3 Ways SMEs Can Save on Operation Costs
Any entrepreneur can agree that starting a business is never as difficult as the struggle to keep the company afloat in the crucial first years. Part and parcel of running a cost-efficient business is making good financial decisions to maximise value and minimise cost. It can be a tricky line to tread, so here are some tips to take into consideration:
Explore co-working spaces
Gone are the days when an office meant a sterile formation of cubicles or four walls and a door. Over the years, much attention has been paid to disruptive tech companies and their stunning office spaces. These days, it seems a conducive work environment is key to attracting and retaining talents. But before you begin splurging on the ideal office unit, or state-of-the-art office furniture, consider how much rent and renovation costs can pile up, eventually eating into your capital or potential revenue.
Co-working spaces are an affordable alternative to costly office spaces, and options are aplenty in Singapore alone. Many of these co-working spaces are fully furnished and carefully decked out to achieve a comfortable office environment where anyone would feel right at home in. These workspaces offer a range of payment options, from day passes to monthly membership fees as low as $150 a month. What’s more, fees tend to be inclusive of basic utilities, Internet and access to office equipment.
Trim staff costs with outsourcing
Every business will require the help of lawyers to thumb through paperwork, accountants to keep finances in check, or administrative staff to ensure operations run smoothly. While these roles are essential, there is no need for small businesses to have in place dedicated departments to oversee every aspect of a company.
Outsourcing some of your business processes will help replace fixed costs with variable costs. It has been reported that the benefits of this are evident: small companies who engage the help of freelancers or third-party vendors have experienced greater cost savings, been able to hire talented and affordable staff, enabling them to gain an edge over their competitors.
Invest in the right technology
Businesses need to have processes in place in order for them to run smoothly. Small business owners may not have access to a pool of resources large enough to meet with high demand, resulting in bottlenecks that will affect the quality and reputation of a company.
Automating business operations not only improves efficiency but could also help cut costs in the long run. By speeding up or thoroughly accomplishing mundane and time-consuming tasks, online workflow tools such as cloud computing, teleconferencing or project management apps, have streamlined the everyday office environment. A survey conducted by cloud computing company, Rackspace Hosting, found that 88% of cloud users were able to reduce IT operating costs, while 56% revealed that cloud computing allowed them to boost profits.
Keeping a business afloat requires real stamina, smarts, and keen judgement. Being selective about how you spend your money, such as opting for a co-sharing space, cutting back on certain staff, and investing in the right technology are some ways to ensure your business runs efficiently, while still being cost-effective.
Follow Canon Singapore on LinkedIn for more business-related solutions and insights.