Last Updated on Apr 17, 2020 by James W
Saving money and cutting down on costs as a small business can be a hassle. This is especially true if you are a startup in the early stages where you may be operating on a tight budget already.
Fortunately, there are practical tips that you can consider to follow to save money and trim overhead on one part and increase business efficiency on another side. In the end, you will have saved for short and long-term purposes by securing cash reserves for new projects, emergencies, and new business opportunities etc. Let us look at simple money-saving tips you can start adopting today!
Practical tips to save money as a startup
Use digital ways of marketing and ads
One way of increasing the sales of your product and services is through rigorous marketing. Whether or not you have a reasonable budget for marketing your company, it is still essential to do so to keep at par in the industry. But do you know you can advertise your business without having to break your bank? In this era of tools like social media, you do not have to pay for expensive billboards or buy mainstream media ads. You can reach your potential customers by signing up on Facebook, Twitter, Instagram, TikTok, or other social media apps available.
The likes of social media marketing have gained popularity, and it is helping businesses connect with their customers at low costs. So, start investing in digital marketing and save on money that would otherwise have been used to pay for expensive ads.
Purchase refurbished office equipment
Considering purchasing office furniture or electronics? It is a lot cheaper to acquire used and functioning equipment. Usually, some established businesses or enterprises will be upgrading their office equipment to the latest available. That does not necessarily mean that their old equipment is faulty. You can reach out to them to secure the equipment they might need to dispose of.
You can set up a nice office for your startup at cheaper refurbished equipment the same way you’d have done with new ones, albeit at a less expensive cost. Just ensure you buy top grade used devices and furniture.
Hire contractors and freelancers
As a small business, your budget might not be enough to employ many full-time staff. That is why you need to consider hiring contractors and freelancers to perform various tasks for your business. The good thing is that you will only hire on need-basis and pay only when the work is satisfactorily done.
Besides, freelancers are not entitled to a salary beyond their work or even mandatory allowances. As such you will not need to spend a lot of money on employees. Working with freelancers will automatically give you a great deal as you can negotiate for the cost of services you receive. This is way different from regular staff whose salaries and allowances are often fixed.
Adopt open source and cloud computing
When it comes to technological solutions, you don’t want to spend on massive hardware that will cost you an arm and a leg and fill your office space. That is why it is advisable to try and go for open source tools that are also top grade. For example, you can use Linux OS instead of purchasing Windows OS, depending on your business needs.
You should consider using cloud computing services for your business to reduce hardware costs. You can use the cloud for storage, databases, networking, and software analytics, among others. Again, you can outsource these services from application and cloud managed service providers who can help you move from your current setup on a budget. Cloud computing is also good for security, reliability, implementing data redundancy, mobility, hastening deployment etc.
Cut down on business meetings
Now, you can also look at the number of people in the meeting boardroom and consider the amount you pay them hourly for sitting in the meeting. To save that money, you can reduce meetings and only remain with the most useful and much-needed ones. Try even to adopt a different communication method, such as writing internal memos to your team of workers. You can also use teleconferencing tools to reduce meeting costs.
Most meetings even consume a lot of productive time, which may negatively impact business performance. That is why you need to cut back on some meeting time and free up time to get the work done.
Lower employee turnover
It is for the benefit of your business to retain high performing employees. This will ensure that your business efficacy is sustained. You will also avoid having to hire new employees frequently, which can also prove to be very costly for your business. You can retain your employees by improving their compensation and engaging them in core business affairs among others. This will make them feel that they are part of it and their input is highly valued.
Running a small business on a budget requires that you take smart approaches to save on costs. The beauty is that you can use the tips we have covered, plus you can also get creative in cutting costs!