Have you recently launched a new business or are in the midst of doing so? While it’s no doubt an exciting time for you, it can be an incredibly stressful one too. There are so many moving parts to account for, many of which center around your finances.
After all, there’s no denying the fact that starting a new business can be a costly endeavor. But that doesn’t mean you need to spend through the roof to launch a successful business. If you know a few simple, but impactful ways to keep your costs down, you can remain on-budget and still achieve everything you set out to.
If you’re after a few tips to get started, keep reading to discover our three best ones for keeping your new business’ costs down.
1. Outsource Your Staffing
There are no two ways around it: hiring in-house staff is usually one of—if not the most—expensive overheads in your new business.
You not only need to pay for their salary and healthcare, but also for an office, furniture, stationary, and bills such as electricity, internet, and heating. And let’s not forget about all of the additional perks you may wish to provide, such as bonuses, snacks, and social events. It can all quickly add up, which is undesirable when your cashflow is already minimal at best.
So why do so many new businesses rely entirely on in-house staff?
Unfortunately, many new business owners assume that doing so is a mandatory part of launching their business. But the reality is that it’s unnecessary to have all staff on your full-time payroll, working in the same office as you. This is particularly true in the current COVID-19 environment.
If you want to seriously cut down on your business costs, outsourcing work to offshore professionals is the way to go. It’s incredibly cost-effective to do so because you don’t need to cover any of the costs we previously mentioned.
Nowadays, you can outsource almost any of your business processes: software development, customer support, call forwarding service, accounting, etc.
Plus, you can hire such professionals on an as-needed basis, making it easier to keep your budget on track.
Hiring remote staff also gives you access to top professionals around the world. For example, you can hire everyone from the best of the best software developers in Belarus to the most highly-skilled ones in Argentina.
2. Build a Knowledge Base
Imagine if your customers could instantly get the answers they’re searching for about your company’s products or services without ever needing to email, message, or call your company?
This is precisely what a knowledge base is designed to do. A knowledge base is an online system that stores answers to common customer queries. There are countless benefits to setting one up.
For starters, if your customers could consult your company’s knowledge base instead of contacting your customer service channels, you would be able to downsize your customer service staff costs. Moreover, as they’d need to answer fewer queries, your customer service staff would have the time to focus on solving more complex customer service problems.
But before you start setting yours up, keep in mind that in order to reap such benefits, your knowledge base needs to be comprehensive and easy for customers to use. Needless to say, this takes a bit of work. You also don’t need to go about it alone, however. If you use well-designed knowledge base software, you’ll be able to easily create, edit, store, and stylize your knowledge base content. Additionally, you can set up small business phone systems to provide better customer support and answer questions faster.
3. Downsize Your Marketing Budget
When you’re trying to get your new business on the map, it can be tempting to spend a small fortune on executing your marketing strategy. A bigger budget will equal bigger results, right?
Not necessarily. As a new business owner, you simply don’t have the luxury to spend big on your marketing, especially when positive results aren’t guaranteed. Remember, you can always expand your marketing budget once your business takes off.
One of the best ways to keep your costs down is to hold off on any expensive marketing campaigns and switch to effective, low-budget marketing ideas. For example, you can try your hand at writing for industry publications, cold emailing/calling prospective clients, or staging a guerilla marketing campaign.
There are plenty of online resources on the matter to guide you in the right direction, so finding inspiration won’t be hard.
4. Stick to the No Inventory Model
Since storage costs could make for the majority of your expenses, starting an online business with no inventory makes a lot of sense. Consider that there are no guarantees of you selling the goods in time. If that happens, storing an inventory for a long time leads to losses.
As a new business owner, you need to be pragmatic about where and how you spend your money. If you aren’t, the future of your business can quickly become compromised. As our three tips above demonstrate, keeping your costs down doesn’t need to be painful. It just involves doing things a bit differently—which is precisely how some of the most successful businesses around today got their start!