For a business to make money it is important to understand which costs are absolutely necessary and which ones to avoid. In my experience, I have seen a lot of businesses that overspend on things that can be avoided. Each cent saved is a cent earned.
I also like to calculate everything yearly to get a better idea of how much I can save. Saving 50 dollars per month x 12 is 600 dollars per year. Learn to save 200 per month and you are looking at 2400 a year, which is already a considerable amount of money.
Renting Instead of Buying
If there is any equipment necessary for doing some jobs, but you need it only a few times a year it would be wiser to rent it on a project basis which frees up cash flow. The same goes for any other expenses where buying can be avoided. It gives you more space to maneuver and plan your funds.
Having employees means that you are responsible for their salaries and the cost is fixed. For example, you are paying someone 2000 per month for a full-time marketing position, you have to monitor them, plan ahead, and if something happens and your turnover falls, you still have to pay the same amount of money. If you hire an agency you can pay for work/hours done and scale with your business. And if the turnover falls you can always negotiate a smaller budget with an agency.
Before ordering a service, find at least 5 other providers and get quotes. The best known and marketed companies are not always the best on the market and they will be overcharging for their services because they spend much more on marketing and advertising, paying larger commissions to their sales reps to motivate them. And you guessed it, it all adds up to the price you are paying.
Understand Your Needs
When you are just starting, do you really need the website for 5000 dollars or you can start with a website made by yourself on Wix, Tilda, or other similar services? It is a mistake I have seen a lot of entrepreneurs do and it is a good way to burn through your funds quickly.
As my passion and specialty is sales I have always tried to find a better and more creative way to find clients than the usual – pay for advertising and sit on the phone a lot. Whatever is the service, try to find opportunities to promote your business with little investment. Some of these involve:
- Asking existing clients or partners for references
- Guest publishing on small blogs.
- Bartering – exchanging your service for exposure
- Find your clients in local organizations
- Work efficiently, and create a landing page and create inbound leads instead of working hard on cold outgoing sales
These are only a few examples of how to save money on starting and growing your business, however quite effective ones.
Remember that for a business of any size, operating wisely with your finances is the difference between earnings and losses or even going bankrupt.
Thanks for being with Starting Business, all the best in your journey.
Co-Founder, CEO of Starting Business
If you have any questions feel free to reach out to me on my profile: Martins Lielbardis
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