Simple but Effective Tips to Reduce Business Expenses
If you’re looking to cut costs where it counts and make the most significant impact on your bottom line, here are some helpful tips that can save you in the long run.
Reduce Paperwork
Regularly printing out memos, invoices, and other paper documents may not seem expensive, but looks can be deceiving. Going digital by storing these on your hard drive, network, or in the cloud is one of the simplest ways you can cut down on unnecessary material costs.
What’s more, storing data this way reduces the need for traditional storage. Fewer cabinets, bankers boxes, and bins lower the need for physical space. With the average cost for a square foot of office space topping out at nearly $25, according to the SBA, reducing paperwork could help you downsize and watch your cost savings add up.
Buy Refurbished/Energy-Efficient Equipment
Large or task-specific pieces of equipment costs can add up if you’re buying new. Instead, consider buying refurbished items that can save you up to half of the price of buying new, according to entrepreneur.com. Properly refurbished equipment runs just as good as new and may even come with a limited warranty that protects the buyer from potential defects.
Renting big-ticket items such as 3D printers or machinery is also a savvy way to skirt the high cost of buying new. It also makes sense if you’re only using the equipment once, or considering buying but want to try out different models first. Check out the pros and cons of renting in this piece by Associated Training Services.
The Case for Buying New
While refurbished equipment and rentals have their cost-saving merits, there are ways you can save by buying new, too—especially when you consider energy-efficient appliances such as refrigerators and air conditioning units.
Sure, they’ll cost you more upfront, but the long-term savings can add up. When looking for an energy-efficient appliance, you can compare annual energy consumption on the energy guide label.
And if new appliances are not within budget, simply buying new energy-efficient light bulbs can save you money over time.
Carefully Consider Banking and Taxes
Choosing the right people to manage your money can considerably impact your bottom line. Different banks offer different services, interest rates, and benefits, many of which are better suited to different types of businesses.
Take the time to shop around and find a bank that offers what your business needs. When it comes to financing, you may find that going the route of traditional banking may not be the best fit for your business. In that case, consider looking into alternative financing options.
In addition to looking for the right banking and financing opportunities, keep a careful eye out for potential tax write-offs. Many small business expenses qualify as tax-deductible, and keeping track of these expenses can make your end-of-year tax payment more affordable.
Consider Officing Alternatives
Sometimes, even simple changes can help you cut costs where it counts. Depending on the type of business you run, you may be able to save money just by staying out of the office.
This option doesn’t apply to everyone, but you can reduce utility costs for businesses where most work is done online by having employees work from home more often. You may also find you don’t need an employee workspace, and eliminating rent can significantly impact your bottom line.
If you are office-bound, small reminders to turn off lights and appliances when not in use are a great way to keep utility costs at a minimum. Reducing personal waste may allow you to change your cleaning schedule to every other day. When stocking your bathrooms and breakrooms, consider what’s a necessity and what isn’t.
Start Today
Reducing business costs and saving money is an ongoing process. You may not see the benefits overnight, but if you keep at it, they’ll show up in every reduced purchase price or lower energy bill. The key is to start cutting today with these tips revisited here:
1. Go paperless to reduce the cost of office supplies and reduce the need for storage.
2. Buy refurbished equipment from reputable sources or rent when you don’t need to own it.
3. Choose energy-efficient appliances or switch to energy-efficient light bulbs.
4. Shop around for the best bank for your business and maximize business tax deductions.
5. Consider a work-from-home or hybrid home-office model.