For small business owners and start-ups, it’s important to carefully manage costs.
According to the annual SME Confidence Tracker survey opens in new window, 39% of smaller firms highlighted cash flow as a concern.
With the rising cost of living and the pandemic’s effects still impacting some companies, keeping a lid on costs can make financial sense.
Starting your own business in a competitive market can be costly.
Inflationary pressures may increase the price of equipment, inventory, and services beyond your start-up business plan.
Cost of living pressures can push up wages and finding and recruiting staff can be more costly.
Customers may reduce spending, lowering your revenue.
However, by examining your business activities, you may be able to reduce operating costs through technologies and digital services.
Discover the personal aspects of starting a new business with our free Entrepreneurial behaviour course opens in new window
As part of our Learn with Start Up Loans opens in new window partnership with The Open University, our online course is free to join, delivered by experts and includes a free statement of participation on completion.
How technology can help start-ups
Digital technologies can help new businesses access tools, services, and capabilities that previously were the preserve of larger organisations.
Adopting technologies, such as cloud-based software and services can help you save money that can be invested elsewhere in your start-up.
They can also help your business compete more effectively.
For example, automating processes such as invoicing and reports may help save you money and time, reducing the need for external accountancy firms.
Moving documents onto digital platforms, such as cloud-based storage and collaboration services, can also help save costs.
Removing the need for paper, stationery and printing can reduce the estimated 11% of annual revenue spent on paper-based tasks opens in new window by UK businesses.
A study by Hitachi Capital Business Finance shows that 76% of UK small businesses opens in new window have used technology to improve their business operations and efficiency.
These improvements include increased employee flexibility, reduced commute times, boosted productivity, and storing data and information more securely – 27% reported decreasing overhead costs, too.
Here are some cost-saving technologies to help your start-up save money.
Moving your businesses’ data, information and documents to the cloud can be straightforward and may save you money.
Cloud computing services typically include online storage of files and documents, online software such as webmail and office software such as spreadsheets, and industry-specialist tools such as customer marketing services and email newsletter tools.
Cloud-based services from companies such as Google, Apple, Dropbox, Evernote, and Microsoft typically offer access to their cloud services for a small monthly or yearly subscription.
The fees can be cheaper than purchasing software outright.
Cloud computing and collaboration services also allow your team to access, share, and collaborate on documents and files from anywhere with an internet connection, which can help your start-up work more effectively.
Digital marketing tools
Having an online presence to sell product and services is essential for most businesses today and there are lots of tools that help you build a website, use social media, and other digital marketing services.
These offer lifetime deals for new business tools that are often a fraction of the retail price.
Save money on phone calls by using VoIP – Voice over Internet Protocol opens in new window.
This technology uses the internet rather than phone lines to transfer and make calls.
Traditional phone calls are priced based on distance and length of the call, whereas VoIP utilises your broadband connection, costing you less – in many cases, VoIP calls are free.
VoIP is especially good for off-site and homeworkers, reducing telephone costs, and may work with a smartphone and VoIP app.
It’s also a great way to make international calls.
Automated technology streamlines processes and reduces the need for human input by automating simple but repetitive tasks.
Automated technology can help improve the efficiency and productivity of your business, as well as save money.
It may involve paid-for software or services that charge a monthly fee but can save money and time on dedicated employees.
For start-ups, it can mean that activities are completed without you having to remember them.
Examples include sending automatic emails when customers sign up to your website, using automated chatbots to handle basic customer questions, providing reports on sales and marketing activities, and transcribing audio from video conferencing meetings.
In the aftermath of the Covid pandemic, many employees are still working from home or trying to save on fuel costs opens in new window by minimising commuting.
Video conferencing is an efficient and cheaper alternative for remote workers in attending meetings online rather than in person, provided they have a stable internet connection.
Examples of free video conferencing platforms include Skype, Zoom, Microsoft Teams, and Google Meet.
Although some platforms may charge a fee or subscription for more advanced uses, such as a larger number of attendees or recording capabilities.
Smart meters and smart plugs
Money-saving technologies aren’t limited to software or cloud services.
Consider installing a smart meter, for example, to help you track your energy usage and monitor costs.
Many UK energy suppliers will install a smart meter in your workplace, which can help assess how much energy your business uses – and where you can save.
Consider also using smart plugs in your business.
These allow you to remotely turn off electricity to equipment, set timers for switching off, and generally gain greater control over appliances.
Thinking of starting a business? Check out our free online courses in partnership with The Open University on sustainability in the workplace.
Our free Learn with Start Up Loans courses opens in new window include:
- Effective communication in the workplace opens in new window
- Succeed in the workplace opens in new window
- Leadership and followership opens in new window
Plus free courses on climate and sustainability, teamwork, entrepreneurship, mental health and wellbeing.
Reference to any organisation, business and event on this page does not constitute an endorsement or recommendation from the British Business Bank or the UK Government. Whilst we make reasonable efforts to keep the information on this page up to date, we do not guarantee or warrant (implied or otherwise) that it is current, accurate or complete. The information is intended for general information purposes only and does not take into account your personal situation, nor does it constitute legal, financial, tax or other professional advice. You should always consider whether the information is applicable to your particular circumstances and, where appropriate, seek professional or specialist advice or support.