Here are five top tips on ways to cut costs without having to make staff redundant or move premises.
Keira O’Mara, founder of breastfeeding scarf Mamascarf, says she managed to save money and raise her company’s profile by doing all her own PR. ‘I approached a lot of media organisations and eventually appeared on Working Lunch. My story was then picked up by other news organisations. Using blogging and Twitter have also been great ways to get my message across. The trick is to follow people in your own area and make sure your posts aren’t all business-related, otherwise people will switch off.’
Reduce your business rent
Chris Gorman, of the Forum of Private Business, says SMEs often pay more than they should in property costs. ‘This is an overlooked area where big savings can be made. Many small businesses pay too much in rent, rates and service charges without realising it. They just accept their existing bills as a fact of life. Many others are eligible for an instant tax break through the small business rate relief scheme.’ You may also be able to negotiate with your landlord to switch your rent payments from quarterly to monthly in order to prevent paying such huge chunks of money before you need to.
O’Mara says she was able to get a lot of help without having to pay the full labour costs just by asking around. ‘Our web design was done by my friend’s husband. It took a little longer than using a stranger’s services, but the cost-savings were worth it. I was also able to get free legal advice from an ex-colleague’s husband, which would have cost hundreds of pounds. I think small businesses are often prepared to help each other. I’ve managed to save money by posting messages on forums such as Mumsclub, and bartering my goods and services in exchange for other goods and services.’
Cut energy costs
Small gains can add up over time. Many businesses could cut energy costs by over 10 per cent through cost-effective measures according to Carbon Trust estimates. Saving energy is one of the easiest ways to save money, so remind staff to switch off lights and computers when not in use. A good way to start is by installing a smart meter.
Through an annual subscription to the Buying Support Agency, you can get discounts of up to 35 per cent on things like stationery, work wear and packaging. ‘It basically consists of small businesses grouping together to give themselves the negotiating power of a big business when purchasing goods,’ says Gorman.