If there were ever a time where small businesses need to save money, it’s 2021. The past few months have been rough on most companies, and there’s a need to cut back wherever possible to grow and/or remain solvent. In this article, we’re going to explore some of the specific actions you can take.
Try These 6 Money-Saving Moves
How big of a difference would it make to your business if you could cut expenses by 10 to 25 percent? Would it mean the difference between shuttering the windows and remaining open? For many companies, it would.
Not sure where to begin? We have a few recommendations that you can use to shed unnecessary expenses and clean up your balance sheet. Let’s take a look:
1. Outsource Wherever You Can
Want to grow your business and strategically allocate resources without increasing expenses? Or perhaps you’re looking for a way to cost-effectively handle a task that would otherwise require you to hire a full-time employee? Outsourcing may be the answer.
Outsourcing, whether to a strategic service partner or an independent contractor, can save you as much as 25 to 75 percent in costs. Plus, depending on who you use, it may allow you to enjoy superior quality. Many outsourced partners specialize in specific tasks, which leads to better results.
2. Leverage Cost-Effective Services
Sometimes you don’t want to outsource, but you can still streamline by leveraging cost-effective services. Take payroll as an example. There are payroll services for the following: pay employees and contractors, automate payroll taxes and filings, process W-2 and 1099 forms, and stay within your state’s rules and regulations. Using one of these services, which tend to be very inexpensive, could significantly reduce your HR expenses.
3. Source Free Content
Content is currency in the digital world. But creating fresh, original content that adds value to your audience and industry is either time consuming or expensive. Thankfully, you can reduce some of this burden by sourcing free content. Options include content curation and the creation of contributor programs where you accept guest blog posts on your website.
4. Join a GPO
Stop paying full price for everything and join a GPO, also known as a group purchasing organization.
“A group purchasing organization leverages the power of a group of businesses and helps them attain discounts on products they’re already buying,” Windfall explains. “GPOs partner with larger businesses, known as suppliers or vendors, to provide their members with exclusive savings on products they need to run their business. GPOs are typically funded by administrative fees by suppliers, and there’s no cost for small businesses to join.”
With a GPO, you may be able to save on things like office supplies, shipping and logistics, credit card processing, and even office furniture.
5. Focus on Employee Retention
It’s much more expensive to hire an employee than it is to retain an employee. In fact, one recent study suggests that it costs an average of $7,645 just to find an employee. (It costs thousands more to onboard the employee and get them set up in the system.)
Want to reduce your HR costs? Try emphasizing employee retention for a change. Do whatever it takes to keep your employees happy, because it’s almost certainly less expensive than having to replace them with a new employee.
6. Try Affiliate Marketing
Don’t have the funds to pay a large sales or marketing team? Consider launching your very own affiliate marketing program and giving people commissions on every sale they bring in. While it’ll cut into your profit margins, a smaller percent of a sale is better than zero percent of no sale.
Boost Your Company’s Bottom Line
Your company’s bottom line must be protected at all costs – particularly in an environment where revenue is suppressed and the future is so uncertain. While there will come a time when you need to reevaluate revenue streams, now’s the time to zero in on the factors that you can control — such as expenses.
Work your way through each of the items listed in this article. Ask yourself if there’s a way to cut back in these areas or switch up the way you’re currently doing things.
If so, now’s the time to move. The new year is coming fast, and you must be prepared for whatever may come your way.