So you’re an aspiring entrepreneur, and you’re looking for ways to shine. Whether you have unlimited funding or are on a tight budget, the best method to build profits quickly is to trim expenses. Before I run down some areas in which you can do just that, here’s how I started my own business:
My wife graduated college several years ago, and we were left with a pile of old textbooks. I knew selling them back to the campus bookstore wouldn’t be profitable, and after investigating several buyback websites, I determined that I could still earn more money. So I opened a seller account on Amazon, listed the books, and sold the books for much more than I ever thought possible. Eventually, I looked around my house for other items to sell and earned even more money. Then a colleague told me about the website FatWallet, a coupon aggregator that offers hefty discounts at a variety of retailers. Using these coupons, I invested my initial reselling profits and the majority of my emergency fund to purchase discounted laptops and small electronics.
This move turned out to be quite profitable. In 2010, with more than $40,000 in gross product sales, I netted nearly $6,000 in profits. Other than some Scotch tape, packing supplies, and the products, I had almost no initial cash outlays for my venture, which I continue to operate from my home.
For those with grander plans, here are four areas that provide ways to save on starting a small business:
1. Office Space
Like the residential housing market, commercial real estate space continues to struggle and is available at deep discounts. Check with local real estate agents on unoccupied office space in your area. And don’t discount an online search, such as on the website LoopNet, a comprehensive nationwide clearinghouse for listings and availabilities. Once you hone in on space that will work for you, negotiate the price aggressively, as many of the owners are desperate for renters.
2. Office Supplies
Look for used and free supplies. Check out pre-owned computer equipment on eBay, Amazon, and Craigslist, and for amazing freebies, visit the website Freecycle. As long as you’re willing to pick it up, you can score quality used office furniture, computer monitors, and more. To purchase discounted paper, pens, sticky notes, and other office supplies, sign up for a loyalty program at your preferred office supply retailer, and you will be alerted via email any time a sale is announced. Whenever you make a purchase, always use a cash back rewards credit card.
Advertising your business is always a necessary expense. However, there are many opportunities free marketing online. Social media marketing is simple and can help you to reach thousands of potential customers. Open accounts on Facebook, Twitter, and LinkedIn, and provide a link to your website. Do your best to make the experience interactive for readers – consider holding contests, offering giveaways, or even supplying coupons to those who refer your business to friends. And always respond to all queries and comments – whether online or in person, the customer should always feel valued.
When you launch a business, wear as many hats as possible to save expenses. For short-term projects that may be outside your realm of knowledge (such as IT issues, logo designs, and website creation), consider outsourcing to freelancers, or bring on temporary workers, rather than committing to a full-time staff. The websites Freelancer and Guru are good places to find these folks.
When planning to launch a business, be sure to choose an area you’re particularly well-versed in or very passionate about. It’s hard enough to start a new company without having to worry about learning the details of the industry. As long as you work within a realm that you are a master of and watch your expenses every step of the way, there is no reason you can’t succeed as a small business owner.
What other ways can you think of to save on business expenses?