Most people who own, or work at, a small business would not trade places with their big business cousins because there is much that small business people like about their situation:
- The camaraderie inherent in the family-like setting of a small business
- The flexibility and ability to change course quickly
- The lack of corporate structure
But, that said, big businesses have some advantages that, to be perfectly frank, make most entrepreneurs jealous. These include bigger budgets, greater manpower and specialized help (lawyers, assistants, marketing pros, etc.).
One other significant area where big business usually has an advantage over small business is in the area of costs and expenses. For various reasons, big businesses often have a better handle on keeping costs down, usually due to better negotiating power and the fact that small businesses often lack awareness when it comes to benchmark costs.
So what is a small business to do to help reduce their expenses?
Here are five areas where small businesses tend to have costs that are too high, and what to do about them:
Far too often, small businesses stay in a location because, well, that’s where they’ve always been. But doing things the same old way because that is how they have always been done, including staying at the same location, often makes no sense, especially if the business is not dependent upon being in a certain spot. When that is the case, there is a better way to help reduce your small business expenses.
The easy solution is to hire a broker and see what else is out there. Viable businesses are valuable tenants and as such, small businesses typically have more negating power than they realize. By shopping and around and comparing locations and prices, you can probably get a better deal, either in a new space, or with your present landlord who will not want to lose you.
This is another area where doing the same old thing because you have always done it that way can negatively affect the bottom line. These days, telecommunications companies offer powerful, affordable, plug-n-play, all-in-one phone systems designed specifically for small business and small business budgets.
So ditch that expensive system you have had forever and step up into a new, affordable, sleek and powerful modern telephony system.
Oh sure, you may think that big businesses have the advantage here because they have deals with travel companies, but the fact is, any small business can be a player when it comes to travel. Of course you know all about sites that compare costs like Kayak and Expedia, but travel expenses result from other factors as well. By having the right software that manages your business and travel expenses together, you can cut down on both.
The same policies from the same agents and the same companies mean your premiums probably go up every year. By simply educating yourself and learning what else is out there, you can make great strides in reducing your insurance expenses.
Far too often, entrepreneurs start a business and learn a few clever marketing tricks, whether it is an ad that pulls or whatever. They usually never bother to learn a new one after that because, they figure, they have a winner.
The problem is, by doing same thing again and again, you hit the same people again and again, and your strategy eventually goes stale. More importantly, between social media and other e-options, expensive old-school marketing ideas are rapidly being replaced, by new, far more affordable online ones which would help reduce your small business expenses. Check some out.
Bottom line: A little education and some smart comparison-shopping can often reduce your small business expenses significantly. Reduce your small business by checking out on the latest spend data with our Expense IQ report.