Who doesn't want to save money? If your small business has been shelling out too much cash for services, supplies, and other expenses, use these tips to boost your cost savings this year.
1. Lease or Rent Equipment
Avoid big cash outlays by leasing or renting the equipment your business needs.
While it's nice to have the cash to buy equipment and supplies up front, sometimes leases and rentals make more fiscal sense. You don't have to come up with a big chunk of money, which keeps your liquidity flowing, and you can upgrade the equipment at any time without spending even more money.
In Entrepreneur magazine, Cisco Systems vice president Peter Alexander highlights the advantage of predictable payments. On a lease or rental, you know exactly what you have to pay each month (or each quarter, depending on your lease agreement) to satisfy the terms. You can then better budget your money.
Alternatively, consider financing equipment through your small business banking partner. This will spread out the cost over months or years, which allows you to budget wisely.
2. Find a New Bank
Does your bank nickel-and-dime you every time you write a check, swipe your debit card, or access your online account? Switching up your small business banking strategy might offer significant cost savings. You won't bleed money through fees and other expenses that eat up your profits.
3. View Purchases as Negotiations
Haggling isn't just for used-car lots and flea markets. You can negotiate the price with your business's suppliers and vendors to score big discounts. Those companies want to keep your business, so if you continue to place orders with them, they might lower their prices to keep you happy. Asking for even a small discount can make a big difference in your ongoing costs.
4. Meet Only When Necessary
If you have daily, weekly, or monthly meetings with your team, make sure you actually accomplish something of value during those get-togethers. Nancy Koehn of the Health Leadership Forum reports that 11 million business meetings take place every day in the United States, many of which are not productive.
If you have a meeting just for the sake of keeping to your schedule, you're paying your employees (and yourself!) to sit in uncomfortable chairs and stare at one another. A better solution is to schedule meetings only when you have a precise purpose in mind.
5. Review Expenses Once Per Month
Tired of high small business costs? Start crunching numbers.
As much as you might hate your calculator, it can become your best friend if you know how to use it. Every month (such as on the first Monday), create a spreadsheet or ledger that details all the expenses from the month before. Are you bleeding money unnecessarily? Can you cut an expense without putting your small business at risk?
If you're not sure about whether you're spending money wisely, book an appointment with your small business banking representative. Use that time to ask questions about your finances and to learn about new solutions.
6. Reduce the Paper
One of the simplest and most effective ways to boost cost savings is to use less paper. Small businesses go through reams of paper every year, often with little or no benefit. Switch to paperless invoices, send internal memos electronically, and encourage employees to use the screen instead of the printer.
Sometimes, the best cost savings strategies are also the simplest. If you're unhappy with your small business banking costs, check out our free business checking offer to help you save money and build your business.