10 ways to reduce your business costs

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Few issues are causing more of a headache for early years settings at the moment than the government’s pledge to deliver 30 hours free childcare. 2016 also marked the introduction of the National Living Wage for employees aged 25 or older, increasing costs for childcare settings by over £900 per year for each employee affected.

With this in mind, we’ve come up with 10 ways to help reduce your costs in other areas of your business.

1. Review your energy bills

It’s estimated that the average UK SME (small to medium enterprise) spends around £3,000 each year on energy bills. Diarise when your energy contracts are up for review in plenty of time, so that you can look around for a cheaper provider. If your renewal date is a long time away, call your existing provider and ask them to help you find a way to cut your costs today.

2. Move to paperless

We’ve had nurseries reporting that they can end up spending between £400 and £2000 a year on their printing costs. Moving to paperless assessment can help you cut back on these costs and also reduce the time that staff members are out of the room, as all the information for children’s learning journals can be captured using a tablet device.

3. Appeal to parents

If you’d like to increase the number of books in your nursery’s library, ask parents if they would donate any of their children’s unwanted or outgrown books so that other children may enjoy them instead. Parents are normally more than happy to help out in ways like these.

4. Don’t pay to advertise job vacancies

If you have a job vacancy at your setting, why not advertise it online for free? If you have a social media page like Facebook, you could post details of the role on there and ask parents to spread the word for you by sharing your post. You could also pin up a notice on your information board for visitors to see.

5. Eliminate finance charges

Are you spending money unnecessarily on things like late payments on loans, overdraft penalties and credit card processing fees? By staying on top of your bills and paying them when they’re due, you can save on these costs. Easier said than done – with parents paying you late! This being the case, automated fee collection can make sure you always get paid on time.

6. Think of ways to make use of existing skills

Rather than paying for guest speakers to visit your setting, why not ask parents to come and share their knowledge? If you have children from a diverse range of cultural backgrounds, you could invite parents to come and talk about their traditions and celebrations. If any parents work in interesting professions like dentist or firefighter, they could come and talk to the children about what they do.

7. Consider charging extra for meals

The NDNA have stated that the average nursery absorbs a loss of about £34,000 a year due to the funding gap, with 89% of nurseries making a loss on free places. The current funding rate also doesn’t cover food provision, so many nurseries are absorbing this cost themselves. Rather than trying to plug the shortfall, you could consider charging this cost to parents. Alternatively, you could give parents the option of sending their child in with a packed lunch.

8. Buy used office equipment and furniture

If you don’t need to buy new equipment, then you could consider scouring sites like Craigslist, Gumtree or eBay to buy items for your office or staff room. As long as it’s functional and in good working condition, there’s nothing wrong with buying something second hand and you could save yourself hundreds of pounds in the process!

9. Recycle and reuse materials

Tissue boxes, string, newspapers, coloured foil and egg boxes are all great materials which can be used for craft activities or open-ended play. Think creatively and never throw anything away that you can find a second use for. If you have a particular craft activity in mind e.g for Easter, appeal to parents to donate any items you think you’ll need.

10. Get your staff on board with energy saving

You can save an average of £78 a year by turning off appliances and office equipment when not in use and £240 a year by switching to energy efficient lightbulbs. Put notices up in your staff room and kitchen as helpful reminders to save energy or water whenever possible – it all adds up over the weeks and months!

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