Let’s get real. Finances is always a critical consideration when starting a business and limited resources has always been a number one challenge.
So how can you get through with this?
I had first-hand experience on this seemingly overwhelming challenge with most of my startup businesses. And sometimes (more often actually!) , it’s also because I don’t want to spend too much on a business startup unless am sure that any additional cash investment will give me returns in exchange.
When I started a massage business with my friend, we had limited resources but it didn’t stop us from pursuing our business. We just needed to find ways. But hey, all the businesses I have started were from my limited resources! I guess my motto has always been –
Limitations and scarcity can hold us back in a lot of ways. But you know what mama? It can also spark our creativity. For me it did — so many times. And it worked! I had to make do with what I have and what I can afford.
Being an entrepreneur means finding solutions to daily challenges. With resourcefulness, influenced by necessity (haha!), produces a whole bunch of creative solutions that helped me find true money savers.
Here are 8 creative hacks I have used to counter financial limitations:
1. Use Second Hand Supplies
Your new business doesn’t have to be sparkling new. If you have existing equipment, furniture or supplies, by all means use them! You may also find bargain prices from closing businesses.
In the massage business I have mentioned earlier, we were able to salvage old massage beds and lighted signages from my partner’s previous business as well as our personal couches and cabinets we no longer use. With a little refurbishing, it was almost good as new! Check out your home or maybe ask a friend, you might just find business treasures from your or their junk.
2. Form business tie-ups
Marketing and promotions may entail some budget. Looking for business alliances who are willing to trade is a good marketing and financial strategy. Instead of shelling out cash, I used my products and services.
I have tied up with a marketing company who will cover the printing, promotion and selling of our business coupons in exchange of our discounted products and services. They got the sales from the coupons while we gained new and returning customers responsible for our increase in sales.
Another option is having your products offered by another business whether they have a physical or online store. They get a commission for every sale, without you spending rent for the space or ads for an online presence. Isn’t that clever?
Am sure, with a little creativity you can think of more tie up options.
3. Use Free Resources
Setting up your business may also require certain systems and softwares to be installed to operate more efficiently.
Instead of purchasing, with some research, I was able to use free accounting and booking softwares. In exchange of spending cash, you might just have to spend some time finding appropriate resources for your business that are free to use.
4. Maintain Minimum Inventory
A stocked inventory means the amount of your money sleeping. Through careful projections, maintain a minimum inventory of your products that you have projected sales or usage in a week or a month. It will allow you to use your money for other business needs or even roll it before your next inventory purchase.
In my wedding favors business, since this is a pre-order basis which I have ample to prepare, I don’t usually stock my raw materials. I only purchase depending on orders placed within a period. Since I ask for a down payment, am able to use my client’s money with minimal addition to purchase whatever is needed to complete the order.
For the massage business, we started with a minimum inventory of spa supplies while we are still assessing which services are highly availed. From there, we were able to project our weekly requirement and purchase our supplies twice a month.
5. Use your Network
Your group of friends, family, organizations and the likes can be your powerful resource to help you with your business startup. If you can tap them with their skills and talents to help you out, it can save you a lot of cash. Your social media group is another network you can tap to promote your products and services for free or for a minimal amount.
When I started a spa business with my sister, we were able to get free exposure from a blogger friend who featured us in her online site during our opening and every time we do have special events. A cousin of one of my friends was an interior designer who helped us with our spa design. We have used our personal social media accounts to promote our business to friends, family and colleagues. We were able to book group spa parties and even spa gift cards through the help of our friends with connections to organizations and companies.
Look around you. Help is just around the corner. Don’t be afraid to ask for it. Friends and family are usually willing to lend a hand.
6. Do it Yourself
For a startup, a hands-on approach can be very beneficial for you to learn the ins and outs of your business. if you can learn it or have an existing knowledge or skill on a particular task or business requirement, why not do it yourself. It will cost you time but will save you the cash.
I have been a DIY startup entrepreneur. I make use of the skills and experience I already have like setting up accounting and operating system for most of my businesses. I enjoy learning so I was able to set up my own website, social media platforms and even design my business logos and marketing graphics.
For some entrepreneurs, doing most of your business startup stuff is something they may not recommend as you lose focus on the more important part of your business.
Though part of it may also be true, but personally, I see this as an opportunity to learn the ins and outs of your business especially now that you are still on the startup phase and have limited funds — more often, not even capable to hire people to work for you.
This will be helpful later on so you can set up a better control system to manage risks and failures on the different aspects of your business operations and delegate work properly when you start building your workforce.
7. Find a Good Supplier
A little research can go a long way. Don’t be lazy in making comparative study on various suppliers of your business. Determine which will give you a better package in terms of cost, efficiency and dependability.
It’s not enough to just find a supplier with the cheaper price. Depending on location, consider shipping costs if any and how efficient are they in terms of lead time — like how long can they deliver your orders from the time you have placed it?
Can you depend on the supplier for providing consistent quality? Are the materials or supplies always available? Do they provide discounts or free shipping? Are they accommodating?
Now, don’t depend on just one supplier. Make sure you have at least 2-3 suppliers. It’s best to have a back-up in worst-case scenarios. Just another tip, you might want to use the average price of the 3 suppliers or the highest one when you do your product or service costing to provide allowance or contingencies not only for unexpected scenarios but also for possible unannounced price increase.
This happened to me several times on different businesses and having various suppliers was a life saver. Your credibility as a business is important to keep your customers and so is consistency. So don’t take this for granted.
8. Think Green
If you can use energy efficient fixtures and appliances, natural lighting, well ventilated space, and implement energy conservation methods as you tackle your business, it can minimize your energy consumption and expenses.
Implementation of these green ethos not only lessened our utility expenses but also reduced our carbon footprint. Awareness on energy conservation and its implementation has become an integral part of our task and responsibility not only in business but in our personal undertakings as well.
Have you tried any of these hacks to work around your budget? Any other creative ways you have employed to surpass money challenges? Share it with others and leave a comment.
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