Huge corporations often get to be somewhat cavalier about their spending habits because they have no much equity built up. SMEs aren’t typically so lucky. It’s more common for them to go through lean periods on occasion — and the COVID-19 pandemic that’s currently keeping much of the world locked down has ushered in a time that threatens to be lean for many companies.
The priority right now is survival, both for people and for businesses. If you can find a way to thrive in the coming months, that’s a bonus, because simply making it through to the end of most lockdown measures without running aground will be an achievement.
And the key for that, of course, is getting your finances in order and ensuring that you’re staying as far into the black as you can manage. To that end, here are five crucial money-saving tips:
Cancel unneeded subscriptions
It’s normal for people and companies to build up software subscriptions these days. In one case it could be due to needing a particular SaaS tool for a few months then being able to move on but forgetting to do so. In another case it could be the result of a free trial period automatically converting to a paid subscription without the subscriber noticing. Either way, the result is the same: money going out for no reason. Trawl through all your outgoing payments and look for monthly costs that don’t serve any particular purpose — then start getting rid of them.
Minimize travel expenses
Travel expenses should be fairly low at the moment due to most businesses operating remotely, but some companies — haulage businesses, for instance — are continuing to travel frequently, and it’s more important than ever before that they do so economically. New restrictions could come in at any time, or the supply chain could break down and leave them with nothing to haul. Any company with a fleet in operation should source fuel cards through a site like iCompario (visit website) to more easily track its spend, while any other type of company should keep office trips to a minimum. And speaking of office trips…
Stop renting office space
The best way to keep office trips to a minimum is to stop having an office, and that’s something that most businesses should be considering at the moment — both as a short-term measure and as a long-term tactic. Look at it this way: even if you can afford to keep your office space during this crisis, leaving it empty but covering the rent, what’s the point? To ensure that you still have it when this comes to an end? Well, do you really need it at that point? This pandemic has made one thing very clear: most companies can work remotely just as effectively and at a lower cost. If you want to save money, go fully remote and stay there.
Outsource instead of hiring
It is important to invest in long-term employees, but given how uncertain everything is at the moment, it might not be the best time to bring in full-time workers. Instead, wait until projects come up, then outsource them to freelancers. A good freelancer will charge more per hour than a full-time employee, yes, but hiring them for ten hours in a month will be far cheaper than paying that standard employee for an entire month just so they can do ten hours of work.
Negotiate when you can
It’s easier to just pay whatever price is initially quoted to you, but more business owners need to be aware of the power of negotiation. Simple haggling can pay off: before you pay the listed price, make a lower offer. If it’s accepted, you’ve saved money. If it isn’t, you still have the option of paying the listed price. Don’t assume that every deal is all or nothing.
It’s a strange time to be running an SME, but if you’re willing to adapt and cut back on your spending then you should have a decent shot at making it through these turbulent times. Good luck.