by David Bakke
If you don’t think that saving money is important when you launch a small business, just take a look at the statistics: More than 30% of small businesses fail within the first two years, and insufficient funds is one of the top reasons why.
Fortunately, there are ways to save on startup costs when launching your venture, and it’s in your best interests to investigate them. The more you keep costs down in the beginning, the faster you’ll become profitable, which is a key in the beginning of any small business. Entrepreneurship presents a wide variety of opportunities, but if you spend unnecessarily, you’ll find yourself back at the drawing board before you know it.
1. Buy Used.
Consider buying used computer equipment and furniture to outfit your office. You can find a lot of products that are listed as “used” on eBay or Amazon that are actually in new condition. You can also investigate Craigslist for furniture and other items for cheap.
2. Trade Your Services.
Next, work to develop relationships with your vendors and suppliers, and see if you can offer your own services in a trade to acquire what you need. For instance, if you’re well-versed in marketing, you can offer your services to expand the advertising efforts of one of your suppliers in turn for a discount on their supplies or services.
Consider investigating the website U-Exchange. You can post what you need along with the services you can offer. The website is free to use.
3. Market for Free.
When you first launch, skip the expensive marketing strategies and focus on what’s free – namely, social media marketing. You can open up accounts on Facebook and Twitter free of charge and use it to offer new products and interact with potential clients. Respond to all comments and questions in a timely fashion, and post relevant content that your readers can actually use. To further entice interactivity, post questions or surveys for your readers.
4. Go It Alone.
Running a small business is challenging, but resist the urge to bring on staff too soon. You’ll have longer days and even longer nights, but by managing your efforts as a “solopreneur,” you’ll save plenty of money.
5. Don’t Overspend on Miscellaneous Office Supplies.
When it comes to small business ownership, you can never save too much. For your office supply needs, dedicate yourself to one retailer, and sign up for its loyalty rewards program. Not only will you get discounts on your purchases, but you will also be alerted when office supplies go on sale or when mail-in rebates become available.
Some of the typical items promoted are pens, staplers, pencils, Post-it notes, and printer paper. If you pay attention, you can virtually outfit your entire office for a fraction of the regular cost. Just be sure to spend your rewards certificates on items your business truly needs. Additionally, some of the best small business credit cards offer up to 5% cash back on purchases made at office supply stores.
Remember, even if you experience success early on in your endeavor, that is by no means an invitation for runaway expansion. On the contrary, before you decide to grow your business, make sure you have enough staff on board to support the growth, and be sure they’re well-trained to handle the increased business. If you expand too rapidly, you may find yourself back in the employment line before too long.
What other ways can you suggest to save money when starting a small business?
David Bakke is a small business owner based in Atlanta who also contributes his ideas and tips on the blog, Money Crashers Personal Finance.