It’s much easier to bankrupt than succeed on the market. Nine out of ten startups fail due to bad management and overspending money. Many founders fail in chasing their venture dream because they don’t know how to avoid the unnecessary expenses. Here is some advice on where to save money and decrease your startup’s costs successfully.
Spending Money
Let’s start with the general rule of treating your business as an individual who should live his life within his means. Even if you have some incredibly generous investors who are ready to go for your idea, always be cautious about spending significant amounts of money before making enough income to cover it.
Hiring
New businesses owners often focus on creating a small team of talented and high-priced individuals, hoping that it will kick off the venture. Soon they learn that personnel costs can quickly consume their operating capital and postpone the long-awaited moment of the high return of costs.
Ask yourself what does your startup need right now regarding human resources. Recruit individuals who firmly believe in your new product or service, and those who are open to prove their worth on a commission-basis. These salespeople are more likely to be better at generating business in the early stages than a “run-of-the-mill” employees. You can also consider hiring interns because they’re enthusiastic and it’s possible that they’ll go for your project and do their best to make it succeed.
Legal And Financial Advice
These two factors definitely can’t be ignored. If you don’t find a proper financial or legal advice, your project can fail before it even takes off. Luckily, there are some websites, such as Justia Ask A Lawyer, which provides legal and financial advice for free or at a very low cost. Sometimes this kind of help turns out to be not sufficient, however. In this kind of situations, you should consider hiring an expert or an attorney. However, before you hire one, try to find out whether there’s somebody in your family or among friends who can provide you with the professional advice – they’ll do their best just to make your business thrive, and the money will not be a problem.
Software
There’s a lot of software that can be used easily and very often completely for free. What software does every enterprise need at the beginning? Well, while starting a business, you’ll need a conferencing service – consider using Skype or Google to avoid unnecessary expenses. You can do similar when it comes to planning a budget, making a presentation for potential investors and preparing a business plan, or other venture-related documents. Try to use Piktochart or Canva to create a presentation like a pro – you can do it completely for free (or at minimal costs).
Networking
We’ve been already strongly emphasizing that networking and meeting new people from the startup environment is incredibly important – we keep it up. But at the beginning, try to seek out events, conferences, and trade shows that take place closer to your home. Of course, there is a lot of amazing things going in the startup ecosystems all around the world, but choose approaches that require less time and money. Don’t forget that there are also free or low-cost webinars – a great alternative for more prestigious (and more costly) startup meetups.
Advertising And Promoting
It’s true that digital marketing can be beneficial and effective when it comes to branding and getting new users, but remember that it also costs a lot. Don’t give up; even if you don’t have enough money supply, you can still promote your business successfully and entirely for free. To succeed with free advertising, you should be aware that the word-of-mouth still seems to be the best way to acquire customers. You should also take advantage of Quora, various Facebook groups and communities, and any other portals where the prospective users speak their minds. Also, try to focus on the strategy to make your content viral – once you have it on a high level, it’ll make your promotion fruitful and it will lead the sales to the sky high level.
Overpriced Electronics
There are millions of gadgets available on the market. To minimize the costs, buy the basic versions of all computers and other devices needed for your business. What to do when your developer says he needs a laptop that improves his efficiency and productivity? You should definitely agree and buy this kind of a device. However, when the person responsible for the content of your website asks for the same, don’t go for it, because the brilliant content can be created no matter what the device functions are.
Office Space
Remember that at the beginning your business doesn’t need a posh office or the expensive furniture to entertain the workers. It should be just enough to accommodate a handful of employees. Consider sharing the office space with another enterprise or think about getting a part in one of the startup incubator programs. The best you can do when you start is finding a place with a table, comfortable chair, and the environment that will help you to concentrate on your work.
Clothes
It may sound trivial, but it isn’t. Entrepreneurs are always seen as nicely dressed and well-mannered people who never reveal their bad and unacceptable habits. Luckily, business culture changes and we see more and more successful people from the business world replacing expensive leather shoes with comfortable sneakers and still rule the market. Believe me, the person starting a new venture doesn’t have to (and shouldn’t) spend extra money on clothes.
It’s incredibly important to think all of the expenses out carefully. It’s effortless to overspend money which finally leads to bankruptcy. Find out how to avoid unnecessary costs and increase the chances for success on the market.
