Saving money whilst running a small business may be difficult, however it may be necessary depending on your financial situation. It will be beneficial for you to regularly do an expenditure analysis and see where your money is being spent, and where you can save.
Here are some ways in which you can reduce your costs and save money:
Use a financial and/or budget plan
This will help you see where the biggest expenditures are. Having a monthly updated budget plan will show you where the money is spent, and by taking some time to look over the expenses it will help you see where you can make cuts and save money. For example if you are spending too much on postage, then consider using different packages to save some money.
Outsource when you have to
These can be variable costs instead of fixed costs. Instead of hiring permanent staff, outreach and source people as and when you need them. For example if you need an IT technician, have a regular freelancer that can be hired when you need them.
Do your own marketing
Marketing can be expensive, if you are just starting out and want to save some money then do your own marketing. You do not have to spend most of your budget on marketing. Depending on how creative you are, you could create your own logo and set up social media platforms for your business yourself.
Get an accountant
Although this will cost you, if you have little to no previous experience with taxes and accounts, an accountant will be a great time saving help. Also, they can help you budget for your business, and offer different services to fulfil your needs.
Use your partners
The great thing about having partners is getting exposure. You will normally only have to pay your partners when you have made a sale, which ultimately is the best business partnership.
Minimal personal expenses
If you are just starting your new business, it may be wise to consider not taking out a mortgage to buy a new house or having a high maintenance lifestyle. Keeping your personal expenses to a minimum especially at the beginning of your business venture will relieve pressure.
Be energy conscious
You may be surprised how much you can save on your electricity bills by simply turning off electrical supplies such as computers/ lights etc when they are not in use. Also encourage your employees to be energy conscious and do the same.
You may have the urge to replace employees if someone leaves. Try to resist the urge to hire a replacement straight away because then you will have time realise if somebody else may be able to pick up their job. Or if you really need to hire a replacement, you will save some money by holding the hiring process off a little.
Work from home
It may be worth considering working from home. Many small businesses start small. By working from home you can save huge fixed term expenses like rent for an office. Also consider the location, when looking at office space.
You really have to take time and analyse your situation individually to really understand where to make the biggest savings. For more information check out our Business Finance section.