Perhaps it was a fitting sign of the times considering the strong turnout last Thursday for an evening workshop presented by the Cayman Islands Investment Bureau on smart ways to control costs.
Aimed primarily at small business owners just learning the ropes and presented by Tristan Relly, the objective was to shed some light on accounting and the ways it can help small businesses, followed by some basic tips on how to save money in tight times.
The interactive workshop kicked off going over basic accounting principles, with discussions touching on how profit and loss statements work, the way business costs are categorised and how such costs impact operational decisions.
‘Making smart decisions about where to spend, and where to save on costs helps your company run with the best results,’ said Mr. Relly.
‘In an economic downturn this becomes even more important and can be the saving grace that tides a company over. Keeping accurate financial records provides useful information to support decisions that help with this process.’
Mr. Relly urged the attendees to make sure there is a balance between saving and spending.
‘Don’t cut yourself short to think you are saving money when in the long term you are really losing,’ he said.
Mr. Relly also emphasised the need for business owners to become fully aware of what is going on in their business, using such tools as inventory management systems and payroll systems.
He noted that people hire accountants for a reason, as keeping accurate accounts that are up to date is essential for the good functioning of businesses, and accounting records are a way of telling a story to partners, shareholders and others in a common language.
Mr. Relly then went over some of the basic concepts in accounting, stressing that keeping good records, whether by hiring someone to do them or doing them yourself, allows business owners to see whether they are really making a profit.
Not a few in attendance were struck by how much they still needed to brush up on when it came to figuring out simple calculations like gross profit ratios and determining the break-even point.
The workshop then delved into a range of cost saving tips for small business owners to consider.
For instance, Mr. Relly noted having a cost cutting brainstorm session with employees and staff, the people closest to the daily running of the business, is usually beneficial.
‘Having a discussion like this also engenders a culture of cost-awareness,’ he said.
‘But while you’re cutting costs, don’t skimp on things that are earning you money!’
Other pointers that came up included negotiating lower rents in a down market, being energy smart, reconsidering operating assets, even renting machinery and other items instead of owning them outright if they are only used for short periods.
In addition, participants were encouraged to keep a better eye on inventory, keeping only things in stock that were selling, raising some interesting discussions on how to balance shipping, storage and purchasing costs when running a business on a small island.
Another issue raising much interest was cutting telecommunications costs, as were the relative values of different marketing strategies.
The well-received evening ended with attendees leaving armed with some newfound knowledge and a number of useful resources for more cost cutting ideas.
For further information contact the investment bureau at www.investcayman.gov.ky.