by Shannon Fry
In today’s economy, more and more small business owners are trying to keep their companies out of the red and in the black. There are many things a small business owner can do to help cut costs, without hurting their staff. Here’s a list of some of small business tips to do just that:
1. As a small business owner, you should always know what cash you have on hand. This means you should know what cash is available in your checking account on a daily basis. If you don’t have control over your money, then you have no control over your business.
2. Talk with your accounts payable department, if that’s someone other than you. Are they paying invoices as they come in, or when they are due? One of the biggest mistakes companies can make is paying their invoices early. If you pay invoices when they are due, instead of early, you can, in some instances, stretch money in the bank for two, three even four weeks.
3. Ask new customers or ones that have failed to pay their invoices on time, for a prepayment. Customers that don’t pay on time hurt your business and your cash flow. If they don’t want to prepay a certain percentage, then drop them. Why should you do work for them and then let them “pay when they want?” That’s not cool.
4. Invoice your “good customers” as soon as the work is completed. Let them know that if they pay by cash, cashiers check or money order, that you will offer a discount. The reason for this is that the money is immediately available. When you are paid by check, the money takes days, sometimes weeks to clear both banks.
5. Save yourself money by doing some of the “grunt” work yourself. Do you have a cleaning service for your office? Well, get rid of them. Put on the rubber gloves yourself. My momma always said, “God made dirt, so dirt don’t hurt.” What’s the harm in cleaning your own bathrooms, vacuuming your own floors and dusting your own cubicles? You clean at home, so what’s the difference if you take a few hours each week to clean your office space.
6. I know this is going to sound harsh, but pay yourself last. Yes, I know you have bills to pay at home too, but stop taking out such a huge salary and take only what you need to pay the bills.
7. Talk to your landlord and see if he/she is willing to negotiate a lower rent. If they are unwilling to lower your rate, talk to them about moving your office to a smaller office in the same building or site that they manage. So what if things are a little cramped for a while. Would you rather lose your business or be a little tight squeezed? Remember, it is only temporary. It’s not as if you are looking to make this a permanent thing.
8. Switch you bank account to one that gives you interest on your checking or savings. Often times these are called “sweeps” accounts. These sweeps accounts are a type of investment account that can help businesses make money off the interest that accumulates when they move “extra” cash from the account to a stock fund. Talk with your banking agent to find out more.
9. Make sure you have an eye on your competition. Check weekly to see if their prices are comparable. If you find that your costs are too low, then raise them a bit to be in line with your competitor. The same goes for if your prices are too high – you’ll want to lower them. Make sure your customers know that you will beat any competitors price by a certain percent. Sometimes this can make all the difference with a new customer and make the deal a “make it, or break it” one.
10. Look at how you advertise. You’re probably wasting too much money on placing ads in magazines, handing out flyers and business cards and telemarketing. You can cut all those costs. Think about it. How many people do you know now that have an iPhone, tablet PC or Smartphone. According to CNET, “One-third of U.S. adults own a smartphone.” That’s a lot of people.
And the bonus tip: Consider using a blog writing service to help drive traffic to your website, increasing the amount of people that inquire about your business. More and more people are using the internet to find local businesses. Having your name out on the ‘net means your business is visible to a wider range of people.
If you would like to learn more about how we can help small business owners get more website traffic, then contact us today. We’d love to hear from you.
This is an interesting example of a blog for me. I actually find myself disagreeing with a lot of the advice, and think that it may not even be appropriate for my audience. Why publish it? Because I don’t want to get too hung up about it. I love my blog, but it’s not the front page of the Wall St. Journal. It’s just the Blogmutt blog. If someone reads over a post and disagrees a little, or doesn’t like it much, it’s no big deal. It still helps Google understand that I’m a site that serves small business as a blog writing service, and it helps visitors to my blog see that my business is keeping current with regular, fresh posts. In short, my blogging is done. In the sweep of what matters in a business, “done” matters most of all. — Scott