As the economic recovery continues to sputter along, many small businesses are adopting the belief that budgets must be slashed to the core. However, even when budgets are tight, there is a right and a wrong way to save money.
Gerald Irwin of Sutton Coldfield based Licensed Insolvency Practitioners and Business Advisers, Irwin Insolvency, believes that trimming spending in the wrong places could end up hurting businesses in the longer term.
“When small business owners start to get panicky about their spending, one of the first things to go is often the perks and services lavished on customers. This could be a serious error of judgement as it is always wise to beef up all those areas that will be impacting on the customer. Another common knee-jerk reaction is to slash the funding designated for marketing. It is worth remembering that eventually the economy will recover and businesses will need new customers to enable them to grow,” said Mr. Irwin.
One of the biggest threats to the survival and success of any small business is the uncertainty of budgeting. Whilst trimming expenses is to be applauded it is also prudent to set aside income wherever possible. Any money set aside now could ultimately be a life saver in the future.