The following is a Guest Post by Annie Button
If you’re the owner of a small business, you’re probably already familiar with the statistic that 8 out of 10 entrepreneurs will see their business plan fail in the first 18 months. Perhaps you’ve not yet reached that goal or maybe it’s already behind you, but we’d be willing to bet that when it comes to making decisions for the future of your company, you’ve always got one eye on the accounts.
Whether you’re still trying to balance the books from when you first started or are simply trying to stay afloat in an uncertain economy, here are 12 often-overlooked steps that can help you keep control of your finances month-to-month.
1. Go paper-free
If your business can happen digitally, why isn’t it? Using paper-based procedures is not only inefficient from a storage and admin point of view, but it ends up requiring additional costs – from printing, scanning and filing equipment to desk tools like staples, hole-punches and paperclips.
2. Focus on staff retention
If you’ve got good staff, congratulations – dedicated, driven employees are often har
d to find. Unfortunately, they’re highly desirable and therefore can be hard to keep (particularly in trying times like Brexit), so make sure you’re keeping them happy.
Offering small perks doesn’t have to cost your business (like flexi-hours, transparency, dress-down days, pet-friendly work spaces, shorter summer hours etc.), but even if they do, it’ll be far cheaper than replacing a valued employee.
3. Encourage telecommuting
Is your office bursting at the seams? Before moving to a bigger office, consider getting your employees to hot-desk and work from home on some days if their job doesn’t require them to be physically present.
Think of it this way; if a team of five each took one day at home, you’d only need to operate four workstations. It’s better for work-life balance AND easier on your overheads.
4. Streamline your HR
When small companies start to grow, employee processes are one of the first things to feel the strain. What used to take an informal conversation and a scribble on a calendar eventually needs to be cross-referenced with other staff, fed into time sheets and tracked for accurate payroll.
Make sure you’ve got one coherent system that can track availability, manage holidays and absences and (if relevant) help you manage your staff rotas or shifts – you’ll be thanking yourself later for the time, money and effort it saves by avoiding under- or over-staffing.
5. Don’t be afraid to barter
If you’re short on cash but need a product or service, it’s worth going down the unconventional route of bartering. There are likely other small businesses in your area that are in the same position and would be happy to trade, or established firms that would be glad to use your expertise in exchange for something that’s insignificant to them in the wider scheme of things. It’s not going to be a profit-spinner long-term, but can help you get what you need without spending cash.
6. Find a buying group (or create your own)
Befriending other local businesses isn’t just beneficial when you want something from them – it can be useful for sourcing third-party goods, too. If you’re buying from suppliers that reward large order quantities, see if you can band together with nearby companies that can’t make the minimum order requests on their own. Everybody wins.
7. Invest in passive energy saving measures
Small businesses might struggle to come up with the initial outlay, but renting a modern, energy-efficient property or upgrading certain features on your building can save costs building up in the long-term. Passive measures include things like double-glazing, black-out curtains or blinds (to retain indoor temperatures), and improving seals around doors and windows to reduce drafts.
8. Brush up on your social media skills
There’s no limit on what advertising and marketing can cost as your company grows. Luckily, you can get set up on most social media platforms for little to no cost, so make the most of it. Even a paid campaign (like product promotions, sponsored posts or professionally edited campaigns) have a much lower cost-per-thousand (CPM) than traditional advertising and reach your potential customers in ways that billboards or TV spots never will.
9. Manage unexpected workloads with temps and freelancers
As simple as it sounds, really. Rather than stressing out your existing employees by overloading them with work (or worse – losing business by disappointing clients through underperformance), hire seasonal, temporary or freelance workers. You won’t need to enroll them in your benefits program or pay them for more work than you need – perfect when it comes to a crunch.
10. Install a smart thermostat
Heating and air conditioning can end up being a huge expense for any business. You don’t want your staff or customers to be uncomfortable, but even a small change in temperature can save you a considerable sum. Invest in a smart thermostat that you can program to run during the working day and turn itself off (or run at a cost-efficient level) once everyone’s gone home. Nest estimates that their thermostat saves bill-payers between $131-$145 each year.
11. Stop ordering bulk stationery
The fuller your supply cupboard, the quicker your stationery will deplete. Why? Because employees are more likely be comfortable taking supplies they don’t actually need when it looks like there’s “loads”. Only got a handful of pens available? Staff are more likely to take the one they need and leave behind the three they don’t. As if by magic, your stationery expenses are reduced every quarter.
12. Use automatic lights
Another measure that can end up being small but mighty – automatic lights are perfect for bathrooms, meeting rooms and offices that aren’t in constant use. Using timers on other non-essential equipment (like printers, TVs, coffee machines etc.) can also reduce the strain on your energy bill without affecting operations.
You’ll probably have found many of these steps disappointingly simple, but it’s true that looking after the pennies is just as essential as making big financial decisions when it comes to growing a small business.