7 SMART WAYS TO REDUCE STARTUP COST

 Strategies To Help Small Businesses.

Are you a startup owner with a limited budget? If so, there are many other entrepreneurs and business owners in the same position as you, who want to get more funds for their future goals. 

Reducing your startup cost allows you to increase profits for your business. This article provides practical tips on how to keep costs low for a healthy startup growth prospect. Walk with me to your future!

#1. Prioritize through planning

You'll likely find it incredibly easy to make a massive list of startup costs. The trick is sticking with what's necessary to operate effectively while minimizing any additional costs. And to do that you need to develop your business plan. Create a list of all items your business needs to start and operate, including things like computer equipment, POS systems, office supplies, furniture and salaries. This will help you build out the financial section of your plan and forces you to estimate realistic startup costs. By the end, you should have a budget that accounts for all the needed items, a cash flow statement, which is at this point a forecast to track the financial health of your business and an income statement to understand your revenue and expenses. Having all of this planned out ahead of time will ensure that your business is sustainable and that any upfront costs are manageable.

#2. Digitize your documentation process

Another effective way to reduce costs is avoiding papers or physical documents in your startup business. Dealing with physical documents attracts a lot of costs in terms of storage and space. This is because you'll have to rent a bigger space to store your documents. You can avoid spending a lot of money on your storage space by digitizing your documentation process. This allows you to use the available space for other business operations rather than storing large piles of files.

#3. Diminish communication expenses

With the rise of technology and network opportunity, the internet is considered to be a great tool to communicate with each other, especially in the competitive business world. Instead of using the telephone, you can use the internet which would help you in reducing your monthly communication expenses. For instance, you can use WhatsApp in order to communicate with your suppliers and customers. Besides this, you can also use free email services like Outlook, Yahoo and Gmail. 

#4. Keep track of expenses

Track all expenses from Day 1 of launching your startup. From supplies, equipment, marketing, furnishings, employee benefits to legal and tax consultations. Every single expense should be noted.

Audit your expenses and see if there's anything on the list that you can operate without. Make sure to keep every receipt. This helps you organize and calculate deductions during tax season. To save time and effort, subscribe to an online inventory management tool that integrates with your accounting software. This allows you to mange orders, shipment, payroll and other business-related expenses in one software. 

#5. Bulk purchases

While it is important to keep your startup costs lean, there may be times where buying more upfront is the better option. Office supplies, software licenses, product materials and even service arrangements can easily build up over time. And while you need to be cautious and not buy an excessive amount, you may find that a larger purchase makes more sense, especially if a discount is provided. Take time to compare prices, test products and plan out the use cases for items you'll be using for the day-to-day operation of your business. You may even find yourself building solid relationships with vendors and service providers which can also lead to initial discounts. Don't rush into a minimal purchase right away while making sure that any large purchases are feasible and actually save you money.

#6. Automate your business processes

Business process automation is another effective way to reduce your startup costs. With automation, employees can spend less time to complete a task, which helps increase your business efficiency. It also helps them reduce errors, which they would commit through manual processes. All these allow you to minimize your business costs.

#7. Bring your website to a business app

The final step to reduce the startup costs is to bring your website to a business app. The workings of business websites are entirely different from mobile applications. In order to attract a diverse audience and developing the presence of your market, you need to go the extra mile for mobile users. However, this doesn't state that you are required to create an app from scratch for your business. You can clone your business website into a mobile app for developing a good enough UI for your prospects.

Final Thoughts...

Any business that wants to maximize its profits must reduce its startup costs, which refer to all the expenses you incur when launching a new business. These includes expenses incurred during market analysis, business marketing, purchasing office equipment and so much more. So, if you want to earn profits faster, you must keep all these expenses to the minimum level.

You can learn more about our market entry expertise or get in touch to discuss a potential project.

Are you looking for online jobs in Kenya? Check it out here

How to make money online? Find out more here

Written by: Antony Moturi

   About the Author: 

Antony is a professional DJ, Pianist, Social Media Manager, Content Creator and a Blogger. Besides that he does professional Sound Engineering, Public Speaking and is a Youth Leader.