During the COVID-19 pandemic, small businesses found ways to trim costs and operate as frugally as possible in order to stay afloat. While the pandemic is now over, many of these tactics are still relevant and useful. Here are five post-COVID-19 cost-saving strategies to help you save money and stay cash flow positive.
1. Reduce or Eliminate Office Space
Office space can add a significant overhead. If you noticed no significant downsides to working from home during the COVID-19 pandemic, consider making remote or hybrid work your new normal. Even large businesses, like Slack and Facebook, made remote work a permanent arrangement for all or some employees. Virtual communication and collaboration tools like Zoom, Slack, and Google Docs have helped many businesses make the switch to remote working.
If you feel you need that physical office space, consider downsizing to save on rent and operate a flexible home working policy that makes a smaller space viable. Coworking spaces can give you the best of both worlds—a full- or part-time office space without committing to a long lease.
2. Cancel Non-Essential Monthly Subscriptions and Services
How many of us subscribe to a TV service we rarely watch? “Subscription creep” is the accumulation of unused subscriptions, memberships, and licenses that are forgotten about and which can seriously impact both individual and company budgets.
Take a look back through your last couple of months of expenses. You may be surprised at how many subscriptions you have forgotten about or don’t need. While the monthly charges might be small, they can add up to hundreds of dollars a year. Take inventory of all the software, tools, and other services you pay for each month, and be ruthless about stripping them back.
Consider paring back services you need, and reducing the frequency of others. You can often find free or lower-cost alternatives to many tools and services, so shopping around is time well spent.
3. Cut Down on Business Travel
There are still advantages to cutting down on business travel even after the COVID-19. Save money by seeking out online or local networking and professional development opportunities.
The pandemic saw a huge rise in online learning, with platforms such as LinkedIn Learning and free Massive Open Online Courses (MOOCs). These resources can help you update your skills and encourage employees to look after their professional development, at a fraction of the cost of in-person courses and conferences.
You may also be able to lessen the number of in-person meetings you need to travel to. Even reducing local travel can save on gas, parking, and more. Plus, virtual meetings have become a common practice, so you’re unlikely to encounter much resistance if you suggest a video call.
4. Negotiate Better Deals
Review your supply chain and look for places to reduce costs. For example, consider buying supplies in bulk if you have the storage space. You may also be able to negotiate better prices or payment terms with your suppliers, distributors, wholesalers, manufacturers, and so on. Some vendors offer discounts for early payment as it helps their cash flow. So, if you can afford to pay suppliers quickly, it’s worth exploring.
Also, review your dealings with insurers, banks, and other financial institutions. You may be able to negotiate a better insurance rate, switch to a bank account with lower fees (or to a different financial institution entirely), or take out a line of credit to reduce your reliance on credit cards with high interest rates.
5. Streamline Your Marketing
Marketing is essential to the success of most businesses, but it doesn’t have to come in the form of glossy print brochures and expensive radio ads. The key to making every marketing dollar count is to consistently review what works and what doesn’t, and focus on what generates the best return on your marketing investment.
For example, instead of printed marketing collateral, focus on more cost-effective marketing strategies such as targeted pay-per-click online advertising. Build an email list so you can stay in touch with customers and prospects, and become part of the conversation on social media in your location and industry. Learn how to streamline your marketing from our article, How to Write a Marketing Plan.
Don’t forget that your time is money. Spend your time on things that can make a real difference to your bottom line, such as focusing on high-value customers. And, make sure you are taking advantage of all available government programs and other funding available to you.
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