Without a shadow of a doubt, entrepreneurs have nerves of pure steel. Keeping a small business afloat in favourable economic circumstances is hard enough – now, imagine trying to keep a small enterprise going when it falls upon hard times.
Despite being the lifeblood of the local economy, fewer than 50% of South African small, medium and micro-enterprises survive for more than five years, and as consumers rein in their spending due to the economic impact of COVID-19, small businesses are truly experiencing the brunt of these trying financial times.
Keeping tabs on the exact expenses a business incurs is crucial if the enterprise is to keep its doors open, and overspending makes all the difference when a company is not doing as much business as it used to. Read on to learn how SMMEs often overspend, and how this can negatively impact your small business.
Those who fail to plan, plan to fail
It goes without saying that running a business is not something one can do without proper planning. This means knowing exactly what is spent on each aspect related to the functioning of the business. Even the smallest unplanned expenses ultimately add up, and business owners know the dread associated with books that don’t balance, come to the end of the month. Efficient business planning should include the meticulous management of the company’s monthly budget.
Overspending on overpriced products and services
Due to time constraints and the pressures of keeping their enterprise afloat, business owners often don’t shop around, rather choosing to keep on using the same overpriced vendors and service providers they’ve consulted since the beginning and throwing money in the water as a result.
Spending too much on internet and telecoms services
One of the areas in which businesses habitually overspend is on keeping employees connected to the internet and to one another. Bulky cellphone and data contracts that offer too much (or too little) can chew a hole in the company’s budget at lightning-speed, while prepaid solutions are often far cheaper and easier to keep track of.
Proper auditing is key
Good planning means very little if it isn’t followed up by proper auditing at the end of every month. When every transaction is audited, business owners can keep track of all payments, and easily ascertain which products and services are simply costing too much. This allows businesses to reassess expenses and act accordingly, curbing overspending and keeping the enterprise in the black.
Choosing a telecoms solution from Business Prepaid is a sure-fire way to curb unnecessary spending and brave the current economic storm. Speak to us about a plan that will suit your small business, and ensure you’re connected and ready to serve clients with significant savings in tow.