There’s one golden rule in business: you need to spend money to make money. People that can’t get over this fact usually aren’t very successful at business, and they commonly do things like distributing profits as bonuses to employees instead of reinvesting it into their company. In fact, many internet companies are worth over $1 billion but don’t make any profit. This is typically because they reinvest everything they make into their company to grow it. As long as they’re capable of paying employees, they’re fine with making zero profit.
However, that’s not to say you can’t be frugal with your business. There are plenty of business ideas and models that you can use to create plenty of profit to grow a business without actually spending much money at all.
Lower Operating Costs
There are literally a hundred and one ways to reduce the operating costs of your business, so let’s go through of them to give you some idea of what to look out for:
- Hire Remote Employees – Hiring an employee will take a lot of time, effort and obviously money. If you want to seriously cut down on the costs of hiring, then consider using remote employee instead of traditional employees. This will seriously reduce the costs of operation since you won’t need to spend time and money interviewing them, and it opens you up to far more talent than if you only looked locally.
- Make Use of Freelancers – Much like using remote employees, using freelancers is a fantastic way of saving money. This is usually because freelancers can be hired for certain jobs that don’t require a long-term employee, such as designing a website, logo or even writing content for your website.
- Look For Cheaper Ways to Furnish – A startup office doesn’t need to be filled with the latest and greatest in technology or furniture, Look for affordable office furniture or consider using hand-me-downs that you can find on auction websites instead. They’ll provide plenty of functionality even if they don’t look the nicest, and you can save a tonne of money.
- Understand Advertising – Startups don’t need to use expensive methods of advertising such as paying for clicks or advertising in other types of media like television. If you understand advertising, then it’s actually surprisingly easy to use platforms such as social media to create “free advertising” assuming you know how to engage your audience.
Lowering operating costs is perhaps the best way to start a business for next to nothing, but there are a couple of more extras that you can follow if you want to ensure the +longterm success of your company.
Research is Important
One of the most stressful aspects of running a business is keeping up with the latest trends. Once you fall off the map, it’s a long grind back up to the top or even back to a comfortable location where you can stop worrying about your financial situation and more on how to improve the customer experience. Being in that state of having no money to improve but fighting to stay alive is difficult, which is why you need research.
Research is important in many different aspects of life, but when it comes to operating a business, research is what you should live and fail by. You need to understand your audience’s needs, you need to know what they like and dislike about your products and you need to listen to their criticism with an open mind. Research costs nothing thanks to the internet, and it’s one of the most valuable tools you can use to succeed.