Smaller businesses don’t have as much room as the big boys when it comes to their profit margins. It means that they have to be smarter with how they do business and where they spend their money in the first place. But, a few years in they might even find they need to cut costs, and save money. Much like everything, there are big selling months in the year, and many smaller businesses are aimed at the consumer market, the general public, not B2B.
Ebbs and Flows
Insurances go up, taxes go up, the price of business rises year on year. It is no wonder that many businesses feel the squeeze. Economic issues matter too. A bakery might find that due to a farmer’s smaller crop, they are paying a higher price for what is available. Inflation on goods in another issue. So if you are finding you are getting squeezed, and need to save some money on your day to day running.
Small businesses sink a lot of money into their advertising. And of course, that is a smart more 99% of the time. But it also means it is prime money saving space. If you are a service business, then you might find that you are paying even more than the average company. The issue with the big spend in traditional marketing methods is that you won’t be able to compete with the big companies – however, the internet is free game. While they might be paying SEO companies to put them into the 3 advertised spots on a google search, there is no reason you can’t be working on your organic search appearance.
Social media is a free tool that can be maximized with time. You can pay for promotions if you want to, but you can do this sparingly.
Your online presence should have the following as a minimum:
If you are really gifted with video or photography, then consider youtube and Instagram too. Ideally, you will start creating an emailing list, and use that to reach people directly.
If you have been with the same supplier for a while, just because it is easier than swapping, you might be doing yourself a disservice. Buying wholesale is always the smartest thing to do, it saves countless coins. Buying in advance will stop any dips in your purchases by needing that dreaded ‘out of stock’ sign.
It pays to shop around if you can, sometimes you will need to go through trade magazines, other times you can find what you are looking for online. In fact, the internet is so perfect right now for looking for new suppliers you can even order dental supplies online!
Many people don’t feel like they can ask for a discount, but you might find that if you do, you actually get one. If you like everything about your supplier apart from their price, then look for other suppliers at a cheaper rate and use that as a bartering tool.
Sometimes we think we need more space than we actually do. So we get an office space, and some shop floor space too. But the chances are you don’t need both. If getting rid of the office is going to save you some money, then it might be worth looking at if you can have a home office (high for deductibles) or find space to do your business admin in the shop.
If you have no need to run your business from a commercial space, then an office is really just a luxury expense that you don’t need at all.
Insurance is something that you cannot actually be without. If your good went on fire tomorrow and you had scrapped your insurance to save money, you’d be in some serious financial trouble.
That said you can still save money on it. If you have just been paying your insurance without ever looking over it again, then you might be paying for things you don’t need. Your business will change and grow or shrink over the years, and sometimes your insurance doesn’t match anymore.
So call your insurance broker and ask them for a review of your needs. You might find you have insurance on assets that you no longer have – which would be a huge money sink.
You can also take a look at changing your deductibles. If you increase your deductibles, you can reduce your premiums. The best thing to do here is to sit down and work out what is the best way to do it. Don’t have your deductibles so high that if you had to make a claim, you couldn’t afford it.
Home business coverage is a must. Your house insurance won’t cover that, so make sure that if you work from home, you are insured to do so.
Minimizing what you’re paying in taxes is obviously going to save you cash every year. But how do you do this? You need to maximize your deductible without reason. Get in the habit of keeping all of your business receipts, and keeping both paper and digital tax records. Record your vehicle mileage, use a home business deductions calculator to work out what you can deduct in terms of electricities and other utilities. Here are a few things (that most people don’t know about) that you can write off:
- Medical and Dental
- Tax Prep fees (for the self-employed)
- Home Renovation – to make your home office fit for purpose, and some of your homes too
- Airline baggage fees (self-employed)
- Mortgage interest deduction
- Self-employed health insurance
- Car registration – if you use the car for business and are self-employed
If you don’t know where to start with your taxes, then you should head to someone who does. What you pay them will be more than worth it when you see the number of deductibles they are able to input for you.
In the age of small business, you can thrive by pinching a few pennies in smart and legal ways.