For many small businesses, money can be tight. If this sounds familiar to you, you’re not alone! In fact, according to capterra.com, a whopping 77% of small business owners rely on personal savings alone for their initial funds.
Thankfully, there are plenty of ways to lower costs for your business. To give you some inspiration, we’ve rounded up 10 awesome money saving ideas to help you get on top of your finances, give your bottom line a boost and pave the way to a leaner, more profitable future!
Try Crowd Funding
If you have a great idea for a business but your budget doesn’t quite stretch to cover it, crowd funding can help you raise the money to get started. It works by providing you with an online platform from which you can pitch your ideas to the public. If someone likes your idea and believes in the cause, they can then ‘back it’ by making a contribution. In exchange for this, you can ‘thank’ your backers with rewards such as tweets, products, events, experiences or mementos that reflect the money invested. The benefit of crowd funding is that it gives you an alternative way to bring your idea to life. While you could always apply for a business loan, search for grants or borrow money from family members or friends, crowd funding provides you with a way to secure funding for your business with the support of an already engaged audience.
Work from Home
There’s no benefit to taking the plunge and investing in costly office space if you don’t really need it. Working from home can save you a lot of money, and not just in office fees and taxes. If you work from home, you’ll never have to worry about commuting, saving you fuel money, parking costs, train or bus fare and wear and tear on your car. You won’t have to go out and buy new office attire and you can pocket all the extra money you’d usually spend on lunch, snacks or expensive coffee that many of us buy on a whim during the working day. On top of that, you’re saving time. In the hour you’d usually spend sitting in traffic on the way to work, you could get a head start on your day. As the saying goes, time is money!
Buy Used Office Furniture and Equipment
Alternatively, if your line of work requires you to have an office, there are plenty of ways to reduce the cost of equipment and office supplies. By scouring antique stores or discount sites such as eBay, Office Supermarket, Craigslist and Want Don’t Want, you can find great quality second hand furniture for inexpensive prices, without the need to spend thousands kitting out your space. Same goes for technology. A lot of trusted sites offer refurbished computers, phones, tablets and television screens in perfect condition, all for a small fraction of the price you’d pay for new ones.
Negotiate with Suppliers
Never be afraid to ask for a discount from your manufacturer, wholesaler or distributor. It’s likely that your business supplier will be just as keen to stay in business with you as you are with them, so they might just be open to negotiation when it comes to lowering prices. Check to see if they offer any discounts on quantity or buying in bulk, or for early payments. The more trusted and reliable you prove to be, the more open your supplier will be to forming a partnership with you and offering a regular discount.
Get Rate Relief
If you’re a small business working from one property, you could be entitled to discounts on your business tax with a government scheme called Small Business Rate Relief. In case you haven’t come across it before, it’s based on the rateable value of your business property and varies depending on what that is. For example, if your property is valued between £12,000 and £15,000 you’ll be entitled to tapered relief. If your property has a rateable value between £6,000 and £12,000, then from April 2017, you’ll no longer have to pay any rates on your tax, saving you up to £5,900 per year! To find out if you’re eligible for Small Business Rate Relief, contact your local council.
A great way to save money for your business is by hiring freelancers for certain projects and jobs. Not only are they cheaper to keep on the books than full-time employees, you also aren’t expected to provide them with any pricey additional benefits, such as health insurance, pension schemes or paid time off. You simply pay them per job until the work is complete. It’s always helpful to keep staff to minimum when you’re starting out. Where skill sets are missing, use sites such as elance.com, peopleperhour.com or freelancer.com to find the right person for the job on a temporary basis, while keeping your labour costs low in the process.
Make Smart Hires
When you are ready to grow your team, it helps to be smart about who you hire in order to save on costs. While it’s easy to be tempted by skilled individuals with years and years of experience, it’s likely these candidates will cost you. Instead, keep an eye on intern sites and your local university for young, emerging talent. Not only will they be cheaper to hire, but they’re likely to be just as capable as more experienced employees, be full of ideas and enthusiasm, and will often grow into their roles as the business grows, which in the long run, helps to build employee loyalty. Another way to hire intelligently is to use your own contacts to find the right candidate. Recruitment firms are costly and not always necessary as long as you’re able to network efficiently. Use LinkedIn, go to networking events and speak to friends and family to see if they know anyone who might suit the role. If your business goes through surges, consider hiring temporary staff to ride the wave while you’re busy. It’s much more economical than hiring someone to work full time when business is slow.
Take Full Advantage of Social Media Advertising
When it comes to marketing, one of the most effective ways to get the word out is by leveraging social media. The best bit? It’s completely free! While it’s easy to leave social media at the bottom of your to-do list, it’s always worth putting some time aside to develop your presence on sites such as Twitter, Facebook, LinkedIn and Instagram. According to business2community.com, 92% of all marketers say that their social media efforts have generated more exposure for their businesses, while 80% of marketers indicated that their social media efforts increased traffic. As these statistics show, having an active social media presence can bring a lot of benefits. By posting regular updates, sneak peeks of your products and engaging content that’s likely to be shared, you can capture the attention of an otherwise untapped audience, build a following organically and boost traffic to your website, all without spending a penny!
Embrace Cloud Computing
If your budget doesn’t cover expensive servers or additional hard drives, take advantage of free cloud computing to safely back up your work. Platforms such as Evernote and Dropbox allow you to back up safely while on the go, while cloud-based software will host data for the likes of book-keeping and word processing, saving you from the costly fees you’d have to pay for hardware, installations and upgrades. Similarly, if your business warrants international phone calls, opt for using services such as Skype, which is both easy and free to use.
Use Start Up Sites and Free eBooks For Knowledge
If you need to brush up on your skills or do a little training around a particular strain of the business, have a look at the free online resources that are available to you before signing up for any costly courses. The internet is brimming with helpful information, from specialised start up sites to free downloadable eBooks that are packed with tips, advice and knowledge from industry professionals. If you’re looking for somewhere to start, try this selection of free eBooks from alltopstartups.com or our very own Start Up Hub, which covers everything from how to set up a company to how to promote your business on a budget.
Do you have any tried and tested money saving tips for fellow small business owners? Let us know!