In an economy where costs are set to rise in most areas, saving money in business is an important part of any business plan. There are many ways to control spending and have visibility of your spending. FSCS covers business savings. Alternative financial services providers can also help with savings. Other ways to save money include energy audits and recycling packaging.
FSCS covers business savings
You can take out a business savings account if you have enough cash. Typically, a business savings account is one that doesn’t require you to give notice to withdraw funds. However, some accounts have limitations on withdrawals, including a maximum amount per year. Alternatively, you can invest your cash into a fixed rate bond.
In addition to protecting your personal savings, FSCS also protects the cash reserves of your business. In general, the scheme protects up to PS85,000 per bank or building society, and up to PS170,000 in business savings accounts. You can even diversify your cash reserves across several banks, but this requires time and money. For this, you can use an online cash management service, like Flagstone.
Alternative financial service providers
While banks use various methods of credit checks to ensure their customers are eligible for their products, alternative financial service providers don’t require them. As a result, they usually charge higher interest rates and fees. This can lead to financial trouble and a “debt trap,” where one debt is required to repay another.
Energy audits
Energy audits can be a very effective way to save money and energy for businesses. They help businesses identify areas that can be improved to reduce their energy consumption. They can help create momentum within a business and convince colleagues to join the process. Energy audits can also identify opportunities for improvements that were not previously considered.
Energy audits are becoming more important to businesses. Not only do they help companies reduce their energy bills, but they also help businesses increase their productivity. A green business will also have higher morale. Furthermore, energy audits can help businesses secure funding as investors consider climate-related risk when deciding whether to invest in their business.
Reuse packaging
Reuse packaging can save you money in a number of ways. Many companies are already adopting reuse models, such as allowing you to use reusable containers to buy goods. Businesses can also offer incentives to encourage people to reuse containers. Starbucks, for example, offers refillable reusable cups in exchange for a small deposit, which can then be used to purchase drinks. These types of incentives can be explained to consumers through communications. In the UK, the most common reuse models are return-on-the-go and refilling at home.
In the UK, 45% of plastic packaging was recycled in 2016, according to the Environment Agency’s National Packaging Waste Database. The level of recycling has increased thanks to improved recycling symbols and increased awareness among consumers. With this, the UK now ranks second among EU member states for commercial and industrial packaging recycling. However, the UK still has a long way to go. Many types of plastic packaging have a long life, and if they are not recycled, they can end up in landfill.
Budgeting for a recession
Budgeting for a recession in business UK can be daunting – especially for small businesses. With food and energy costs skyrocketing, it’s difficult to save money, let alone keep afloat. However, if you’re in the right position now, you can be better prepared for a possible downturn. The Bank of England recently forecast that the UK will enter a recession this year. In response, they raised interest rates to their highest levels in over 27 years. While this may be a surprise to some, it’s no surprise to SMEs who are experiencing a cost-of-living crisis.
With inflation expected to rise further this autumn, it’s crucial for companies to watch their costs and growth in the upcoming recession. In addition to keeping costs under control, companies should not overextend on new initiatives or projects. A downturn is a great time to focus on problem-solving. In the UK, the economy relies heavily on consumer spending, which accounts for over two thirds of GDP. If consumer spending drops, the economy will shrink. A recession in the UK will lead to a 10% reduction in GDP.
Cost-cutting ideas
Running a business isn’t cheap, but it doesn’t have to be. There are many hidden costs involved, and there are ways to cut down on them. Love Energy Savings has identified five key areas for cost cutting in businesses. If you’d like to start cutting costs in your business, consider using these tips.
Investing in business bonds
When you have surplus funds, you may be wondering what you can do with them. You may be unsure whether or not to invest them in business bonds or in a bank account, but it is worth considering the inflationary climate to make sure you’re getting the best rate. According to Moneyfacts, the interest rate on an easy access business savings account will be 1.25% by 2022. This would equate to PS20,250 in interest payments every year. According to the Office for National Statistics, inflation reached 9.4% in the 12 months to June 2022, putting this amount of money at risk.
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