Starting and running your own business is exciting….and expensive. Whether you are using your own money, venture capital or a bank loan to get your business off the ground, you need to watch and account for every penny. Here are some clever ways to cut costs. Some may only save you a few dollars, but in end, it all adds up.
Be a Jack or Jill of all Trades
Large corporations have cleaning services, PR and HR departments, a pool of accountants and fresh bottled water delivered right behind the carpet cleaning and uniform drop off service. You, as a small business owner, should fill as many of those roles as possible. Keep your office tidy and do a deep clean on the weekends or during an allotted time once a week. Learn basic bookkeeping skills and pick up your bottled water at the grocery store. Until you have the cash – not the credit – to hire out these services, schedule them into your day.
Jack or Jill of all trades notwithstanding, there are going to be some things beyond your capabilities. In those cases, consider contract services. Rather than hire full-time staff to do your accounting or creating a dedicated in-house marketing team, contract these services to firms or freelancers. Thanks to today’s global marketplace, in many cases all you need is a computer and an Internet connection to find and utilize the skills of a professional freelance service provider. Do your due diligence to ensure your contractors are trustworthy and reliable.
Reward your employees
High turnover is costly. Having happy employees that are invested in the business saves you time and money. Some low-cost ideas to reward your staff include buying a pizza lunch once a month if the company hits sales targets, putting a special trophy or goofy award on the desk of the employee that gives extra effort or has the highest sales (trophy gets moved weekly) and CCing all the employees on emails you send praising a staff member’s efforts. Never underestimate the power of please and thank you. Be polite and respect the people that work hard for you. If you are demeaning, rude or take your frustrations out on your staff, you will be “rewarded” with lower productivity, a bad reputation in the industry and staff that don’t stick around.
Don’t skimp on insurance
You’ve worked hard to build your company, but vandalism, theft or fire can damage your building and your inventory. Without insurance, you would have to build up your company again from the start. Don’t skimp on insurance coverage. It could be the difference between starting over or just a small setback.
If your business does not require the overhead of an office or warehouse, consider converting part of your basement, a bedroom or garage into your workspace. Not only will you save money, you have a cost-effective way to test your ideas in the marketplace without starting in, or incurring additional, debt.
The faster you break even, the faster you can strategize ways to grow and expand your company. The money you save today is the money that funds your company’s strategic growth. There may be a time for the cleaners, the delivery service, the beautiful office and the condo on an island you lavishly allow your employees to borrow; but for now, dream big….and spend small.