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When you are working at building your business, it's one of the most difficult components any of us have to deal with. Finances can keep us up at night, give us the biggest headaches of all, and when we've got employees who rely on us to ensure they are paying their bills, this is a lot of pressure. Naturally, we look at finding ways to save money as a common practice. But when we're starting out, we hear so much about the maxim of needing to "spend money to make money" or investing in the right areas. Ensuring that you put a lot of money into your business is essential. But this means we can be out of pocket. So, from our perspective, as the people who are in charge of our business, and we have to find ways to cut corners, but without compromising the integrity of the company, or cutting employees' salaries, what are the best tactics we can utilize?
Scouring The "Personals"!For people who make the transition from average citizen to business person; it feels like stepping into a completely different world. It's a world where we don't know where we can get help. As you develop, you become acquainted with like-minded business people, you start to network, and eventually, you begin to find the resources that benefit you. But when you step into this larger world, you can forget about some of the basic practices that can help you. Second-hand items, for example, are wonderfully cheap, especially when you are trying to get your business up and running but don't have the capital just yet. And as you progress in your chosen industry, you find the business equivalents of the personal ads to see you through. Whether this is finding cranes for sale in order to help you thrive in the construction industry or you need to buy raw materials in bulk, when you are looking for the cheapest items, you can't underestimate the alternative channels. While established businesses have their own preferred suppliers, when you are finding your feet, and you don't have the money to invest in shiny new equipment, you can't underestimate the business equivalent of the personal ads!
Ain't Nothing Going On But The Rent!The elephant in the room, as far as trimming the fat is concerned, is office space. In short, do we need it? These days, we've got super-fast internet, meaning that, if the circumstances are right, we can hire people to work on a full-time basis at home. Office space isn't just the rent, it's the smaller components to go with it, from the health and safety to the cost that was factored in based on the location. But now, there are many ways for you to save money but still maintain a business that's efficient and professional. If you were to hire employees on a full-time basis, on the proviso that they work from home, you would save considerable amounts that you can reinvest back into the business. Many entrepreneurs believe remote working to be a poisoned chalice; even though money is being saved, productivity is greatly reduced, not to mention the communication problems that can arise. After all, isn't it simpler to speak to someone in person when there is an issue, so it can get fixed quickly? But, we work in the same building as other people, and there are only a few floors separating us, we still send them an email! And with this in mind, surely it's not any different than sending an email to someone who is working at home? And also, we've got numerous ways to communicate and collaborate. Not only can we Skype someone if necessary, but we can collaborate with someone effectively on a project in spite of distance. If you want an efficient workforce, but you don't want to pay office rent, this is feasible. It does require a different set of tactics when it comes to leadership and management, but many companies have successfully made the transition from office base to home-based work.
What Do You Deem "Necessary"?Everybody has their own opinion. But if you believe it's vital to have expensive lunches on the company payroll because you may net a new client over dinner, surely there are other ways around this when you need to save money desperately? We can get accustomed to a certain lifestyle- this is obvious. But is it ethical for you to spend money that tends to go into other aspects of the business that will benefit you in the long run? Now, a lot of entrepreneurs go completely the other way and don't even pay themselves a wage. This is only feasible if you saved up enough money over the years to keep you afloat, but for the vast majority of those who require a regular wage, we need to pay ourselves in accordance with the role. But when you crunch the numbers, and you see that these little flourishes of expense here and there add to a lot, so much so that you could hire an employee on a part-time basis, you've got to get your priorities in check. A lot of us are excited by the entrepreneurial lifestyle, especially when we are new to it, but if we've got to cut back on expenses, so the business can benefit, we've got to look at our own little selfish expenditures and ask ourselves, is this really "necessary"?
Are You Investing Too Much?Social media seems to be one of those areas that are essential for any business to fly now. Many entrepreneurs believe that investing above and beyond into paid advertising, like Google or LinkedIn ads, are the best way to grow any burgeoning business. But while many companies spend a considerable amount on paid acquisition, there are some tricks we can take advantage of so we can promote a business, but without going over the top. Search Engine Optimization is one of those things that everybody has got to get in bed with, and when we pay a marketing agency to do this for us, is this money that's better invested somewhere else? After all, is it cheaper to hire an employee that knows how to do this, rather than paying for an agency that charges through the nose? But this boils down to the idea of quality and quantity. If you are desperately searching for leads, are you going to benefit through paid acquisition channels? Not just marketing agencies that craft your campaigns, but other marketing strategies like Call To Action (CTA) marketing, email marketing, as well as the many other components which can be quite costly. Many companies that don't have any funding have to learn the ropes by themselves, so would it be cheaper for you to hire someone that already has the knowledge and can develop with these new marketing techniques, but also take over the duties integral to the business?
Do You Need To Go It Alone?Perhaps the best money saving technique is something that can be done before any documents have been signed. Forming a partnership rather than going it alone can benefit you in so many ways. For example, if your skill set lies in the creative aspects of business, such as design and content, and you have someone that is great with money, as well as the marketing and the customer service side of things, you balance each other out. This works wonders when it comes to setting up a business that can go far because you don't have to go it alone in any way at all. Financially speaking, you can both share the burden, but be aware that jumping into bed with someone else can cause fractious relationships. It's a way to save money as well as a way to distribute skills effectively, but it requires two people who are on the same wavelength when it comes to all of this. There are many business partners that have fallen out in spectacular fashion due to disagreements. Democracy is all well and good, but does this help in business? As far as saving money is concerned, if you work with someone who is already established in a certain field, such as web development, they have the tools as well as the talents, and so you are able to trim back the costs of setting up the website. The website is an essential commodity now, but as there are (expensive) tools online that enable us to create a good quality website ourselves, having somebody that's well-versed in the practices is common financial sense.
It's part tactics, part introspection. When looking to cut costs in business it has to come from a place of well-meaning. We can cut corners that positively impact the business but negatively impact on employees. This isn't going to win you friends in the grand scheme of things. But this means you've got to decide on what is essential, and when we have wages to pay, not least our own, we've got to undertake a lot of soul-searching.