How to Cut Costs as an Established Business
If you are a British business owner, it is likely that you spend quite a bit of time thinking about money. After all, there are over 5 million small businesses in the UK — but less than 45% of those businesses will survive over 5 years due to financial issues.
And sometimes it can seem like the costs are always rising: every year the price of business insurance goes up, and wholesale suppliers frequently raise their fees to match inflation. This can make it seem impossible to get on top of your business finances, but we are here to help.
There are lots of ways to cut costs as an established business. You just need to know a few tips and tricks. Here are six simple ways to reduce outgoing costs for your business.
Reduce Office Space Spending
Does your business have a store, office or storage space? If so, you might be able to take advantage of lower prices in the area, or you may be able to speak to your landlord about reduced rates if you have been there for a while.
It may also be possible for you to physically reduce office space for the company if you can go mobile. For instance, you could hire virtual assistants rather than physical staff, which means that you won’t need any office space at all! This is a great way to save money, as the average cost of office space per person, per month, is between £150 and £1500.
Reduce Supply Spending
You can also reduce supply spending by comparing wholesalers. There are hundreds of wholesalers across the UK (and thousands across Europe), so if you have a look around you might find that you are able to get a better deal on supplies.
And if you find that you already have the lowest rates, no problem — simply speak to your wholesaler to see if you can negotiate reduced rates. It can be a bit nerve-wracking asking wholesalers for a discount, but most wholesalers are actually fairly happy to reduce costs and offer discounts for bulk orders.
Reduce Energy Spending
It is also possible to reduce energy spending by switching to a cheaper provider. Many businesses choose the gas and electric company who already supplied the building, but if your contract is ending soon you could find a provider with better deals and offers. If you want to do this, you can use Utility Bidder to compare business energy prices for both gas and electric.
Reduce Staffing Spending
Businesses can save a significant amount of money by reducing staff spending — and no, this doesn’t necessarily mean firing people! Some staff members (such as parents or older people) may be happy to cut down their hours so they can spend more time with loved ones, so you could switch some employees from full time to part-time. It is also possible to hire younger staff for weekend shifts, as the national minimum wage is lower for people under 21. Of course, this isn’t a good idea for qualified positions, but it is ideal for basic admin work!
Reduce Insurance Spending
Many business owners worry about their annual insurance bill, but it is possible to make these bills much cheaper by finding a new insurance provider. Sit down and do an annual review of your costs with an insurance broker, and see what they say. Are you getting a great deal, or are you being ripped off? Some business owners don’t like the idea of shopping around for new insurance as they worry that they don’t know enough to find a better offer, but there are lots of online comparison websites that you can use to make things easier.
Value Your Time
Finally, it is very important to value your own time. Lots of business owners do most of the work themselves as they worry about delegating to less experienced employees, but in reality, this is more likely to hinder the business than help it. For instance, some business owners do the daily drives to pick up stock themselves, but this task could easily be passed over to a less skilled employee. Doing so can result in the owner having more time to focus on important things, like finding a better gas and electricity supplier!
So make sure that you get the most out of your business by valuing your time. Look at your schedule: are there any tasks that you could easily delegate to someone else?