June 6, 2015
Frugality is a good thing, whether your startup is in the earliest stages or your small business has already achieved success. Fortunately, there are a number of ways to save money without impacting your product or services.
Consider these three frugal hacks.
1. Buy Used
This is a good way to save in most situations, and it makes especially good sense for startups trying to make the most of their money. Second-hand furniture is especially inexpensive, with desks, couches and other items in decent condition often going for a fraction of their original price. You’ll most likely have to arrange a pickup if you’re using a site like Craigslist, but the low price you’ll be getting is worth the extra hassle.
While your office might not have a sleek, consistent style if you buy used, there’s another benefit to taking the used route. Many companies tout their environmental friendliness, and used products don’t generate extra pollution like buying new does.
This is one of those uncommon instances when taking the environmentally friendly route is also a lot cheaper than the alternative. Take advantage of it when outfitting your workspace.
2. Host Pricey Services through Third Parties
I was speaking with a jewelry designer and, being completely ignorant of the industry, I asked her if she cuts the stones herself. She just looked at me with a bit of horror and said, “If I did that I wouldn’t have time to make any jewelry.”
Using third parties to save you time and money isn’t just exclusive to the jewelry industry. It’s what all smart companies do so that they focus on delivering a great final product instead of bogging themselves down in mundane and time-consuming details. This is especially important in the early stages of a startup.
Experts differ on the extent of what should be outsourced, but many agree it’s best to let others handle the non-essential aspects of the company. This can range from payroll to Web hosting services or even your phone system, as Jan Gaul from Merlin Communications has noted. Gaul points out that hosted phone systems are best for startups with limited capital or those with an uncertain future that don’t want to be tied down to expensive equipment.
3. Don’t Hire Too Quickly
It’s sad to say, but the graveyard of failed startups is full of business that hired too quickly. With bloated staffing levels, money is burned through quickly. Sometimes, in a rush to expand, hiring standards are dropped and less-than-ideal candidates end up being hired to fill a position. Too many bad hiring decisions can hurt a company in its infancy.
Of course, hiring too slowly can also be a problem that hampers growth and prevents scaling. What can you do? Think long and hard about your company’s future and goals. Don’t be reactionary. Consider what can be improved in the present. It’s not the normal human reaction, but take a step back and look at your company with a discerning eye and little emotion.
What other growth hacking strategies can your startup use to save money? Tell me in the comments section below.
Image by William Iven
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