A while ago I wrote about how you could save your business money by doing the simplest of things, such as putting a note in your diary for the renewal dates on your insurance, electricity and gas contracts, telephone lines and broadband providers. With it being the consumer’s market out there, one can save thousands of pounds over a single year! Yes, that’s right! My businesses have and so can yours. All you have to do is shop around when it comes to renewing your contracts.
With the exception of your insurance policy, you can pretty much chop and change suppliers every year to save money. The reason why you should stick with one insurer is that, generally, the insurance companies do not like someone who is changing all the time they think you are up to something.
But right now I’m going to talk about leasing. This is something that, while tax-efficient, can cost a business thousands of pounds if overlooked. Recently, I visited a friend and saw some of his equipment really struggling to work. Out of curiosity, I asked him how old it was and how much he paid for it. "Oh, I pay £439.80 a month," he said. "So it’s leased?" I asked. "Yes, I think so! I’ve always paid this."
On digging deeper, we discovered he initially got the equipment leased among other things and the term ran out a year ago, but since he didn’t realise that it did, the leasing company simply kept charging him for it. Now, there are two points here: when you lease a property, the landlord will not necessarily have to come to you and say, "Your lease has expired!" He is getting his rent, so he will continue to receive his rent. The only thing is, had you contacted him, you could have renegotiated. With commercial leasing, you simply pay a charge for the titles to either be transferred to your name or for indefinite use of the equipment until its life ends. Either way, it saves you from paying the lease on it.
So what have we learnt? We have to keep on top of all our outgoings especially the big, but infrequent amounts. We tend to be so busy looking after the daily grind that we often forget to take care of the big stuff, which ultimately costs us an arm and a leg, simply because we didn’t look at the numbers or, in this case, dates.
So sit down as soon as you can and list all your suppliers of utilities, leasing, finance or any other expenditure. Next, find out the renewal dates, terms and all the other necessary details and, finally, put a note in your diary, so you can pick up the phone and renegotiate, move away or look at other alternatives.
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