Cost-Cutting Ways for Your Business
by Barbara Weltman
to Survive and Thrive
Here are some easy, simple ways to save money in today’s economic environment.
Whether your business is facing challenges during this tough economy or is doing just fine, the more you can trim off your business expenses, the better off you’ll be. The savings can be used to keep your business afloat, expand into new ventures, or improve your bottom line. Here are some easy, simple ways to save money in today’s economic environment.
Save on utility costs
Reduce the cost to heat, cool, and light your workspace. Small thermostat adjustments in winter and summer can produce sizable savings. Save on summer air conditioning costs by pre-cooling your space, a practice that research shows will save you money. Set the thermostat to cooler-than-normal temperatures early in the day and to warmer-than-normal in the afternoon and the space stays cooler all day long, reducing energy usage by 25% to 30% during peak electrical demand.
Cut electricity consumption by turning off unused office equipment after hours and on weekends and holidays. Use energy-efficient office equipment (find information at EnergyStar.gov) to reduce electrical usage; your purchases may even qualify for rebates from EnergyStar partners.
Use VoIP solutions, which allows you to make phone calls using a broadband Internet connection instead of a phone line, to slash monthly phone bills. Comparison shop VoIP options through VOIPReiew.org and be sure to choose your plan wisely.
Make your purchases work for you
During these tough times, access to capital is tight and cash is a highly-prized commodity. Nonetheless your business needs certain things to operate, such as office supplies, equipment, and materials. Conserve your cash by using smart purchasing strategies.
Exchange and barter your goods and services to acquire the things you need. Barter directly with local merchants you know or join a barter exchange geared to business. Use informal exchange portals, such as BusinessHelpingBusiness, a no-cost way to post your needs as well as what you have to offer (“needs” and “haves” are distributed to subscribers daily via email).
Get cash back on your everyday business purchases. Bank of America recently launched an online shopping portal called Add It Up where small business owners can earn up to 20 percent cash back from more than 270 retailers when they shop online with their Bank of America check card. Participating retailers include top names such as Staples.com, HomeDepot.com, Walmart.com, and Costco.com, where small business customers spent the most money in 2008.
Keep employees but reduce payroll costs
The last thing a business wants to do is let a valued employee go. For small businesses, this can be like losing a family member; it can also be very costly to rehire and retrain a new employee needed when the economy recovers. To maintain staff size while trimming payroll costs, consider a few key strategies.
Maintain current salaries where possible, while temporarily eliminating raises and bonuses. You may even consider giving unpaid furloughs (time off without pay), in order to save money. This can be especially helpful for a seasonable business in the off season and may allow you to keep your employees long-term.
Barbara Weltman is a top selling author, attorney, tax and small business expert. Barbara serves as an expert on the Small Business Online Community, powered by Bank of America. She recently conducted an expert forum on the Small Business Online Community, where she answered questions about the impact of the stimulus package on small business owners. Barbara has also authored several books include JK Lasser's Small Business Taxes 2009 and The Complete Idiot's Guide to Starting a Home-Based Business, 3rd Edition.