How can you learn to control your business expenses to keep your business profitable? Bloomberg estimates that 8 out of 10 small businesses fail within the first 18 months. One of the main reasons is profit, so you need expenses to be as low as possible to maximize your profit.
If your business has been operating in the red, but you need to get in the black quick, read here to get 5 ways to start cutting expenses pronto.
1. Switch to the Cloud
The cloud eliminates the need for expensive servers and software updates. You will always have the latest software updates. Plus, there is more flexibility since everything is online and programs can be accessed from anywhere with the Internet.
You could downsize the IT service costs as well as all the hardware fees and expenses. Since all your data and programming are online, you have a business continuity plan in place without any additional expense.
In addition to programs, you can also move all your phone systems to the cloud to save even more money. You can also use online video conferencing to minimize travel expenses for important meetings.
2. Barter or Find Free Services
Bartering is a good way to save on money with vendors and services. This method has been around for years for ways to save money. Check out Craigslist’s bartering section.
You can also find some free services online. For example, you can create pay stubs online free. Consider an intern to give a high school or college student experience for their resume – you will be surprised how many students want the experience more than the pay.
3. Update Your Office Space
This could be a huge cost saving. If you need a retail space, check out other areas for cheaper pricing. Try negotiating with your landlord to see if you can get your rent reduced.
Would you be able to work out of your home? If so, you can save on more than just rent. You could save on insurance, utilities, and taxes. Make sure you do your research before making the switch because there may be zoning regulations.
Another option is sharing office space with another business depending on how much space you need. This could be especially beneficial if your businesses naturally work together such as an event planning business and a florist.
4. Cut Advertising Expenses
With today’s digital world, it’s much easier to lower advertising costs with social media. Create a website along with a Facebook page and Twitter account. Collect email addresses from customers and send out regular electronic newsletters.
Asking for referrals is a great way to increase new business. Run a contest to get new people in the door. People love giveaways.
5. Downsize Staffing
If you have slow periods, it may be wise to hire consultants or part-time employees instead of employing every one full-time year round. Use family members whenever possible to save additional costs.
During slow times, offer unpaid time off. You may be surprised how many people are happy to take some time off with advance notice.
Cutting Expenses and More Business Ideas
As you can see, there are several ways to begin cutting expenses in your business. Take advantage of the digital world and find ways to network even if you’re an introvert.
If you want more business ideas, check out our jobs and work section. Check back regularly for updated posts on other areas such as home, family, travel, health, and more.