The majority of startups fail and we think that most of these failures are due to overspending. If you are running your own business in 2016, you need to think about how to cut costs from the word go. Otherwise, before your business even starts to make money, you’re going to be in debt. There will then be a long road to recovery that most entrepreneurs don’t reach the end of. Instead, let’s look at some simple ways you can keep costs under control from day one.
Don’t Buy Property, If You Can Avoid It
We understand of course, that this isn’t always going to be possible. If you’re manufacturing a product you will need a shop or factory. But if you’re eager to set up an online company, you can run it from home. There’s no need to rent or buy an office. You are just giving yourself an unnecessary expense if you do this. Setting up a new company from home is easy. You just need to make sure you have a good internet connection. You can use this to connect to any business partners or customers. If you have jobs you can’t complete, outsource the issue to another company. This is the best way to control your costs.
Do Some DIY Work
Another big spend that entrepreneurs make from day one is the set up of their business. Rather than getting their hands dirty, they hire teams of staff to install equipment or even just bring in furniture. But there’s no need. In fact most of the work can be completed by you or with the help of your team. Take duct systems on a shop floor in a factory as an example. These are needed to keep the air free of dust in a factory and make sure the environment remains in good condition. But you don’t need to get someone else to install a dust collection pipe for you. Instead, you can use ductwork that you can clamp together yourself. That’s just one example of how you can DIY the setup of your business.
Don’t Borrow Money
If you can avoid it, you do not want to borrow money to set up your business. In some cases, this isn’t possible. You’re not going to have enough money to buy a factory in your personal accounts. But at the very least you do want to control how much you owe. The last thing you want is a heavy debt weighing on your head. Instead, look for a source of financing that won’t push you into debt. Governments are interested in funding startups that have a high chance of success. As are private investors. These are the sources you should be reaching out to before you take out a business loan.
Do Get Insurance
Lastly, you do need to make sure that your business and any financial investments are properly insured. You’d be surprised how often a business experiences a theft or criminal act in the first week open on the market. Without insurance, an incident like this would cripple your company. Don’t take that risk. Speak to an insurance company today and make sure your business is covered for all possible damages.