1. Make sure your marketing is data driven
It’s a common reaction to tighten your marketing budget during times of uncertainty, as many consider this to be a non-essential cost. However, “it’s important not to halt your marketing activity entirely, otherwise, you risk losing leads and new business opportunities.” Huw advises. Instead, Informi recommends prioritising data driven marketing tactics by having a clear idea of the ROI you expect per channel, and monitoring results regularly through tools such as Google Analytics. “By monitoring results, it means a small business owner can continue to invest in the right areas, or respond quickly to areas of marketing which take a dip.” says Huw.
2. Think hard about your office space needs
“If your business can provide its services successfully via a working-from-home model, then remote working is worth strong consideration, as a huge proportion of your revenue can be saved this way.” Huw advises business owners that if you’re an advocate for the benefits of an office environment, there are more flexible options available without having to commit to a lease or rented space, such as shared office spaces or hot desks.
3. Review third-party contracts
As the cost of living soars, day-to-day tasks which are often outsourced to third-party specialists can commonly be considered as ‘unnecessary’ and cut accordingly. But, Huw advises that “while this is a quick way to minimise costs, you should consider the impact they could have on your business in the long run, such as your sales pipeline.”
“Small businesses should consider conducting a spend analysis to help avoid making knee-jerk decisions based on intuition” he continues. A spend analysis can help businesses focus budgets elsewhere instead of on expenses which are having the biggest impact on the bottom line.
4. Better optimise your team
The cost of living crisis, increase in National Insurance rates, and the minimum wage rising, could all mean that it is no longer feasible to maintain your current staff levels. Informi recommends taking time to assess your current staffing structure, including where responsibilities lie, and see whether existing roles could be better optimised to meet the needs of a business. It’s also worth considering whether a reduction in hours is possible.
“Tread carefully,” says Huw, as “from a legal perspective – any changes to an employee’s contract must be agreed with them beforehand. Always get legal advice before reviewing decisions relating to staff.”
In summary, “belt-tightening is of course necessary during challenging and uncertain times”, but Huw also reiterates that “as well as being frugal, it’s important to invest in the right areas to give your business the best chance of withstanding any future financial threats.”
“Small businesses can visit their local authority websites to understand more about monetary support that may be available, and utilise advice services such as Informi.”