One of the most common causes of startups (and smaller businesses) going into administration – aka closing down – is high running costs. It doesn’t matter how amazing your products or services are, if your running costs exceed your profits, then keeping your business going is an almost impossible task. That being said, understanding that change is needed and actively taking steps to make changes to how your business is run and how funds are spent, can make controlling your spending slightly easier.
To ensure that your business survives, you will need to make some big changes. It won’t be easy to change your spending habits but it is doable, and if it saves your company from going under, it’s worth it.
Be smart about your suppliers and services
The fact is that simply by making a few small changes to your suppliers and services, you can make a big difference to your spending. Consider buying more items in bulk, from your office supplies to your office furniture, buying in bulk can save you a lot of money in the long-run. When it comes to your office resources, such as your printing ink and paper, use them efficiently. For instance, when printing always use black and white where possible, instead of using colour cartridges, and always reuse paper when possible. Undertaking an audit for your company’s printing, like the ones that http://www.xeretec.co.uk/services/print-audit offer, could also be a good idea. The better understanding you have of your company’s spending, the higher your chance of cutting costs and making ends meet.
Review accountancy practices
Challenge your accountancy team to make cuts wherever possible. Perhaps you could give them a monthly amount that you would like them to aim to save – this will give them a figure to work towards and should also help to motivate them. If you deal with your accounts yourself, seeking the assistance of a financial advisor could be worthwhile, so that they can suggest different ways to reduce your business’s spending, lowering your running costs.
Focus on increasing income
Aim to focus the majority of your time on increasing your company’s income, rather than on cutting costs. Cutting costs is important – any monthly costs that you can reduce will help to make your business more sustainable. However, in the long-term, increasing your income is what will help to keep your business afloat.
Merging with other companies on certain aspects of your business can be highly beneficial when it comes to saving money. Many of the most successful companies have worked with other brands and sharing resources at one point or another. Look for other local companies that you could team up with and collaborate with, to help reduce your overhead costs and make running your business more budget-friendly. To learn more about why collaboration is essential, visit https://www.inc.com/natalie-nixon/.
The fact is that businesses aren’t always cost-effective to run, which can impact their success. When funds are low, and business overheads are high, the chances of a company going into administration are high. However, by taking note of the tips and advice above and implementing them, you can take control of your business’s spending and reduce your running costs.