1. Plan for the worst
You cannot become successful by mistake, you need to plan accordingly. It is often best to think optimistically but plan for the worst. When starting a business you need to plan for the worst financial position you might face. Make sure you have an emergency fund, which should include multiple months’ worth of your business expenses, such as rent, monthly marketing expenses, and utilities. When you first start you need to be prepared in case you don’t sell enough during your first few months or even your first year to become profitable.
2. Don’t just purchase things with cash
When you first start, cash flow can be hard to come by. Consider other ways to get services or goods you need by offering something other than cash in return. You’d be surprised how often this works, you aren’t the only one strapped for cash, the person on the other side may also be trying to make ends meet and would be more than willing to do a service in return for your goods or services. You can also offer free marketing by offering advertising spots on your storefront or social media pages in exchange for goods or services.
3. Take advantage of free marketing
With the rise of social media, creating an audience is easier now than ever. Before you spend money on expensive marketing campaigns and ads, take advantage of all your free options first to gain a good foundational audience. Gain organic traffic on your social media platforms such as Facebook, Instagram, and youtube. You can create content for these on your phone for free to gain a good following through consistent posting and engagement.
Another great free tactic is a referral program. Create an incentive structure for existing customers to spread the word. Offering a small discount to loyal customers is a great way to encourage word-of-mouth marketing.
4. Rent/Mortgage Hacking
One of your biggest business expenses each month can be your rent or mortgage. To save every month consider renting out parts of your space to others to cover the costs. If you have a big room that could work for meetings, consider renting that out during the day to small companies that need a room for bigger meetings every once in a while. You can also try renting out your space after hours to locals for events or meetups. You may want to consider renting out some space for popup shops during your business hours for local artists or vendors. This is not only a great way to secure some rent money, but pop-up shops can drive customers to your storefront as well. Not only will rent or mortgage hacking save you money on your monthly bills, but you will start building a network that could be valuable in the future.
5. Find some interns
If you find yourself having to use your time for administrative tasks, an intern may be a good option for you. As long as you are providing some sort of education you don’t have to pay them. Most of the time it is required that the intern is earning class credit, so reach out to a local college or high school to see if they have an internship program and if your business would fit their internship requirements. You may have to use some of your time to teach them the skills needed for the job, but once you teach them and they are self-sufficient you will have more time to focus on more important tasks. You may also find a great future employee along the way!
6. Invest in software that you actually need
With the growth of technology has come a large amount of software claiming to make you more productive. This software can cost up to hundreds each month, to save costs, try out these software and take notes of which ones you actually use. You may want to try out free options such as google drive, before moving on to ones you pay for. Be conscious of whether the paid-for software actually makes a difference in your productivity. If you find that software is saving you a lot of time it may be worth the costs, but if you find that you just like the cosmetics of expensive software over a free one it isn’t worth the cost.
7. Think of everything as an ROI
When you are starting out, you really need to be smart about your finances and what you are purchasing. If you are figuring out what you need to get up and running before you purchase something, think about how you will use it. Everything in business will have a return on investment, whether the return is time or money. When you are making your purchases, ask yourself a series of questions before spending. Such as, will this actually make me more efficient? How often will we actually use this? Is there a cheaper alternative that gives me a similar ROI? Going through a series of questions will make you smarter about your finances and spending. Spending is one of the few things you can actually control in your business so make sure you are spending your resources wisely.