According to data released by the Philippine Statistics Authority (PSA) in 2015, the country is home to more than 900,000 registered businesses. Large enterprises account for only 0.5% of this number, and the remainder comprises of micro, small, and medium sized entities.
While this may serve as good news for entrepreneurs, existing players face increased competition, and new entrants don’t have it particularly easy. Fortunately, there are measures that small businesses can employ when it comes to saving money.
Choose Capability over Experience
People who have little work experience look for entry-levels positions with salaries that match. If you find an employee who you feel is competent for the job but does not have experience to back his or her skills, consider giving the person a chance. You may also consider hiring interns studying in local colleges. This does not mean that you should not look for experienced employees if it makes more business sense.
Evaluate Operating Expenses
Do you buy coffees in the plentiful for your office? If so, consider asking the local coffee shop for a loyalty discount or think about investing in a coffee maker for the office. Day-to-day expenses often add up to a considerable sum at the end of the month, and areas that may do with your attention include maintenance, stationery and other supplies. Take time to identify where you might be paying more than required. Compare quotes from multiple vendors at least once a year to ensure you are not overpaying.
Use a Specialist to Make and Receive Cross-Border Payments
If your business deals with overseas customers or suppliers, consider how you make or receive payments. For example, while PayPal usually serves as an effective means of receiving payments from international customers, there have been instances of the company blocking merchant accounts as a result of compliance reviews.
Australia-based OFX gives businesses and online sellers in the Philippines easy means to send and receive cross-border payments. Businesses may use the services of this company to pay suppliers and overseas staff. Online sellers can get free receiving accounts in Australian dollars, U.S. dollars, British pounds, euros and Hong Kong dollars. TransferWise and World First, both UK-based companies, provide similar services as well.
Interact With Your Accountant Regularly
Several small business owners think about contacting their accountants only when it’s time to file taxes. This is not the best way forward because keeping track of potential tax deductions should be an ongoing affair. By speaking to your accountant ahead of time, you know what is expected of you. This way, you will not add extra burden on your accountant toward the end of the financial year, which, in turn, may lead to savings.
What You Can Do About Tax Deductibles
First up, don’t give into the temptation of making a purchase simply because it comes with a tax deduction. You will, after all, still need to pay for what you buy. In you own a home business, don’t forget to include all applicable write-offs when you file your taxes. These may include rent or mortgage payments, a percentage of different maintenance related expenses, as well as any business related purchases you make.
Effectively saving money can make all the difference between the survival and downfall of small businesses, which is why paying attention to even seemingly insignificant expenses matters a lot. Little drops of water, after all, make an ocean.
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P.S. To get help in your business accounting and for filing of your income tax returns before April 2018, get in touch with G&C Financials by sending an email to gcfinancialsph@gmail.com or call 0977 807 3224 today.
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