Businesses have a lot of expenses. You need to rent space, get insurance, pay staff , pay for utilities and hire professionals to handle the legal side of things. The less you can pay for all of this, the more money will go into your pocket. So how can you reduce your costs?
If you just accept the first quote you get for utilities and insurance, you will be ripped off (this also applies to your home life). Shopping around will give you an idea of what a standard rate will cost, and you can try to negotiate. And don’t just look at different options then leave your rates to go up – reassess your options every year or two to make sure you keep expenditure down.
If you don’t have the time or the knowledge to do this yourself, you can employ a broker to do it for you. Although you may have to pay for this, you will save more than you spend – so you’ll end up ahead.
Consider moving premises
Obviously if you operate a retail store then you need to have a good location. If, however, there is no real reason for you to prefer one physical location after another then you should look around for a cheaper area. A warehouse, for example, can really be anywhere that is reasonable for you to get to, and doesn’t have to be close to a business area.
If you need an office then there can be some value in being in a prestigious location, but only if you meet a lot of clients there. If you simply need workspace, then you don’t need to be in an inner-city area at all! Even if you do meet clients you probably don’t need a very big space, and you can do the actual work elsewhere – you just need to schedule your meetings efficiently.
Spend money on things that will grow your business
It can be tempting to buy expensive things when you need them for business, on the basis that you can count them as expenses. This doesn’t, however, mean that they are free. Rather than a new car to drive to visit clients, buy a used one and spend the money on marketing yourself.
Similarly, while going to seminars can help you learn new skills and expand your network, that money can often be better spent. Professional services such as accountants are more expensive than people realise, and fixed costs need to be covered before you start paying for extras.