When starting a business, many people have a tendency to save money or overspend in the wrong areas. To help you spend your money wisely in the beginning, here are just a few tips on where to save and where to splurge.
Many companies can be started from home – buying business premises could be a waste of money. Even if you have dreams of launching a retail business, it could be worth starting out as an online business first. If there’s no way in which you can run your business from home (e.g. starting a restaurant or a bar) you should still take measures to save money on renting a building – rent can be one of the biggest costs for many businesses and can cripple many startups.
When it comes to buying equipment for your startup, you’re often better off spending that little bit extra. Cheap equipment won’t look good on your public reputation and it may not be very energy efficient or reliable. Investing in decent equipment can help you more easily compete with other businesses from the start – it could even give you the edge over other established companies that may be yet to upgrade their equipment.
Whilst marketing is essential for any new business, you don’t have to spend huge amounts on massive marketing campaigns as a startup. Consider saving costs by relying on DIY marketing in the beginning. This could include building your own website, setting up social media pages, networking, contacting local news outlets and maybe investing in a few flyers. Avoid splashing out on branding or large-scale marketing campaigns as these are often better suited for established companies.
You don’t want to be skimping on security. Startups are most at risk of being attacked by criminals as they often having little security in place – fend off these criminals by investing in good quality security software, a burglar alarm and possibly even CCTV. Some security features could be a legal requirement such as in the case of GDPR laws – you may want to research into compliance solutions for EU firms to prevent yourself getting in legal trouble. You could even consider outsourcing a security advisor to help you put in place measures.
As a new business, you may not need to shell out on an accountant. Save money by doing your own bookkeeping at first – you could try downloading some accountancy software to help you. As you start taking in larger amounts of offering more varied services, you may want to then consider hiring help in this area.
If you plan to take on employees, be prepared to spend large amounts on them. On top of providing them with a good wage, you’ll want to invest money into the hiring process, training and employee incentives to keep your staff loyal. You don’t want your employees to feel undervalued by skimping on them.
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