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3 Effective Cost Cutting Ideas for Your Small Business

3 Effective Cost Cutting Ideas for Your Small Business

While it’s always a  good idea to concentrate on ways to bring in new customers to your business and ramp up revenues as a result, don’t forget that you can help your cash flows significantly by cutting costs around the office, too.

When it comes to saving money in the workplace, there are many innovative ways that you can get ahead without feeling like you’re tightening the purse strings too much. Read on for some tips for cutting costs as soon as possible, that you may not have considered just yet.

1. Crowdfund for Capital

Whether you’re operating a fledgling startup that you’re just trying to get established, or currently run a solid business that has been around for a while, you will probably look for a loan or investment capital at some point along the way to help you grow your organization. If this is the case, keep in mind that you may be able to cut costs by crowdfunding for capital rather than paying for expensive bank fees and interest rates.

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In this digital age, technology and the rise in crowdfunding sites such as Kickstarter and Indiegogo, means that it is easier than ever to access a cash injection by unconventional methods. You can now connect with customers and investors who are keen to back your venture’s mission and product offerings through third-party sites which handle the paperwork while also giving you the chance to reach out to a receptive audience.

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    Do you, for example, need to raise some money to create, introduce, or try out a new product, or perhaps purchase an important piece of equipment for the production of certain goods? If so, you may be able to raise the money you need online, through a crowdfunding website instead of going to a bank or other lender.

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    You usually won’t have to pay too much in the way of set-up fees to list your information on a crowdfunding site, and generally don’t have to worry about expensive interest rates on the capital you raise either. Most crowdfunding investors simply want to receive a product when it is made or other low-cost goodies such as posters, T-shirts, key rings, signed copies of books, and other investment incentives. These are all usually much less expensive for a business to come up with than what they would have to pay when obtaining funds from a more traditional lender.

    2. Use Free or Low-Cost Information

    Before you go and spend lots of money on lawyers, accountants, financial consultants, and the like, it pays to remember that fees for such services can rapidly add up and end up costing you way more than expected. To save some money then, you should do everything you can to minimize the billable hours racked up by every consultant or service-based business you deal with.

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      Keep in mind that you will find a lot of valuable information and other resources for free (or just a low cost) online, at libraries, and through business or other groups that help entrepreneurs. You may even have mentors, colleagues, or family and friends who can provide you with the information you need. Even just spending some time searching through the results on a search engine such as Google can provide you with a lot of the information you might have had to pay for in the past.

      If you want to save some money consider, for example:

      • Online legal sites which provide free or reduced-rate legal agreements and case-law information
      • Accounting programs which provide tutorials, videos, and other step-by-step information to help people keep their bookwork in order and read or create reports
      • Free and low-cost photography websites which provide images you can use for your marketing and other tasks

      3. Utilize Freelance Websites

      No matter the type of business you run, you will likely have to, at some point in time, engage in activities such as graphic design, content writing, social media marketing, video creation, and the like to promote and grow your business. If you don’t have the skills and time yourself to handle these tasks, or have the staff on hand to do it for you, you will have to outsource the work to a company or contractor that specializes in each area.

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      While this used to be quite expensive, these days you can save some cash by trying out services on websites like Freelancer, Fiverr, and Upwork. It is important to be discerning when you select a person from those advertising online, but it is definitely possible to find experts in their field who charge a lower rate than traditional, larger outfits.

      Due to the fact that many professional service providers now work from home and don’t have to pay for large overheads such as office or retail space, they can charge more affordable rates. These savings can then be passed on to other business owners.

      Featured photo credit: fthmb.tqn.com via fthmb.tqn.com

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      Published on November 20, 2018

      The Best Ways to Save Money Even Impulsive Spenders Can Get Behind

      The Best Ways to Save Money Even Impulsive Spenders Can Get Behind

      The truth is, there are many “money saving guides” online, but most don’t cover the root issue for not saving.

      Once I’d discovered a few key factors that allowed me to save 10k in one year, I realized why most articles couldn’t help me. The problem is that even with the right strategies you can still fail to save money. You need to have the right systems in place and the right mindset.

      In this guide, I’ll cover the best ways to save money — practical yet powerful steps you can take to start saving more. It won’t be easy but with hard work, I’m confident you’ll be able to save more money–even if you’re an impulsive spender.

      Why Your Past Prevents You from Saving Money

      Are you constantly thinking about your financial mistakes?

      If so, these thoughts are holding you back from saving.

      I get it, you wish you could go back in time to avoid your financial downfalls. But dwelling over your past will only rob you from your future. Instead, reflect on your mistakes and ask yourself what lessons you can learn from them.

      It wasn’t easy for me to accept that I had accumulated thousands of dollars in credit card debt. Once I did, I started heading in the right direction. Embrace your past failures and use them as an opportunity to set new financial goals.

      For example, after accepting that you’re thousands of dollars in debt create a plan to be debt free in a year or two. This way when you’ll be at peace even when you get negative thoughts about your finances. Now you can focus more time on saving and less on your past financial mistakes.

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      How to Effortlessly Track Your Spending

      Stop manually tracking your spending.

      Leverage powerful analytic tools such as Personal Capital and these money management apps to do the work for you. This tool has worked for me and has kept me motivated to why I’m saving in the first place. Once you login to your Personal Capital dashboard, you’re able to view your net worth.

      When I’d first signed up with Personal Capital, I had a negative net worth, but this motivated me to save more. With this tool, you can also view your spending patterns, expenses, and how much money you’re saving.

      Use your net worth as your north star to saving more. Whenever you experience financial setbacks, view how far you’ve come along. Saving money is only half the battle, being consistent is the other half.

      The Truth on Why You Keep Failing

      Saving money isn’t sexy. If it was, wouldn’t everyone be doing it?

      Some people are natural savers, but most are impulsive spenders. Instead of denying that you’re an impulsive spender, embrace it.

      Don’t try to save 60 to 70% of your income if this means you’ll live a miserable life. Saving money isn’t a race but a marathon. You’re saving for retirement and for large purchases.

      If you’re currently having a hard time saving, start spending more money on nice things. This may sound counterintuitive but hear me out. Wouldn’t it be better to save $200 each month for 12 months instead of $500 for 3 months?

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      Most people run into trouble because they create budgets that set them up for failure. This system won’t work for those who are frugal, but chances are they don’t need help saving. This system is for those who can’t save money and need to be rewarded for their hard work.

      Only because you’re buying nice things doesn’t mean that you’ll save less. Here are some rules you should have in place:

      1. Save more than 50% of your available money (after expenses)
      2. Only buy nice things after saving
      3. Automate your savings with automatic bank transfers

      These are the same rules that helped me save thousands each year while buying the latest iPhone. Focus only on items that are important to you. Remember, you can afford anything but not everything.

      How to Foolproof Yourself out of Debt

      Personal finance is a game. On one end, you’re earning money; and on the to other, you’re saving. But what ends up counting in the end isn’t how much you earn but how much you save. Research shows that about 60% of Americans spend more than they save.[1]

      So how can you separate yourself from the 60%?

      By not accumulating more debt. This way you’ll have more money to save and avoid having more financial obligations. A great way to stop accumulating debt is using cash to pay for all your transactions.

      This will be challenging, depending on how reliant you are with your credit card, but it’s worth the effort. Not only will you stop accruing debt, but you’ll also be more conscious with what you buy.

      For example, you’ll think twice about purchasing a new $200 headphone despite having the cash to buy them. According to a poll conducted by The CreditCards.com, 5 out of 6 Americans are impulsive spenders.[2]

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      Telling yourself that you’ll have the discipline to not buy things won’t cut it. This is equal to having junk food in your fridge while trying to eat healthy–it’s only a matter of time before you slip. By using cash to make your purchases, you’ll spend less and save more.

      A Proven Formula to Skyrocket Your Savings

      Having proven systems in place to help you save more is important, but they’re not the best way to save money.

      You can search for dozens of ways to save money, but there’ll always be a limit. Instead of spending the majority of your effort saving, look for ways to increase your income. The truth is that once you have the right systems in place, saving is easy.

      What’s challenging is earning more money. There are many routes you can take to achieve this. For example, you can work long and hard at your current job to earn a raise. But there’s one problem–you’re depending on someone else to give you a raise.

      Your company will have to have the budget, and you’ll have to know how to toot your own horn to get this raise. This isn’t to say that earning a raise is impossible, but things are better when you’re in control right? That’s why building a side-hustle is the best way to increase your income.

      Think of your side-hustle as a part-time job doing something you enjoy. You can sell items on eBay for a profit, or design websites for small businesses. Building a side-hustle will be on the hardest things you’ll do, be too stubborn to quit.

      During the early stages, you won’t be making money and that’s okay. Since you already have a source of income, you won’t be dependent on your side-hustle to pay for your expenses. Depending on how much time you invest in your side-hustle, it can one day replace your current income.

      Whatever route you take, focus more on earning and save as much as possible. You have more control than you give yourself credit for.

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      Transform Yourself into a Saving Money Machine

      Saving money isn’t complicated but it’s one of the hardest things you’ll do.

      By learning from your mistakes and rewarding yourself after saving you’ll save more. What would you do with an extra $200 or $500 each month? To some, this is life-changing money that can improve the quality of their lives.

      The truth is saving money is an art. Save too much and you’ll quit, but save too little and you’ll pay for the consequences in the future. Saving money takes effort and having the right systems in place.

      Imagine if you’d started saving an extra $100 this next month? Or, saved $20K in one year? Although it’s hard to imagine, this can be your reality if you follow the principles covered in this guide.

      Take a moment to brainstorm which goals you’d be able to reach if you had extra money each month. Use these goals as motivation to help you stay on track on your journey to saving more. If I was able to save thousands of dollars with little guidance, imagine what you’ll be able to do.

      What are you waiting for? Go and start saving money, the sky is your limit.

      Featured photo credit: rawpixel via unsplash.com

      Reference

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