There’s probably a lot on your mind as a small or medium-sized business owner. And one of the main things you’re probably dealing with is funding. And aside from thinking about how you are going to get the money you need to grow your business, you also have to consider in which ways you are going to save it. Every entrepreneur needs practical, Money Saving Tips for SME Business to help them. In the sea of information that is the internet, it can be easy to get overwhelmed. That’s why we decided to compile an easy-to-follow list of some of the best.
Regardless of what kind of small business you own, these recommendations should help you save money for the things that matter and stop wasting it on the things that don’t.
Consider less conventional office space options
A dedicated office space to take your meetings and work in an organized manner may help. However, it can take a big bite out of your budget. On average, a single square foot of office space costs anywhere between 40 to 90 dollars. Even in places with the lowest rates, like Florida, it got to be around 20$ per square foot. As you can see, even the cheaper options can add up to a large sum quickly.
And the group that suffers the most from this is small business owners. If you see your profit heavily hindered by the monthly rent, it’s probably time to consider alternatives. The good news is that it’s easier than ever to convert to a fully remote business. This is primarily due to the rise of tools like Slack, Asana, and Zoom.
If you want to cut down on office space rental expenses but don’t want to give up having a dedicated physical workspace, there are options for that too. We recommend checking out coworking spaces. The most popular options today are:
- The Wing,
- Impact Hub.
Finally, if you still feel like you need your own office space for your company, you should consider moving to a place with lower rent prices. While moving your office can seem frightening at first, with careful planning and enough help, this process is sure to go over smoothly.
Change your business entity type
One of our top Money Saving Tips for SME Business is to follow along with your company’s growth. If your business grows, it is probably time to adjust your business entity type. For example, if you started your company as a limited liability company (LLC), you may want to transition to an S Corporation. We recommend doing some additional research and comparing these options to find the one that’s best for you.
To put it simply, an S Corporation (S Corp) offers significant tax advantages. It preserves your ownership’s flexibility and saves you self-employment taxes. If your taxes are big (and getting bigger) every year, then it’s probably time to consider forming an S Corp. If your business is already an S Corp, you may be eligible to create a C Corporation.
The main takeaway is that you should research and compare company structures and see which is best for your business.
Consider hiring freelancers
As a small business owner, you’re likely aware that employees cost much more than their base salary. Hiring a full or part-time employee also means paying for benefits. These usually include retirement, insurance, paid leave, etc. To avoid these costs, in the beginning, you can hire freelancers. Aside from saving you money, this can also add the benefit of simplifying taxes and reducing the amount of internal paperwork.
You can find a freelancer who can complete just about any task you need, from managing day-to-day administrative tasks to assisting with account management, helping with your social media presence and completing almost any ad hoc project for a short period.
Some of the most popular websites for hiring freelancers are:
Using these services is fairly simple. All you have to do is post what you need and the rate you’re willing to pay. Then just sift through the incoming proposals.
Avoid traditional advertising
One of the most common mistakes small business owners make is neglecting the importance of marketing. However, in the beginning, you’ll need to be very smart about your marketing options. One of the best money saving tips for small businesses is to skip traditional marketing tactics for (at least) the first year of your business.
A good example of how traditional advertising can cost more than it’s worth is TV commercials. To run a local TV commercial, you’ll need to pay not only for the air time but also for the ad’s production cost and talent. And with the recent decline in the popularity of cable TV, you might not break even with it, let alone turn a profit.
Our best recommendation is to look into posting ads on social media. However, if you’re not a fan of that idea, you can also make use of paid search results or ad space on other sites. By using smart SEO techniques, you can get great results without even having to spend on ads.
Make use of open-source software
A mistake that is common even with long-time small business owners is working with the idea that you need paid software to do proper work. Programs like Photoshop, Word, and QuickBooks are usually unskippable needs for running a business. However, that doesn’t mean they’re the only option available. There’s a large number of free alternatives that are just as good as, if not better, than the pricey ones.
Whenever you’re considering paying for an expensive program or subscription service, at least take the time to look up a few free or cheap alternatives. Just make sure to keep good relations with your employees and ask them whether they need additional education to work with the new programs.
Audit your expenses
Whatever your business looks like, keeping an eye on your biggest expenses and cutting down where it makes sense is essential. Let’s go through a couple of examples of expenses that can be reduced that your audit could reveal.
- Inkjet printers – If you use your printer a lot, it might be smart to swap your inkjet printer for a laser one;
- See which office supplies and tools you buy the most – Whatever you notice you use a lot, try buying it in bulk rather than one at a time;
- Shipping services – If your business relies heavily on shipping items, check multiple shipping service options and see which one has the best rates (keep in mind that rates change, so you should keep up with those changes);
- Meetings – If you decide to use a coworking space, you can try cutting out unnecessary meetings or at least cutting down on overly long ones;
The list doesn’t stop there, and some things might apply to one company but not to others. While they might seem trivial at first, these unnecessary expenses can quickly add up.
Having a proper plan in place about how you are going to finance your small business is an integral part of achieving professional success. And integrating as many of the Money Saving Tips for SME Business we have listed here into that plan is a great place to start. Remember to refine them to suit your individual needs, and don’t feel discouraged if you don’t immediately start seeing results. This is an acquired skill. After some time and effort, your efforts are sure to pay off.