in Bulk
Just as you can save money in your personal life by going to warehouses and purchasing what you need in bulk, as an SMB business owner, you can reduce your expenses in the same way. Check the prices to confirm that the items you are purchasing in bulk do indeed reduce your costs. Bulk orders usually have larger discounts. You can easily find reputable places that sell office supplies and materials in bulk by doing a simple Google search.
Use Digital, not Paper
The world is going digital and your SMB should too. Rather than printing everything on paper, save what you need in digital format. This will save your company money on ink and toner. In addition, it will expand the life and reduce the maintenance costs of your office equipment like your copiers and printers. You will also save money by spending less on office supplies like folders, paper, and paper clips.
Get Smart and Automate
Most large businesses have turned to automating many of their tasks to reduce inefficiencies. SMBs should also look to automate routine tasks. Manual processing takes a lot of time and costs more money than buying simple tools to automate those tasks. Your business can reduce costs, save time, and boost efficiency with automation.
SMBs can save a lot of money by hiring interns instead of full-time employees. Many colleges and universities have internship programs available to their students, often for credit. For the intern, working for your company is a great way to not only get college credit but also to gain experience that will look impressive on their resume.
The intern can work on tasks that require minimal training and are time-sensitive. Oftentimes an internship can lead to a job that can benefit both the intern and the company. If you as the business owner are pleased with the quality of work done by an intern, you will have an already-trained employee ready to hire when they become available, usually when they graduate.
Take the time to examine what you are spending your money on so you can realistically assess what is a necessary expense and what is not. You will then be able to know exactly where your money is going and if the purchases are helping grow your business.