How Small Businesses Can Cut Costs

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Small businesses often struggle to manage the costs of running a small business, often operating on a minuscule budget. However, there are in fact many small but effective changes that managers can make to cut operating costs dramatically.

From managing utility bills to rethinking freebies offered in the lunch room, this articles summarises a few easy ways that small businesses can cut costs.


One of the easiest ways managers can reduce the costs of running a small business is by assessing how utilities are managed. Utilities are a key expense for small businesses, whether operating in a retail store, an office space or from home. By making some small changes managers can greatly reduce the company’s utility usage.

A great place to start is a schedule thermostat. Use this to set the temperature in your workspace for whenever there are customers or employees around, and avoid heating or cooling the office when there’s no one around so that you save energy at night.

Another thing to consider is what type of utilities you are using, and whether there are more cost-effective options out there. For example, air conditioning may cost you relatively more than investing in fans as an alternative, and likewise space heaters may be more economical than running heat all day during the colder seasons.

Depending on where your business is located, some cities will offer incentive programmes for businesses that work to reduce their energy use, so see if there are ways to save with your utility company.

Lastly, always remember to turn off all lights and devices at night, and unplug anything that’s not in use. Of course, this is a no-brainer, but it is easily overlooked after a long day’s work.

Negotiate Better Prices

Most small businesses have a range of expenses that are required throughout the working year, such as stationery, or staff supplies such as coffee. Every little bit counts, so it is a good idea to consider buying such items in bulk.

Depending on your vendor, you may be able to get a discount for supplies purchased in bulk. This is always more economical than buying on an as-needed basis, and may help to reduce company expenditure.

In the same way, consider bundling opportunities when it comes to your personal insurance and business insurance. For example, if you have business liability insurance as well as car and home insurance, see if you can get a discount for having your policies all with the same insurance company.

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Melanie - Unleashed Software

Article by Melanie Chan in collaboration with our team of Unleashed Software inventory and business specialists. Melanie has been writing about inventory management for the past three years. When not writing about inventory management, you can find her eating her way through Auckland.

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