How Small Businesses Cut Costs
8 out of 10 small companies reportedly fail within their first 18 months of trading. So as not to add to the statistic, you must do everything in your power to survive in your industry.
It’s common for many budding entrepreneurs to focus their efforts on boosting sales, but it is also crucial to look at how your company can reduce its overheads to achieve or maintain profitability.
Reduce Paper Usage
There are a number of reasons why you should reduce paper usage in your company. In addition to helping your company improve its bottom line, cutting down on paper waste will have a positive impact on the environment. For example, you can store sensitive documents in the cloud, can print and copy double-sided, and you should reduce waste paper or at least ensure it is recycled.
Allow Telecommuting
Telecommuting is an effective way to decrease operational costs. As your employees will be working at home, you can reduce utility costs and can downsize your office space to lower rent. It will also help to increase employee morale, as they’ll enjoy a greater work-life balance while reducing their commuting costs. As a result, they’ll be more productive each day, and you can help to retain your most talented team members.
Invest in Efficient Lighting
Illuminating your office space can cost a pretty penny, as you might have to invest in expensive lighting for your office, warehouse, or venue. For this reason, you must buy bright, light and efficient LED high bay light solutions for your business. As they will come with a five-year warranty, you can help reduce your expenditure, as you will not need to regularly replace the bulbs and can improve energy efficiency. What’s more, it will maximize light flow to improve productivity.
Don’t be Afraid to Barter
Many small companies make the giant mistake of taking suppliers’ prices at face value, but they could potentially secure a better deal by bartering. Companies will want to secure your custom, so they might be willing to drop their prices to make a sale. However, avoid going too low or you could potentially offend a supplier. So, don’t be afraid to negotiate a better deal to improve your profit margin, as the lower rate could help your business not just survive but thrive.
Pay Your Invoices Early
Paying your invoices early will not only improve your company’s efficiency, but it could also help your business finances. Many vendors are happy to slash 2% off an invoice total if a client pays in full within 10 days of an order.
Buy Used Equipment
Don’t make the mistake of buying brand-new equipment when attempting to get your business off the ground. It’s essential to watch every penny when you first start out, which means reducing your expenditure as much as possible. Buying used office furniture and computer equipment could potentially help you to save up to 60%, and the extra money can be pumped back into the business.
