Small businesses and startups operate on thin margins at their earliest stages. Restricted budgets, modest staffing, and limited resources are facts of life for these budding companies. As a result, constant upwards growth is a daily battle, meaning owners, founders, and leaders must be ready to pivot and allocate resources swiftly.
An age-old strategy for staying agile is to take an analytical approach to business expenses and consider where excess costs can be trimmed.. It’s an important strategy for any size business but is essential for companies looking to launch new projects, products, and ideas.
But where to begin? Below are five areas where small businesses can start to corral excessive costs while still banking on growth.
Whether a local distributor or a growing law firm, automation technology like artificial intelligence and machine learning work to save time and money. Automation equals greater accuracy and reduces the risk of human errors on repetitive tasks like re-keying data or manual bookkeeping. Less error means less waste and more time for building a business.
Automated technology that syncs with the cloud can eliminate paper costs while consolidating data storage into a centralized location. Automatic workflow tools keep information flowing so deadlines and budgets sync. Automated expense management tools can save companies from unauthorized spending or overspending when employees gain access to company funds.
In the infancy stages of running a business, paid ads can be out of the question. However, organic marketing opportunities exist that can generate long-term benefits. In-house content marketing like thought leadership, e-books, or blogs is a great place to start. These resources showcase a company's knowledge base while driving product value.
Bolster this with a solid SEO strategy (there are tons of free courses on this on YouTube and LinkedIn), and companies can organically grow their reach. It’s not an overnight success story, but dominating keywords is worth it in the endgame.
Social media marketing is another free option for companies looking to establish a market presence. Finding a niche, staying on top of trends, and interacting with followers and customers put companies front and center of target audiences.
While it may not be top of mind for business owners, consumers are increasingly aware of the environmental effect companies have on the world. According to a survey by The Economist, consumers believe that brands have as much responsibility as governments to create positive environmental change.
Making sustainable business decisions can help save on the bottom line. Small processes convert to big changes. Automated lights and thermostats cut down on energy consumption. Digital documents reduce paper waste. And computer shut-down practices save power.
A company office should be a space for growth and development, not a money pit. So, where is it okay to trim back? A budding business likely needs office furniture, computers, printer ink, and various product supplies. Buying office supplies in bulk, secondhand, or during sale seasons means companies can still garner the materials they need for a better price.
Rent or mortgage is second only to payroll for many small businesses, and now more than ever, companies are willing to shift a bulk of their workforce to remote settings. Smaller in-house teams mean less space and a smaller rent check.
Bootstrapped business leaders should also be prepared to negotiate or barter with vendors and suppliers for better deals. The market is constantly changing, so more favorable payment terms for office needs are never out of the question.
The above examples offer opportunities to change how small businesses boost cost-savings; however, when implementing new strategies, these processes must still be consistently reviewed. Setting policies and forgetting them may sometimes work, but the reality is that company needs constantly change.
Sometimes it's supplies, other times, it's tech, but most of the time, it’s spending that could be considered excessive. Are you paying for any recurring subscription services that no longer serve you? Does your company use unnecessary transport services? When your business becomes operational, keeping tabs on every facet of company spending helps finance teams reduce the inevitable surplus when trying out vendors, suppliers, and technology. Figure out what works and trim the rest.
At the end of the day, having the right spend management solution prevents unnecessary costs and cushions your business against diminishing margins. For growing businesses, it’s crucial to find a software solution that is intuitive and quick to integrate, all while being affordable.
Navan's expense management solutions give finance teams ultimate spend control to drive savings, productivity, and compliance. Get up and running in just 5 minutes today to find out how this expense management software can benefit your small business.