It’s perfectly possible to start a business on a shoestring budget, but you have to be careful of failure due to a lack of resources. It’s crucial that you find the right balance, and are able to provide the products or services your customers want without overspending in certain areas. If you’re looking to drive down your overhead costs and get ahead, here are some points to think about.
Switch Your Communications
Communication is essential in business, but it doesn’t have to be via telephone. Services like Skype and Google Voice are not only more modern but will save you money on your phone bill too. Instead of picking up the phone, sending out an email or a message on your business’s internal chat system could be the better option. Instead of traveling to meetings, use video software to hold video conferences instead. You will save money on lunches, travel, hotels and more. Since almost everything is done online these days, it’s easy to find the right programs and prevents you running up unnecessary bills.
Outsource Areas Of Your Business
Businesses can be wary of outsourcing due to the misconception that it’s more expensive to do so. While there will be costs (the company working for you has to make their money somewhere) overall, it can actually be the more frugal choice. There’s no need to recruit, interview, train and pay new staff, so you save money there. You can keep your office premises small as you don’t have everything going on in-house which will keep your office rent down. And you don’t have to pay for equipment, maintenance, and management of extra staff. It can make your life much easier as a business owner too since once different areas are outsourced they’re essentially out of your hands. You ensure that everything is doing correctly, efficiently and according to the (ever changing) law, so it’s win-win.
Professional IT consulting companies will offer IT outsourcing, you can outsource your payroll department, finance, human relations, fulfillment, marketing... the list goes on. As your company expands, consider outsourcing as opposed to hiring more employees.
Rent Equipment
If you’re just starting out in business without a whole lot of cash, you probably don’t have the budget to be buying all brand new equipment. Rent, instead of buy which will be cheaper to start off, you can always purchase your own later down the line. For example, if you’re a print company you could hire a professional printer for a small amount each week as opposed to having to find thousands of dollars up front. When you’re kitting out your office, look for good deals on desks, chairs and other office essentials. Again you can always replace them at a later date, but it means you don’t have huge costs to fork out right away.
Plus, while you’re renting you save on maintenance costs. Since the equipment doesn’t belong to you, if it develops a fault it’s the hire company’s job to fix it.
What advice would you give to a new shoestring business in regards to overhead costs? Share your thoughts on Twitter @MikeSchiemer #BootstrapBusiness.
I hope you enjoyed this article about being on a shoestring budget and simple ways to reduce overhead costs.
Interested in more articles about reducing business costs?
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Published by Michael J Schiemer
Owner of the Bootstrap Business Blog
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