There are only two ways to start a business and see profits quickly: minimize costs and get a product/service out to the public to generate income as soon as possible. You’ve got to have something to sell and you have to keep those initial costs down. Actually, the economy is reminding us we should always be seeking ways to keep costs down-even after we are an established success! Regardless, in the beginning there are some crucial ways to minimize startup costs so you can start generating an income faster:
1. Do with as few employees as possible. Hire temps on an as needed basis. Outsource tasks to contract employees. Plan to work very, very hard in the beginning doing as much of the work yourself as possible. Know your strengths. This is called sweat equity, so prepare to sweat.
2. Don’t buy anything fancy. Unless a polished image is a must for your new venture (and for most, it is not), make do initially with second hand furniture, low-cost equipment, basic business cards and a Web site. Caution: low-cost does not mean poorly constructed or designed. Do the best you can with what you have but do not build a Web site if you have no eye for design or an understanding of HTML. Minimize startup costs by outsourcing it to someone affordable instead.
3. Start slowly. Many an established business has failed because they tried to conquer their industry too quickly. Examine each success point to make sure that you have fully “arrived” (i.e. you have money in the bank!) before expanding or diversifying.
4. Develop smart partnerships. Whether it is a business partner in your deal, or someone you can cheaply lease space from or share it with, examine opportunities to leverage smart minds and opportunities to save money now and later.
5. Avoid borrowing. If you can, plan ahead and begin saving for your new business idea in advance. If you have an established business, establish a separate savings account for “business ideas or expansion” so you always have something to dip into when a new hot idea or opportunity strikes.
Don’t bury your business in debt. Instead of being a wage slave, you’ll become a debt-slave and, if careless, find your business profits are greatly reduced because of that. Plan carefully, work hard and watch your business income grow! For more ideas to minimize startup costs, you can learn more about debt-free funding here.
by Steven Schlagel