There’s a clear divide between those entrepreneurs that believe business is about money and those that think it is about passion. Both can be true. However, if you don’t keep your finances in check, “a small leak can sink a great ship”, according to Benjamin Franklin at least. Unnecessary expenditure can be the difference between failure and survival for your business – especially for a start-up or SME. Here’s how to reduce unnecessary spending when growing your business.
Address your utilities
You don’t have to be financially savvy to understand the value of comparing utility prices. In fact, energy regulator Ofgem stated that those who fail to shop around could be paying an additional £100 a year on energy bills. Not committing to long term contracts, tailoring energy packages to fit your specific needs and using comparison services to find a great deal are all ways to reduce energy overheads. However, switching providers isn’t the only way of cutting costs.
New businesses should also consider the grants or funding available to improve the energy efficiency of their facilities. For example, some businesses may be entitled to a grant for loft insulation. Business owners should also ensure that their electricity meter is read regularly and that direct debit payments match up to the energy use stated on the meter. These may seem like obvious pieces of advice, but as your business grows, these small reductions in energy costs can add up to significant savings.
Embrace the freebie
You don’t need to beg, steal and borrow to cut the expenditure of essential business supplies and software programs. Just by conducting a quick Google search, you will find a barrage of offers, discounts and free trials and testers for essential office supplies. Computer office or design software, business cards and stationery are among the many purchases you can find at a reduced – or non-existent – cost.
Of course, they won’t be free forever, but embracing free tasters of products is great way of testing different suppliers. This will also allow you to compile a verified supplier list for your business by shortlisting the ones you would like to work with in the future.
Transition to digital
No matter how much you save on utilities, or the amount of free stuff you acquire, as technology continues to evolve, there will continue to be other ways to trim down expenses and create a faster, more financial efficient business. Technology provides businesses with multiple ways to streamline operations.
Transferring traditionally manual operations, such as accountancy, bookkeeping and tax returns, to a digital alternative version, can provide significant financial advantages. Using a competitively priced online accountancy package, such as Tally Accounts, you can ensure you know exactly what you are getting, without any hidden costs or nasty surprises. Unlike traditional accountancy, online accounting can provide tailor made packages, that can be configured online in your own time – avoiding lengthy set up procedures and meetings with accountants.
In the early stages of business, every penny counts. While passion and enthusiasm are an essential part of entrepreneurial success, poorly managed finances can destroy even the greatest of business ideas. Plus, if there’s any historical icon to take financial advice from, it’s the guy that graces the $100-dollar bill – thanks Benjamin!
Richard Stonier is a partner at online accountancy firm, Tally.