Saving money is always one of a sole trader’s biggest priorities. That’s because when you run a business entirely by yourself, you’re responsible for everything from the day-to-day running to all the expenses big and small. However, there are a few simple ways to cut costs without making dramatic changes – which we’ve rounded up below.

Check your expenses

Expenses are by definition – expensive. That’s why it’s important to keep a track of your finances to find out what you’re spending on and when. Make a spreadsheet or use a free tool to monitor them and budget, budget, budget.

Take time to figure out what expenses are essential, and which aren’t. Are you spending money on services you signed up for but don’t use anymore or could you just find a cheaper alternative to them? Could you cut out little things like takeaway coffees and meals out?

Shop around for more low-cost options for insurance, your business phone bill and your personal bills. Have an audit and look for any unnecessary direct debits and subscriptions. Sometimes you can downgrade the level of service to save a few pounds too.

Use refurbished equipment

Buying equipment is costly. And although it can be tempting to buy the latest model of everything – in the hope that it will last longer – it’s probably better to look for good quality refurbished items.

Online you’ll easily find second hand tools for tradesmen, refurbished phones, laptops, printers and even furniture. As soon as something is pre-owned, it is drastically reduced in value even if it has no damage or the damage is just cosmetic and doesn’t affect the function.

In the same vein, don’t buy any equipment you don’t need. For example, if you have a laptop you might not need a similar piece of kit like a desktop PC or iPad, especially in the early days.

Carry on saving

With all the initial costs of setting up a business and general outgoings, saving money can fall by the wayside. However, when you work for yourself, you have no back-up for a buffer so creating a contingency fund really is a good way to put money aside for a rainy day or a quiet month or a period of sickness.

Saving money isn’t just vital if disaster strikes. Although you don’t have to pay taxes in your first year of operation, having money in an account keeps you prepared for when paying your taxes does roll around – all too quickly.

Plan your travel

A lot of sole traders have to travel for work but if you’re lucky enough to work from home all the time – you can skip this section. Getting around gets expensive quickly, whether it’s clocking up the miles in your car or spending pounds on public transport but planning in advance can help.

Public transport is often cheaper and better for the environment especially if you buy your travel all at once with season tickets or choose more cost-effective advance fares. You can also use the time spent travelling to do all your business admin which you can’t do when you’re driving.

If public transport doesn’t work because you need the flexibility of having your own car or van, business fuel cards are an easy way to save money on your petrol. Look for a free fuel card that has no sign-up fee and no hidden costs which is an ideal solution for sole traders who want to save a few pennies per mile.

Keep your timings in check

Your time really counts when you’re a self-employed sole trader. Make sure you keep a detailed record of all the minutes and hours you spend on each project so you charge the correct amount (not over or under).

Monitoring how long things take will also make it easier for you to make time quotes in the future which should improve the accuracy of your predictions and improve your chances of winning business based on fair forecasts.

Look for sole-trader support

There are often grants and loans available for sole traders from the government and even some charities. Follow this link to discover everything from start-up loans, to vouchers to general advice and guidance at the gov.uk website.

Since the pandemic there are coronavirus initiatives available that offer financial support to businesses to help bolster the economy. Local authorities also have the capability to offer specific tax reliefs to businesses that conduct research and development to make advances in that industry.

Resources:

• Fuel Cards UK – Business Connection Zone

• Best Fuel Cards – Fediverse

• Tesco Fuel Card – Home.Blog