Running a successful enterprise means more than just maximizing profits from sales; it also means being smart when it comes to purchasing the products and services you use to run your business.
To help you get the best deals on your supplies and equipment, we've put together a list of dollar-wise buying tips:
- Ask for the small business discount. Many vendors offer special pricing or packages for small business. Canada Post, for instance, has a VentureOne™ Small Business Preferred Client Program which entitles members to a discount off certain shipping services. Even companies that don't have special programs for small businesses may decide to cut you a special deal, just to win your business.
- Schedule your purchases, preferably around seasonal promotions, like back-to-school, Christmas or Boxing Day sales. To create a purchasing plan, you need to keep an eye on your supply room and monitor what's being used and replenished frequently. Then use this information, along with your business plan, to forecast your needs on a yearly basis.
- Buy in bulk - it's almost always cheaper than buying smaller packages. Most office supply stores offer multi-packaged products. Or you may want to look into membership with cooperatives, which offer bulk-packaged products at discounted rates.
- Take advantage of early payment or cash discounts. Many businesses will deduct a small portion -usually one or two per cent -of the invoice total if you pay within a specified period or if you opt to hand over cold hard cash.
- Take advantage of association discounts. If you belong to an industry or professional association, or perhaps a university or college alumni association, you may be entitled to specially negotiated rates with certain companies. Members of Certified Management Accountants of Canada, for example, get discounts when they purchase from Grand & Toy, Primus, UPS and Workopolis.
- Buy generic or private-label brands. Many no-name products are comparable to their brand-name counterparts when it comes to quality and features.
- Buy second hand. Check out used office equipment stores, liquidation auctions or even garage sales for previously owned supplies and equipment. And where possible, look for products still covered under warranty. To find an auction near you, check out the Auctioneers Association of Canada website, which lets you search for auctions by item, location and date. The site also offers tips and background information on the auction process. For auctions of the online variety, visit ebay.ca's business and industrial section. Ebay merchants offer used as well as brand new goods.
- Look into obtaining a credit card that awards points for purchases. Visa® cards offer a wide range of credit options for small business, including cards that let you earn rewards toward travel or merchandise. Depending on the type of card and the financial institution issuing the card, a Visa Business card may also offer savings on such things as travel or car rental insurance. As well, Visa Business cardholders can take advantage of exclusive savings through the Visa Savings for Business Program. For more information on Visa's Small Business program, talk to your financial institution or click here.
- Join an in-store rewards program. Staples Business Depot, for instance, runs a Dividends loyalty program that gives people rewards every quarter. "All your purchases are tallied up at the end of each quarter and, depending on how much you spent, we send you a rewards coupon to a maximum of $30 per certificate," says Karen Leyland, database marketing manager at Staples Business Depot. "Basically, the more you buy, the more you save."
- Barter with other businesses. Instead of paying in dollars, talk to your suppliers or other companies about using your products or services as currency in exchange for their products or services. You may also want to check out a few online bartering systems, such as Trade Exchange Canada Ltd. or Trade Business Exchange Canada Inc. Keep in mind that the Canada Customs and Revenue Agency has strict rules concerning bartering, so it's best to consult your accountant before entering into any bartering arrangement.
- Hire a student. Depending on your type of business, you may be able to set up a student co-op program with a university or community college. If you're interested in hiring students for the summer, you can also apply for wage subsidy. Visit Canada Summer Jobs oryouth.gc.ca for more information.
Getting the best deals on your business purchases requires a bit of research and comparison shopping. But the money you save, and the resulting increase in your overall profits, will make it well worth the effort.