12 Ways To Save Money While Running Your Business

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StrategyDriven Managing Your Finances Article |Save Money|12 Ways To Save Money While Running Your BusinessAs far as entrepreneurship is concerned, every penny counts. While you try your best to pool resources to set up your business, your employees and suppliers deserve their paychecks. To meet the growing financial demands that come with putting up a business, you may have to implement good economic policies to unlock extra cash and save more money. Here are some ways through which you can cut down your business expenses and save cash.

1. Get rid of surplus equipment

During the start-up phase, some business owners strive to acquire tons of equipment. But as operations begin, some equipment may become redundant. Examples include printers, ink, toner, and cartridges. Surplus equipment takes up much of your office space. Moreover, they wear out with time, and will gradually depreciate when you don’t get rid of them early enough. Instead of watching your unused printer ink and toner waste away in your office cabinet, why not sell them to suppliers such as Sell Toner. This way, you will make extra cash while getting rid of surplus equipment.

2. Set up a virtual office

Thanks to technological advancements, businesses don’t have to tether their offices to one location. You can run your business while staying at home by using technological tools to connect with your staff as well as your customers and business partners. Virtual offices allow you to run your business with little resources since you don’t need to have a physical building. Focus on establishing your customer base, after which you can then put up a commercial building.

3. Use Open-Source software

A lot of business software is reconfigured open-source software from volunteers in the business community. This means that they are obtained from non-proprietary sources. Comparatively, open-source software costs far less than proprietary commercial software. Whether you want accounting or bookkeeping software, there are several non-proprietary software that can help you save money while getting your basic tasks done. However, you may have to bear with the fact that the support service for open-source software is limited. But the good news is that business owners who use open-source products can join community forums to access support services from other users.

4. Find discount offers

Usually, bulk-purchasing is cheaper than when you buy products individually. Before ordering products from your chosen supplier, ask them for discount offers. Many suppliers will be willing to slash off prices for customers who have a long-term business relationship with their company. Do some research and find multiple suppliers, negotiating prices before you settle on the most cost-effective. Also, do not tie yourself to one local supplier. To increase your sales opportunities, move out of your comfort zone, and connect with suppliers who offer discounts on shipping and bulk orders.

5. Track the flow of your cash

Another vital activity for saving money is tracking cash flow. When you track the flow of your cash, it saves you from incurring late payments fees — also, you will not miss your bill payments. The majority of small businesses often fail because they are unable to conserve their cash. The opportune time to start tracking your cash flow is during the initial phase of your operation. To generate revenue, your funds have to pay your regular expenses, including the unforeseen ones that may erupt. By looking at the statements of your cash flow on an annual and monthly basis, you will understand the value of your cash and whether it’s enough.

6. Reduce your expenditure on traditional advertisement

With the rise of the internet revolution and digital marketing, business owners have the means to cut down their costs of traditional adverts. Reach more audiences via the internet by using paid advertising resources such as Google AdWords. Use search engine optimization techniques to build a great website and attract customers to your business. Some business owners are able to garner hundreds of thousands of views by creating videos on YouTube to promote their products. This is almost a free way to advertise your business to a global audience. Traditional advertising platforms are expensive, and may not broadcast your business to wider audiences.

7. Outsource some tasks

When you have a strong team of full-time employees, your business has the potential to grow. However, permanent employees also sometimes cost a business its financial resources. Salaries, insurance covers, and office spaces are some employee-related costs that businesses often struggle to settle. So, consider outsourcing your tasks to virtual assistants (VA’s) to reduce your workload, improve work efficiency, and save money. Virtual assistants are skillful people who work from locations across the globe to get your special tasks done in time. Since VA’s have their own office spaces and equipment, you can save money assigning repetitive tasks to them. As a business founder, this will free up more time to focus on building the core parts of your business. Negotiate with independent contractors like VA’s, and you are likely to make a fair deal that will benefit both of you.

StrategyDriven Managing Your Finances Article |Save Money|12 Ways To Save Money While Running Your Business8. Cut down extra expenses on employees

The Covid-19 Pandemic has turned the world upside-down. It has negatively impacted the global economy to some extent. For businesses whose finances have been hit hard by the pandemic, laying off workers may be an idea worth considering. This will have to start with an evaluation to find out which employees go and which stay. However, since employees form the backbone of your business operations, and you don’t have to fire all of them even if times are hard. If you do so, your business may suffer disastrous consequences.

Instead of laying off all your employees, negotiate with them for a pay cut. If you were providing them with free three-square meals a day, reduce it two or one. For example, assure them of their breakfast and cancel their lunch and dinner. Your employees who understand the economic burdens on your business will readily accept pay cuts. After all, half a loaf of bread is better than none. By implementing this strategic decision, you can save money to run your business even during tough times, such as the coronavirus pandemic.

9. Hire smart workers

The levels of smartness of your employees can also determine how economical your business is. On this subject, you don’t have to use only the experience factor to rate the abilities of your employees. In recruiting new employees, give chances for inexperienced people (recent graduates) provided they are smart enough to fit your work demands. Some workers may not have several years of experience, but they can learn fast once you put them on the job. Hire inexperienced people and pay them entry-level salaries. This way, your business will gain a monetary advantage. Meanwhile, your smart workers will contribute their best to grow your business.

10. Hire interns

The two main types of internships are paid and unpaid internships. Interns are usually students or recent graduates who work for companies in order to gain experience in their chosen field of study. Many times, interns work for experiences, not necessarily for the money. Marketing organizations have been able to achieve their goals by hiring interns from local schools to build their social media marketing campaigns. It is up to you to also understand your business operations, and find out areas that match the skill set of interns. By hiring interns instead of full-time permanent workers, you can cut down your expenses on salary and even office space. When this is done together with telecommuting, you can run a small business by getting tasks accomplished for a fraction of their standard costs.

11. Understand your customers

As technology advances, so do customers evolve with time. When you know your customers’ demographics and behavior on the internet, you can streamline your online marketing campaigns to reach the desired audience. Channel your marketing investments on online platforms that are likely to pay off, instead of spreading your campaigns to several areas on the internet. When you understand your customers’ preferences, responses, and general views about pricing, then you can prepare a reasonable budget and avoid losses. Eliminating ineffective options means that you are in a better position to make wise investments by targeting the right customers.

12. Reward your hard-working profit makers

This may seem controversial, but it makes sense to motivate your workers and customers who bring you the profits. For many successful entrepreneurs, rewards take the forms of good gestures such as the occasional provision of free refreshments, leaves, promotions, and salary increments. Boost the morale of your employees, and they will be encouraged to do more for the business. Offer value-added services and discounts to your regular customers so that you can win their everlasting loyalty. If you invest in the people who bring you profits, you’re nurturing a friendly relationship that will go on to bring extra profits to your business.

To wrap things up, your ability to economize the limited resources at your disposal will determine the growth rate of your organization. The above money-saving tips may be the best ways to build a resilient business that will thrive no matter the business climate.

5 Viable Options for Financing Your Small Business

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StrategyDriven Managing Your Finances Article |Financing Your Small Business|5 Viable Options for Financing Your Small BusinessFinancing a small business isn’t always easy, but there are plenty of solutions available, no matter how bad your credit rating is. Before you start looking for finance, however, make sure you have a strong business plan. Lenders will want to see evidence that your busines is viable, even if you don’t need a lot of cash to get the ball rolling. In addition, be prepared to put up some collateral, either your personal assets or shares in the business. Often, loans come with strings attached, not just interest!

In this article, we will look at the best solutions on the table.

Credit Card

When you don’t need a huge amount of capital, easily accessible funding options like credit cards are a useful tool. The great thing about credit cards is that they are flexible, so if you only need a short-term cash injection to buy supplies, a credit card may work for you.

It’s even possible to enjoy a 0% loan if you look around for a good deal. Plenty of credit card companies have 0% introductory offers for new customers but bear in mind your personal credit rating will dictate which offers are available to you.

Bank Loan

Approaching your bank manager for a business loan is another option, but this one takes longer to sort out. Banks don’t typically throw money at customers these days; they were too badly burned in the financial crash of 2009. You’ll have to provide a solid business plan, as well as detailed cash projections outlining how you plan on repaying the money. If everything looks good on paper, you should have no problem qualifying for a business loan.

Specialist Lender

While high street lenders have their place in the finance sector, they don’t tend to work for people with bad credit or niche requirements. For example, if you have CCJs in your credit report or you want to start an online business selling CBD products, mainstream lenders won’t touch you. You’ll need a specialist instead.

Luckily, specialist business models and bad credit doesn’t have to hold your business back. There are lenders who will consider most applications, no matter how off-the-wall, so don’t assume your business idea is doomed if you have a few late payments on your report.

Crowdfunding

Crowdfunding has allowed all manner of businesses to achieve their potential. Thanks to sites like Kickstarter and Indiegogo, startups like Pebble and Oculus have achieved phenomenal success. As long as you have a great pitch and people can see the potential in your business plan, the money will flow your way. In fact, crowdfunding has been so successful in recent years that many small startups have bypassed traditional funding sources altogether.

Make sure you understand the different types of crowdfunding before you create a pitch. They include:

  • Donation-based crowdfunding – ask for money with nothing given in return
  • Reward-based crowdfunding – ask for donations in return for a reward
  • Peer-to-peer crowdfunding – cut out the middleman and borrow money directly from investors
  • Securities-based crowdfunding – investors are given a share in the business in return for cash

Angel Investors

Angel investors are people with a lot of experience and significant capital to spare. They look for embryonic businesses that show a lot of promise. In return for capital, the investor is given a share of the business or the promise of a decent return on their investment.
One advantage of securing funding from an Angel Investor is that you can tap into their experience in the early days of running your business. After all, they have a vested interest in ensuring your venture is a success!

Lastly, don’t dismiss the notion of asking friends and families to contribute to capital if they can afford it. If they say no, consider whether your business idea is worth pursuing.

5 Common Finance Mistakes to Avoid for Small Businesses

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StrategyDriven Managing Your Finances Article |finance mistakes|5 Common Finance Mistakes to Avoid for Small BusinessesDid you know 82% of businesses fail due to cash flow and cash management problems?

This can be due to a lack of planning or trying to DIY your finances and making business finance mistakes you cannot overcome. While this is a staggering statistic that may leave you feeling overwhelmed, you can use it to make better financial choices and give your business a fighting chance at success.

If you are a small business owner who wants your business to succeed, here are several financial mistakes you should avoid making.

1. Not Having a Financial Plan

When starting a business, one of the most important things you can do is create a financial plan. This is the part of your business plan details the financial side of your business. Creating a financial plan will help you know if your business idea is viable or not so starting with this plan is essential.

2. Not Following a Budget

If you don’t have a budget or are not following a budget, you can spend more than your business brings in and experience cash flow problems.

Because there are many common business expenses, creating a business budget is as simple as detailing your income sources and determining your fixed, variable, and one-time expenses. Following a budget is the easiest way to take control of your business finances.

3. Getting Into Business Debt With No Repayment Plan

For many small businesses, having debt is necessary to start and run your business. The problem comes when you have several forms of debt with no viable way to repay it. Never take on more debt than is necessary and always have a reasonable, short-term repayment plan.
If you are overwhelmed with debt, search “how does debt relief work” to learn about debt consolidation.

4. Ignoring Your Business Credit Score

Like your personal credit score, your business credit score is an instant indicator to lenders and investors of how well you manage your business finances. Having a good business credit score can be the difference between receiving funding to grow your business and being denied.

It’s important to maintain a great business credit score so you can have another option for funding your business.

5. Combining Your Personal and Business Finances

A common mistake many small business owners make is combining their business and personal accounts. This is dangerous because a misstep with your personal finances can negatively affect your business reputation and vice versa. It can also make your business and personal taxes difficult to figure out.

Separate your business and personal finances from the start to avoid the headaches that are sure to come if you don’t.

Avoid These Finance Mistakes to Have Business Success

These are the common business finance mistakes that result in failure.

Start with a plan and a budget to manage your business finances. Avoid unnecessary debt as this will put your small business in danger of failing.

Don’t ignore your tax planning, keep your personal and business finances separate, and make sure to maintain a good business credit score. Create an emergency saving account so you can stay afloat during difficult times.

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5 Money Management Tips for Entrepreneurs

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StrategyDriven Managing Your Finances Article

As an entrepreneur, you know how important money management is. Both inside and outside of the workplace, it can be the difference between struggling to make ends meet and paving your way for financial success. What’s more, it can be the difference between making and losing a profit. For this reason, money management simply must be a skill that you work on and try to become well versed with regards to.

If you feel that your career as an entrepreneur is being held back by a lack of knowledge on your part in the art of money management, then make sure to check out the five pieces of advice below.

1. Establish personal financial goals and steps to reach them

In order to turn over a profit in your career and grow your entrepreneurial portfolio as a result, you must, first, be able to manage your money on a personal level. Well, if you can’t look after your own money, how are going to be able to look after a business’s or even another person’s?

To learn how to look after your own money, you should establish some personal financial goals. It means setting targets and being proactive in the steps that you take to reach them. Whether this means aiming to have a specific amount of money saved by a particular time, or whether this means spending a certain amount in a week, you should set your targets and put plans into place so that you can reach and hit them. By becoming well versed in the art of goal setting and step taking as a person, you’ll succeed as an entrepreneur because these are skills that are exchangeable.

Something else that you should do on a personal level is to know what your credit score is. You’re never going to get anywhere as an entrepreneur if you don’t know what your rating is. What’s more, you could actually be held back from making future investments based on past discrepancies. It means that knowing where you stand with regards to credit is essential.

2. Get educated

If you want to become a genuinely great manager of money, then you need to educate yourself financially as often and as fervently as you can. It doesn’t necessarily mean taking a course in finance or accounting; this just means throwing yourself into tasks in which you have to be on the ball in a financial sense to stand any chance of success.

A good first port of call is to throw yourself into the deep end with investing and stock markets. By learning all about what it takes to study and manipulate ever-changing financial markets, you will soon understand how to stay afloat financially no matter what financial fiasco comes your way. By educating yourself in regards to bull and bear markets and what kinds of investments can and should be made within them, especially, you will set yourself up for a lifetime of financial strength and longevity. In this instance, you should check out Dr Kent Moors stock picks, specifically the information that details oil investment, as this will help you to have a better grasp on what, how and when certain investments should be made.

3. Learn to crunch numbers

By learning how to crunch numbers, you will be able to make sense of every financial figure that comes your way, which means that you’ll never be left dumbfounded by anything that you come across, and you’ll find yourself missing out on profit far less. To learn how to crunch numbers and reach financial figures easily, spend as much time as you can with your company’s accountants. Also, you could try playing games that rely heavily on one’s ability to read and understand financial patterns, one such game being poker.

Learning how to crunch numbers will also benefit you in your quest to become a great marketer. This is because number crunching will teach you what it takes to translate the impact of trends and then turn them into tangible results for yourself.

4. Become well versed in the art of organization

You’re never going to become an entrepreneur that has a reputation for being great with their money if you aren’t good at organization. It doesn’t just means learning how to organize your money, either. You should treat organization as if it is a way of life. You should know where everything is at all times, and you should know where you have to be at all times too.

In regards to chronicling your financial information specifically, start by organizing everything into categories. Put information of the utmost importance and outgoing payments that are deemed urgent at the forefront of your financial plans, and sums that can afford to be left unattended for a while on the back burner.

5. Find yourself a mentor

If you aren’t a professional accountant or financial advisor, you will struggle from time to time when it comes to money management. Sometimes you’ll feel like you can’t keep up with all of your monthly outgoings and incomings, and sometimes you’ll spend far more than you can afford to. To stop yourself from inflicting irreparable damage on yours or your business’s financial status, you should find yourself a mentor who can guide you. It could mean working alongside an accountant at your firm, it could mean hiring a financial consultant to help you from time to time, or it could simply mean talking to an older friend or relative of yours that has some experience in equity and asset holding.

If you want to be a successful entrepreneur, then learning how to manage money is an absolute must. To do this, you should ensure that your personal finance is as strong as it can be, you should educate yourself with regards to investment, you should learn how to number crunch, you should organize yourself in a business sense and as a person, and you should align yourself with a mentor. By doing all of this, you’ll be well on your way towards being able to handle even the largest sums of money. Lastly, don’t forget to check out https://www.moneyexpert.com/za/ for all the best deals for helpful financial purchases from loans to insurance for your business.

Dealing with Payroll for Small Business Owners

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StrategyDriven Managing Your Finances Article | Dealing with Payroll for Small Business Owners

Single touch payroll is one of those essential tasks that small businesses must undertake, but it can be a confusing and time-consuming process. The basic principle is straightforward enough – calculate the gross monthly earnings of your employees, then subtract deductions to arrive at a net figure. Inevitably it isn’t as simple as it sounds, and you need to be aware of every detail and produce 100% accurate net figures. If you don’t yet have small business accounting software, here is how you can understand it.

Deductions

Statutory payroll law states that the employer must retain this deduction and transfer the money to the relevant tax office. Statutory deductions include federal income tax, social security tax, Medicare tax (with an additional percentage for high earners) and state income tax. There will also be local taxes that come under the statutory umbrella, such as city and county taxes, plus school district, state disability and unemployment insurance.

Voluntary deductions are agreed with the employee and cover employment benefits such as health insurance, life insurance, retirement plans and stock purchase plans. It also includes any job-related expenses, for example, uniform, meals and union subscriptions.

Employer’s role in tax collection

It is essential that every employer keeps records of their payroll accounting and adheres to the law regarding tax deductions. It is the duty of the employer to deduct the correct tax amount from the employees’ wages and ensure that it is transferred to the right tax agency. To maintain comprehensive accounts of all monies dealt with, the employer must produce reconciliation reports, file payroll tax returns and include all payroll expenses in the company accounts and financial reports.

Taxes paid by the employer

In addition to the taxes an employee pays, the company must contribute to payroll taxes. These are payable in addition to an employee’s earnings and include social security, Medicare, federal unemployment taxes (FUTA) and state unemployment taxes (SUTA).

The importance of good record-keeping

Make sure your payroll accounting is kept meticulously recorded and up to date. Taxes need to be paid on time, and the mandatory forms filed when due. These forms include the annual federal unemployment tax return, the employer’s quarterly payroll tax return, the annual return of withheld federal income tax, and the wage and tax statements form. As well as federal requirements, employers also have to file reports with state and local agencies.

How do you run your payroll accounting

Large businesses can employ payroll experts or even entire teams to take care of all aspects of payroll. Small businesses often don’t have trained personnel, and with payroll being a crucial factor in running a legitimate business, the responsibility needs to be taken on by someone with the knowledge and abilities necessary to ensure that standards are being met. Small business owners often need to learn new skills, and this can often be facilitated by researching the topic on the Internet. For many needs, as long as you are careful to check that your sources of information are authoritative and reliable, then the knowledge you wish to obtain can be found quite easily. However, the skills required to run a well-managed payroll operation will not be so readily acquired using the same method. The intricacies of payroll and possible complications require professional training if you want to be confident you won’t end up in a payroll tangle further down the road.

Learning to run the payroll

The American Payroll Association runs courses on payroll, and offers virtual study options as well as having training suites in most major cities. The study can lead to Certified Payroll Professional (CPP) and Fundamental Payroll Certification (FPC) qualifications. It could be a good option if you wish to master the art of payroll for yourself or have a member of staff that is suitable for the role.

A less formal option might be to enlist the help of friends, family or anyone else who understands payroll and could help you with keeping records and doing tax returns to the required standard. It could be a good option if you only have one or two members of staff and limited resources. It cannot be stressed enough, however, that whoever you ask for help must be an expert, not just a buddy from the office next door who says he knows all about payroll! Make sure your adviser is qualified and can prove their expertise. Payroll is far too important to get right to trust it to just anyone.

Not learning to run the payroll

You may not want to spend your precious work time doing payroll, let alone learning about how to do it properly. If you don’t have the time or inclination to do it yourself, one option is to outsource. Outsourcing has become a popular choice for many discrete business functions and is a good way of getting aspects of your business taken care of professionally when you don’t have the skills or availability to do it yourself. If your business needs you to bring in sales leads and meet with clients in order to generate business, then that is what you need to devote yourself to. The business is likely to make more profits with you acting in your strongest role rather than spending time doing payroll, which could be accomplished more cost-effectively with outsourcing. Choose your outsourcing company carefully to ensure you get the highest standards of service. This option sounds expensive, but it needn’t be. It is perfectly possible to find a Cheap Payroll Service that will do a good job for you, so don’t assume it will be too costly.

Payroll matters

The thought of tackling payroll may make you groan, or induce a headache as you contemplate the lists of tax percentages, welfare contributions and complicated calculations. The key message here is that payroll is vitally important, and it won’t go away. However much you might dislike it, it has to be done. Spend some time assessing which solution is most suitable for you, your staff and your company. Decide the method you want to use to tackle your payroll, put a plan into action, and then quit worrying about it.