Save More and Grow Your Business with These Six Creative Tips
Every small business establishment looks to generate sales and profit. However, the top reason why 20 percent of them fail to make it to the second year, and 30 percent do not make it to the third year, is related to cash flow problems.
While finding creative ways to save money is key to business success, getting financial protection with professional liability insurance is equally important. Also termed Errors & Omission (E&O) insurance, professional liability insurance covers the legal cost of defending against unexpected situations such as non-adherence to time frame or budget, undelivered service, or other errors. Check here to know more about professional liability insurance.
Six creative ways to save money? Here are six creative ways in which small businesses can save money:
Work from your own home or stay mobile: If you are a consultant or service provider, explore the option of working out of your home or offering the services at the doorstep of your customers. Renting an office space can cost between $100 and $1,000 per month per employee that can be avoided with these strategies.
Handle more tasks: A Salesforce survey shows 66 percent of small business owners personally handle at least three key business areas, including finance, operations, sales, human resources, customer service, IT, and product development. If you have expertise in any of these areas, consider handling the department yourself to avoid the cost of hiring full-time employees.
Save on marketing: Marketing is one of the key expenses for small businesses. As per a survey, 27 percent of small businesses spend between $750 and $2499 to collect data necessary for effective online advertising. Building a large database of mailing lists for email marketing can cost thousands, while the results can take time. Advertising alongside other companies that offer complementary services or goods can help you cut down the costs of obtaining mailing lists or building a database.
Content marketing is an important marketing opportunity for small businesses. Successful companies spend as much as 40 percent of their marketing budget on content creation. When you have more time on hand than money, writing your own content can help save a significant amount of money. Find experts in the specific industry and interview them over the phone, email, or in-person and publish the interview. You can also leverage user-generated content by encouraging your customers and friends to post content on your products or services.
Use contractors, interns, or freelancers: Hiring full-time employees can be expensive in terms of managing payrolls, compensations, and other benefits. Hire interns, freelancers, or contractors who can be paid only for services rendered.
Buy used equipment and furniture: If you are not working out of your home, you can save money by purchasing second-hand office furniture or equipment. As per an estimate, the startup costs related to office equipment can range from $10,000 to $125,000, while office furniture can cost up to 10 percent of the total budget.
By buying monitors, office chairs, or other equipment at used equipment stores, you can cut down significantly on these costs.
Review all expenses: A smart business practice is to analyze all expenses to eliminate unnecessary costs. Small cuts can add up to huge savings in the long-term. Review costs related to inventory, shipping, payroll, cleaning and maintenance, free meals, or anything else that is not necessary and not delivering on its ROI (return on investment). Installing solar panels, cutting down on paper use, or letting employees pay for their own meals are some ways to eliminate costs.
Buying in bulk, negotiating with suppliers for a better price, and saving energy costs by using renewable energy sources are just some of the other ways in which small businesses can save money.
Ensuring your small business is smart with respect to spending money is key to success. The better you get at eliminating unnecessary spends, the better the chances of succeeding in the business.
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