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7 Ways Business Owners Can Save Money

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Saving money as a small business or start-up can be tough. In the early days, your sales might not be as high as you like and you might find you have to bootstrap your way through the beginning of your business venture. This means it’s important to make your operations as cost-effective as possible. Here are seven ways business owners can save money and increase their bottom line.

1. Go green

Going green has been a bit of a buzz-phrase in recent times in relation to the threat of climate change. Aside from the environmental effects, you believe it does or doesn’t have, going green can save you money.

Whatever industry you’re in, it makes sense that the more energy efficient your business is, the lower your costs will be. Find ways to reduce the amount of power your business uses and look for things like energy efficient light globes.

2. Compare interest rates

Whether you fund your business with a loan or you use a credit card to pay business expenses, there’s always room to save on interest rates. You can use sites like RateCity to compare a range of providers and find the best rates for your business. You might be surprised that many banks will lower the interest rate or remove the annual fee if you negotiate with them.

3. Save space

New businesses often move into an office that gives them some room to grow into. This is a great way to streamline future processes, but what should you do with all that spare space? Having spare space, which you’re paying rent for, sit idle is simply a waste of money.

Instead, you can list your spare space on a community sharing site, like Spacer. This platform will connect you with other businesses or individuals looking for extra storage space. This way, your business can help locals in a secondary way, while you earn money from your spare space.

4. Buy used equipment

When starting a new business, it can be tempting to deck it out with the newest and latest equipment. However, this will be very expensive to do. As a small business, you should be looking to make savings every way you can.

Finding second-hand equipment can go a long way in keeping your pockets full. You can look for used equipment on sites like Gumtree, or you can ask other local, established businesses if there’s any equipment you can buy or lease off them. Whatever you do, ensure that the equipment is in normal working condition.

 

5. Barter with other businesses

When you hear the word bartering, your mind is likely to jump back to the distant past where people exchanged goods and services for other goods and services. While it was useful in the old markets, bartering can still be a helpful solution for businesses today.

If you need a certain service or product for your company, you can try to trade it for whatever your business provides. Granted, this will only work in certain situations, and you will have to be careful with how the transaction takes place but used in the right way, bartering can be extremely beneficial. Not only can you get what your business needs without spending capital, you can build relationships which lead to future work.

6. Look for free and open source software

In this digital age, nearly every business will use some type of software for at least part of their business. Certain software for bookkeeping, presentations and other processing duties can be expensive.

Look for free, open source software or cheaper cloud options. There’s a range of services out there that will be sufficient for small businesses and don’t carry a large price tag. You can also look for software that gives new users a 30-day trial. After that, they will start charging, but if you’re strategic, you can unsubscribe and repeat the process with a new software platform. Rinse and repeat until your business is stable enough to make a commitment. This way you will know which one you like the best and can be confident with your purchase.

7. Be smart with new hires

For a new business owner, hiring staff can be a tricky thing to master. Your first hire can make you feel like a legit business, but it can also be a massive waste of money. For a small business, a full-time employee can be particularly expensive, what with insurance, super and allowances, and they might not even be needed consistently.

In the early days of your business, it’s often best to use contractors for specific projects. Today, we can easily reach high-quality contractors all around the world thanks to the sites like Upwork.

If you’re looking for an in-house employee, consider getting interns or recent graduates. While they might lack experience, they will be significantly cheaper than someone with years of industry experience, and new graduates are often highly motivated, making them perfect hires for small businesses ready to grow.

Saving money as a small business can be incredibly difficult. Adopting a frugal way of doing business can help keep your expenses down and your cash in the business. Shop around, make use of your space, hire smart and tighten up your spending and you might find your cash flow is better than you budgeted.

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