More and more people are becoming entrepreneurs and starting their own business. Whether it is due to corporate layoffs or just wanting to venture out on one’s own, many are finding that starting their own small business is better than re-entering the ‘rat race.’
However, most new entrepreneurs are not experienced business owners, nor do they have access to a lot of startup capital. Bootstrapping, or saving on as many expenses as possible, is the way to go for many new business owners.
But how do you know if your bootstrapping strategy will work? Here are five tips to help assure that you get the most from your tight budget.
Your First Day Is Not Your Dream Business
Some entrepreneurs have dreams of grandeur starting on the first day they open their doors for business. If you have access to a virtually unlimited supply of capital, then yes, go redecorate a class A office or retail space and build your dream business. However, if your budget is limited, don’t expect to have thousands of customers, employees, and a custom interior designed office.
Work From Home
Bootstrapping means saving cash, but office or retail space requires rent. You already pay for your home, so why not turn a portion of it over to your business? You save money on rent expense and get a great tax deduction for a home office. Consider using a spare bedroom, or converting your garage into a small home office.
When you need to meet with clients, you can rent a “pay as you go” office space by the hour. Or if you want to delve into retail, start with an ecommerce store first so you don’t have overhead rent plaguing your bottom line.
Barter for Services
Sure, you want your cash flow to improve. However, you also want to save expenses to reduce spending. Why not barter for essential services? For instance, offer your web design skills to a bookkeeping service. You can redesign and optimize their website, and in turn, you get accounting services.
Offer ‘Introductory’ Prices
You want to get cash flow moving, so why not offer your first customers a reduced introductory price, say 25% off? You can get a number of new loyal customers and get money in the door right away.
Start with a Simple Website
You don’t need a website with all the bells and whistles right off the bat. If you are not a web or graphic designer, simply use free web building tools and templates provided by your web host to get a great-looking site off the ground. You can always improve and customize the look later when your cash flow grows.