There are Two Ways to Build a Profitable Business
The first way is to increase sales. The second way is to… save money.
Although most entrepreneurs focus their attention on increasing sales, it isn’t 100% under your control. When it comes to saving money, on the other hand, you can cut costs, spend less and ultimately add to your bottom line.
Here are 10 ideas how you can save money in your business:
1. Review All Your Expenses
Take a look at all your spendings and separate the essentials from the non-essentials. Anything that is not essential should be cut.
2. When in Doubt, Go Without
Do you really need to buy or replace something? Think it through instead of just going for something larger or newer. Use what you have until you are certain you need something else.
3. Negotiate Everything
What you’ve been paying so far doesn’t mean you have to continue paying it. In the end, suppliers want to stay in business too. Many are willing to negotiate lower prices rather than lose a regular customer. Share with them your budget constraints and negotiate products, services and payment schedules to meet your budget.
4. Get Interns
Reach out to local high schools, career centers and colleges for students looking for internships who will be thrilled to work for very little and gain experience in exchange.
5. Outsource Non-Essential Functions
Employees might be essential to getting work done, but their costs (salaries, office space, insurance…) can be the biggest chunk of a small business’s budget. Keep full-time staff to a minimum and outsource as much as you can.
6. Barter With Other Businesses
Consider replacing some of the buying and selling of products and services with bartering – exchanging one service (or product) for another. Get creative and you might develop some business relationships where you never pay each other, while benefitting from each other’s services.
7. Join a Co-Working Space
Co-working spaces are a great solution that eliminates the high overhead of office rent. It doesn’t matter whether you’ve outgrown your home office or a mature company looking for a flexible workplace.
8. Encourage Referrals and Word-of-Mouth
Instead of spending money on marketing, sales, promotion and advertising, encourage your satisfied clients to share about you on social media, refer their network to your business or leave reviews on Google. Word-of-mouth is the most trusted form of marketing and costs you nothing.
9. Fire Unprofitable Clients
This might sound counter-intuitive, but clients who are paying less usually cost you money due to their constant demand for attention. It’s best to let them go and find more profitable customers.
10. Get Sponsors for Events
Events can attract both old and new clients. If your business relies on regular events to grow your client base, consider getting sponsors who will help cover the expense of events in exchange for some form of advertising within the event.
Now It’s YOUR Turn
For five minutes… come up with as many ideas as you can… what can you do save money in your business?
Please share your ideas (all of them or just one) in the comment box below… and let’s get WOWing.
Live fully, stay awesome,
Top Commenters – last 30 Days
Please share your ideas (all of them or just one) in the comment box below… and let’s get WOWing.
Live fully, stay awesome,
Many of the ideas mentioned here have been implemented by me one day or another. I'm quite amazed by Aramik's enthousiasm and his suggestion nr. 10:
"Give Thanks and Gratitude every single day for all money that Comes to you! “I love MONEY! I am a Money Magnet! My Money Flows to me Every Day and Make my Day Every Day! My Money Loves me and brings me More Magical Money Blessings Every Day” and to see "money" as a relationship. That is interesting, I see money as a means, but feel now I need to change that.
I quite like all your ideas of cooperation in some form or another, I think it's best to set "cooperation" as a goal and see what comes out of it, in stead of "saving money" per se.
The most important question in my case is often: "make or buy". I learned that the one thing I couldn't do myself is: coaching, or "consulting me on my own business". I learned that business coaches really helped me to become aware of habits and comfort zones, and see things from a different perspective.
1. Make a choice: Does it cost me money to paint my house, while being a bad painter. Or do I find a good and cheap painter.
2. Share your office if you need your own space for clients and Co working is not convienient
3. Make sure that if you have insurense on stuff you have the right insurence an pay it on time. Otherwise you find out you are not insured.
4. About insurence. Sometimes it is cheaper not to have insurence for things you can easaly pay.
5. Make sure you know every supplier you know. Maybe a barter or discount is not in the picture right now. But once you have a great connection it will come.
6. In stead of getting a very expensive subscription because you are a small business owner. Try to find a big company and see if you can join their subsricption. This saves me €500,- per year.
6. Make your own lunch. In stead of having lunch somewhere, treat yourself with nice things for lunch (paling) it is cheaper than going out.
7. If you do not like to walk. Buy a nice care that is 15 years old. You can save a lot of money in taxes if your car is 15 years old.
8. If you do not have any knowledge in money do not fall into the stockmarket crap. Stick with what you are good at.
9. In stead of hiring a video maker for important video's you can ask them to set up a video scene. You pay them once to set it up.
10. You can make a lot of nice video's with you phone, a simple speltmic and a special ligth
Most importantly: get yourself a good bookkeeper/accountant. It saved me a lot of money!
I agree that a bookkeeper is a good thing to have. She is keeping me online.
How ever. Make sure you really know the difference between a bookkeeper and an accountant. A bookkeeper is also less expensive.
My husband is an accountant. In the beginning he did everything. But bookkeeping is really different than accountant.
All the invoices lower than €500,- was not interesting.
Now my bookkeeper does all the invoices coming in and going out. She makes sure the main things are paid and keeps an eye on my expenses.
She is really great.
More complex things my husband still does. My husband does the overview! It is working great.
1. You do not have to buy everything new. The furniture in my office and my shop are almost 100% from Marktplaats. People are always telling me they feel comfortable and at home when they come to my shop. And they are very surprised when I tell them everything is second hand.
2. Re-use boxes and wrapping material. I made stickers with the text: They gave me a second chance. I am a used box.
3. Collaborate with others to let them leave flyers at your office and vice versa. Preferably businesses that complement you
Some very good suggestions here, thanks! I really like barter deals. Some questions I ask myself; Is the person an expert in his field, do I need this service, will it add value and could this be a paying customer? If the last question is answered YES I will usually not barter. I always look for win-win-win. What else could a barter bring in terms of new connections, additional upsells etc. If a 50% barter is feasible that would be a preferred option.
So far this has brought me: a personal trainer, a copy writer, a video maker and a few VA's saving me a lot of time 😁.
I addition I critically review my expenses every month and stick to the budget.
- Learn how to invest in stock market or real estate (to rent) and start small
- Change mindset from poor to rich one - My advice read Poor Dad, Rich Dad and Millionaire Mindset
- List your yearly spendings on a spreadsheet to know where your money goes
- Regularly review your spend areas and decide what to keep and what to get rid of
- Focus on how to grow revenues
- Don't buy the cheapest. Buy the best.
A higher price up front might save you money in the long run.
- Work from home.
- Go digital as much as possible.
- Get work done by people in countries like India or Romania. They are often highly educated and skilled but much cheaper.
Hi Paul, I like your tip: a higher price save you money.
About work in other countries: Fiver is also a good place for that.
How ever. Make sure you know what you want. Sometimes it is better to look more close to home if you need good quality.
The more you need to communicate well the better it is to look nearby for suppliers.
1. Look for sales for every product you buy. There is always a cheaper version or way 🙂
2. Skip abonnementen or review them. Many information can be found online.
3. Don't wait for black friday. There are equally good sales during the year.
4. There are special apps where you can put your product you are looking for and when it comes into sale you get a notification.
5. Don't buy the newest model (unless it is very necessary for your business) of products. Do you need the newest Iphone or do you want it? Can you go with a cheaper phone with equal possibilities?
6. When you can, skip your printer. I can do without it and do everything online/ computer.
7. Don't go along with every offer you get, just because it pops up every time you go to this or that website. Really consider if you need it and what it delivers for you.
8. Only buy a new workshop, training, etc. when you have finished the previous. How many have you got lying on the shelf? I'll be honest.... I bought a couple but still have to finish them. Will I really ever.....????
1. buy when there is a sale
2. buy bulk
3. buy when the currency is better
4. review what works and stop it if there is no return on investment or return on ad spend
Every time you get an invoice (sometimes you're already late then) question yourself: Do I really need this? And then cancel the subscription.
Look at your bank account: are there expenses that are wrong?
Work paperless as much as possible.
Sell things you need to send by airmail in bulk, so you can send in bulk (saves you a looooot of money).
When you buy one material thing, 2 things need to go out (good for decluttering, and overthinking if you really need that thing).
Always think: Do I need this? (or love it)
Is there another way?
Is there a cheeper way?
How much time or energie does it take? Is there a simpeler way?
When you think you need something wait a while and see if you still think you need it. Compare where you can find best offer when you really need it. Is the tip I allready use a lot. We recycle a lot and repair a or buy second hand.
Do not trust financial service providers and always ask for a quote.
Find financial service providers that can be trusted through and through.
Do you make few kilometers? Sell your car and rent a car if you need one.
Use public transport which is often cheaper than petrol and parking fees in a city.
If possible, schedule an appointment online, which saves you time and fuel.
Choose open box items or second hand.
I see so many ideas coming by.
One thing... I call it knowledge economy.
Do simple things yourself instead of hiring others to do the work.
If you got time learn about all things that sometimes need to be done. Though they might not be appealing, Just do it!
Be on the lookout for lifetime deals. It pays back to get lifetime deals for certain tools or software that you need. But beware of the pitfall that you will start to buy things because they are such an interesting deal. First assure yourself that you really need it or that it will be useful, either now or later.
Speaking of software: licenses for software like Microsoft Office can also be bought "second hand" (pre-owned), saving you a lot of money.
I love appsumo for great lifetime deals
A little late, probably because I have a difficult relation with making money. I am retired and Philips pays me a good amount of money, so somehow it feels for me that I should not take away money from my competitors. When writing it like this, it already makes clear that this holds me back already for years. And I am trying to change:
1. Ask a fair amount of money for the private lessons in math that I give, taking into account that I have a high education in math.
2. Be precise and careful in sending invoices
3. Judge the courses I paid for, and validate and evaluate them. Where they worth it?
4. Improve the webshop and ease the way in which something can be bought there. Strange this is not really facilitated by Facebook shop.
5. Learn from other how to step forward.
Good luck and sorry for the delay.
I love 2, it can save you hundreds of euros per month. Plus sending reminders for non paid invoices. Actually I hate that I have to do it that way.
1 stop paying for stuff you don't use anymore
2 try to borrow or rent things you need only once or a few times, instead of buying them new
3 investigate the biggest expenses and try if you can do with a cheaper variant or whether there is a equally good cheaper alternative
4 buy things that are more durable and thereby more money efficient in the long run
5 stop doing the things that take up too much of your time and outsource them to someone who can do it better and faster
5 is good as well, you save money in the end.
When possible use Zoom or the like instead of a live event.
There is a lot of course material (physical items) I can create myself and check my supply first before buying.
See if you can use things like a beamer for free.
Combine your appointments saving when you have to visit your clients, saves time and money.
When possible carpool, especially when I have a mandatory course with colleagues.
1. Don’t spend money before you have earned it. It makes you very creative
2. Whenever you want to do a big investment, run it first with a friend and tell them to challenge you on it.
3. Every investment should return tenfold.
4. Set budgets in advance. Not when you’re excited.
5. Check your data every day. If you don’t make a lot it’s painful- but it really helps being on track and be aware on your spendings.
6. Be aware if you’re spending money to create you a shortcut. If you think spending money will make your life easier, think again. Example: taking a training (this training will teach me the quick way to become rich!) or Facebook ads: then my clients will come rolling in! Both are not true. Please please don’t spend money because you’re not willing to do the work. (This one is from my own experience and cost me last year a lot of money).
7. Whenever you hire someone, make sure you know what they’re talking about. This way it’s so much easier to let them do their work effectively, and it will save you a ton of money and frustration.
8. We say in Dutch “goedkoop is duurkoop”. If you spend money- make sure it’s on something with quality so it won’t fail you half way.
9. Ask your clients to pay you upfront instead of afterwards. I know. Sounds scary. But it often works- and it saves you from waiting on your money forever.
10. Commit yourself to first make a plan on HOW to use what you buy no matter how small the investment. If you have a subscription on the Business University, commit yourself to go at least once a week and watch a video. Otherwise it’s a waste of time. This goes also for subscriptions on book sites (Kobo, audible, etc)
yes yes yes! Love this list @Gerdy! Especially #7. I see many ZZPers trapping into this, getting in panic and ending up spending 10.000 euro for a website that doesn't even convert...
One question: #3 : Do you work with deadlines on this ROI?
This subject scares the hell out of me, but there's so much to learn from you guys 🙂 In the first place your fun and your dedication to the money-subject, something I never experienced. Big challenge...!
- Plan smartly and combine meetings. It saves travelling costs (expensive fuel) and time
- Re-use and recycle what you can. Especially when you're a maker. (My friends save empty yoghurt containers for me, haha. Saves me mixing cups)
- When you're a smaller company, use an online accounting program and save your accountant a lot of work (and yourself a lot of money)
- Make your (production)process more efficient
- Turn your heating lower and wear a warm sweater
- You can do more than you think (for instance: make your own crowdfunding video - DIY can look very attractive)
- Take good care of your machinery and other stuff
I can totally relate, Ine...
As a money personality, I'm an avoider... I couldn't care less about it.
But as a strategy in life, it's not such a supportive idea.
So I taught myself, and committed myself, to do care about money.
If I don't care about my friend, how long will he/she stay around?
Not for long.
Same with money...
Love your list, by the way...
Nice to hear that from you, Nisandeh. And I agree with you: if you're not good at something that's actually necessary to grow your business (or other important things in life) teach yourself! You can learn almost everything and otherwise, work your way around it with creative tactics.
Money, here I come!!
Thank you Nisandeh, I can relate a little bit.
I am also an avoider. Especially when I know I spent a lot.
The thing I really like is:
If I don't care about my friend, how long will he/she stay around?
Not for long.
Same with money...
Totally agreeing with @Nisandeh, @Ine. Love Your list! We all are in this Challenge together and you are doing just fine by sharing about it! GO GO GO! (My advice: Check Nisandeh's course on Money and Financial Freedom, especially "Ultimate Business Machine".)
I’m learning to be good with money. I love to have enough of it and when spending it I appreciate the fact that I’m supporting the economy. However I start appreciating that fact that I don’t take myself
Serious if I don’t develop a money mindset-my FQ. All the brilliant tips shared above are very useful.
Here are some tips of mine:
1) take the train whenever possible. Take a coffee, enjoy the ride and use the time working, reading or listening to useful podcasts.
2) share your car through Snappcar which will help you regain some costs.
3) create financial freedom by lowering your expenses.
4) join Airbnb and rent a room or your whole house when on vacation. No tax paid uptill €4800 per year. You are well insured and it is an interesting way to connect.
5) share business subscriptions with co-partners
6) stick to the 100 km /hrs will not only safe a lot of money but is also good for you the environment
7) check the petrol prices in your area. You will be surprised by the difference
8) read your mails and docs on your iPad or phone instead of printing paper.
9) use ParkBee when parking. It is much cheaper than eg. Easypark
10) check the costs of your apps. They are more expensive than you think
- Buy you flight tickets to fairs or exhibitions you attend way in advance, or on the 31th of December. This day has the cheapest rates.
- Search the internet on rates on another ip address, some sites increase their prices if you don't decide right away because you're still comparing. If you visit the site later to book, the price is often higher.
- Contact your internet/phone provider and ask them to give you good reason why you should renew the contract, because you have had a good offer from the competitor.
- I send very small items to customers, I asked my network to recycle their neat bubble envelops and small boxes they receive. Since then I have enough free packaging material.
I didn’t know about Dec 31st!! Thank you!
Only use free social platforms for advertising. I tried several paid ones, but I never got one client out of them.
Sent your invoices digitally.
Get rid of all subscriptions that you think you need, but only cost you time (to read) and money, and don't really pay of.
Ask satisfied clients to gave away your businesscard to people they think might need your services / products.
Be very clear about who your target audience is, the wrong clients cost you money.
Love your list Manny... especially #3 - it's amazing how quickly we hord subscriptions that we never use beyond the first month..
Cancelling those that you do not use is a huge money saver...
* standardise and automate. Look at your processes and repetitve jobs and are which ones of them van be more standardised to do it faster, or automate and not do it at all
* Team up with other companies to get volume discounts.
* Look at your contribution costs.. (e.g. do you really have to work with do many different Banks)
* I preach that people 'focus on their powers'.. in this case you might consider picking up stuff your accountant already taught you and hire them for new stuff and revision only and save a bit on these costs. Decide for yourself how much time it will take you. When you're not comfortable, this is a lousy suggestions.
Very great ideas, @Frans! Totally agreeing on #1.
And then: how do YOU do this? I am right now in middle of our Systematization and I am curious how do you prioritize between the automation & systematization!
How I did it for a client was sitting together:
1. Identify repetitive (manual) processes/actions in your business and list them out.
2. What do these processes/actions currently cost you (time/money)?
3. What could be possible solutions for the items you identified?
4. What does it cost you implementing these solutions? And how much time will it take you to get the benefits (you can differentiate between standardising and fully automate or a bit of both)
5. When you have the answers, you can do the numbers and you will have clear which initiatives will save you money and which will be too expensive/time consuming/complex for now... so the priority rolls out, basically..
Would love to read and write more, but have to get back IN my business now 😉
WOW @Frans! I think I missed your great example and Answer.
Thank you so MUCH! I just copy/pasted it to my notebook and will come back at you very soon, thanks a million!
I love this TOPIC!! 🙂
1. Money Out = Money Out! You can’t Save Money If you Are spending it! Always and Always keep 10% aside and Never Touch it! Make a overview of all of Your expenses and Income. Private and business.
2. Get on Fiverr.com, Freelance.nl or Upworks.com If you need to outsource! You will be amazed what VA’s on Fiverr will do for $5 (3 hours of admin? 3 hours of cleaning your Database? 3 hours of Research?? YES they do that JUST for $5!!)
3. Have flash and Special sales on Special days like Mother’s Day, Father’s Day, BF Day, CYBER Monday, Blue Monday,...
4. Negotiate and Buy Bulk Sales! Never Ever buy things on the season that the Demand is high...
5. Always get first paid instead of the traditional dutch factuur of 14-30-45 days!! There is NO law that says that Your Client should have Their “wettelijk betaal termijn”! Have a 0.0% “Debiteuren Administratie” Policy! Just Don’t!
6. Buy things second hand: Yes, buying second hand applies to businesses, too. Of course, don’t buy things that break. But where possible, pick-up second-hand equipment. Used office equipment can be an important cost reduction for a start-up.
7. Maximise word-of-mouth marketing! Word-of-mouth marketing is perhaps the cheapest form of marketing there is. It happens when a client loves your product so much they convince someone they know to buy it as well. To get the most out of word-of-mouth marketing, make it easy for clients to review and share how much they love your product.
8. Pay Yourself first & Always GIVE Yourself a BONUS to Celebrate Your Wins! Your inner child does NOT want to save money, it just wants to have it all and play and spend! So you better prepare Yourself to those self-sabotages...
9. Read or learn at least one book or course on Financial Freedom, Money Management and Investing (like “Financial Freedom For Woman” by Vered, “Rich dad, Poor dad” by R.Kiyosaki, “Enlightened Millionaire“ by Nisandeh Neta, “Think & Grow Rich”, “The Richest man of Babylon”, “As a Man Thinketh” and “Science of Getting Rich”, “Elements of Success”...
10. Give Thanks and Gratitude every single day for all money that Comes to you! “I love MONEY! I am a Money Magnet! My Money Flows to me Every Day and Make my Day Every Day! My Money Loves me and brings me More Magical Money Blessings Every Day”
Hey Aramik, thanks for your great suggestions and enthusiasm!
You are so welcome, @Ine. Which one did you like the most?
#1 ... Always and Always keep 10% aside and Never Touch it!
#5 Question: how do your clients react on this policy?
Your Question: honestly? First when I began : They don't know what to do with it 🙂 So when I explain the way I am working with them (Give a lot of value upfront WITH great results!), they can NOT wait to just pay me in advance. It's a great Win-Win-Win.
And now: this policy has become a huge and great Qualification tool I am using to fill in my Waiting-lists and programs. Now they all know: They need to implement before any thing will happen.
It's all about Overpromising, OverDelivering AND keep on OverDelivering once they buy and become clients.
WOW ! These are great tips Aramik. Thank you so much for sharing so much value.
As a "one-woman show" saving money is always at the top of my mind.
I thought I was good on this topic but it seems when you spend 5 minutes brainstorming you can always find new places and ways where you can save some money.
Here are a some ideas:
1. As I print A LOT of pages in order to edit and rewrite, I use BOTH sides of the paper. I recycle it. it's good for saving and for the environment
2. If I need to purchase something for my work, I make sure that FIRST I get a new assignment that would cover the costs and get paid BEFORE purchasing what I need
3. If you can't afford expensive items, check if you can rent it or find 2nd hand ones - especially with technology that could go for a long way
4. My laptop is my way of earning money, so when it nearly "died" on me instead of buying a new one, I got a refurbished one. Great value!!
5. Since the Corona outbreak, my business skyrocketed and my expenses went down enormously as everything I do now is online via Zoom.
6. All my meetings with agents and producers are via Zoom and saves me the travelling time and overnight stay and sometimes flight tickets!!! God bless Zoom!
Always sell first.
In the Netherlands they say “cost comes before revenue”, but this is not necessarily true.
Save money by selling first.
If you can sell it, spending the money on creating & maintaining it is a no-brainer.
It saves lots of useless costs in the first place.
No selling = no business.