It is important to learn how to keep your costs to a minimum… Read on to find out about 9 money saving tips for small businesses in Singapore!
The pro-business environment in Singapore makes it promising ground for budding entrepreneurs to incorporate a business. However, many business owners face challenges in sustaining their business in the long run. Typically, the first hurdle that small businesses and startups have to cross is a financial one. To build a profitable business, you either increase sales or you reduce expenses. How do you cut costs as a small business and startup, and yet make enough money to get by?
If you find yourself struggling to succeed in a tough economy, don’t worry. With our compiled list of 9 money saving tips for small businesses in Singapore, you can undoubtedly save some dollars for your next big venture.
1. Plan Ahead
Effective budgeting is one of the key money saving tips for small businesses and startups out there.
A guaranteed way to save money is to not spend it (unwisely) in the first place. Firstly, try to reduce overhead expenses as much as you can and spend your money on essentials only. It is easy to splurge but that is a big no-no. You should know how much capital you need before committing to a costly project that is difficult to sustain.
For example, in Singapore, a sole proprietor or partner may use his/her residential address as the registered company address. This means that you can work from home. It also means that there is no need to rent office space in the early stages of your business. In short, good planning definitely ensures that your business can run as smoothly and as long as possible.
2. Test the Market’s Waters
Before embarking on your business venture, a pro-tip is to survey the market prior to taking concrete action. This way, you can find out whether there is a demand for your business in the first place.
Think about the type of business you have. For example, you want to provide cooking lessons, photography sessions, dance classes or tuition. However, how can you be certain that the number of sign-ups is sufficient to cover the entire rental of the space over the contractual period? As such, you should test the waters by renting the space for just a month or so. This method helps you to explore the appetite and desire of consumers for the particular service you have in mind.
A great option would be to use GoSpaces, which allows you to rent spaces such as classrooms, studios and other unused and available rooms on an hourly basis. This is great for startups trying to save money and test out a business idea.
Developing a proof of concept can help a small business owner or startup founder determine whether the idea is feasible or not. You can weigh the risks and benefits of your business. You can also reduce the chances of you incurring unwanted costs for a wasted endeavour. Do note that these pointers are especially useful money saving tips for small businesses that focus on providing services to consumers!
3. Buy Used Equipment and Furniture
Second-hand equipment and furniture may be old but they are still gold! Save extra costs with these money saving tips for small businesses in Singapore!
Instead of buying brand new desks and tools, why not look for second-hand options? They not only cost a lot less but usually, also have a similar quality as their new counterparts. Oftentimes, great deals are available at second-hand stores or online websites like Carousell for used goods that are still in good working condition. On the other hand, you can check out local auctions or wholesale events for cheaper alternatives.
Rather than spending money unnecessarily, you are strongly advised to put your funds to good use. Perhaps you can use the money for business development or to get more clients? Recall this tip before your next purchase and kill two birds with one stone by reusing second-hand goods and saving the environment at the same time!
4. Work Remotely or From Home
Gone are the days when working remotely or from home was just a dream~
In recent times, the working environment has shifted and many business owners today recognise the benefits of remote work. Sitting at a desk does not make you or your employees more competent. In reality, studies have shown that working remotely leads to a more balanced work-life. What this means is that you have more productive and efficient employees.
With the advancement in technology, there is the advent of online office tools out there. Many businesses have started to go “smart” and use software to facilitate daily business operations. Most collaborative work and business correspondence can also be done online. Consequently, there is less of a need to meet in person to get work done.
Allowing your employees to work remotely means that you can extend your reach for talents and recruit beyond local geographies. Furthermore, it means that you might not need office space, to begin with. As such, with a virtual team, business owners can save money on large expenses like utility bills or rent.
5. Hire Good Employees with Less Working Experience
Good employees are not hard to find!
Fresh entrepreneurs are often advised to hire employees who are capable and hard-working. Sure, experienced employees are the strength of a company. However, this does not mean that less experienced employees are necessarily less competent or adequate. Furthermore, employees with less working experience generally look for entry-level salaries. This translates into you saving some money from your hiring budget.
In addition, interns or trainees are also great money saving tips for small businesses in Singapore. Even though they may lack the requisite expertise, they are nevertheless helpful in their own right, especially during peak or busy periods. They can support many business functions like administrative work, document checking and data processing.
6. Use Government Grants to the Fullest
Here are more incredible money saving tips for small businesses and startups! Check out the Government grants for start-ups and small and medium-sized enterprises (SMEs) in Singapore.
Start-ups and SMEs are seen as the powerhouses of Singapore. This is why the Government tries to support the growth and sustainability of these entities as much as they can. Leveraging on these schemes helps to keep your costs at a minimum! A few local favourites include:
- ACE Startups by SPRING Singapore
- Productivity and Innovation Credit by the Inland Revenue Authority of Singapore
- Financial Sector Technology and Innovation Scheme by the Monetary Authority of Singapore
- ComCare Enterprise Fund by the Ministry of Social and Family Development
- Technology Enterprise Commercialisation Scheme
- Early-Stage Venture Funding
With so many grants out there, you are sure to find something that suits the needs of your business.
7. Rent a Co-Working Space
As a start-up, you probably don’t need a whole lot of space for your business. Renting an office space is one of the cost-effective money saving tips for small businesses in Singapore!
Have you ever rented a big space and left some of it unused? Well, why not rent co-working spaces for your small business or startup for starters? The truth is, co-working spaces are a great way for you to eliminate the high overhead.
Renting an entire office demands capital that many budding entrepreneurs and business owners lack. Besides, this is a growing trend in Singapore. Do a quick search and you can find many gorgeous and conveniently-located options. To begin, check out the following places:
- The Great Room
- Wotso Singapore
- Just Co
- The Hive NBR
These are some of the many cool shared office spaces in Singapore that provide a conducive environment for great ideas to blossom!
8. Outsource Certain Tasks to Save Time and Energy
Distributing your workload is also one of the smart money saving tips for small businesses. It helps to reduce the effort you need to spend on daunting tasks by leaving it to the experts. Who wouldn’t like that?
Imagine this: you want to create a website or an application for your business. The catch is, you are not tech-savvy at all. What do you do? Instead of spending weeks trying to figure out how to put together a decent-looking website, why not outsource the task? There are countless freelance website developers out there who can get the job done easily within a couple of days! Firstly, you save yourself the time that could have been better used elsewhere. Secondly, you are more likely to receive a better end product!
As there are so many freelancers out there, the quotations are likely to reflect competitive prices. Hence, don’t worry about the high costs of outsourcing. It will surely not cost a bomb in this day and age. In fact, a Government-led survey revealed that there are around 223,500 residents who are self-employed in 2018. Simply go on any freelancing website and you can choose your preferred candidate to complete any task you desire. With the freed time, you can put your mind to other tasks that require your attention more.
9. Review Your Spending
From time to time, it is important to look back and reflect on how your company has fared.
Monitoring your finances is essential in ensuring that your expenditure has been generating an optimal return for your business! You can reduce energy costs by employing simple techniques. For example, purchase a smart temperature control or install new energy-efficient light bulbs to generate savings in utility bills.
Apart from that, you can also employ finance software to track where your marketing budget is being invested. After reviewing your marketing spend, you know which area to target and reduce. To get more bang for your buck, you may encourage your marketing team to employ free or lower-cost marketing strategies.
There you have it, all 9 money saving tips for small businesses in Singapore.
Regardless of the industry, managing finances is a critical aspect of doing business. In general, small business owners are always conscious of their expenditure and rightfully so. After all, it is crucial to monitor where every dollar is spent in order to maximise business efficiency and growth.
While this article contains a lot of tips, know that nothing is one size fits all. Depending on your business venture, find the perfect money tip that suits your needs the most. For starters, employ at least one or two of these pointers and you may well be surprised at the results!