For small businesses living frugally can sometimes mean the difference between survival and downfall. In those early days of a business keeping an eye on cash flow and expenses is crucial.
Having started my own online business ‘Custard & Crumble’ last year there are a number of tips and lessons I have learnt to reduce costs and increase profits. It is important to find out where your money is best spent to drive revenue and profit as quickly and as cheaply as possible.
- Use the Internet – it is free and there is a lot of information out there. The HMRC website offers a wealth of information across all topics as well as some useful templates you can use for accounting, legal, shipping etc.
- Trade Shows – take a look at the relevant trade shows for your business. Many of these will have offers on the day for different services – web design, phones, accounting etc. You will also find talks by key speakers where you will be able to take home a wealth of information for free.
- Advertising – if you decide to advertise in magazines and newspapers never pay their first offer price. There are always deals to be made although this is still an expensive form of advertising.
- Social media – If you are web based social media is a great and free way to advertise your business. The only cost will be your time, but your time is obviously money and therefore you need to make a plan and measure the success of your social media campaign as quickly as possible to see if this is right for your business.
- Networking – Take a look at your local networking groups. Again many are free to join and give you the option to tell people about your business as well as find people whose services you might need.
- Bills – if you work from home ensure you get your gas and electric bill on business rates –these will be cheaper with the opportunity to claim back the VAT.
- Word of mouth – encourage your happy customers to spread the word about your business for you. Perhaps incentivize them with a discount. Testimonials are great to show customer satisfaction and will make potential customers more likely to buy from you.
- Newsletters – another really cheap way of advertising to replace the traditional and expensive postal mailers. You can always use a promotional code to track sales from this and therefore your ROI.
- Outsourcing – if you cannot afford to employ someone permanently, using an outsourcing company can be a great, cost effective way to get some extra work done. Whether it be content writing, book keeping or design you can get the extra work done leaving you to make more sales!
- Research – whether it be web design, SEO, location or banking make sure you do as much research as possible and get as many quotes as possible. Do not be afraid to play off one company against the other. Remember knowledge is power and if you know what you need and what’s involved you will be in a far better position to negotiate.
Rachel Bradbury is a Mum of one, Jack an enthusiastic toddler, with another on the way. She is also the owner of Custard & Crumble, an online luxury nursery store selling nursery furniture, accessories and gifts.