The first year of business is always the hardest, no matter what type of business you’re running. Many businesses won’t make much of a profit in the first year, if any at all. So, it’s important to keep costs down so you can build your business without worrying about going into debt. Here are few ways you can cut costs during your first year.
Operate from Home
Running a business from home will mean you don’t have the added costs of maintaining premises. Even renting a small office space can be costlier than it’s worth. Do you really need that office space or that small store? It’s sometimes more cost efficient to work from home and base your business entirely online. Operating your business from home will mean that your electricity, gas, water and other utilities are already accounted for because you were paying for them before the business was set up.
Cut Office Costs
If you do need to operate from an office, there are lots of ways you can cut costs. For example, look at different locations. Increasing the work commute by five minutes could make a big difference to your rent. You can also save on your heating bills by using infrared panels to warm your employees during cold spells. Try and invest in second hand equipment, like refurbished computers and laptops. Often times, they’re as good as new but half the price. Buying office supplies in bulk can also help you save in the long run.
Negotiate with Vendors
If your business relies on buying products from vendors and suppliers, then it’s important to establish a good relationship from the start. If your supplier knows you intend to give them repeat business and your aim is to increase the amount you purchase each time, they may be willing to negotiate on price to keep you as a loyal customer. Don’t be afraid to barter somewhat- they can only say no.
Work with Freelancers
The beauty of working with freelancers is you don’t have to offer a permanent contract. That means, if the work isn’t there, you don’t have to continue to pay your workforce. Freelancers are a lot more flexible, which means you can hire as and when you have the need. It also means you can get a lot of your work done online, saving you additional office space. For example, paying a content writer to write for your blog can be done on a blog-by-blog basis, rather than having to pay a writer a salary.
Free Software and Online Tools
When you’re running a business, it’s a good idea to get all the help you can. However, that doesn’t mean you have to pay big money for it. There are tons of free online tools you can make use of and free software that will help you run your business easily. From scheduling meetings to posting on social media and paying employees, there isn’t much you can’t find when you look hard enough.
If you’re willing to carefully watch your money in the first year, there’s no reason you shouldn’t successfully enter your second.