The majority of new businesses have limited cash flow, and this is something that can lead to failure. In fact, statistics show that 50% of businesses fail within their first 5 years, with 82% stating issues with cash flow as the main reason for closure.
Ensuring your business has positive cash flow may be essential to success. To help you on your journey, here are 5 ways your new startup can save money.
- Use Free Marketing
A good marketing strategy is essential for any new startup, but it can be expensive. Thankfully, startups have access to an amazing source of free marketing: social media. Using social media allows you to build brand awareness, increase your company’s following, and generate leads. Develop a social media marketing strategy to market your company while also saving money.
- Go Virtual
While it may be nice to have your own office, when launching a new business, it’s not always necessary. Instead, you could consider going virtual as technology allows you to work from any location and can reduce overheads. However, it is important for your business to present a professional image. To do this, you could invest in a virtual business address, or if you need a space to meet clients, consider hot desking.
- Rent, Don’t Buy
While you may be tempted to run out and buy equipment for your new startup, this is expensive and not always necessary. Rather than purchasing, you may find you are able to rent the equipment your business needs. If there are instances in which you really must buy, you can save your startup money and limit damage to cash flow by opting for used.
- Outsourcing and Interns
Hiring employees can be time-consuming, expensive and impractical. Due to a varied and unpredictable workload, most startups don’t need to hire full-time staff straight away. As such, new startups can save money by outsourcing tasks (such as bookkeeping and admin), or by hiring an intern, who will work for free in exchange for learning new skills.
- Form Local Relationships
Forming good relationships with local businesses can help a new startup to flourish. Go to networking events where you may find a mentor; meet with other startups who may be willing to offer service swaps; and form good relationships with local suppliers and delivery services that can help your startup provide a better service.
Increasing cash flow can help to safeguard your new business, reducing the chances of failure while also promoting growth. Try these strategies to safeguard your business and help your startup save money.