Cost management tips for SMEs (1)

how to save business cost
photo credit: www.youthvillage.co.za

– Have a cash management system that works; SMEs trade with limited funds.it is therefore vital that cash turnover is gauged based on cash available within the business,frequency of trade,profit margins and monthly costs within the business. SMEs are advised to avoid credit sales and in cases where credit sales can not be avoided ,ensure payments are made within the shortest possible time. Delayed payments disrupt cashflow in SMEs so that the business is not liquid,this in turn hampers growth potentially causing the SME to go out of business .

– Collect data within the business and evaluate regularly,collecting data within a business allows you know the health of the business and provides basis for evaluation of the business over periods of time. This lets you detect problems with a business early.

-Register your company with popular online directories,this allows you boycott part of the cost required for online advertising,giving your company more online visibility than you can actually pay for.

-Analyse your costs to detect inefficiencies in your company,one of the things this will let you know  is what to bulk buy and what to purchase per time,this can also enable you identify what to outsource and what to cut costs on

-Choose cheaper phone options such as skype, whatapp, cheaper data and call rates….e.t.c

– Employ interns as well as smart inexperienced people, these set of individuals are usually eager to learn  and cost you less. Except you are on the look out for a specialized skill ,it is cost efficient to opt this group

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