Watching your spending and finding ways to pinch the pennies is important for everyone, but none more so than for small business owners. Whether you’re trying to get a new company off the ground or simply looking for ways to cut back on your expenses, these business money saving tips will help you to enjoy more of your hard-earned profit.
Even if negotiating isn’t your strongest skill, vendors may be open to discussing pricing to longstanding clients or to offer discounts for upfront payment. After all, it’s better than potentially losing business with you entirely! Depending on what type of operation you run, you could even suggest a trade of services–that’s a win-win for both parties. Remember, the worst that can happen is that they’ll say no, so it’s always worth trying to talk a vendor into reducing their prices if you’re looking for quick business savings.
Reassessing office expenses has always been one of the top business money saving ideas, but since the COVID-19 pandemic, reducing costs on office space and supplies has become even more important. Whether it’s because your team now has more flexible schedules or you’ve lost employees through downsizing, re-evaluating how much space your business needs and possibly finding a smaller, less expensive home could save you significant amounts of money each year. It’s not only rental costs that you need to factor in; heating, electricity, and other building maintenance costs also play a part.
Office supplies can also add up quickly when you’re not planning ahead. Instead of buying on an as-needed basis, create a weekly or monthly order system to ensure that you’re only purchasing what you actually need. You’ll likely find that ordering in bulk ends up being cheaper for products you go through quickly or always need, like stationery.
Hiring new workers to replace those who leave is a costly process at any level of the company, but this is even more true for your best members of staff. Your highest performing employees are often the individuals who bring in the most revenue, but they’re also typically seen as leaders among the rest of the team and help to ensure that others are adhering to the company culture at all times. With employees this valuable, it’s important to keep your retention rate high. Check in with your staff to ask for feedback and try to be accommodating where possible when it comes to both flexibility and growth opportunities.
4. Utilize Remote Workers
Giving your team more options when it comes to where they work can benefit your business in a number of ways. Those who choose to work from home full time or are happy with a “hot desk” arrangement can allow room for downsizing your office space, saving money on facilities costs. Remote workers also don’t need to be permanent employees of your business, and making use of independent contractors or freelancers can save significantly if you only need occasional help, rather than creating a fixed position within the company.
Creating a business financial plan is essential, regardless of the number of years that you’ve been in operation. It forces you to take a step back and look at where your business is right now, make realistic plans for growth, and put together an action plan for how you’re going to move forward. Particularly when you’re working on a financial plan for a new business, keeping track of the big picture and overall long-term vision helps you to decide what’s important now and what can wait for the future. Don’t forget to continually revisit your budget and track everything you’re spending throughout the year!
When it comes to marketing, you should aim to spend around 5-8% of your annual budget on promoting and advertising your business in the first year alone. There are plenty of options out there, from traditional media to newer digital strategies, such as social media, optimizing your website with SEO best practices, and growing your customer email list. Not all of these approaches will cost money and finding a good balance for your business will take trial and error. Make use of free tools like Google Analytics to track your key performance metrics to see what’s working well and where you could be missing out on potential new customers.
7. Find More Sustainable Alternatives
Building a more green and eco-friendly business isn’t just great for the environment; it helps you to save money too! Going paperless and working in digital-only or cloud-based systems help you to save on paper and ink costs, as well as making your customer data easier to track. Think about incorporating a recycling program into your business too. Printer cartridges, cans, bottles, and batteries are all recyclable and many recycling centers will even pay you for certain items. There’s also the possibility of donating products like old company cell phones to charity, which can be written off come tax time.
If you’ve taken out a business loan or two in the past, consolidating this debt onto a low-interest credit card can help you to save on fees and higher interest rates while you pay your loans off. Most credit cards will offer you better interest rates than a standard bank loan, particularly if your business credit is better now after a few years in operation, compared to when you took out your loan.
With artificial intelligence (AI) and machine learning becoming more sophisticated by the day, making use of automated systems can help to save your business both time and money. Tasks that your team work on every day can be digitized and automated, freeing them up to work on other, more important (and likely revenue-generating) work. You may even find that some of these tools are able to replace employees who carry out specific administrative tasks, allowing you to save on salary and benefits costs associated with additional staff.
10. Become Familiar with Your Community
Being an active and known member of the community certainly comes with advantages, especially if you’re working with other businesses as a trusted partner. Just like with vendor relationships, you may have the chance to barter or negotiate with other local business owners when it comes to supply or rental costs. Staying local means that you’re all invested in seeing your community thrive, so there’s often more opportunity for sharing resources than when you’re working with out-of-town businesses.
Depending on the type of business that you run, equipment can eat up a sizable portion of your startup or annual budget. Some equipment like computers, printers, office furniture, or even heavy-duty machinery like diggers or tractors can all be found second-hand and lightly-used. Talk to other business operators in your area and search neighborhood groups to see if there’s anything that you could make use of. After all, one person’s trash is another person’s treasure!
When you’re looking to open a business checking or savings account, turning to your community bank can be the answer to many of your problems. Community financial services typically offer lower fees than their nationwide counterparts, and the personalized service from people who are just as invested in your community as you are is hard to beat.
Compare business bank accounts to find a solution that works best for your needs and benefit directly from the small business expertise that your local bank can give you. Moody Bank offers some of the best small business bank accounts in Texas, working directly with owners to support their goals.
Whether you’re in Houston, Lake Jackson, Galveston, or further afield, our commercial banking team is ready to help you take your business finances up a gear. Contact us today to open a business checking or savings account, or to find out more information about commercial financing with Moody Bank.