When it comes to your business the ability to save on operating costs without reducing efficiency can make a massive difference to your books. With well over 5 million SMEs in the UK, there are a number of ways in which they can learn from each other and reduce spend.
Keep your workforce flexible
Full-time employees may seem a good fit as you know you’ll have staffing options. However, review your roles annually as part-time or even outsourced roles may become more beneficial going forward. Using consultants or freelancers can cut the cost of overheads like full-time salaries and office space.
Utilise your workforce
Resist the urge to always hire well-qualified candidates from outside your business. There are countless times when promoting from within ensures knowledge is brought up. You can also avoid the probation training period you’d encounter with an external employee. Look at employing and training an apprentices, some local authorities grant funding towards their salary.
Streamline your office space
Ensure you’re not wasting your floor space. If spare office space is not in use consider sub-letting the area to earn extra income until you’re confident of a successful expansion. Consider investing in a reliable office equipment to ensure your internal office needs are always met, saving you time and money.
Negotiate
Never be afraid to negotiate or ask for a discount. Research suppliers and don’t be intimidated when looking for the best deal for you, keep in mind; if the deal doesn’t suit your needs you can always just walk away. Instead of paying upfront for a service ask if you can pay quarterly or monthly, reducing outgoing per month. .
Research
Many opportunities to cut costs for SME’s are missed due to poor research and planning. Keep a close eye on all your costings, from sales through to supplier costs. Annual reviews focusing on every individual overhead can save huge amounts over time. In addition, research your customers too. Targeting the wrong demographic or taking on the wrong clients can have a negative effect if they don’t pay or don’t connect to your services.
Granted no two SMEs are the same which means cost cutting measures will differ across locations and industries. What remains a common goal however is the desire to reduce costs and to use that saved money to reinvest in future growth.