3 Tips To Dramatically Reduce Costs In a Small Business
In recent times, we have seen a sudden spur in the growth of startups across all major business sectors. However, one of the main reasons that very few of them ever taste success is due to the fact that most new business owners aren’t aware of the costs of running a company. In fact most startups are shut down not because of their idea or the core product itself, but because operating costs become way too much and they run out of capital before reaching any measure of profitability.
This is why we decided to write this piece today, in order to give the budding entrepreneurs of today, three very simple yet effective tips that can someday end up saving their startup venture from going bankrupt
Spending Less on Premises
Modern media, especially shows like ‘Silicon Valley’ have promoted this idea that every startup needs this sprawling office space with glass doors and beautiful decor to work out of. However, in the real world, most successful bootstrapped startups have grown out of an attic or someone’s garage where the founders have toiled endless hours to bring their dreams to reality. Don’t get us wrong, if you need room for expansion, then you should of course invest in a bigger office space but getting a swanky office can burn a large hole into your company wallet. So, whenever you’re leasing or renting out an office for your own business, make sure that you negotiate the best deal possible and do not overspend precious capital on it.
Purchasing Only Necessary Office Supplies
Now once you’ve got your office space sorted out, next comes the turn of furnishing it with the required supplies. The most common mistake that companies make here is buying all their supplies and equipment new and at retail price. Especially when it comes to technology startups, we often see a large amount of the initial capital being invested into purchasing high end equipment which are often overkill for the job at hand. So, the trick here is to save money and go for the absolute bare necessities. Also if possible, it is advisable to buy from the second hand market as most technology related products can be bought there at a much cheaper rate. If you feel like your current expenses are too high when it comes to office equipment, getting a office stationery price audit might be a great place to start!
Hand Picking the Right Workforce
During the early growth phases of a startup, the total capital doesn’t allow many full time employees to be brought on board. This is where we see many times a single person being tasked with a multitude of roles which often leads to very long stressful work hours and overall decreased productivity. In such cases, it is always advisable to be on the lookout for freelancers that can help ease the burden of the full time employees. Also with the help of Machine Learning and Artificial Intelligence, many of the menial office-centric jobs can now be handled better by dedicated software than human personnel. So, make sure you weigh out all your options, outsource work as much as possible before you spend money on increasing the workforce.
Now all these 3 tips are meant to help you survive the early days of being a small business and should come in handy whenever you think your company is ready for their next expansion wave, but at the end of the day sometimes you need to splurge a bit to get that corner office, or a specialized equipment or even someone who is really talented. If you feel that making that one particular investment is going to help your companies growth potential in the future, then we would always suggest going for it! Because in the end, no matter what anyone says, no one knows your business better than you do!