When starting a small business, most entrepreneurs have limited funds to startup their endeavor. Allocating your resources properly is a critical element in determining whether your small business will be successful or not. In her post “What NOT to Spend On In Your Startup”, Anita Campbell discusses some startup costs which many entrepreneurs make the mistake of spending too much on. Of course, every business is different and you may have to incur some of these expenses, but hopefully this will give you some insight on what to consider when spending your limited funds.
Travel: Not only is this an expensive cost, but it also makes you less productive. While traveling, you are limited on what day-to-day operations you are able to do and control. Aside from an important sales call or meeting you have to attend, utilize Skype, Google Hangouts, telephone or email instead. Skype video conferences and Google Hangouts are great free substitutes you can use for in-person meetings.
Hiring Employees: Hiring employees takes time and is very costly. You have to interview potential candidates, properly train them to bring them on board, communicate with them the company’s vision and allow them time to get acclimated. In some businesses, such as restaurants, you must hire employees for the business to be able to run properly, but many other businesses are better off focusing on marketing, product development, and sales before hiring additional employees. Work within your means and do not expand too quickly without having the sales volume or resources to cover the additional costs.
Large Print Ads: Prepare and print in small quantities brochures, mailers and other small applicable items. Eventually, usually after the first 6 months, you will refine your business and your marketing materials and will know what channels to advertise through to reach your target market. Another alternative to large print advertising is to ramp up your social media presence. The Kutztown University’s Small Business Development Center has a social media guide to help small business entrepreneurs understand how to effectively use social media.
Not Shopping Around for the Best Deals: Besides shopping around and researching many possible vendors or suppliers, you should also consider the vendor’s loyalty programs. Many vendors offer loyalty program discounts. Also, the official partners of these vendors may offer discounts as well. Don’t buy anything until you first look into the websites of your vendors to see what offers or discount programs may be available.
Every business is different and some expenses may be impossible to avoid. There are numerous expenses that an entrepreneur must consider when starting a business. This is just a brief example of some of the costs small businesses can look to minimize. To read Anita’s full article, visit: http://smallbiztrends.com/2013/05/startup-costs-to-avoid.html