For many of us, both businesses and individuals, January is all about the tightening of belts, but that needn’t be a depressing thought. Sometimes you have to spend a little to save a lot more. Here’s how to do a financial review with a positive approach.
There’s no sugar-coating it; things are tough out there for SMEs at the moment. But one thing all owners of start-ups and small businesses tend to have is plenty of optimism and a growth mindset - it’s in our blood.
Harnessing that positive approach is never more useful than when you’re looking at cost-saving. It feels rather negative to focus on what you must ‘lose’. Try reframing the problem by looking at creating more value for your business with products and services you already have or could add. It’s about investing in the business; bringing more money IN to reduce what goes OUT, instead of simply cutting back. A little creativity, agility and efficiency can make a surprising difference to your bottom line. Here are a few things to consider before it’s ‘beans on toast’ time for your business.
Check for hidden value in your outgoings
Regular audits of your outgoings are a must, but before you get shot of a service or product, check you’re not missing the hidden value that’s there. It may be, for example, that getting rid of your free fruit for employees looks like an easy saving to make. But if that’s something that keeps your employees happy and makes them feel valued, the money it costs the business might be well worth it in terms of productivity.
The best way to find out what matters most to your employees is simply to ask. Survey Monkey is an excellent, low-cost tool for canvassing the opinions of everyone in your company. Offer an incentive for people to fill it in to encourage responses, and while you’re asking them what makes them happy, maybe also ask them if they can think of any fat that can be easily trimmed from the company’s day-to-day running without affecting your service. They’ll often come up with ideas you haven’t thought of yourself as they have a different perspective on the business.
Consider problems that aren’t costing you money… yet
Reducing recruitment and retention is one area where you can make huge savings, but it’s a cost that many SMEs don’t consider until the problem arises. Recruitment is a huge cost for any business and when it goes wrong, the costs can spiral further.
First, look at what you can do to help keep your current employees. This is where that survey will come in handy. Do your employees actually want the benefits you are currently offering? Or would they prefer to lose some benefits in favour of hard cash in their salaries? Perhaps what they really want is a bit of flexibility and the ability to buy and sell benefits and annual leave? The cost of adding what your employees really want to their package is probably much lower than the cost of recruiting for someone to replace them.
If you do find you need to recruit, consider whether you can implement a ‘refer a friend’ scheme, offering your current employees a reward for introducing a new recruit to the company, therefore saving you the cost of recruitment advertisement.
To make sure you get the right recruit first time, it’s also worth investing in screening tools to ensure you’re not only choosing the best candidate, but also someone who will fit in with your company culture and existing employees. Try DISC profiles and Myers-Briggs analysis tools to help with that.
Get more value from your current customers…
The old adage about it 'being more profitable to keep an existing customer than to find a new one' has never been more true. Growing sales from existing customers makes good financial sense, and the way to do that is to get to know them better. Investing in some CRM (customer relationship management) software is a great start but try to view CRM as a mindset rather than ‘just’ a piece of software, too. Keep in touch with your clients, find opportunities to meet in person, listen to them, find out what their problems are… and then work out how you can be the solution.
Put your company at the front of their mind with regular communications such as newsletters and social media content that show them you are the experts and remind them what you can do for them. It’s worth spending a little bit of money on some new tools like Beautiful AI to make your presentations pop and grab your customers’ attention. Similarly, tools that help you manage and measure your campaigns will help you get more from them - Act-On is a great little tool for doing just that.
And make your new client wins work harder for you, too
Remember that the hard work doesn’t end when you win a pitch - that’s when it should really begin. Make sure all your business processes are delivering efficiently so that you look just as slick after the sale as you did before. Technologies can help with smoothing out any bumps in the road before you reach them. At Amack we love Trakti, an online contract management tool that eliminates paper entirely and smoothly guides your customer through the onboarding process. It’s not too pricey and worth every penny.
Dedicate a bit of time to regular check-ins with your new clients during the first year to make sure you’re offering them everything you can, and finding all the opportunities to upsell your current service.