4 Ways Small Businesses Can Save Money on Their Supplies

James Crier

April 26, 2017

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For any business to be successful, it has to be self sustaining. This means a business must generate enough profit to cover expenditure, such as staff wages, rental premises and marketing. Many startups and small businesses have a limited cash flow and in order for businesses to grow, any profits are often reinvested. While an increase in sales or clients could increase profit margins, one of the best ways to do this is by evaluating and reducing company expenditure.

As such, here are four effective ways a small business can save money on their supplies.

Get Several Quotes

Seeking quotes from multiple suppliers is important for two different reasons: one, how will you know you have secured the best offer if you only have one quote? And two, having this information is a great tactic when it comes to negotiating. Aim for a minimum of three quotes from different suppliers. Tip: tell your current supplier as well as prospective companies that you are looking for quotes elsewhere. Honesty is the best policy, and it can help to inspire a sense of competition.

Never Accept the First Offer

As a general rule, a supplier will never give you their best price straight away. Remember, to get the best deal, dedicate time to negotiation. It is important to keep communication open and create a relationship, so that you can return to suppliers and discuss their offer in further detail. This is also where those additional quotes can come in handy.

Consider Multiple Suppliers

It may be easier to go through the negotiation process once with one supplier, but this may not help you to cut costs. Instead, if your business covers a lot of different areas, or requires specialist equipment, then you could consider using multiple suppliers. For example, if you own a small independent airline, there are dedicated suppliers like Flightstore Pilot Supplies.

Other Savings

If you have negotiated and negotiated and have been unable to reduce the price as much as you would like, then there are other areas you can save. Prices of products and supplies are not the only way to cut costs. Talk to suppliers about a discount for bulk orders, discounts for early payment of invoices, or an extension on payment terms.

Reducing expenditure is a fantastic way to increase cash flow for any small business. Even if you are unsuccessful in achieving the price you would like, there are other areas you can save, such as discounts on large orders or early payment.