Cost cutting in small business is particularly relevant given the current economic environment. This blog covers a number of different ideas to help you maintain a professional looking business without the price tag.
Years ago, I believed you had to have significant financial backing to start and run a professional looking company. This could not be further from the truth.
Yes, there are some companies which require significant capital outlay to cover inventory or licensing costs however the initial setup can be very cost effective.
If you have an existing small business, you may wish to implement some of the fixed cost cutting measures below whilst maintaining or improving your company's public image.
One of the first places to start is with good corporate structure to protect yourself and your family in case unforeseen circumstances (like COVID-19) adversely affects your business.
An example would be:
For the purposes of this article we will focus on setting up a trading entity.
eCompanies and Easycompanies are both cost effective solutions for setting up a new company.
The process is quick and easy, and includes ASIC registration fee, registration of ABN and TFN with the ATO, along with PAYG and GST registration (if required) for around $580.
Although you can set up a family trust with a corporate trustee through both eCompanies and Easycompanies, this is probably a task best left to your accountant or other professional adviser.
Xero – Xero is an online accounting software which helps you to keep an up-to-date view of your cash flow. It will also help you save hours on administration. Plans start from USD $11 per month (approximately $15).
Zoho CRM – Choosing the right customer relationship management software is key to efficiency in a small business. This CRM is completely customizable and will grow with your business. Zoho CRM provides seamless integration with the applications you will likely use at some point including Office 365, Mailchimp, Zoom, Linkedin, Paypal, Xero and more. The best part is, Zoho CRM is free for up to 3 users.
Mailchimp (email direct marketing) - With Mailchimp, you can promote your business across email, social, landing pages, shoppable landing pages, postcards, and more — all from a single platform. Mailchimp is free for up to 2000 contacts.
The goal here is to create a professional looking company that people will feel comfortable doing business with. For me, it’s about ensuring the company appears larger than it is, with more resources than it has.
When I visit a company website, there are generally several telltale signs that I am dealing with a small company, or a company with limited resources:
These are very simple and cost-effective issues to fix as I will explain later in this article.
Body: There are resources online where you can simply download free logos or design your own. To ensure a professional image and consistency throughout your website and all other documentation, it’s a great idea to take advantage of outsourcing sites like Fiverr or Upwork, where you can have professional designers located overseas work on creating branding including logos, letterheads and business cards.
In the past I have tried many cheap website hosts. The result has been the age-old saying, you get what you pay for. This was until I came across Panthur.
Panthur are Australian based (and so are their web servers – this is important when Australians are trying to browse your website!). When you call their support number, they are able to provide you with more comprehensive support than “have you tried closing your web browser and re-opening it?” or “Have you tried restarting your computer?”. Panthur also provides free basic SSL certificates to secure your website.
Their plans start at $6.00 per month with the ability to scale as your business grows. All plans will provide you with your own CPANEL (Server) installation, which you can use for hosting one or more websites and hosting your business email accounts.
You will need to purchase a domain name for your website. This can be done through Panthur with a domain name ending in .com.au generally costing $12.00 per year.
A cluttered or poorly laid out website has the same effect to visitors as a cluttered or poorly laid out house. I don’t suppose you watch selling houses Australia? If you do, you’ll get my drift.
Website navigation should be a seamless journey from one page to the next with the ability for people to skip sections using navigation tabs such as “Home, About, Services/products, FAQ, Contact Us” etc. Plan out the pages you want. If you are unsure, take a look at websites from a similar industry to get an idea of what may work.
The next step is to create content for those pages. Again, you may wish to use websites from a similar industry as a guide to the kind of content that may work on your website. You can then get to work writing your content in Microsoft Word or similar.
If you are not very good at creative writing, it may be an idea to look for content on other websites which contain what you are trying to say, and then hire a professional copywriter from outsourcing sites such as Fiverr or Upwork, to rewrite or collate the content in a way which is unique to your website.
Collecting quality images for your website is easy using the likes of iStock or Shutterstock. These image providers generally have introductory offers where your first 10 images are free, or something to that effect. 10 images will usually be enough for a basic website.
Once you have your content and images, you can usually get a website built through Fiverr or Upwork for around $175.
If you would like your website to contain dynamic content such as articles and are not confident with updating the website yourself, it may be an idea to create social media pages for your company through the likes of Facebook, Linkedin and Twitter, and have your developer link these to your website. That way when you update content on company social media accounts it appears on your website.
The lawyers reading this article will probably cringe about now, but the title of this article is “Cutting fixed costs, setting up a company on a shoestring budget”, so with that said I will forge ahead. Legalvision provides templates for website Terms & Conditions and Privacy Policies.
The advice I have received in the past is “it’s better than nothing at all, but make sure these are among the first documents to be reviewed when you have a budget for legal advice”. That’s a fair call.
Let’s face it, there’s nothing that spells out small or micro business more than a mobile number as the main number on a website. Thankfully, there are cheap, easy solutions to this. Cloud PBX providers like Sipcity or Clouded Communications provide cost effective, full featured voice over ip (VOIP) phone systems allowing you to choose one or more phone numbers located anywhere in Australia. You can even choose a 1300 number if you prefer. Plans start at as little as $9 per month with no lock in contract.
Most cloud PBX systems have all the functionality of a full-fledged office phone system, but you can use your mobile or computer as your office phone. Alternatively, you may wish to purchase cheap, secondhand VOIP desk phones through the likes of eBay. An example would be the Polycom VVX500 which can be had for around $80.
Cloud PBX systems feature virtual assistant functionality and the ability to add hold music.
You can have professional virtual assistant greetings recorded for around $25 through Fiverr or Upwork.
There are plenty of virtual fax services out there too. Some examples that spring to mind are Faxmate and Gofax. Plans start at $5 per month with no lock in contract.
Let’s face it, office space is a large fixed cost for a small business. To minimize overheads the majority of small businesses are run from home in the first instance, however this does not mean you need to miss out on having a professional location to display on your website, business cards and other documentation.
There are a stack of virtual offices which offer a business address along with mail forwarding for less than $30 per month, and probably less again due to COVID-19. You can usually hire meeting rooms or boardrooms at these locations to use as and when needed.
There are a bunch of industry-specific content writers, like Financial Writers Australia or Article Writers Australia. These providers have a library of up to date content you can brand and send to your clients.
The usual process is, download content in Microsoft Word format, add to your company letterhead (edit if needed) and send out through Mailchimp or similar…Easy..
These services are usually around the $130 to $150 per month mark.
Print providers are everywhere. You probably have one down the road from you. I have found Vistaprint to be pretty cost effective with business cards starting at $17.99 for 250. Vistaprint products are delivered to your door.
Body: So, it is possible to cut fixed costs in a small company or set up a professional looking company on a shoestring budget after all. And the best part; no lock in contracts, no personal guarantees.
A quick cost total is listed below:
Initial Setup Costs
Ongoing Monthly Costs
Note: Pricing is updated as of May 2021 and may change without notice.
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