Starting a new business is always a considerable challenge and, if you’re new to the game, you’ll undoubtedly be familiar with the statistic which says that “9 out of 10 startup companies fail”.
People who are certain they’ve taken all of the necessary steps to maximise their chances of success start most of their businesses with high hopes and good intentions and yet the actual success rate of startups remains extremely low.
All of this can be quite worrying and demoralising for new business owners to come to terms with; but, whilst success rates are low, there’s absolutely no reason that your new startup can’t flourish and grow as long as you build it upon strong foundations and manage it with a few crucial principles in mind.
The first and most obvious of these principles is that you should do absolutely everything you can to save money in the early days – and indeed going forward in the future.
Lack of financing has bankrupted many a startup, and if you can eliminate this risk then you can dramatically improve your chances of success in business.
Having said this; below are three essential ways to save money in your early days of trading so you can relieve yourself of a major burden and worry:
- Business Address & Location
- Scale Down
- Invest in Energy Efficient Equipment
Bartering is perhaps the most ancient form of human economic exchange and, in recent years, it has enjoyed something of a renaissance as more and more businesses have realised that they can save immensely on costs by trading solely in goods and services, where possible, with other businesses.
So, if you’re opening an advertising agency and looking for a company to clean your premises, consider offering to pay the cleaners back by taking care of their advertising campaigns rather than by giving them money.
Or if you’re starting a web design firm, consider offering a local copywriter a new website in return for your content.
It’s important to keep in mind what business address you are going to use and where this business is going to be located. Consider how many workers you will require, what markets your business will be targeting and whether you will actually need physical office space.
Many startups have remote workers who may be working from different countries. If this is the case, will a physical office space really be worth the investment? Instead, consider whether a virtual office is the best option for your business. These kinds of offices provide you with office services but without the need to commit to the cost of renting a physical space. The main advantage of this kind of office is that it provides a business address that you can use for mail handling. Call answering services can also be availed of with a wide choice of area codes. These calls are answered by professional, trained receptionists.
When you’ve made the decision to open a startup, your mind can easily become filled with images of you owning and operating your dream business. And whilst it’s good to keep this dream in mind as something to work towards, it’s important to learn to walk before you run.
That’s not to say that you should be pessimistic or unambitious, but rather that you should be aware that your dream business would probably require significant initial capital to create from scratch – and unless you have this capital to hand, you’re very much starting down the wrong path.
If it’s your dream to run a sophisticated Italian restaurant, for example, it may be a good idea to test the water with a food truck or small pizzeria first. Likewise, if you’re selling manufactured goods, it’s probably sensible to start out by focusing on an individual product line, or by selling exclusively online with no overheads.
Energy efficient equipment doesn’t just help to minimise the impact your business has on the environment, it also brings your utility costs down significantly and gives you one less thing to worry about at the end of each month!
You can make some significant savings when it comes to refrigeration systems, heating and ventilation, lighting and in the office equipment you choose.
Saving money in your early days may just be the key to the longevity of your business so it makes perfect sense to barter, scale down and invest in equipment and business practices that are energy efficient.