Simple ideas to reduce business outgoings

Tuesday 13th December 2022

We are all currently living in difficult economic conditions making it important now more than ever to ensure that every penny spent counts for something, in particular if you are running a business. It may not be obvious to you where costs can be cut but the good news is that there are many simple ways to reduce your outgoings and improve your bottom line, in particular for small businesses.

If you look carefully at the way your business operates, you will see opportunities to cut costs and we have outlined some areas that may help:

Create a Budget

This is probably the first thing to do. Without an accurate budget you will have no idea where your money is going or even where it is coming from.

With a daily clear view of your expenses and expenditure you will be able to see where you can reduce business expenses.

Buy carefully

Make sure you are getting the best possible price for your products. Negotiate with your suppliers and if they won’t reduce the price then look to alternative suppliers, maybe large discount ones.

Don’t forget about the basic expenditures like phone services, photocopying, printing and cleaning services. When everyone is trying to hold onto business, deals can often be struck.

Time management

Improve efficiency with time as this will help reduce costs and ensure that productivity levels are optimised. Examine where time is being spent - is a lot of it engaged in pointless meetings? Do employees spend time on their phones whilst on toilet breaks?

Set expectations for the completion of certain tasks and offer incentives to meet or improve on them.

Make sure when meetings are scheduled that they are managed efficiently, ensure the agenda is stuck to and that it finishes at the appointed time.

Marketing

Are you spending lots of money on the more traditional marketing techniques? Digital marketing can be an extremely cost-effective way of reaching your target audience and there are many online tools that will teach you how to use it. Alternatively, find someone who knows how to do it and get them to help.

Narrow your focus

Cut costs by focusing on the more productive services and products that your business offers. You may also find you are more productive if you limit your services.

You could also look at subcontracting if you can, reducing costs by subcontracting parts of your business will lower your expenses considerably.

Travel costs

Reduce the amount spent on travelling and save money on fuel by having virtual meetings. Video conferencing tools such as Zoom and Microsoft teams will reduce business costs quite significantly and many of these technologies are free.

Leasing Equipment

Are you leasing equipment and do you actually need it? If not then try and renegotiate your contract, explain that a failing business may mean you can’t pay in the future anyway. Return if possible or sell if you can and pay off the leasing loan.

In the future look at renting if equipment is only needed intermittently.

Be energy efficient

Change all your bulbs to ones that are energy efficient and turn off equipment if you are not using it.

Go paperless

Avoiding the costs of paper, ink and mailing costs will reduce your office costs significantly.

Switching to digital invoicing and bill payment systems is much cheaper and documents that are on your computer and not in piles of paperwork take up less space in your office.

Remove your landline

This is definitely a cost you no longer need. Either use your mobile or look into the cost of a virtual phone line.

Insurance policies

Visit all your insurance policies and financial accounts, looking closely at the costs involved. Compare insurance for cheaper providers and either negotiate with your current one or switch.

Check the details of your insurance. Are you paying twice or more for the same cover? Many policies cover you for things that you’re not aware of and that you may have duplications of.

Taking action with some of these few simple practices could save your business a lot of money and help keep it trading and profitable in the future.

Interested in boosting your businesses cash flow? Find out how Novuna Business Cash Flow can help

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