10 practical ways small business owners can save money

Finding ways to save is essential for your company’s long-term success. After all, you need to ensure you have enough money to cover essential bills, pay staff and invest in new equipment.

That’s where these ten top money-saving tips for small businesses come in. Read on to discover how you can run your business for less.   

Why should a small business save?

There are many reasons why your business should save. For a start, it can help you cover unexpected bills and expenses.

Boosting your savings and putting money into a business savings account also means you have funds if you want to expand your business, buy other premises or launch new products.

If you have enough put by, you can hire more staff, pay for an advisor or invest in more modern equipment to improve efficiency.

Read more: 

• How to use a business savings account

• How much should you have in your account?

Top tips to reduce costs and save money for your business

Without sufficient savings, your business might struggle to survive, so it’s essential to know where you can cut costs.

Below, we’ve outlined some tips to help your business save money:

1. Regularly review subscriptions

It’s easy to forget exactly how much you’re spending on subscriptions. Make sure you go through your bank statements regularly to remind yourself of what you’re paying for and cancel any contracts you no longer need. Good examples include magazine or software subscriptions.

2. Get a better deal

It pays to renegotiate contracts where you can. Call your energy or broadband provider to see if you can get a cheaper tariff. If you rent equipment, contact the supplier and haggle for a reduced price. 

You won’t be successful every time, but even a small discount can help you save, so it’s worth trying. 

3. Reduce hiring costs by improving staff retention

Hiring and training new staff costs money, so take steps to retain the staff you already have. Make sure you’re recruiting the right people for the job and then offer the right benefits and incentives to keep them in place. 

You might need to offer more company perks, personal development opportunities or make the office a better place to work. It costs money to do this, but it’s cheaper than continually finding new staff and starting from scratch.

4. Cut energy costs

Switching to a cheaper energy tariff is one way to reduce your energy bills, but there are other steps you can take too. These include turning off lights and appliances when you leave work, ensuring your business is fully insulated, and buying energy-efficient equipment. 

You can also install a programmable thermostat to automatically regulate the temperature at your premises. For example, you could set it to come on before staff arrive each morning and to go off after everyone has gone home for the day.

5. Get savvy with your accounting

Hiring a good accountant could save you money by helping your business to become more tax-efficient and avoid penalties by filing your tax returns on time. Your accountant might also offer invaluable business advice to help your operation run more efficiently.
Compare: Our best accounting software for small businesses

6. Buy fast moving items in bulk

You can often get a discount if you buy certain items in bulk, and you should save on shipping fees too. Items to buy in bulk include stationery or bathroom supplies, as well as more expensive items such as software and business laptops.  

7. Automate repetitive tasks

Using software such as QuickBooks and Xero to handle routine tasks can save both time and money. Look for tools that automate things like invoicing, payroll, appointment scheduling or email responses to lower staffing costs and free up time to focus on growing your business.

8. Get a better business bank account

Different business bank accounts charge different fees, so it’s worth checking whether you could save money by switching to a new account. 

For example, if your business carries out a lot of transactions and your account works on a pay-as-you-go basis (where you pay per transaction), it could be cheaper to switch to an account that charges a monthly fee but offers unlimited free banking transactions in return.

Alternatively, if your business account waived monthly fees for the first year and that time is now up, it could be worth moving elsewhere. 

Read more: Your guide to business bank account monthly fees

9.  Reduce payment processing fees

Payment processing fees can add up over time, especially if your business handles a high volume of transactions. Compare different providers to see if you could get a better rate.

You could also encourage clients to use lower-cost payment methods, such as bank transfers instead of card payments, where appropriate.

10. Carry out regular inventory checks

It’s easy to overlook the need for regular inventory checks. By keeping track of inventory levels, you can avoid overstocking items that you aren’t selling or using. Thereby reducing costs and saving cash.

In conclusion

Saving money as a small business owner comes down to staying in control of your costs and making smarter day-to-day decisions. Review your spending regularly and use the right tools to reduce waste and keep more cash in your business.

And remember, small changes add up over time - they all help build a more stable and resilient business in the longer-term.