Six Ways Your Startup Company Can Save Money

By | Posted June 21st, 2012

So, you finally got that big business idea that you’ve waited your entire working career for. Well, it’s time to start your own company and become that successful entrepreneur you’ve always dreamed of. But before you go making any big decisions or purchases, you should already be formulating ways to cut costs on the basics to prevent your business from starting off on the wrong foot. Here are a few suggestions to help you save money on your new venture and how to get that business you’ve envisioned off the ground.

Small Space

Your long-term goal may include that giant skyscraper in the sky with your name in large letters across it, but for now, you’ll need to think of something a little smaller. Some of these office spaces you can choose from can be as high as $1,000 and as low as $250 in rent. To save additional money on your startup costs, you can try negotiating with other office renters for a shared copier, mailing room, and even a receptionist. These small spaces can come with a conference room and a kitchen—all shared with neighboring companies, of course. [1]

Start With Social Media

For regular ads, Google reports that 1 out of every 1,000 users clicks on an ad and spends an average of 11 seconds interacting with it. For ads placed on social networking sites, the average user spends 30 seconds on the advertisement. Not only that, but 35 of every 1,000 will click the link that will redirect them back to a company’s webpage. Don’t waste valuable money and resources printing out pamphlets when you can create your own Facebook or Twitter page for your business, and spend only a small amount of energy and time promoting it.

Don’t Bother With Fancy Office Supplies

Even if you spend 90% of your day in a chair, don’t blow your money on expensive furniture. It will certainly be tempting to buy that memory foam chair with the heated back massager, but you can make these sorts of splurges later on when you’re a little more financially stable. Similarly, you shouldn’t buy more furniture than you need, and sell extra furniture as you replace it later down the road. [3, 8]

Work With Your Vendors

If you have a vendor who supplies your goods, you may have quite a large bill on your hands after a few orders. Ask your vendor if you can possibly defer payments to help separate the gaps in expenditures. Though they may initially be hesitant to do this, once you earn credit with them, they should be more receptive to the idea. On the other side of the coin, though it can be good business to negotiate, don’t constantly pressure your suppliers to lower prices or ever stiff them on a bill. If you do, you’ll probably find yourself without a source of product. [4, 7]

Don’t Panic About Initial Finances

Time is money, but you’ll need some time to make money. Either from investors or your own pocket, startup costs are a reality you’ll have to face. In any business that’s just taking off, it will take a bit for your sales to pick up before you will see any significant profit. Until then, don’t panic. Also, from the time you start your business, you should have some tax deductions available to you.

From the beginning, give yourself a strict budget and never squander your money. If your business idea is tangible enough, you should be actively seeking out interested investors who can help you with your funding. [5]

Hire Interns

What’s the legal way to attract free or cheap labor from well-educated individuals? Easy. Bring in some interns. At this point, someone has told them that not every business will pay for an intern and some might just accept the experience as enough of a payoff. And if you like them, at the end of their internship you can consider offering them a permanent job position. They’ll be thrilled to have a job that will pay and you’ll be enthralled to have someone on board that won’t require training and who has already proven to be valuable to your company. This saves you from wasted time, money, and headaches. [6]

Conclusion

Some expenses are necessary when it comes to starting up your own business but it doesn’t mean you can’t pinch a few pennies here and there. Remember that your goal in putting the initial cash into your business is to have a higher return on your investment. You have to invest money to receive money in return.

Sources
[1] http://under30ceo.com/which-type-of-shared-space-works-best-for-your-business/
[2] http://www.nytimes.com/2011/08/04/business/media/promoting-products-using-social-media-advertising.html
[3] http://excelle.monster.com/benefits/articles/2718-10-ways-to-save-money-when-starting-a-small-business?page=2
[4] http://www.smallbizviewpoints.com/2010/10/20/how-to-reduce-startup-expenses-when-launching-a-business/
[5] http://articles.bplans.com/starting-a-business/estimating-realistic-start-up-costs/62
[6] http://excelle.monster.com/benefits/articles/2718-10-ways-to-save-money-when-starting-a-small-business?page=3
[7] http://www.entrepreneur.com/article/66028
[8] http://www.appraisaltoday.com/cost_cutting.htm