One of most difficult things about starting your own business is coming up with the money you need in order make things work. Saving money as an entrepreneur is of the utmost importance if you want success later. Reducing expenses can free up money for you to invest in business growth. That means learning to bootstrap stays important well beyond the beginning stages of forming your venture. If you are looking for ways to save money as you start your business, here are some good suggestions.
Avoid Setting Up Your Office Space
Chances are that you don’t need an office right away. There isn’t a reason to lease office space for your business (unless your startup is in retail that requires a dedicated space). Consider working out of your home instead. After all, working from home is suddenly the new normal.
If you feel that you need a separate work environment, you can consider co-working spaces. Basically, these are shared office spaces where you share the space and cost of infrastructure (like internet and phone/fax) with others. You can decide to rent a dedicated desk where you are always in the same spot, if you want. Or you can save even more by being flexible with where you sit. You can even host an in-person meeting there if you need, since they have dedicated meeting rooms for you to use. (Although this might be unnecessary for at least a while during the pandemic.)
By going this route, you share space with other entrepreneurs, and save money while doing it.
Look for Interns
You can save money on your staffing if you look for interns that will work for free, or for very little. Many interns are competent college students looking for class credit. Others are simply looking for a good reference. In some businesses, college students can even teach you the latest trends in the industry, not to mention how they can give you insight into the up and coming generation. As a start up, you can find interns, or low-cost college students who will help you get your business going for much less.
Consider Using Fiverr
Another way to save money is to use Fiverr to help you find people to perform various small tasks. You do have to be careful, though, to screen those you choose to do things for you. However, you can get some help with marketing, logo design, copy writing, and other tasks, for much less than you would otherwise. It’s a great resource to save some money.
Buy Used When You Can
Another option is to buy used for your side business. If you do need to get an office, you can buy used items. From office furniture, equipment, or even supplies, it’s possible to save money when you buy secondhand. You could look for liquidations from other businesses, or from a consignment shop or thrift shop. Don’t forget Craigslist, eBay, or Facebook’s Marketplace either. A slightly used desk chair will work just the same as a brand new one, at half the cost.
You might be surprised at how many people are willing to trade something they have for something you can offer — even if it’s “just” knowledge. If you offer services, you can trade them for the services that another business owner offers. You can also trade in kind, offering products for products – or even products for services. There are entire barter networks that can help you connect with people willing to trade with you.
This is another reason why using shared office spaces are so beneficial. You are naturally gathering with other bootstrapping entrepreneurs. The connections you form there could go a long way.
Check for Free and Low-Cost Resources
There are a number of free business resources available. From opportunities to get free and low-cost business cards, to special deals and freebies, you can find a number of free and low-cost business resources. You might only get a small number of samples, but that isn’t too much of a problem since. As a startup, you probably don’t need 5,000 business cards to pass around. Only a few are required when you’re starting out. So, don’t go crazy with spending a great deal on lots of resources that you don’t need just yet.
Coupons and Sales Work for Businesses Too
Just because you are spending for the business doesn’t mean that all the tools you’ve learned to save as an individual don’t apply anymore. I’m talking about using coupons, discounted gift cards, and waiting for sales. These are tried and true methods of saving, so don’t ignore them just because you are running a business.
For example, there’s no reason not to wait a few weeks for holiday sales if you are in need of a laptop. Or if you are looking for tools, why not wait until a Memorial Day, Father’s Day, or Fourth of July sale that goes on every year?
Don’t Get Hung Up on Labels
Companies have a way of making more money just by labeling a product for business use. Laptops and desktop computers come to mind. For whatever reason, “business laptops” can be more expensive than consumer laptops with very similar specs. In a corporate environment in the server room, some back-end servers can take advantage of business specific form factors and specifications of higher priced computers. But as an entrepreneur who is only buying one laptop for now? Save yourself some money.
Don’t Forget Uncle Sam
Too many entrepreneurs ignore taxes at the beginning of their venture. However, tax savings can be had from day one, just the same as day 1,000 — when mega money is hopefully being made.
You can save yourself some headaches if you can set up the right business structure. So don’t try to save time at the beginning by skipping this step. Talk to a CPA if you are unsure about what will work for your business and personal situation.
Also, by knowing what is a legitimately deductible business expense from the onset, you can spend your money smartly in an effort to get those tax breaks. The saved money will help your business grow quicker.
The Bottom Line
Starting a business can seem very glamorous, but most businesses are started by a bootstrapping entrepreneur watching over every penny. The effort can pay back in spades though.
When I first started MoneyNing.com, I took a 70% pay cut to give running the website full time my full attention. It was hard at the beginning, trying to save money on the business and in my own personal life. But with some luck and hard work, I now get to work at home helping others reach their financial goals without a boss breathing down my neck. All while providing for my family financially.
In retrospect, taking the time to save money to start and expand on the business was a no-brainer. If you want to become successful with your own venture, then it’s best you start learning how to save money as you start out.