While generating income and a profit is a major goal in business, saving money is equally important; after all, for every dollar saved it means each extra one earned is more profit.
There are various ways to save money in business, some of which can make for major savings although all can mount up over a year.
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1. Savings in staffing costs
Staffing is a major business overhead so savings made here can make a big difference to your bottom line, and you could soon notice the reduction in salaries being recorded on your tax reporting forms.
Controlling staff costs doesn’t necessarily mean laying people off. Indeed, it could help you and your people depending on your business and staff profiles.
For example, if you have more senior-aged people working in your business, perhaps they’re at a stage where they’d value unpaid time off by reducing their working week. Or perhaps, in more seasonal businesses, some may consider unpaid time off when demand slackens?
It could be worth discussing options with staff members falling into this category.
Other staff savings could be made by cutting general overheads; rather than providing workspace could certain staff work remotely? This is especially helpful when you’re looking to expand; rather than facing the expenses of extra staff and providing the space and equipment for them costs could be saved with remote working.
2. Audit suppliers
It’s definitely worth taking the time periodically to check you’re getting the best rates and deals from suppliers and negotiate effectively with them if required.
You could find other suppliers that are potentially cheaper, or you may have grown to a point where the amounts of extra supplies you’re ordering each month would qualify you for some kind of volume discount. Some suppliers are remiss at automatically offering these to expanding existing clients, so check if you qualify.
Check the terms of your existing suppliers; perhaps you could make further savings by paying earlier for instance?
Make a calendar note to check suppliers say each quarter or at least every year. Suppliers who are aware you check prices regularly will maybe be more motivated to ensure you’re getting the best deals rather than risk losing your business.
3. Marketing and promotion costs
Certain promotional activities can be expensive, such as print advertising, so it’s worth assessing where cost savings can be made.
That said, be careful about cutting costs in promoting yourself as you wouldn’t want to risk a slowdown in new business as a result of the word not getting out. Rather, it’s worth considering other effective but potentially less expensive marketing methods such as greater use of social media and other options.
4. Buy used equipment
Buying used office furniture, equipment, and tech can save considerably on buying new.
Tech equipment that’s just past the cutting edge especially can offer huge reductions on buying the latest specification hardware. Computers especially can fall into this category; many slightly older spec models are still more than capable of doing the job you want of them at vastly reduced prices – some may well be brand new models but simply not the latest specs.
5. Save time
The old saying ‘time is money’ is very true; if you and your staff can reduce time spent on basic tasks and redirect it to creative and income-generating activities this saves costs in the long run.
It could be something simple like a staff member no longer taking time out to drive across town to pick up the stationery supplies when the company offers a delivery service.
Try instituting some basic time management such as only dealing with email and texts at certain times rather than being deflected off course with that incoming email or smartphone pinging.
Cost saving is infectious
Once you start looking into how to save costs in your business it becomes quite infectious, and you’ll find other ways of streamlining what you do to save time and money. Just be careful this doesn’t in itself become a time sink to reduce your focus on revenue-generating activities.
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