How to Reduce Spending with a Small Business
It’s easy to get excited about all the things you want for your small business. There are times when businesses get a little ahead of themselves and make poor choices when it comes to money.
If you’re spending more than you’re earning, something has to change. There are many ways that businesses can save money, even if it’s not a significant amount.
Take a look at how you could be helping your business to stop spending.
1. Profit First
Implement the Profit First system to always ensure a profit. Too many businesses flounder around without putting a proper financial system in place.
They might invoice and track things, but most do not have a profit account they are transferring to or another one for tax etc. Read Profit First and implement that system in your business.
Being focused on profit is a great way to curb your spending and need for new things.
2. Go Green
It may not seem like it, but going green could significantly reduce your costs. Whether you’re working from home or renting an office space, there are plenty of ways you could save money by going green.
Investing in energy-efficient machines won’t just mean you’re doing your bit for the planet; it will also mean you don’t have to pay high bills.
You could do anything from changing your light bulbs to installing solar panels on your roof and you’re sure to see a difference in the amount you pay.
Be sure to only purchase what you actually need and use. Don’t get every piece of office equipment or new shiny business thing just because you want it.
Every small business comes to a point where they may need an extra few pairs of hands to manage workload. If your productivity is lacking because you have too much on your plate, it doesn’t mean you need an employee, instead consider hiring a freelancer.
The benefit of a freelancer is that you only need to hire them as and when they are needed. It saves businesses from paying out regular wages during quiet times.
You could save yourself a significant amount by hiring on an as needed basis, rather than employing someone with a minimum-hour contract.
When you have an employee there are other expenses, not just their wage to take into consideration. Contracting out work can be a great way to fill the needs in the business without the full expense of an employee until your business is truly in the position to support an employee.
4. Hire, Borrow, Barter
Some things you might only need once or twice so they are not worth spending the money to own. Compare the prices of hiring or see if another small business owner you know has what you need and is willing to lend it to you.
Another option with some things is to barter but ensure it is like for like. Have it in a contract, outline exactly what each business is doing, the value and invoice each other or get proper tax advice on how to do it so you both benefit.
5. Proper Tax Advice
Too many people go into business without proper tax advice. Doing business without knowing what you can claim, how your business should be structured or other tax strategies can cost you thousands.
Having proper tax advice along with a solid plan can not only help curb spending, it can help you spend in the right areas while also paying less tax.
Do yourself a favor and get professional advice.