We’re six months into the coronavirus pandemic and many of us have had to pivot our agency operations. We’re doing virtual interviews with nannies and having Zoom meetings with our agency clients. Social distancing and hand washing are part of every conversation now.
You’ve tweaked your agency’s operations in many ways during the pandemic, but have you thought about adjusting your budget? Because your cash flow and spending have likely changed this past year, it’s important to look at your agency’s budget and adapt it to the “new normal.” Here are some tips to help you do just that below.
Evaluate your budget
Analyzing your budget is the first step. Look at how your income and spending have changed since the beginning of the year. How much money is coming in? And where is it going? Assigning every dollar of your income a job is called zero-based budgeting, which can help you avoid wasteful or unnecessary spending.
Looking at your numbers over the past few months can also help you predict what you may need in the months to come. That’s an upside to being nearly six months into the pandemic: you have some idea of what your new expenses and income will be like.
Use your existing numbers for your balance sheets, cash flow statements, and income statements. (Here’s a refresher on financial terms if you need it.)
Cut non-essential spending
Now that you know the ins and outs of your budget, where can you trim your expenses and save a few bucks? Every business, as well as every nanny agency, has a unique financial situation. But there are common non-essential expenses that you likely don’t need right now.
If you rent an office space for your agency, check with your landlord to see if you can renegotiate their prices. Put any renovation or office improvement projects on hold for now, especially if you’re not using your office to meet families or interview new nannies in person.
It’s also a good time to consider whether you need a dedicated office space outside your home if you’re a solo business owner. You might think about converting an extra room or private space in your house to an office instead. It’ll cut down on expenses like rent, utilities, commute, and more.
Find cheap or free alternatives
You have to invest in your business in order to make money, but that doesn’t mean you can’t seek out cheap — or free — options for many of your expenses.
Refer back to your budget and look at some of your expenses; specifically, items like internet service providers, website hosting costs, marketing services, or business tools. Explore options from competitors and look for great deals. For example, you might find a less expensive website host or email platform that has extra features you’ve been wanting.
Check out software and program alternatives, too. Rather than pay for QuickBooks, you might try Wave or Zipbooks instead. Switch to Google Drive from Microsoft Office. Downgrade your project management software, like Trello or Monday, to the free version by removing users or reducing features.
Reduce payroll expenses
This is not easy for any business owner, but if your payroll takes up a big chunk of your agency’s expenses, you may need to think about reducing this part of your budget.
Luckily, there are a few steps you can take before laying off employees to keep your business going. Consider reducing hours or eliminating one to two workdays during the week to cut costs. If you can, put benefits or overtime pay on hold. You may even think about temporary wage reductions, too.
Partner with other businesses
If you slashed part of your marketing budget, there are still ways you can keep your agency relevant. Reach out to other small businesses that serve the same areas as your agency and agree to promote each other’s services.
Don’t forget how effective and inexpensive digital marketing can be! Many people are still working from home, which means they’re probably spending more time on their computers and phones than usual. Stay relevant and fresh in your target audience’s social media feeds. Create valuable content and share it across blogs, social media channels, and email newsletters.
Adjustments are necessary
Rethinking your budget is essential for keeping your nanny agency going during the pandemic (and after!). You may be in a tough spot currently, but making changes now can help you stay on course towards your goals for your agency.
If I’ve missed any helpful resources or tips in this blog, I’d love to hear them. Please share in the comments below!