Running a small business is gratifying, rewarding, and comes with a strong sense of accomplishment.
Unfortunately, it can also be very expensive. If you are making the shift from employee to entrepreneur, it’s important that you do your research before taking the plunge. There are many things you can do as a small business owner that will save you hundreds, maybe even thousands, each year.
As a new business owner, stay mindful of your expenses and constantly reevaluate where you can save. While spending a few extra dollars each month may not feel like a huge loss, remember that these costs add up over the course of the year and may be the difference between your business thriving or barely squeaking by.
There are five key areas where your small business can be saving you cash. Your marketing, utilities, office, employees, and equipment are all major costs, but with a little awareness and proper management, you are guaranteed to discover ways in which you can save.
Most successful businesses also have a strong marketing plan. While it is true that you have to spend money to make money, your business’ marketing doesn’t need to eat up the majority of your budget. Nowadays, marketing can cost less than ever, the key is creating a clear, cohesive marketing plan.
By utilizing social media, you will be able to reach your target audience for free. Through following potential customers and using relevant hashtags, your business will be put in front of more eyes, resulting in more customers. For as little as a couple dollars a day, you can target a specific audience through Facebook ads. When done properly, Facebook can be more effective at targeting than any other form of advertising.
Aside from social media, there are several other ways to save on marketing costs. Set up a referral program to encourage loyal customers to share your business with others. Team up with local businesses to take out an ad together or run a promo for each other’s customers. Beef up the SEO on your website to improve your standing in search engines. Switch from mailed promos to email, or simply clean up your mailing list to save on production and mailing costs.
When it comes to cutting down your overhead, you have to take into consideration how much energy your business is using. The first way to save on electric is to reconsider your provider. Get quotes from other companies at the end of your current contract and ask your provider to price match. If they refuse, it may be time to switch.
To save costs on the energy you are currently using, invest in power strips that are controlled by a master plug. Plug computers into the master outlet and all other devices into the slave outlets. When the computer is turned off, the other devices will also shut down.
Be diligent about turning off lights when they are not in use. Create a work culture surrounding energy efficiency and encourage your employees to do the same. Rather than using air conditioning throughout the entire day, use standing fans to create airflow and cool the space. Another effective way to cut costs related to temperature control is to install programmable thermostats. This will naturally maintain the climate of your workspace and reduce energy usage at night and on the weekends.
If possible, run your business from your home or a shared office space. There are many co-work opportunities that cost much less than renting a commercial space. When choosing a place to run your business, there are a couple things to consider. First off, look for a space with natural light as it will help cut down on energy costs. When outfitting your space, seek out people who would be willing to barter. You may be able to save on electrical working, plumbing, and decorating by trading with other professionals.
When determining your workforce, keep in mind that full-time employees can be very expensive. Whenever possible, hire freelancers as they will already be experts in their field, can often telecommute, and require less training. If it is best for you to have regular employees, pay close attention to your scheduling so you don’t over staff. Another great way to improve morale and cut costs is by giving employees an extra day off each month. Many who have implemented this strategy have not noticed a decrease in the amount of work accomplished, but have saved in energy costs.
#5 Equipment and software
One of the biggest upfront expenses of starting a small business is the cost of equipment and software. Do your research and be sure to purchase intelligently. A good way to save is by purchasing your office equipment second-hand. To conserve energy, consider purchasing energy efficient equipment. While this may cost you more upfront, it’ll help you save in the long run. Finally, do your research before purchasing the software. Outfitting multiple computers with the same programs can add up very quickly and it may be possible to find a comparable software that you can download for free.