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Starting a business will cost you money… period. Now, the amount of money you need is determined by the size and type of business. Some online businesses have little to no startup costs, while brick and mortar companies have a large outgo. Either way, it’s important to know exactly what you’re getting into and what the cost will be upfront and for the first year. You want to use the most economical business startup plan you can to get your outgoing cash to a minimum. Here are several tips to consider. I do, however, recommend doing thorough research or consulting with a coach before you get started.
Economical Business Startup #1: Save on Office Space
Though you may want a beautiful highrise office or a shop in the trendiest part of town, you must consider the cost of getting into a high ticket lease. Just as you would with your personal family budget, it’s important to set a business budget that is realistic for where you are.
In the beginning, you may need to cut some corners by choosing a decent space in a lower priced area. However, it is also important to consider what your business goals are and if the location will impact your numbers. This would be true for a retail business. Do online research, consult a realtor, and check out this article that has some excellent tips for securing inexpensive property.
Economical Business Startup #2: Outsourcing
Another way to save money on a startup is to outsource work instead of hiring a staff. Things like IT, security, and customer service are all examples of where you can outsource. Though this might not work for the long term, I recommend checking out businesses like XBASE Technologies, to begin with.
Keep in mind, outsourcing is something you might want to do if there are obvious voids in your team’s skills. One thing you don’t want to do is get bogged down doing things you are not good at. This takes valuable time away from doing the things that will ultimately build your business.
Economical Business Startup #3: Consider Crowdfunding
If you have an excellent idea and plan for a startup, you may be able to secure a part or all of your startup costs with crowdfunding. Sites like GoFundMe and KickStart are easy to use and can help get your needs in front of thousands of people. The more prepared and professional you are in your presentation, the better chance you have of collecting the money you need. You could also try to use a series of goals that go from small to large, so your contributors know exactly what their money is going toward.
Economical Business Startup #4: Savings and Borrowing
Though many business gurus will say that it’s not smart to use your own money for a business startup, however, it may be necessary. Banks look at your investment and personal risk as a part of their criteria for loaning money. Using savings to purchase real estate, equipment, and tangible items is not as risky because you have an investment that will likely increase in value. Furthermore, you could always sell later on if needed. Once you decide what money you want to put into your business, getting money from other sources is your next step.
