Running a business means you’ll spend money. It’s also a learning experience in how to budget, reduce expenses, and keep debt from piling up. In the same regard, you likely already understand the importance of hiring an HR pro for the betterment of your business’s finances – this reduces turnover and ensures you hire the best people for the job, all of which impacts your bottom line.
Keep reading for financially face-saving tips from DMHR Consulting.
Preventative Measures
Getting your business out of debt is much harder than keeping it that way from the beginning. If you’re just starting now, a few things that you can do now to get your financial bearings include:
- Register as an LLC. When you register as an LLC in Arizona, you’ll enjoy a few tax benefits. Further, you have the option of opening a credit card or other credit line in your business’s name instead of your own. This can help your business gain a great credit rating, which you can leverage for capital later if you need it. There are many formation services that have all the information you need to form your business entity without having to do extensive research.
- Negotiate well from the beginning. Negotiation is the art of getting and giving. If your business routinely buys products and services from others, negotiate early to get the best price. Gatekeeper vendor software explains that something simple, such as promising expedient payments, may get you a lower price.
- Outsource tasks that don’t require a full-time staff. Hiring full-time staff is expensive. Not only do you have their salary, but you also have to pay extra in taxes, benefits, and overhead. Look for services, such as HR management, that can help you do things on a part-time basis. Budgeting, deposit preparation, and bill pay are all examples of tasks that you can outsource. Another idea would be to route your calls to a call center that can take messages and provide basic information instead of hiring a full-time receptionist.
- Cut overhead by conducting business from a smaller space. Renting office space or another facility can be an expensive proposition. Consider either sharing the space or operating from a smaller footprint. Moving from a larger home and renting a property with less square footage is an option that can save you big in the long run. Not only will you avoid having to pay the usual homeowner expenses like property taxes and regular maintenance, other items like monthly utilities will usually be less. You have plenty of available houses for rent in the Phoenix area – more than 4,200 to be exact.
Ongoing Actions
Once you have a basic foundation of responsible financial actions, you can build your empire with as little investment as possible. Do this by:
- Cutting extraneous expenses. If you have a full staff, you might be tempted to pamper them with little extras that you think matter. Ultimately, however, if it comes down to Free Lunch Friday or allowing every member of your team to keep their job, choose to keep your employees.
- Go green. Going green not only saves the environment but also reduces your expenses. Allowing your employees to telecommute so that you can cut your brick-and-mortar expenses is one idea, but you might also consider eliminating paper from your processes. Device Magic explains that businesses can spend up to 3% of their annual revenue on printing, filing, storage, and blank paper. Even more importantly, getting rid of paper increases your business’s security risks, which brings us to…
- Maintain security measures. Papers can be lost and stolen, and you may believe that your files are fully safe on the cloud. Fortunately, they are safer than when printed, but uploading your documents to the internet is not without risks. Do spend money on cyber security. If you need a compelling reason why consider that it can cost your business up to $3.86 million to recover from a data breach according to CSO.
- Keep an eye on your money. It’s easy to get going running your business and not pay that close attention to your incoming and outgoing funds until there’s a problem. Keep your eyes and ears open, and make adjustments to your operating procedure that either increase your revenue or lessen your debt load. If you need to do the former, try bundling inexpensive products with your top sellers to encourage more sales. For the latter, consider consolidating high-interest credit cards into lower-interest loans.
Your money matters when it comes to your business. Maintain a strong financial standing with the tips above, and you won’t have to worry if you have the money to pay your employees or vendors or if you have the capital to expand when growth comes to call.
DMHR Consulting provides guidance as a small business HR Consultant along with the assistance, as well as any clarification needed while you as the client worry about growing your business overall. Reach out today for more info! 480-725-9772
Guest Contributor:
Marissa Perez-Business Pop