With the uncertainty of various levels of lockdown determined by the current COVID wave flowing through the country, small businesses are finding it difficult to make longterm decisions about renting, employee retention, product expansion and a myriad of other matters now regularly a topic around the boardroom table.
2020 Saw businesses hard pressed to make drastic cuts, often with far reaching negative repercussions which have now left them regretful and stressed out, with shortages in the work force or gaps in the knowledge base. On the upside, top heavy or simply inefficient people were shaken from the tree, leaving more for those remaining, to enjoy, along with the additional workload they inherited.
As companies try to recover, restructure and recreate it is imperative that they do so with a savings mindset, as who know what the future holds.
- RETAIN GOOD EMPLOYEES
The most cost saving strategy is to really look after those who have looked after you, have the necessary skill set, have continuously done a good job and have always been reliable. There are certain people within a system which, even though they are replaceable are really worth keeping. Finding, training and integrating new people into the system is one of the greatest expenses, with many unforeseen, often, hidden costs. Keep your best people, those with competence, a good work ethic and a growth mindset who will embrace the future changes along with you.
Instead of replacing fulltime employees, consider outsourcing the most necessary aspects of their jobs. This is nothing new but has certainly gained momentum and there is far more choice available in the market. A fantastic platform, for finding a huge variety of talent, is the app, Fiverr. Here you can pick the country you wish to do business with and the individual that has the exact skillset you require, often at the price you can afford or less. The opportunity to work ahead of your own time zone can be hugely beneficial and building a good relationship with one person is often possible, once trust is gained and a good understanding has developed. Outsourcing bookkeeping, graphic design, content development, social media management and a vast variety of other skills is now simple, affordable and efficient. Having said that, where possible, first look local and try to buy local, as these are the very people who in turn will support your business.
- SHARE SPACE
If you haven’t already sacrificed the office you are renting, it may be time to maximize its function. This may require a bit of a change of heart or an attitude adjustment. Having laid off people or with many employees now preferring to work from home, there is sometimes additional, unused space available, which could be rented out. Even in the home environment there may be a clever way of dividing a room, renting out another and simultaneously improving the home value and one’s monthly income or savings.
Landlords are more open and accommodate these arrangements more readily, now even allowing subletting, in hope of retaining paying tenants.
Replacing an unused hairdresser chair to make way for a nail technician, allowing a small start-up to rent an empty office or subdividing the space to sublet could be a win-win. If possible, ensure that businesses are complimentary and bring feet to each other. A child psychologist, sharing with a tutor can benefit from eachother, as will a divorce attorney and a family psychologist or a bookkeeper and an auditor co-habiting.
- SHOP AROUND
I am the first to argue in favour of supporting local businesses, especially small businesses who have given you good service over the years. There are times when shopping around and online is really worth it and when times are tough we cannot forgo 30% discounts, like the one which I got on Takealot, for my printer ink last week. Don’t be caught being penny wise and pound foolish and buying unnecessary stuff just to ensure free delivery or worse still, paying for delivery, which then makes the item more expensive than the local, often freely delivered article.
- CUT BACK ON MEETINGS
Because meetings are seen as ‘part of work’ we seldom calculate the actual real cost of them. Take the hourly salary of each person in the meeting and add them up, now multiply by the number of hours in the meeting. Then do a cost to outcomes calculation and reconsider if the meeting is worth the time invested by everyone. Make sure only the necessary people are present, that minutes are taken and meeting objectives are met within the predetermined, allotted time.
- MONEY SAVING APPS
Keep updated with money saving technology such as a book keeping packages that can save time and fees. Be careful to only upgrade to the full package when absolutely necessary. We often only use a fraction of the services we have paid for. A wonderful app like ‘We Transfer’ can be used to send large data files which cannot be transferred via one’s normal email server, but upgrading is only necessary for really big files, which most industries don’t work with.
- SAVE ON INK AND PAPER
Refillable ink printers can save a fortune on ink, especially if your business requires colour printing. Brother has a variety of low cost, refillable ink printers. The difference between monthly cartridges costing in excess of R400 per colour, sometimes per month and paying less than that twice a year can add up to thousands of rands in savings, not to mention the environmental benefit from less ink cartridges thrown into the trash can. Much of what a small business requires is not high-resolution, fast printing. For the home office, especially now that we are also moving towards a paperless work environment, refillable ink is definitely the way to go. Paper is also becoming an increasingly expensive commodity and an easy one to save on, along with many other stationery items which disappear too easily from the office stationery stash. Purchasing each employee a good pen at the beginning of the year, with the understanding that it is theirs to replace once missing, sends out a strong message that the company is frugal. As the old adage goes, ‘Look after the pennies and the pounds will look after themselves.’
- Other office expenses, normally taken for granted like unlimited tea, coffee, milk, cookies and sugar, two-ply toilet paper, lights on in every office at all times and lunch ordered in for everyone regularly may have to take a chop, too.
Austerity measures are needed in these times and if by saving 10% of expenses one person gets to keep their job, well perhaps its not a bad thing, for now.