Starting a company is always a great challenge, with many uncertainties waiting around the corner. Is your idea good enough? Will people respond to it? Are you going to cover all the costs and create a sustainable business? All these questions and many more linger in the minds of those about to embark on the track of entrepreneurship. Still, everyone agrees that the way you start has the greatest effect on the future.
So, what are the typical problems at a very early age? Securing financial backup and having a clear idea about how the business should be run spring to mind. With around 90 percent of all startups failing in the first year, getting it right from the very beginning is crucial. One of the things you need to ensure is that you don’t waste any money, especially when starting a company. Let’s take a look at some tips that should help you keep your costs to the minimum.
Success can greatly depend on the location of your office, as we all know. The more you depend on it, the fewer options you have at your disposal. If you have to work 24/7, sharing the premises with some other business in order to save money on the rent is impossible. However, if your business is such that will allow you to split the rental costs with some other company, make sure you use the opportunity to do so. Sharing office space with another business can be tricky, but if done correctly, it can save both you and the other company a lot of money and could easily be the difference between making it and breaking it.
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Purchase in bulk
It’s understandable that startups wish to limit the expenditure by buying small quantities of items they need and repeating such purchases more frequently. However, in doing so, they are actually spending much more than necessary. Office equipment and stationery are the things each company needs and they are best bought in bulk. Also, finding a reliable supplier, like Winc Australia, for example, who will offer free delivery and match any lower price you find for the same items, is very important if you want to keep your expenditure low. Naturally, you shouldn’t clutter your office with the stuff you won’t be needing any time soon, but if you have a suitable storage facility, this is a chance to save some big bucks.
Streamline and automate as much as possible
Many startups fall into the trap of having everyone doing everything, powered and inspired mostly by the thrill of setting up a new business. Still, that fuel doesn’t last forever. People get tired, disillusioned and realize that there is no method in the madness. The right way to go about it, which is going to save you both human and financial resources, is to automate processes such as payroll, accounting, and administration as much as possible from the start. The more you allow yourself and your colleagues to focus on work, the better it will be for the company.
Consider hiring freelancers
If the nature of your business allows it, think about employing freelance employees instead of full-time ones. The latter cost more, since you have to pay for a full-time salary, sick-leaves, benefits, equipment, and other expenses. Such costs are non-existent when it comes to freelancers and that can save you quite a lot. Just make sure you aren’t breaking any laws when offering such employment since one lawsuit can easily be the end of your startup.
Plan and monitor expenses
It’s vital that you make a plan for your expenditure and monitor where, when and how much of your money is spent. Make sure you don’t forget things such as insurance, utilities, salaries, and others, which are often overlooked as something that will figure itself out. Without a plan, you’ll never be able to know if you’re doing something right and if your business is successful or not. What you also have to plan is the period after which your company should start making a profit. However, in order to live to see that day, you have to be extremely careful with your expenditure before that moment.
What you need to understand when starting up a business is that there are no guarantees and that in order to succeed, you have to do several things right. In the beginning, you have very little margin for error, which makes the task even more challenging. On the other hand, every successful company was once a startup, which means you too can do it. However, you need to be doing a lot of things right from the onset.