Running a small business means watching every nickel and dime. If you want to maximize your profits and give your company the best possible chance of staying the course, growing, and becoming a success, you need to be very careful about what you do and do not spend money on. Unfortunately, many small businesses are wasting so much money in so many ways that they are not giving themselves the best chance of success. Below you will find 4 most common ways that small businesses waste money. If you are doing any of them in your company, then you might want to change that right now and here’s how.
By Team Savant
Image: Joshua Rodriguez
1. Buying Expensive Equipment
Many small businesses waste more money than they need to buy various pieces of equipment when they could rent it instead. Surely renting costs more than buying, right? Not necessarily. Take photocopier rental for example - you can save a lot of money by renting your photocopiers simply because the company will handle repairs and maintenance so you don’t have to.
You can also save money by renting equipment that you only need to use occasionally, so it is always worth working out whether buying or renting will save you the most money before you go ahead and purchase expensive equipment.
2. Trying To Look More Established
So many small businesses waste money trying to make their companies look bigger and more established than they are thinking this will help to bring in the customers. However, it rarely makes sense to spend huge sums on fancy furniture and excessively designed websites when you are just starting out. Aim to look professional sure, but you don’t need to go overboard to try and compete with the big boys right now — wait until you are running a decent profit before you think about that kind of thing.
3. Workspace
As a small business, you should not be blowing a lot of your budget on office space in a fancy location, In fact, if your business can be run remotely, you should think about doing that because you could save tens of thousands of dollars on rent and use that money to build your business into something bigger and better.
4. Staff
Sure, unless your business is a one-man-band kind of thing, you will probably need to employ people to help you with the day-to-day running, but that does not necessarily mean you need to hire a whole team of staff.
Freelancers are often just as good as regular employees and you can save a lot of money hiring them because you do not need to worry about various taxes and benefits that you would need to pay when hiring regular staff. You can also use freelancer workers only as and when you need them, which means you do not have to pay a regular wage even when business is slow and there is no demand to do so.
If you are doing any of these things, then you could be wasting money.