6 Creative Small Business Money Saving Tips Everyone Can Tackle
For many small business owners, saving cash is paramount to all other endeavors to ensure survival and boost revenue. And recent national figures indicate this private sector may be on the right track to achieving this goal.
The Bureau of Labor Statistics revealed these businesses added 171,000 jobs in October, which accounts for the 32nd straight month of positive growth. The Bureau also found that businesses with less than 500 employees have been responsible for nearly 65 percent of new jobs created since 1992, suggesting that small business has a huge role in shaping the backbone of our economy.
But not every business owner feels the rosy impact of these statistics. Small businesses are not without their daily struggles to stay above water, especially when it comes to federal regulations.
“The continued uncertainty over tax, regulatory and healthcare policy makes being a small business leader in this economy very uncomfortable,” says Rick Schardein, President and CEO of Current360, a brand building agency. “Tightening discretionary spending among consumers is further constraining entrepreneurial opportunity.”
“One of my biggest concerns is the federal debt and deficit – particularly how it will affect securing funding, customer spending, and hiring,” says Livingstone Mukasa, founder and CEO of Archability. “Whatever is agreed upon in Washington, we certainly don’t want the burden to be placed on small business owners.”
In the current uphill economy, it takes more than the obvious for businesses to excel. Not everyone can get by with cutting labor and reducing utilities to stay in the black. When you’re dealing with economic factors beyond your immediate control, it may take creativity and serious reflection of your operations to find a light at the end of the tunnel.
If you’re coming up short on creative ways to create new cash flow, consider how you might be able to apply these expert small business money saving tips from people who have been in your situation.
Look to Your Customer Base for Advertising
If you think you need a hefty advertising budget to attract flocks of customers, you’re wrong. Susan Baroncini-Moe, business and marketing strategist and founder of Business in Blue Jeans says that when you have the foundation of a great product or service, you can use your customers as your pro-bono ad execs.
“Usually, delivering value and great service are free, but there are many low-cost ways to expand on delivering value so that your customers and clients get even more excited and talk about you even more,” says Baroncini-Moe. “This nets you great reviews on social media sites like Yelp and Angie’s List and creates raving fans on Facebook.”
Don’t Underestimate the Importance of Feedback
Feedback is integral to evolving your business, and you should consider it from more than one angle—from employees as well as customers.
When it comes to customers, listening to their input can allow you to focus on what you do well.
“By having frequent discussions whether directly or via surveys, customers can help you scale back and concentrate on the core services and products,” says Mukasa. “This can create huge savings which can then be redeployed in areas that are crucial and of value.”
Kathleen Brush, global management consultant and author, emphasizes that constructive feedback from your employers is worth considering, because they may identify areas of weakness you’ve never thought of.
“You’d be surprised with what they can come up with,” says Brush. “Everything from no one drinks decaf, to do we need cleaners every day? Why not let Fred do this rather than paying consultant A, why are we paying a retainer for service A that we never use, no one reads that magazine, we don’t attend that association’s meetings anymore, if we bought in bulk.”
Open Source Software Possibilities
Bryan Marsden of FatWallet.com suggests that business owners can save thousands by implementing a bit of tech creativity by using open source software instead of pricy applications like MS Office Suite or Adobe Photoshop.
“While you may want to replace it with more powerful software when you get financially grounded, these will get you up and running on a shoe string budget,” Marsden says.
Marsden says programs like OpenOffice, GimpShop, BugZilla and TimeTrex, GNUCash can provide everything from creating documents to tracking revenue.
Ask For Discounts
Just like the old adage goes, it never hurts to ask, especially when it comes to your suppliers. Depending on the quantity you buy or the relationship you’ve built with your sources, they may be willing to help you cut expenses.
“With a previous company, when our main customer began to struggle, they approached us to reduce our price,” says John Slafkosky, president of Pie Guy. “We approached our vendors and asked for a discount in order to save this account and volume. Out of 9 main suppliers, 7 reduced our cost. In turn we reduced our cost to our customer.”
Additionally, if you don’t get the discounts you’re looking for, you can also look for competitive bids elsewhere.
Research the Right Healthcare Plan
Affordable healthcare can be difficult for many small business owners to achieve. But depending on the size of your business you may be able to use a tax advantaged benefit plan. According to Anne Case, director of marketing and communications at BASEOnline, self-employed individuals can save as much as $4,000 annually in taxes while a small business with multiple employees could reduce insurance premiums by 10 to 50 percent with the help of a defined contribution plan.
Get More Out of What You’ve Got
Instead of looking for additional resources to complete tasks, you may be able to increase efficiency with your current employees. Schardein has used the in-house approach for Current360 with the help of technology.
“Our company—54 employees—have leveraged technology to deliver more services to our clients via in house resources versus outside vendors,” Schardein says. “We’ve established areas of specific expertise and operate those sub-units as individual profit centers. The result is higher gross profit at stagnant revenue levels. Our clients win, and we win. Technology makes it possible.”
A little bit of the right encouragement can also help a business’s bottom line by boosting output. Brush says this could be something as small as a compliment to creating a rewards-based productivity contest.
“Employees love to know what they are doing is going to achieve something. I’d like to say something big but honestly a lot of times employees just need to know that there is a plan and they are part of it.”
No matter which tip fits into your business model, they all prove one thing: you don’t necessarily have to cut corners to save money. Whether you find the extra revenue from your customers, employees, suppliers or operational tools, seeking out new cash-saving measures can only further enhance your business’s ability to adapt to a fluctuating economy.
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