Despite the alarming number of articles on the web about the failure rate of small businesses, over 500,000 new businesses start each month. To help ward off the bad influences that can bring a small business to ruin (e.g., running out of money), here are 9 ways to cut startup costs in your new business.
- Outsource, don’t hire—especially in the beginning: Instead of paying full-time employees right off the bat, try outsourcing tasks on an as-needed basis. Hire a freelancer to run a marketing campaign, set up your mobile strategy or get your business’s finances in order.
- Share office space: If you have a great workspace at home, and there are no zoning restrictions prohibiting it, working from home is a great way to save money. When you do need more space, consider finding a business to share office space with, or check out some nearby co-working spaces.
- Barter for services: Bartering is still taxable in the eyes of the IRS, but you will save cash by trading services and products with another business. You can set up your own agreement, or look for a local barter exchange or online barter service.
- Keep important documents in the cloud: With daily backup and cloud storage, you won’t have to spend so much money on paper and toner to print out documents. Ask yourself “Do I really need to print that?” before you push the print button. Plus, moving your data to the cloud eliminates the need to purchase and maintain your own servers and storage.
- Bundle your tech: Most telecommunication companies now offer discounts if you get your wireless, Internet and phone systems in one package. If you have a choice as to which company in your area to use, be sure and shop around for the best deal.
- Go green: If you can make some small eco-friendly changes, you’ll not only save money, but you’ll be doing the environment a favor, too. Change all the light bulbs in your business to energy-efficient ones, use reusable cups and turn off computers and monitors when not in use.
- Offer employees telecommuting options, if possible: Telecommuters save on travel costs when working from home—and consider it a big perk. You’ll save on having to provide work space and on utility bills.
- Ask vendors for discounts: Find out if you can you get a lower price if you pay in cash, pay early or buy in bulk. Also, check into discounts that may be offered as a benefit of membership in industry or trade associations.
- Make charitable contributions: Have you considered giving more to charities to increase your tax deductions? You can set up monthly donations with one or more charities, so the same amount is automatically charged to your company credit card each month. As far as asset donations, in the rare case you have assets that have maintained value or appreciated in value, you can donate the item to a charity and take the write-off. In the more likely case that the item has depreciated, you can sell the item, donate the proceeds to charity and then write off the difference.
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