According to MBDA.gov, the average cost of starting a business from scratch was just over $30,000. Not exactly a small amount of cash. Of course, some businesses, particularly home-based and online businesses, cost quite a bit less than that to start. Either way, getting your business off the ground the right way means saving as much as you can so that you’ll be able to handle those inevitable bumps in the road along the way.
Businesses like Boston-based HqO know this all too well, as it’s already making waves with the latest tenant engagement platform to hit the Boston real estate tech scene. The startup business likely kept some of these tips in mind on its road to success.
Take advantage of smart marketing
Instead of shelling out a ton of money to reach new customers, aim to focus on more organic methods. For example, use social media to engage your target demographic without appearing as if you’re just posting an advertisement. You might leave an encouraging comment or offer advice related to your industry/products/services.
Perhaps you’re starting up a travel company that focuses on tours to Italy – you might search for Facebook pages that focus on beautiful photos of the country or other groups with travelers looking for ideas. Offer advice, building brand trust by sharing your knowledge, and the next time someone is looking for a service or product within your niche, they’re likely to remember you.
Be Frugal with Overhead Expenses
Do you really need a fancy office, or can you get by with something simple that will take the pressure off the need to generate revenue faster than you’ll probably be able to? If you don’t expect many customers to frequent your place of business, avoid the urge to splurge on your workspace. If you’re a startup of just one or two people, you can easily work right from home.
If an office is a must, consider using a co-working space. Not only will you save money, you’ll be in an environment where you can completely focus on building the business without the stress of long-term commercial office rent, and you might have the chance to learn from others with more experience among many other benefits.
Think About Bartering
Bartering is a centuries-old practice that can still be taken advantage of today to save lots of cash. What services/skills/products do you have that you can trade for things that you need? You may be able to trade writing a press release for advertising or other services, for example. There are many ways to find opportunities these days for bartering too, from word-of-mouth and community bulletin boards to Craigslist, Facebook, Nextdoor.com and more. It’s a potential way to meet new customers too.
Hire Freelancers Rather Than Full-Time Employees
Hiring freelancers rather than full-time employees, at least at first, can help you significantly cut costs as you won’t have to pay related taxes, insurance or other benefits. Oftentimes, as they’re paid per project or by the hour, the total pay is much less than if you’d hired a full-time employee too.
Shop Around for Everything, and Learn to Negotiate
Never forget that every dollar saved is a dollar that can be put back into your company, leading to greater growth and better cash-flow flexibility. While you don’t want to be so frugal that quality is negatively impacted, you should be negotiating prices wherever you can – oftentimes the price mentioned or listed is expected to be countered anyway.