Startup Savings: How to Keep Your Costs to a Minimum
The startup period is critical. The inception of a new business is a really important time for any business. It can be a very expensive time as well. Most startups are at a stage where they don't have all of their own equipment. They may not have fully worked out their margins and outsourcing/employing may be on the horizon too. This means keeping proper track of all incomings and outgoings. The first few years are crucial and frivolous spending is more than enough to send a business into bankruptcy. If you own a startup, or if you work at one, then take a look at a few of the things that you can do to start trimming back those margins!
Value Necessity Over Frivolity
By valuing an ethos of ‘necessity’, you can allow your business to shave off those added expenses. Integrate this into your buying process. Do you need a full time employee, or will a part time one be more within budget? Do you need that overpriced piece of equipment, or could you use the piece that you already have? Are swanky desks and chairs really necessary, or can you just live with second hand? Always put necessity over frivolity. Separate what you need from what you want and work with that for now. When your startup becomes a stable and steady business, then you can begin to expand into frivolous luxuries!
Always Making The Most of Savings
Don't just buy the first piece of equipment that you see. Take the time to search the web and specialist stores. Find promo codes, discounts, second hand options and carry out your own price comparison. It may take a little bit more time, but if you can save on some money then it really is priceless. Especially as a startup. Saving money can be really simple, so don't buy the first thing that you see and spend some time really exploring your financial capabilities. Here are some places that you can use to save money:
- Charity Shops
- My Favourite Voucher Codes
- Car Boot Sales
- Second Hand Sales
Set Team Goals
Setting team spending goals is a great way to encourage your team to better look after the companies budget. Save small treats up for the team to enjoy once they have reached goals. Some drinks out, cake in the office or letting everyone off half an hour early on a Friday are all great ways to encourage them to keep costs to a minimum! Just make sure that their treat is less than the amount that they are saving!
Boot Sales and Second Hand
Every new business wants to have new, sparkly furniture and tech. But as a startup, you may have to sacrifice these and go for second hand! Car boot sales are literally a haven of unwanted furniture, charis, cabinets and plenty of other handy things too! This is a great way to get some furniture without the high price. Take the time to really look around and don't be afraid to barter. You are running a business here, after all!
Find Some Backers
A great way to get that money in is to find someone who will invest in your startup. Sites like Kickstarter offer a platform for startups to market their business plan to potential investors, so this could be a great place to start. Having investors is great because it will allow you to have some extra money, intel and advice. A lot of backers can offer some great input into the business. Plus you can work out arrangements that work for the both of you. Furthermore, you will have the finances necessary to push your business forward too!
If you are thinking of hiring an employee but are worried about the continued cost of paying a salary then it may be time to consider hiring in some help via outsourcing. Sites like Fiverr.com allow you to post freelance jobs for people to bid on. This is a great way of getting some specialist help at a lower cost than employing full time employees. Plus you can make some good connections as well.
Keeping Track of Your Spending
One of the biggest mistakes that a startup can make is in neglecting to keep track of their finances. By neglecting your finances, you run the risk of not knowing what you can and cannot afford. This will inevitably result in going overdrawn. Always have one eye on what is happening in your accounts. You can’t buy an expensive new piece of equipment if your bank won't allow it.
Working in a startup is a really great experience, especially if you are the business owner. It is an entrepreneur's dream. But don't fall at the first hurdle by spending all of your money and falling into the minuses. This can stop a startup in its tracks. So be sure to follow some of the guidance in this article and, most importantly, never spend more than you are making!