So you’ve had an idea for a new business venture but money is tight. You’ve prepared a viable business plan but, given the financial climate, the bank manager is wary. You need to demonstrate, from the outset, that you have the initial financing under control by exercising restraint on your costs to ensure value for money but without cutting corners.
Be cash aware. Ask your customers to transfer payments via on-line banking. Why wait to clear a cheque? If you do have to go to the bank or to a supplier can you walk there? It’s so easy to get in the car but these peripheral costs soon mount up, especially with the vehicle running costs of today. How often have you seen a new business start-up where the priority purchase has been a nice set of wheels. Wouldn’t a van do? It may not be sexy but the VAT can be fully reclaimed on a commercial vehicle and it will be more adaptable.
Organisations such as Business Link are there to help and can often provide useful information and contacts. If you know your product but are unsure as to how to sell it, you could do worse than involve Business Angels – experienced entrepreneurs who freely offer help and advice. They may also be able to advise on premises.
Just now there is a wealth of commercial units of all sizes available to rent or lease. This is an area you can really pin down and negotiate some cost effective long term deals. Once in your place of work you need to think about equipping your office space. Office furniture is expensive and it is easy to let these costs run away with you. However, up and down the land businesses are closing or relocating and there is equipment to be cleared. This is really worth considering. There are many companies who specialise in clearing top quality office furniture and appliances which they resell at a fraction of the original cost on-line or locally. It’s very nice to have a gleaming, minimalist office to impress your clients but, in reality, they’ll probably be more impressed if your prices are competitive!
The same applies to hardware. You don’t need the latest Mac or gadget to get by. Look around for deals or refurbished ‘previously loved’ office equipment. Use Open Source software wherever possible. Why pay for commercial software? There are many sites offering OS ware, for example, www.craig-west.co.uk lists a great range of options. Just be sure to go to only trusted sites.
A lot of money can be spent on marketing – getting your product out there – and a lot of it can be saved with a bit of DIY. Word-of-mouth is one of the best marketing tools around – and it’s free. Ask your customers for recommendations. Tell your family and friends to tell their family and friends. You won’t get your product known if you just sit in the corner. Sadly, the days of the small ad in the local press have gone and paper advertising and random printed flyers are very expensive. The power of the internet is well known and it’s the place to be, but do you really need that custom built website?
There are many companies offering simple attractive template websites, many of which can be self customised, and can purchased with a domain name for as little as £100 a year. Many allow you also to do your own search engine optimisation (SEO). This is thought of by the uninitiated as some mysterious, arcane art known only to a select few who will charge you for the privilege. Do it yourself. There’s a lot of help on-line and you are probably not trying to promote yourself to the world at this stage. Carefully keyworded SEO targeted at your catchment area will get you a good listing within a few short months. And don’t forget social and business networking sites like LinkedIn and Facebook as a great way to get yourself known.
There is much to consider. This article only really touches on the subject of saving money, but, with a bit of thought and common sense about how you approach your business, you’ll be well on the road to success and keeping your bank manager happy. Now that’s the important thing.
Kathy Richardson works as buyer for LAM Office furniture, sourcing both new and used office furniture for a wide range of businesses.