Starting a new business can be expensive.
One of the main concerns small-business owners have is how to juggle costs and income – especially when you’re new and still finding your way. You can wonder just how long it’ll be before you can pay yourself, or turn a profit. Reducing costs and saving money could be as easy as making smarter choices in these four key areas:
1. Know what it costs to open the door
Create a list of all the things that your business needs in order to open the doors each week. Create a simple budget that outlines your expenses and cost of sales including rent, bank fees, salaries, marketing costs, inventory, consulting fees, bookkeeping charges etc. Your budget should give you a good idea of what you need to bring in as revenue to cover your operating costs. It will also allow you to see if there are areas that you could be saving on. For instance, are you paying too much in bank fees, insurance, telephone and internet costs? It may be time to do your research and see where savings are available.
2. Outsource non-income producing work
As the business owner, your main focus should be driving the growth and success of the business. While it may seem that you can’t afford to get outside help, when you ascertain what it’s costing for you to be tied up doing administrative tasks or customer service that another person could do, you’ll quickly realise where your time is better spent. What doesn’t need your expertise? Could you outsource that? Start small. For example, you could outsource your grocery shopping or home cleaning – so that you can spend more time working ON your business.
3. Embrace technology and save time and money
Are you struggling with an old computer that’s giving you problems, or has outdated software? Have you switched to a smart-phone (yes, there are still people using their old pre-smart-phone devices)? Embrace technology that makes it easier for you to run your business. Moving to online programs and software (cloud technology) means that you can be more mobile and work from anywhere, plus you’ll take advantage of upgrades and improvements to programs as they are released.
4. Market Your Business Online
Social media, websites, online reviews and eNewsletters are just some of the ways that you can inexpensively market your business online. Because customers often research products and services online, a website is the most important aspect of your online marketing. While many small businesses have websites there’s a wide variation on the effectiveness of these websites. If you don’t have a website at all, you’re missing out on important opportunities. Saving on costs and improving your profitability is a matter of making good decisions and reviewing the status of your business often. It’s not about skimping on spending where you need to spend to get the best support for your business – but rather on knowing where you stand financially in your business. This article is sponsored by Australia and New Zealand Banking Group Limited ABN 11 005 357 522 (ANZ). The views and recommendations that are made in this document are those of the author and not ANZ. To the extent permitted by law, ANZ disclaims liability or responsibility to any person for any direct or indirect loss or damage that may result from any act or omission by any person in relation to this material.
Success starts here If you’re thinking of starting a small business, or have recently launched one, you want to do everything you can to ensure its success. Visit the $2 Billion Pledge to find your local ANZ Small Business Specialist and get an indication of how much you could borrow.