If you run a small business, the chances are you are always searching for ways to cut costs. Businesses can take years to become lucrative; for the first three to five years, often no profit is turned whatsoever. These years can be tough to push through, particularly if you only have a small team to fall back on. The exhaustion and pessimism can set in, and this can have devastating effects for your personal life and your business. Cost-cutting is a highly helpful and achievable way to boost your business’ wealth and maintain some peace of mind as a business owner. Here are four viable ways to cut costs for your small business.
1. Scoping Out The Wholesale Market.
Even if you run a very small operation with limited stock, wholesalers are never a bad thing to check out. If your business sells accessories such as phone cases, you can buy wholesale phone cases to sell on which will drastically reduce your costs. If you run a food and drink business, engaging with wholesale suppliers, even on a smaller scale, will help cut your supply costs and keep your business ticking over more easily.
2. Hiring Yourself.
If you have started a small business from scratch and quit your day job, you probably have enough money saved to keep yourself going for a few years. Hiring a team for your small business is very costly, but often necessary. Although you may be tired and have the desire to hire a team who can run the day to day without your constant presence, this might be too expensive for your business at the moment. Instead, ‘hire’ yourself unpaid as the manager of the day to day. This way you can oversee your small team without hiring a salaried manager which will eat into your budget. Plus, it means you can keep a close eye on the development of your small business in its first few years.
Once you have generated enough revenue, there may come a time by which you can hire a full time manager and take the backseat. However, in those crucial first years, keep yourself on the scene and cut costs too.
3. Simple Design
If you have a physical store for your business, you might be tempted to go all-out on the decor in order to attract new customers. This makes sense, but it can be preemptively damaging to your budget. Every business owner wants to draw attention to their brand new store or restaurant, but excessive decorations and expensive furnishings may not actually do this. Instead, try to design a space which is simple yet effective. The minimal aesthetic is increasingly popular among younger folk – so save your pennies and opt for classic, simple designs, with a few chic touches such as houseplants or prints on the walls.
If your business is online, the same rule applies. You do not need to hire the world’s top web designer to promote your business. Instead, focus on a website which is simple and easily signposted, which works well for all users. Your money is better focused on SEO optimization and having a functioning site which does not confuse customers or crash often.
4. Fewer Products, Higher Quality
As a new business owner, you will always be searching for ways to prove you are a cut above the rest. Many business owners choose to offer even more products and services than their local competitors, thereby drawing their customers to the better offers and wider range available. However, this can come back to bite them in the future. Having a wide range of products or services available is, of course, the end goal – but do not cut unnecessary corners, and or spend unnecessary money, to get there. If you are just starting out, you should offer fewer products at a high quality.
Your customers will care more about the actual quality of your products, than the range of different things you offer. If you offer just a few things and they are unbeatable by the competition, you will gain customers who are loyal to your business. Therefore, when the business grows, your customers will be further drawn to you by the wider range. Take your time, and don’t offer more than you can follow through with.
If you love your business and want it to thrive, you should always be finding ways to save money while delivering on your promise to your customers. Follow this simple advice for better cost-cutting and a business that flourishes.