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No matter what industry you’re in, controlling and managing costs is a crucial aspect of running your business. For small companies, who already face so many different challenges to their growth and survival, it’s absolutely essential. Putting the right practices and policies in place from the very start makes it a lot easier to manage things when you grow and expand too. Here we look at just some of the ways your small business could better manage its costs.
This one is great because it reduces costs for both you and your employees – you benefit from lower utility bills at the office, and your employees get to ditch their daily commute. Of course, not every role can be performed from home, but thanks to the likes of Skype and the many instant messaging systems out there, it can be almost like your employee is still in the room next door when you need them. As an added benefit, allowing staff to work from home has been shown to dramatically improve productivity – as there are few fewer distractions and interruptions at home than in a loud, busy office space. Once the system is running well, you may even be able to consider downsizing to cheaper office space and enjoy even more savings.
Hire lower down the corporate ladder and train up
Experienced candidates with several degrees under their belt don’t come cheap – and most small businesses simply can’t afford them. Hiring interns or less qualified staff and training them up in-house is rewarding and mutually beneficial, as well as more cost-effective. You could even allow your junior staff to spend an hour or so of their time each day working on an online course that could benefit your business and their career.
Identify recurring costs and see if there’s a better solution
If you rely heavily on your technology and have to fork out a generous sum each time you need to order a rush service from an IT company when something goes wrong, do the math and work out whether it might make more sense to partner with a provider who offers managed IT services at a fixed monthly rate. If you’re consistently going over your monthly bandwidth and paying hefty overages, would it actually be cheaper in the long run to go for a pricier plan where these charges wouldn’t apply? The same goes for any recurring expenses which are consistently causing you to go over your budget.
Apply common sense to reduce your utility bills
Are you doing something at the office – like leaving the lights and heating on when no-one’s there – that you would never do at home? For some reason, we set a different set of mental rules for energy and water use at home and at the office, but this is irrational.
Going green is an extension of this – reducing your consumption wherever possible, installing better insulation or window glazing, or perhaps even a solar panel to offset your energy use – may all be possible considerations.
Make use of freelancers
Whether it’s a website redesign or tweak, some ad hoc research, creating an email newsletter template, or writing a press release or blog post, many businesses still turn to, well, other businesses when they need a relatively small job done. Not only are freelancers on sites like Upwork or Freelancer.com generally much, much cheaper than hiring a whole company, they’re usually able to respond and deliver the work more quickly – and you’ll have the benefit of seeing reviews from previous customers as well as their online portfolio before you decide to hire them. Most reputable freelance platforms also have buyer protection in place which means you only part with your money once you’re satisfied with the work delivered.
Make a point of revisiting your largest expenses regularly and looking for better options
As a business owner, you simply don’t have the capacity to keep abreast of everything in your supplier’s industries. That’s why it’s important every six months; or at least once a year, to schedule in some time to reassess your biggest expenses and see if cheaper alternatives have since become available. Technology means things move quickly these days, and there are always new disruptors on the market that could be offering a better option for less money than your current supplier. You simply won’t know if you don’t take the time to pursue them. And hey, if you don’t have the time to do it yourself, you might want to refer to the previous paragraph…