Most people don’t know that, by and large, small to medium-sized businesses today are self-financed. These findings come from a survey by BlueVine, which was referenced in a recent Accounting Today article by Michael Cohn.
“Based on a survey of 692 SMB owners in various industries throughout the US, BlueVine found that 83% of SMB owners have bootstrapped their companies and built them using their own personal finances. Only 15% of SMB owners have used a loan to fill cash flow gaps. In contrast, 6% used personal funds to fill cash flow gaps, 48% went without pay, and 17% delayed major expenses such as payroll or rent.”
Because so few business owners actually apply for a loan to finance their businesses (only about 1 in 3), they are forced to use their own savings to finance their business. There are many legitimate causes for reluctance, but regardless, this puts a great deal of strain on the individuals and families involved.
Coen’s article goes on to say that “nearly 4 out of 5 SMB owners said they have experienced a cash flow gap. When faced with a lack of cash, 60% used personal savings to continue to fund their business, 48% went without pay, and 25% delayed payments on a major expense, such as payroll or rent, or cut back on employees or hours.”
Because small and medium-sized businesses face these unique issues, they need to mitigate costs in every way possible.
Tips for Reducing Costs and Increasing Savings (and Profits)
Don’t Buy Brand-New Equipment
A simple Google search will lead you to reputable resources that supply offices with recycled (often refillable) printer cartridges at close to half the cost of brand-new ones. There is no reason to keep buying new cartridges when recycled ones work just as well.
When you need to fill your office with equipment such as scanners, printers, and similar devices, consider looking for them secondhand. You can find some great quality equipment out there for up to 60% less than the recommended retail price. Only buy brand new equipment when you really need to. Purchasing secondhand equipment allows you to focus your budget on things that are more important.
In addition to purchasing recycled printer cartridges, consider only printing when you absolutely must. Smart companies with a goal of moving forward are doing whatever they can to go paperless. It may seem like an overwhelming task to go through piles of existing paperwork in your office to find the important bits and pieces, but once you have done this, you can scan those papers and convert them into a digital format that is remarkably easy to work with, making your office more efficient.
The average worker in America prints or otherwise produces 10,000 pages in a single fiscal year. This is a substantial (and totally avoidable) cost in and of itself, but you also have to factor in the cost of ink and toner as well as the cost of maintaining your printers and copiers. Going paperless allows your business to cut costs on equipment like printers and copiers as well as office supplies like paper, ink, toner, paper clips, pins, folders, and much more. Perhaps the largest saving though is the hours it frees up for personnel who previously spent significant portions of time fighting against paperwork.
An article published on money crashers recently suggests 12 points that will greatly assist SMBs with reducing expenses, two of which we’ll mention here.
Internship experiences carry significant weight on a resume and offer the intern valuable job-place experience. By providing internship opportunities you are actually providing great assistance to college-aged and even high-school-aged young people. Interns are great for taking on tasks that are time-intensive, but require only a minimal amount of training, since they may not be there for more than a few months. Then again, many times internships do lead to jobs, and if you like your interns’ work you’ve got a trained employee on your hands who already has a working relationship with you.
Ask for a Discount
Many retailers offer discounts on their merchandise for small businesses, even if they do not actively advertise it. Asking is something that is easy to do and pays large dividends, though not every time, but often enough to make it worth developing the habit.
Small to medium-sized businesses provide most of the jobs in the western world and at eFileCabinet we are committed to helping them succeed in any way we can. Fill out the form on this page, or call us to talk to one of our experts on ways that you can save time, space, and money for a much more efficient and profitable business.