6 Ways To Cut Costs for Your Small Business | Business operating costs can be quite expensive, even more so for small businesses, which may not have as much budget to spare as large corporations. Fortunately, there are many ways you can make your business more cost-effective. Here are six ways to cut costs for your small business.
1. Go Green
Going green can seem like a more expensive option at first glance, but as a long-term investment, it’s actually much more affordable than traditional options. Your initial costs may be steeper, but green energy and products pay for themselves much more quickly than traditional ones, while also increasing sustainability and improving your reputation with your customers. For example, even just investing in dimmer switches or motion sensor lighting can greatly reduce your energy bills. If you’re concerned about green energy being relatively unreliable compared to traditional forms of energy, there are tools to help you keep your green energy systems efficient. For example, you can install a solar battery backup in case of overcast or stormy days so you don’t risk a blackout.
2. Consider Your Vendor Options
Vet your vendors carefully. A small business can benefit greatly from mutual relationships with other local brands. You can all support each other’s businesses or provide discounts for consistent customers. However, you should be careful to make sure your vendor doesn’t try to overcharge you, as some may try to take advantage of small businesses or popular brands.
3. Hire Interns
Internship programs can sometimes be stigmatized as either not paying participants or making participants into glorified coffee runners. However, these programs can be hugely beneficial to both the interns and the organization sponsoring them. Even for a small business, an internship program doesn’t necessarily need to be unpaid. Check your industry’s regulations and consider stipend or compensation options based on those. Interns are more affordable than full employees, and you can set up your program so interns have the option to be hired as full employees after the program ends, which can reduce your hiring and onboarding costs, too.
4. Utilize Cost-effective Marketing Strategies
Marketing can be one of the most budget draining aspects of your business due to how much research, development and ad space you need to fund. Depending on your business, you may need to conduct market research or user experience testing, decide which platforms would be most effective for your advertising and then develop your ads. A good rule of thumb is that web-based advertising is increasingly popular, effective and affordable. For example, whereas prime-time television spots and popular magazines can be expensive spaces for commercials and will only reach certain audiences, you can post ads on social media for free.
An increasingly popular method of cost reduction is outsourcing. Take a look at your current operations and consider what workflows must be performed in-house and which can be performed by contractors or vendors. The latter two options are often much more affordable than in-house employees. While repetitive tasks such as scheduling and data collection can be performed by software programs, tasks such as managing payroll, human resources and IT may still require a human touch and can be outsourced to companies that specialize in those types of skills.
6. Invest in Assistive Technology
There are plenty of software solutions available you can utilize to improve your small business’s efficiency, accuracy and workloads at a fraction of the cost of traditional methods. Rather than needing to hire whole new teams or create extensive training and onboarding programs to teach employees to do new tasks, you can leverage artificial intelligence and workflow management tools. Instead of needing an extensive IT department to support many different kinds of software and hardware, you can have a lean IT team or an outsourced one assist employees with a small suite of software solutions. Some examples of assistive technologies are customer relationship management software and the cloud.
Remember to carefully consider where you decide to cut costs. You want your cuts to be effective and help you save money without sacrificing your business’s effectiveness and economic capabilities.