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4 Ways to save money when running a small business

It is the perpetual conundrum of the small business owner… how to spend less and thus make more.  

Unfortunately, as a small business there is no magical formula which will ensure major savings throughout your business activities… instead you must rely on a few more modest savings which can cumulatively make a significant difference to your bottom line.

Of course the challenge is making sure that any savings made do not have a negative impact on your business, the quality of service you provide, or the money that you bring in.

Here are 4 responsible ways to save money when running a small business, that can make a positive difference to your bottom line.

 

Change your energy suppliermoney

This has become an ever more pressing issue in recent years with the soaring cost of energy such as electricity leaving many small business owners with tightening profit margins.  Unlike larger cost-focussed businesses, most small business owners never bother to check their electricity and gas tariffs against what they could be paying from a different supplier, opting to simply accept whatever their arrangement is with their current provider. This can be a major error with most small business owners not realising that a little bit of research and a few phone calls could save them a significant percentage of their bill.  

You can easily discover whether your business could save money by shifting to an alternative energy supplier by visiting any one of the major price comparison websites including Money Supermarket, or a more specialist service such as Simply Business Energy.

 

Use Company Vehicle Fuel Cards

Opting to use commercial vehicle fuel cards can helUK employment reportp save your business money whilst also making refueling much more convenient than was traditionally possible.  

Some of the advantages of using such a system include;

  • They allow drivers to easily make payments for fuel without the need for cash or company credit cards. This not only makes the process more convenient and safer for drivers, but also cuts down on the amount of administration required to process these payments cutting out the need for fuel receipts and laborious logging
  • Such commercial vehicle fuel cards allow you to monitor and manage all fuel costs online, and identify new ways to lower the costs further.
  • It controls the costs associated with refuelling by only allowing your vehicles to refuel at pre-approved lower cost stations
  • They often offer free credit on fuel purchases over a set period of time, helping you to manage your cash-flow in a way that is comfortable for you.

 

Give Employees a Sense of OwnershipEmployee Engagement

From a purely practical perspective, you might think that this is a fairly wishy-washy method of saving money for your small business, but you’d be wrong.  In fact in 2014 Inc. named this as one of their top 4 tips for saving money in 2015.  The results might not be immediate, but over time helping to encourage a sense of ownership in your employees can only bring positive outcomes for you business, both in terms of capital and productivity.

The theory behind this strategy is really quite simple- if you treat your employees like a gear in a machine, then they will behave like a gear in a machine, never going the extra mile, never considering what is best for the business, never trying to improve the work that they do.  In the workplace such employee apathy and disconnection can result in too much sick leave, lack of productivity, poor service, and general indifference towards their position which has the potential to be extremely damaging to your business operations.  

Simply investing some time and effort in making sure that your employees feel valued can help to alleviate some of these problems, and instill in your workers a sense of ownership which will ultimately lead to a better, more efficient, and more sustainable working environment.

 

Haggle with your Vendors935588_paper_money_people

As business in the west has become ever more cordial and polite many would suggest that we have lost the art of negotiation- this is a real shame because skilful haggling can be a great way to save a bit of extra cash for your small business.  Whether this takes the form of a barter arrangement, an agreement, or a bulk discount, you might well find your vendors are more flexible in their terms than you ever could have imagined.  Remember always that in the same way as your vendors are important to you, your business is important to them and as such they will always be willing to revisit arrangements if it means retaining you as a customer.

But don’t simply call them up and demand a reduction in price, this would be rude and probably won’t get you anywhere- instead try to outline a few suggestions about how a discount could be of benefit to both parties or what barter arrangement could be put in place.  

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