4 of the biggest business costs (and how to reduce them)

Running a business is not cheap, and sometimes it can be difficult to balance the books. That is especially true for smaller businesses and startups, which often operate on thin margins. Here is a rundown of the highest costs that you are likely to encounter and how to reduce them.

#1 Rent

Rent is a long-term drain that many businesses feel powerless to reduce. Paying for offices and even storage facilities all add up and rent always seems to be on the rise. Lowering or even avoiding rent altogether is not as difficult as you might imagine, though. The pandemic showed that home working is a viable alternative to the office lifestyle and can even be better for employee mental health. The more staff you have at home, the smaller the office you require, cutting down on rent. Some ambitious businesses have even gone entirely remote. The future of the office remains uncertain, but most businesses will likely pursue some kind of hybrid model.

#2 Energy and water bills

After rent, these are some of the biggest recurring payments, and they can feel difficult to avoid. It has always been possible for businesses to compare their energy prices between suppliers and switch where necessary, but water is slightly more complex. Switching your business water supply is a fairly new development and a product of deregulation within the water industry. Using a service like Business Water Quotes will show you a set of quotes from different water companies. From there, you can compare prices, switching to a new provider where necessary. Your initial switch will make a dramatic saving but repeat the process every year to compound the effect.

#3 Equipment

This is particularly true if your business is new. You will need to stock an office space with the basics like desks, chairs, and computers, but some businesses will need more specialized equipment. These are not one-off payments either, as hardware will need to be replaced over time. To get these costs down, consider buying second-hand. You will often be able to find the same equipment, in nearly new quality, for a considerably lower price. Similarly, try to find equipment that performs several roles at once. Rather than buying a printer and scanner, for example, it is much cheaper to buy a device that can do both.

#4 Crime

It might not be the first thing that springs to mind, but crimes against businesses are more common than you think and can be costly. Break-ins and theft are big areas of concern. Taking the appropriate security measures like installing surveillance cameras and keypad locked doors goes some way to offset the risk. That is not the only crime you have to worry about, though. Cyber-attacks in the form of hacks, viruses, and malware can cost companies thousands (if not millions). Cybersecurity is not an area to cut back on. Ensure that your firewalls are up to date and that you are running all the latest security software.