Small business Owners often act carelessly while running a healthy and strong business. They realize their shortfalls only when it is too late. In order to avoid any crisis situation every small business owner should realize their weakness and grab every profit opportunity way before the crisis hits.
• Manage your Cash- centralize purchasing
Check the price range of the goods you buy. The same product may be available on different rates from different suppliers. Choose the one which offers these on minimum rates.
Small business owners are often surprised by the amount they are able to save on smallest of items. Hence, you need to keep a check on how, when and where the money goes. Even the smallest of items, such as stationary is important.
• Office supplies
Everyday tea items, the stationary and other expenditures should all be kept under strict control. Shop for the best and lowest prices. Make your staff hand back the unused items lurking around the office space. This will help you in reducing costs on buying new items every month. Since prices vary with every supplier, pick and choose the one that suites your needs, just as your customers would.
Customers are sharp; they know the worth of every product before they buy it. Keep close track of your competitor’s costs. Know when they put up sales & discounts and when they offer free giveaways. Don’t overprice, otherwise your sales will be largely affected and you may end up losing customers for a dollar or two.
• Rent – office and Equipment
If you need to downsize office space, then do it ASAP. Or if you no longer require it and can cut costs by moving back in your garage, and then do it. Don’t spend money on areas where it is not required. Save it for the rainy day. Sell or donate excess office furniture and equipment if it is not required.
If outflow of cash is more than the inflow, the major credit problems can occur. So, cut back principals’ salaries. Pay yourself last, after paying all other expenses and salaries.
Don’t overpay yours taxes by assuming that they are the same as last year. Calculate and then move accordingly.
• Business Loans/Merchant Services
While you need cash for your business or credit card processing services, go for merchant companies for quick access. These private money lending companies provide easy and fast access to cash in minimum time.
Cutting costs can help every small business survive the rainy days. So save from wherever you can so that your business easily thrives during economic downfall and among the competitors.