Since many companies are facing constant business disruptions due to COVID-19 pandemic, business owners need to review perspectives and shift strategies quickly to ensure they are taking the right actions for both their business and organisation in general.
This is why, many business owners have found themselves struggling to cut costs and mitigate risks to maintain not only operation and profitability, but their very existence. In these tough times, it pays for both small businesses and large corporations to find ways to reduce costs and optimise efficiency to stay afloat and survive the storm. Here are some ideas on how you can low costs and save money in your business.
Review Your Payments
Your organisation probably pays for a lot of basic services through monthly or annual plans, but sometimes we unknowingly ignore small expenses that can accumulate quickly over time. Therefore, it might be useful to review your payments to see whether the level of service you regularly pay for matches your usage and ensure all of these expenses are still necessary.
Many businesses often use payroll and cellular services, cloud computing and bookkeeping. However, you can find some services that can be reduced or eliminated without compromising your business. In the pre-COVID pandemic world, a small overspend could be acceptable, but in the new reality, cutting an extra few per cent can mean significant savings over time.
Change Your Office Space & Invest In Remote Work
From the experience of pandemic, we can learn that office space may not be all that necessary, and everyone who can work from home is doing so right now.
Consider taking a look at the work your employees are doing from home. Can your team continue to work remotely for an unlimited period? While some of your work tasks are probably better suited for the office, others can be easily done at home.
Therefore, you can move to smaller office space, spend less money and let your staff work remotely as much as possible. You can also try to share your workspace and rent with others to reduce your company’s costs.
Use Financial Support From The Government
One of the biggest issues for most companies in these challenging times is finding money to cover all overhead costs. This includes any contract fees you have to pay, subscription services and salaries of your employees. Luckily, you can use various options of financial support intended to help businesses get access to finance more quickly and cope with the ‘new normal’.
For instance, CBILS lenders (Coronavirus Business Interruption Loan Scheme) provide you with two effective solutions, giving small and medium-sized businesses that are affected by the coronavirus to find the suitable variant for their organisation and beat the cash flow crunch. CBILS scheme allows you to apply for a hassle-free CBILS loan or opt for a flexible CBILS revolving credit facility that is backed by your company’s accounts to fund your business.
Taking advantage of as many grants and loans as you are eligible for is the best method to save much-needed money that you can use again in business.
Hire Interns & Inexperienced People
There is no doubt that professional experience is essential for job candidates. However, this isn’t everything, yet it often comes at a cost. Therefore, more and more companies prefer to hire new college graduates and train them for a few months. This way, you will not only receive a monetary advantage by offering entry-level salaries, but you will also benefit from having workers who are enthusiastic, willing to learn and up-to-date on the latest technology.
While for critical work scenarios, you have no choice but to reach out to experienced people, in most cases, the strategy of hiring smart, inexperienced workers and then training them actually works and turns out to be very cost-effective.
Additionally, there are many non-critical tasks and activities that can be assigned to interns such as back-office administration, market research and social media promotion. Interns are usually full of enthusiasm and energy and work from 2 to 6 months, depending on their academic requirements. Sometimes they are even ready to work for free. But if these workers are really adding value to your company, you can consider hiring them as permanent staff in future.
Revise Software Subscriptions
Today, many companies need to use so many apps and software, especially paid ones, which can have a significant part of the business’s expenses. With plenty of free or freemium versions available online, you can find suitable alternatives to most business software and different apps that you usually use at low prices.
It may also be a great idea to review all your software subscriptions and decide whether you need the service at all. For example, you can try to write invoices manually for some time instead of using billing software.
Consider Purchasing Used Equipment
You can save from 50 to 70 per cent by purchasing used copiers, computer equipment, office furniture and other stuff your company might need from classified sites like OLX and Quikr.
As an alternative, you can simply look through at the ads in your local newspapers, which are another great source of used equipment.
Try Not To Buy In Bulk
Small business owners usually purchase items like office supplies in bulk as it is cheaper to buy that way. For instance, if you decide to buy 100 sets of printing paper, your price per set will be less than if you purchased them one at a time. But the main question here is how quickly you will use 100 sets of printing paper?
Since the focus of your company should be on increasing cash flow, try not to buy in bulk. You can significantly reduce the costs and improve cash flow by buying only things that you need today, not what you think you might need tomorrow.