Starting a New Business With a Smaller Budget?

I guess depending on what industry you are in, will depend on the type of equipment, staff, supplies and space needed for your new business.  But let’s start with one of the larger expenses and commitments, which would be your location.  If you can start your business from your home or place of residence, you will not only save on rent, but you will relieve yourself from the commitment for the office lease.  Most office leases these days are anywhere from 12 months to 36 months.  In rare instances you can even find some month to month, and that might be your second option.  If you need to have a brick and mortar (physical location), and you have walk in clientele then you might want to consider subleasing an office from another company that has extra space or even consider looking into an executive suite.  What’s nice about an executive suite, is that they are typically month to month, they offer the furniture, printers, internet, receptionist, and sometimes even phones and computers.  Now keep in mind, it’s like a la carte, the more you include the higher the lease.  It gives the perception to the customer that you’re a larger company and established.  But since this topic is about small start up businesses with smaller budgets, we’ll suggest keeping the business from your place of residence until you see a consistent profit.  Not only is this going to save you money, but in some cases you can write off a fraction of the expenses towards your business. It is recommended you speak to your CPA or tax advisor about anything related to your taxes. For your protection the most important item on your to-do list would be getting your corporation set up. There are several websites out there that can set up your coporation for you, or you can find a local attorney that can offer this same service. In a previous post we covered the 5 steps needed to starting a business, take a quick look when you have time. If you business requires a computer or multiple computers, I would always recommend finding the best deals online.  Buy the basics, what will get you through a couple of years.  And again, when you see that profit turn the corner you can pony up for all the bells and whistles.  While we are on the topic, most computers these days comes with software.  But sometimes if you buy the computer used, or a lower end machine it might not come with a word processing software like Microsoft Word in Microsoft Office.  I think most business owners can agree that software can be expensive and if you can find a way to get the same results for free wouldn’t you want take that route instead?  Imagine having to buy software for multiple workstations, which added up can be very expensive.  Well if you do some research, you might be able to find something for cheaper or even free.  For example, if you need a word processor software, Google has been offering theirs for years now.  The best thing for new business owners is it’s free and it’s all in the cloud! Giving the perception of a larger company can definitely help.  It’ll give more confidence to the consumer.  So if you decide on working from home in the beginning, it might  be a wise decision to get a PO Box for your business address.   I will touch more on what type of PO box to get in a different article.  These days the consumer will use different ways to determine if they want to conduct business with your company, Facebook, Yelp, BBB, and in some cases Google Maps.  Yes Google Maps, I know for myself I’ll pull up Google and check out their location to see if they are in an actual office setting or are they operating from home.  Now we all know that’s not fair to judge a company based on where they are operating from, but let’s put yourself in the customers shoes.  Let’s pretend you are buying vitamins or health supplements, and you were about to spend $150 on these items.  Would you feel more comfortable buying those items from a store or from someone’s house?  They might be identical products, but the comfort of knowing you’re buying from a commercial storefront might encourage you to buy from the store versus what appears to be someone’s home. Technology is like a double edge sword, it can be expensive but it can also save you money.  Word processing software like Microsoft Office can be quite expensive especially if you have multiple work stations that will need the software.  There are several companies out there that offer free software.  But be prepared for some minor glitches or maybe even less functions that you might be accustomed to.  A well known one out there is Google Docs, they have a word processing software that is all Cloud based.  That’s another benefit and another way to save some money is using cloud based forms.  It’s another form of backing up your documents versus paying for another external hard drive or paying for a back up service. I know personally when I’m looking to buy something for the business or even for my personal use I will consider buying it used depending on the item is.  For example, if your office needs a commercial size printer most of them are well built and you will be able to find them used and save a significant amount of money if you can find a company who specializes in used commercial printers.   You don’t always need to buy used items to save money, with the internet these days online retail sales is a very competitive market space.  Before paying for anything, whether that be office supplies, office equipment, or even office furniture you should always search online for coupons.  Even finding a “free shipping” coupon is worth the extra couple of minutes to save some money.  Who knows how much you can save your company over a years time. So these were just some simple steps on how you can save your company money, there’s nothing wrong with saving money.  That only means you have more money to invest in other areas of your company.  One of those areas of investments might be advertising.  How are people going to know who your are and what you are offering unless you advertise?