When it comes to running a business, the money topic can get funky. We hear entrepreneurs touting their 6- or 7-figure businesses, but I always wonder if that’s 6 figures in sales or in revenue? What do their expenses look like? How did they get there? What are they actually selling? I think if we’re going to share the successes, we should also share the process, the strategies, the realities and behind the scenes, and so today I want to talk about money in another light.
Sometimes on the topic of money in your business, it isn’t about adding more revenue streams or offers to your product suite. Oftentimes, it can be about finding ways to SAVE on your expenses and being smart with your spending, and so today we’re going to talk about 5 ways to do just that—to save more money in your business to keep your financial game… and gain… strong.
Find an Expert
One of the most common mistakes business owners make with their finances is trying to manage all of their finances on their own. I’ve been a turbotax girl myself in the past, so I know what you might be thinking. But it’s easy for us regular old non-finance folks to overlook certain financial mistakes, like not paying quarterly taxes and then getting penalized later on, simply because we don’t know any better.
That’s where these financial professionals come in, and I can all but guarantee that they will save you money down the road. If you’re the kind of person who only looks at your numbers when you’re frantically pulling them all for tax season—which hello, I think might just be a lot of us, myself included a few years ago!—then you can and should do whatever it will take to be able to look at your numbers every single month in terms of profit and loss. Hiring a bookkeeper can help you keep a pulse on your spending and your sales on a monthly basis and that in and of itself can give you a read on ways to recalibrate or opportunities to expand.
Other things like learning about tax exemptions and deductions can save you a ton of money over time and give you a financial strategy to follow with confidence, and being aware of these things can help you invest thoughtfully and thoroughly, knowing you have a financial partner to help your dollar go as far as it possibly can.
When looking for an accountant, you want to find someone well versed in your type of business and who understands your industry. The better educated they are in your arena, the better they can counsel you and know different tax benefits that can work in your favor. Since my business has drastically changed since my photography days, my accountants have had to pay closer attention to different tax laws or things that would impact a more digital business, but having an accountant who can grow with you is important. If you’re looking for where to start, I’d first ask for local referrals from other business owners or a simple google search for your specific type of business structure and accountants that serve those types of business.
Pause Autopay and Dig In
The other day my credit card had a fraudulent charge on it and I was so bummed. I sat on the phone with my credit card company and when they told me I had to change my card number and wait for a new one to come, I automatically thought of ALL the things I’d have to change that are on autopay or connected to that card (which by the way, I use a credit card for all of my business expenses to keep things separate from personal but also to get the rewards/perks, like frequent flier miles!)
I mean, autopay is a Godsend, yet, it’s also a sneaky way to let some unnecessary expenses add up and go unnoticed if you’re not keeping track every once in a while. Take a look at your monthly credit card statement or bank statement and go through all of your monthly charges once a quarter to make sure you are utilizing all of the programs and subscriptions you are paying for.
You can also take this opportunity to look for areas you may be able to negotiate or find solutions that might help you consolidate your needs. For example, did you know you can combine multiple school loans into one payment or even negotiate credit card debt? Yes, it’s true!
Credit Karma broke down how to negotiate a crazy high credit card bill in an article on their website—here’s the abbreviated version but I’ll link the full article in the show notes from today’s episode too:
Step 1 – understand how much you owe on different credit cards and what their different interest rates are.
Step 2 – explore the options for negotiating, whether it’s asking for a lower interest rate, removing past late fees, asking for a lump-sum settlement lower than the outstanding balance, or doing debt management or settlement.
Step 3 – know that each option comes with risks, and you might not get your debts forgiven OR deferred… but it never hurts to ask.
Step 4 – reach out to your credit card company or a settlement company to negotiate, and document every conversation you have.
Step 5 – make sure you get the final outcome in writing.
Of course, this should only be done in extreme cases when your debt is insurmountable and you truly need the support. In many cases, people can simply save money and reduce their monthly credit card bill by cutting excess costs like memberships, subscriptions, and monthly or annual payments that they don’t actually use or need. The other day our DirectTV bill like doubled because we were out of the trial period and so Drew called them to say we were going to switch to a different provider and his 30 minute phone call saved us $500 for the year — I mean, it’s a thing. Trust me.
The same goes for business tools, systems, apps on your phone and software that might have low monthly costs but that do add up over time. See if there are free options for any tools you’re currently paying for that would work for your needs just as well.
Assess Your Team
Hiring could actually SAVE you money. If you’re spending all your time on mundane or time-consuming tasks that don’t really add to your bottom line, well, that’s taking time AWAY from where you could be working on projects to boost revenue. It’s totally normal to wear all of the hats and play all the roles when starting out but as your business grows, it might be time for you to start hiring help or outsourcing more.
When I talk to other former-solopreneurs who eventually hired a team, they ALL say the same thing. Hiring the right people allowed them to double and triple down on their efforts and increase their revenue.
On the flip side, if you have an assistant or a team already and feel like all of your money is going toward payroll or contractor expenses, it might be time to adjust or make some tweaks. You want every dollar out, specifically on payroll, to be investing in things that actually yield tangible results for your brand or business. If the expense is weighing on you, look and see if there is there an opportunity to cut back on hours, combine tasks, or add or subtract from their role based on results so that you’re not spending quite so much on team expenses? Can you systemize any processes to save time for your team members?
While this can get a little sticky sometimes, most contractors got into freelance work for the flexibility of it and understand that hours and responsibilities might shift. You need to do what is best for your business and overhead, and adjusting team roles and hours might be one major way to do just that!
Advertising Costs and ROI
Hands down our biggest expense along with payroll is our advertising costs. It’s no surprise ad costs can “add” up, and quickly if you’re not careful. If you’re seeing an awesome conversion rate from your ads (meaning what you’re investing is yielding a greater return), then great! You might not want or need to touch them — though I always think there’s opportunities to investigate and optimize. However if you’re not converting well or right side up or if you’re unsure if your paid ads are truly doing what they should be doing, I want you to track these efforts obsessively and dive deep into your ROI to make sure that your ads are optimized and profitable.
We invest more in LEADS than in getting SALES so we have time to grow know/like/trust and lead our relationship with serving first before we sell. This also gets someone into our ecosystem and gives us a chance to get them results for free before they invest in anything.
We always want to run ads to things that leave us right side up — you don’t want to invest more than you make so we’ll invest in growing our email list and most of our opt ins or freebies convert for under a dollar, meaning we invest one dollar per new subscriber and then when we go into launches, we focus more on retargetting people who are already interested — aka warm traffic — then trying to sell to cold traffic, not only is it more cost effective, it’s a better way of marketing.
If you’re spending more than you’re bringing in with ads, then you might just want to cut back on your ad budget, or pause them altogether for the time being while you double down on free, organic outreach efforts.
Explore and get creative with other ways you can be showcasing your offers using organic strategies like social media, email lists, collaborations, giveaways, challenges, Facebook groups, and more. Ensure that wherever you are investing time, money and energy, you are tying those efforts and resources directly to a result!
Project Management Tools
If you have a lot of moving pieces in your business—from launches to products to team members trying to coordinate and collaborate together—if you’re not using a tool to keep things organized and streamlined, I promise you are leaving money on the table. Your time should never be spent searching for hours or recreating duplicates of something you know has already been created, and your team shouldn’t have to spend their time in this way either.
If you want to try Monday, go to jennalovesmonday.com for a free trial and more information about why we love the platform! While it is a monthly expense, it will save you money, stress, and time down the line. Having a tool to keep projects systemized generally results in higher productivity, which pays for itself, and helps your team save time by knowing everything they need is all inside one platform, in an easy-to-find place, eliminating the need for a bunch of emails back and forth or pointless meetings that, truth be told, we’re all fine with skipping!
So much of financial wisdom isn’t about rash decisions or quick fixes. It’s about making strategic choices now that will compound and make a return in the future. Small, simple changes like hiring a team so you can spend more of your time on the needle-moving pieces of your business or using a project management tool to cut back on wasted time will allow you to stay in the flow of your zone of genius and continue making progress toward your revenue goals, and at the end of the day, that’s all we can hope for!