What is the one thing everyone knows about business? The answer is that they know a business has to make a profit. Without this, it won’t matter how great you are at what you do or what high-quality items you sell; if you don’t make a profit, you won’t be able to stay in business for very long – you’ll simply run out of money.
This is true no matter what business you happen to have, but what is also true is that making a profit isn’t just about making money; it’s also about saving money. The more money you can save in business in various ways, the more profit you’ll make even if you lower your prices to become more competitive. If you can find a way to charge higher prices and save money in your business, that’s even better because your overall profits will be more impressive.
It’s clear that saving money is something all business owners, new and experienced, will need to do to be as profitable and competitive as possible. With that in mind, here are some of the many different ways you can save money in your business. Once you start implementing them, you’ll soon discover your profits begin to grow.
Outsource When Needed
Outsourcing costs money; you’re paying someone outside of the business to do the work that you would normally do. Surely this is not a cost-effective way to grow, and it’s not going to save you any money – wouldn’t it actually be the opposite?
The truth is that initially it will cost money to outsource to a professional. However, if you choose the right businesses or freelancers to work with depending on the jobs you need to be done, you can recoup your money through saved time and improved performance in the long run. There are various roles you can outsource, from HR to accounting – a good example of the latter is Michael Savage from New Canaan; Michael Savage New Canaan provides virtual accounting services, which means a business can outsource their accounting tasks to a “virtual” professional. Outsourcing tasks like these should be seen as an investment in your business rather than an expense.
The reason for this is that when you outsource processes that would normally take you a lot of time to do yourself, you are giving yourself – and your employees – more time to do the things you’re good at. You can speak to more customers, do more of the core work of your business, network more, focus on your marketing, or anything else.
Plus, the work that you have outsourced will be of high quality, so if you can’t be sure your own work will be of the same good standard, it’s best to outsource and impress potential customers with your work. You’ll find they are more receptive to working with you and spending money with you, boosting your profits. In the end, the net profits you make will show you’re saving money when you outsource, although it might take a little while for those results to come through – be patient.
Value Your Employees
When you have employees, you don’t want to lose them. Employees are the heart of your business, and without them, not only would you have to do everything yourself (which is quite possibly not something that can be done anyway and certainly won’t be possible if you want to grow), but you would potentially lose your good reputation. Remember, customers have a lot of choices when it comes to where they want to spend their money, and if your business doesn’t seem like a fair one or one that has issues internally, they might shy away from you and buy from your competitors instead.
On top of all of this, if you want to save money in your business, you need to value your employees. It might be tempting to let one or two go if you want to save money, but this could give you the opposite effect and end up costing you money instead. It’s actually caring more for your employees that makes all the difference. The more you take care of your employees, perhaps through incentives and perks or simply by giving them a good workplace environment with everything they need, including a fair salary, you can be sure they will work hard for you.
The harder an employee works, the more value you get out of whatever you are paying them. Plus, your customers will be happier with the end result as it will be higher quality. As well as this, your employees themselves will feel more accomplished and secure in their work, giving them the chance to feel happy and have a good work-life balance.
When you take care of your team, you’ll make more profits because the work will be better (and you can therefore charge more), but you’ll also have lower staff turnover, saving you a lot of money.
Use Free Advertising
No business can thrive without marketing, but this could account for a significant portion of your business capital – in many cases, marketing is the most expensive thing you’ll need to pay for. It feels as though the more money you put into your marketing campaign, the more successful it will be, and in some ways, that is correct.
However, spending money on marketing when you don’t have to is not a sensible idea, and there are actually a number of ways to advertise for free when you have a business. If you can use these, you’ll save a lot of money. Even if you also implement some paid-for strategies, you won’t need to spend quite so much, saving you money in this way as well.
One of the best ways to gain extensive free advertising is social media. It will take hard work and time, but if you can get social media marketing right, you won’t have to spend any money, and you can build your customer base and reputation to a high level.
When it comes to social media marketing, you’ll need to know exactly who your target market is, so it’s worth doing plenty of market research before you commit to any particular campaign or idea. Once you know who you are marketing to, not only can you come up with advertising that will interest them, but you can also decide which social media platform you want to use – they are all different, and therefore they all need different forms of advertising.
Other free advertising ideas include:
- Giving away free branded gifts
- Guest blogging
- Writing an eBook
- Creating a YouTube channel
- Encouraging word-of-mouth advertising
Experiment with some of these ideas and see which ones work best. Because they are free, you won’t actually lose anything by trying each one, and in the end, you’ll save a lot of money on your marketing if you hit on a free advertising method that shows signs of success.
Consider Your Business Premises
Apart from marketing (and eventually the cost of employees), another one of the biggest outgoings any business might have is the business premises. Paying rent for an office space or warehouse (or both) will take a lot of your profits, and if you also need to pay for utilities and decoration on top of this, it might not be very cost-effective at all.
Although in some cases, there won’t be much you can do about this; if you own a retail store or a restaurant, for example, you’ll need to have a place for people to go to buy from you, there will be other businesses that don’t need an office at all. Is yours one of them?
If you can run your business remotely, you will find that you can save a huge amount of money as you will no longer have to pay rent (or a mortgage if you bought your premises). You also won’t have to pay for electricity, heating, water, air conditioning, and so on. You will have to pay for any equipment your employees need to work remotely, but compared to the cost of business premises, you’ll still be saving money.