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Running any scale of business is a challenge but running a small to medium business has a unique set of challenges to overcome that usually involve cash flow or a lack of capital spending power to re-invest into the expansion of the business.
It can be very difficult choice to choose where to invest your money when running an SMB, as spending money on a small business carries a great deal of risk compared to a medium or large-sized business.
But there are many ways in which you can cut your operational costs and save money on a weekly or monthly basis to allow you a greater cash buffer when it comes to money you can spend.
This article will cover some ways to start saving your money as a small business owner to free up a greater amount of capital for re-investment.
Way to Save Money as a Small Business Owner
1. Save On Your Water Bills
Every small to medium business will have a water bill to some extent. Granted, some businesses may use water on an everyday basis at the core of the services they provide or products they produce. For those small to medium businesses, saving on the water will go a lot further to save money.
But even if your SMB is office-based, it will still use water. Think about the bathrooms, lunch breaks, or people drinking from the kitchen taps throughout the workday. It isn’t much, but it does eventually add up.
Here are some things to consider in helping you save water (no matter your industry or business):
2. Get A Toilet Tank Installed
A toilet tank will allow your on-site bathrooms to save on every flush. They reduce the amount of water a toilet will use per flush without hindering its ability to function. If you run an office with multiple people, this can genuinely knock a decent chunk of spending off your water bill every month.
3. Re-Evaluate Your Wastewater Services
For the businesses that use water on a much larger scale, for example, a car wash or a clothing manufacturer, evaluate your wastewater allowances and shop around for the best deal. Frequently small to medium businesses can get charged a lump sum to ‘cover’ their usage when they are paying for far more than they realistically need.
4. Get An Up To Date Water Metre
A water metre will allow you to track your usage and learn how to cut down on unnecessary usage, but it can also help you discover leaks. Is there a discrepancy between your monthly usage and how much you are being charged? Time to get a plumber in to find out what’s leaking.
Castle Water, a business water specialist, is a great place to go for advice and water-related services. Don’t pour your capital down the drain!
5. Invest In Automated Solutions
Automation is something that many small business owners think they can’t afford to invest in just yet or don’t want to. There is a misconception that automated software that streamlines processes such as payroll and inventory is too expensive for smaller businesses.
This couldn’t be further from the truth. Automated software processes can save time (and therefore money), but they can also help reduce human errors, which can cost money too.
Keeping some processes automated with software can end up saving money in the long run.
6. Always Overestimate Your Monthly Expenses
Overestimating your monthly expenses might seem like a strange way to save. Upon reflection, it may seem like it’ll give you less free cash to spend on re-investment. But the contrary is true.
Always overestimating your monthly expenses will give you a nice cash buffer at the end of every month, regardless of spending and investment. Think of it as incorporating a safety net into your expected expenses.
This can give you a buffer for emergencies throughout the month without impacting your other investment plans. It can provide you with stability for expansion while incorporating a contingency fund into monthly expenses.
It essentially means if everything goes to plan, you should be left with extra cash at the end of the month that didn’t get spent on expenses.
7. Make Use Of Cloud Services
If you move your business to the cloud or a business that uses a lot of digital-based storage, or you run a website and require a website, consider shifting all your online assets to cloud-based services.
This can allow you to cut costs on expensive hardware such as server machines, workstations, a huge data storage arrays that you may need to run your online services.
Keeping this outsourcing to cloud-based services will cut out all the expensive hardware purchasing costs as well as the maintenance costs associated with running this kind of enterprise technology.
In Summary
We have only just scratched the surface with money-saving tips for SMBs. It is important to assess your own business requirements and adjust your business plan accordingly to save where you can and only spend where you need to.
