Top 10 Business Money Saving Tips

That's right, you do need to spend some money up front, so that you can save a whole bunch more in the long run. Incorporating your business will give you tax benefits that sole proprietors don't have access to. And, if you pick the correct state to incorporate in, it can save you even more. I learned this the hard way in 2001, when I had to pay an extra $9,500.00 in taxes because I wasn't a corporation, and another $3,000.00 because I had my business license from the wrong state.

In 2000 I was making a good living working online in Oregon, and decided that I was going to play it smart and move to Washington instead, so that I didn't have to pay Oregon's 9% personal income tax. So, I moved to Washington state, where they don't have a personal income tax, but they do have an 8.5% sales tax. But the sales tax only applies to stuff you buy, and even then it doesn't apply to groceries, medicine, utilities, or home and insurance costs. which in the end meant I saved about 90% over what I was paying to Oregon in taxes.

One of the taxes that I didn't take into account was Washington's B&O tax, which cost 1.5% of your business's gross. And yes, I said gross not net, which really sucks. Nothing like pulling in $2 billion in sales, having $2 billion in expenses, and then still having to pay a tax of $30,000,000 to the greedy state of Washington.

So, the first year I was in business in Washington, I did pretty well, and felt pretty good about it. Of course I hadn't liked paying $3k in B&O tax, but I thought that was a lot better than Oregon's business taxes. I'd taken my paychecks over the months, and paid the feds their taxes and thought I'd be OK when tax time rolled around. What I didn't take into account was the extra portion of social security that I had to pay because I was self employed. That came to an extra $9,000.00 and my accountant asked me why I wasn't incorporated. He then told me that I had taken all of my income as wages, so I had no choice but to pay the tax, but if I was incorporated, and paid myself a fair wage, then the rest of the money I'd made would have passed to me as a dividend.

So, the next year I incorporated in Nevada. Nevada had corporate taxes, but they don't have personal income tax. What I did was elect "Sub S" corporate status with the Feds, which meant that any excess money from the corporation was passed to me in Washington state as a dividend and treated as personal income. I then took a fair wage and ended up saving about $10,000.00 in social security and another $3000 in B&O taxes.

While there are laws and banking rules you have to follow, and paper trails that you have to keep, the actual process of incorporation was easy, and only cost about $300.00. So, if you want to start saving money with your business, incorporate it in Nevada or Maine, because it is my understanding that those are two of the states with the best corporate tax laws. (PS. I'm not a lawyer or an accountant, and you really need to spend the money to talk to those very important people before you do anything I suggest here.)

I love it when a business associate of mine says this, especially when he's telling me this over a cell phone. Cell Phone service sucks, and people make business calls on their cell phones all the time. Why would you pay Qwest or AT&T $1000 a month for business phone service, when you can get the same thing from a VoIP provider for pennies on the dollar. Sure you have to have high speed internet service for internet phone service to work, but don't most businesses have that anyway, and if not, why not? High speed internet service, "PLUS" internet phone service, is still cheaper than landline business phone service by itself.... So There!

I personally use a Magicjack at each of the stations in my office, and my employees can take them with them on vacation. Magicjack works anywhere in the world that you can get high speed internet service, so it's a cool tool to have with you. For example, if I'm in Germany or China, I just plug my Magicjack into my laptop at Starbucks or McDonald's, and use their free high speed internet service to call back to the states for free. It works great, especially when you figure I'm only paying $20 per year for unlimited local and long distance phone service in the US, Canada, and back to the US from any country in the world.

If Magicjack cramps your style, because you want a PBX phone system, then get one from Packet8 or Phonepower. Phonepower offers a managed PBX system that's flexible and cheap, so it can grow as your business grows. Compare these three internet phone companies, and more at http://www.internet-phone.org.

PS: Internet phone services can accept faxes to email, and they work just fine with fax machines. Yeah!

"A $250.00 airplane ticket is worth the same as 10,000 minutes of conference calling!"

"Holy Crap Batman, Really?"

"Yep!"

Don't waste your time driving to the airport and sitting on a plane, when you could take that same money and about 1/10th of the time, and hold a conference call. Check out conference calling comparison websites to make sure you're getting a good deal.

Yep, while some airline credit cards charge as much as $100 per year to have that type of account, other companies will give you mile reward credit cards for $50 or less. Make sure you visit a credit card comparison website to make sure you are getting the best deal, and don't forget to compare interest rates. While it's nice to get a couple of free round trip tickets to Cabo San Lucas, Mexico every year, it's not worth it if you're getting stuck with a high interest rate.

PS. Pay off your credit cards each and every month! If you do, it's like using their money for free. And, there's nothing I like more than not letting the credit card companies make any money off of me.

Employees are expensive, and so is learning a new skill, so when you need something done, that you don't know how to do, outsource it. There are great websites out there that let business owners list jobs that they need done, and then freelancers bid on those jobs. Guru.com and Elance.com both provider places for business owners to list jobs that they need done. Freelancers on these sites pay a percentage of what they make to the websites when they get jobs, so it doesn't cost you anything extra to post jobs on these sites.

Another benefit to posting projects that you need done on Guru and Elance, is the fact that they have an escrow system set up, so that you don't have to worry about getting ripped off. They also have a rating system, so that you can see which people are doing the best work, making the most money and getting the best referrals. Visit Guru and Elance for more information.

Microsoft Office 2010 is like $280.00. Why would you buy that, when you could use Google Docs for free? Google docs let you collaborate on projects with anyone who you give access to. It's way better than emailing business documents back and forth.

Use website like Download.com to find freeware and shareware for your company to use.

There's nothing a bad salesman loves better, than a company that pays by the hour. If you pay people by the hour, then you can't plan your cash flow, and planning your cash flow is one of the most important things for a business to do. While you still won't be able to plan your income and outgo to the last nickle, being able to pay your sales force based on a percentage of the income they produce, will help keep your books balanced and your ROI stable.

Online affiliate programs let you take your products and services and advertise them all over the world, while only paying when you make money. With regular advertising, you have to pay for the ads whether you make any sales or not, but with affiliate marketing, you only have to pay when you get the desired action.

The two types of actions most usually paid for in affiliate marketing are when a sale is made, or when a new customer enters their contact information into a form. As a business owner, both sales and leads are important to stay in business, so lots of companies run both types of affiliate programs.

The top three places to run your affiliate program through are Commission Junction, Linkshare and Share-a-sale. Google bought DoubleClick awhile back, and they also offer a good affiliate program, which is growing every month, so you may want to look at them too while you're at it.

Filing cabinets, office desks, office chairs, coffee makers, coffee cups, computers, printers, fax machines, scanners, projectors and other office equipment can all be purchased online at eBay, Half.com or Craig's List for pennies on the dollar. And that's not all, almost every kind of equipment you need to run your business can be purchased on those three websites for way less than you can get it anywhere else. It doesn't matter if you run a construction company or a medical office, used equipment can really save you money.

If you can plan your printing ahead of time, online printers can usually save you a ton of money over local printers, and they can usually get it to you in under a week. there are all kinds of things that an online printer can save you money on, including:

1- Checks
2- Business Cards
3- Letter head
4- Invoices
5- Promotional products

Here are some of the online printers I've used in the past:
Vista Print
UPrinting
Deluxe

Now that you've worked your way through my list about all the ways you business can save money, you should be able to put some of these into practice and put some extra money in your pocket each month. While all of these tips won't work for everyone, everyone can find something in this list that will save their business money.

If you've enjoyed my list, please book mark this page, or send it to your friends. If you have money saving ideas that you think should replace items on my list, then please leave a comment with your ideas. Other users will benefit from your ideas, as will I.

Thanks for visiting,

Jim