The Hidden Cost of the Small Business Startup (And What to Do About It) Dec 12th
I’ve spent a great deal of my personal time expanding projects; I also work closely with clients on ways to improve growth. The common item I’ve found in my decisions and those that are dumping capital into their ideas is that they allow the finances to become too much of a factor.
Yes, investing into a business is risky but it’s just as much so as deciding to cut corners.
The cost of competing on a web-based level
The cost of reaching leads through local advertising and print
The cost of finding qualified individuals to fill positions
I’ve noticed that small business owners take the finances too personal. I understand because it’s their money (or investor money) on the line but their feverish drive when starting quickly turns to conservative pacing once they’re in the thick of it all.
They’re afraid to take risks – something that shouldn’t be a roadblock in the process especially since there are ways to avoid it.
Obviously, it’s still a good idea to be careful with the money you have, and there are ways to make savings that also make sense. For example, outsourcing your IT consulting support can help to cut costs whilst also maintaining service, meaning you make a saving whilst still getting what you need. There are also many ways to inject capital into your new small business venture without the typical approach of venture capital you often see in the startup culture:
Savings & Family – It can be trying to dip into your savings or approach family for startup capital. You may feel like you’re gambling your money and the same is felt by your family. However, legal documentation for the equity investors and a solid business plan, fully explained, can curb those common concerns. A small investment from an immediate member of the family builds family wealth; their success builds upon your own. The added benefit also happens to be there is more “on the line” because of this close connection which, in turn, often helps increase the drive of the entrepreneur.
Small Loan/Advancement Services – Sometimes an idea for a business depends entirely on a trend. Spend too long on the development and get left in the dust. Getting on board with a trend can lead to astronomical, monetary rewards. When the lightning strikes – it’s the moment when you take the alternative to quickly drying a paycheck and, instead, mitigate costs through easy installment loans. These are options which divide the investment over a set amount of time so you can get in, capitalize on the wave, and pay back as it rolls through versus being limited to a smaller portion that would be found through payday loan services.
Volatile Listing – This is a method in which you scale the efforts based on the return on investment. In theory: you build the small business as if it were a completely operational unit but without the major investments such as ordering product. What you do, instead, is test the market to see how well it responds to your offer and, depending on the response, you only then stock up and finish shipments. By doing so you have an easy way to back out (“we no longer carry that product”) but also an easy way in (“we are currently experiencing a backlog”). Either way, you are receiving a response that will influence your decision. If initial capital comes from pre-orders then you can use that as startup capital for the rest of your operations.
I often notice that businesses fail because their owners fail to invest in the business. They look at the startup cost and immediately want to repay their lenders (or themselves). By doing so they are stifling the investment into the business, that’s much needed, to take the business to the next level and proficiently operational.
The small costs, in many ways, come through this idea of pettiness (sorry, but true). The business owners end up nickel and diming their own business before it ever reaches a point where it’s performing on a level that isn’t reliant (and derivative) of the financial injection. How can you determine how well the business is doing if you’re still running on startup costs?
The small things aren’t worth sweating: a couple hundred to empower employees with mobile devices, new computers, fun and functional workspaces, and mental well-being through competitive environments. So many small business owners look at the bottom line and lose sight. There are great options for when financial injection is needed; once you know this you, as a business owner, won’t cut the corners to stunt the growth – keep those options open.
Dec 12th
I’ve spent a great deal of my personal time expanding projects; I also work closely with clients on ways to improve growth. The common item I’ve found in my decisions and those that are dumping capital into their ideas is that they allow the finances to become too much of a factor.
Yes, investing into a business is risky but it’s just as much so as deciding to cut corners.
The cost of competing on a web-based level
The cost of reaching leads through local advertising and print
The cost of finding qualified individuals to fill positions
I’ve noticed that small business owners take the finances too personal. I understand because it’s their money (or investor money) on the line but their feverish drive when starting quickly turns to conservative pacing once they’re in the thick of it all.
They’re afraid to take risks – something that shouldn’t be a roadblock in the process especially since there are ways to avoid it.
Obviously, it’s still a good idea to be careful with the money you have, and there are ways to make savings that also make sense. For example, outsourcing your IT consulting support can help to cut costs whilst also maintaining service, meaning you make a saving whilst still getting what you need. There are also many ways to inject capital into your new small business venture without the typical approach of venture capital you often see in the startup culture:
Savings & Family – It can be trying to dip into your savings or approach family for startup capital. You may feel like you’re gambling your money and the same is felt by your family. However, legal documentation for the equity investors and a solid business plan, fully explained, can curb those common concerns. A small investment from an immediate member of the family builds family wealth; their success builds upon your own. The added benefit also happens to be there is more “on the line” because of this close connection which, in turn, often helps increase the drive of the entrepreneur.
Small Loan/Advancement Services – Sometimes an idea for a business depends entirely on a trend. Spend too long on the development and get left in the dust. Getting on board with a trend can lead to astronomical, monetary rewards. When the lightning strikes – it’s the moment when you take the alternative to quickly drying a paycheck and, instead, mitigate costs through easy installment loans. These are options which divide the investment over a set amount of time so you can get in, capitalize on the wave, and pay back as it rolls through versus being limited to a smaller portion that would be found through payday loan services.
Volatile Listing – This is a method in which you scale the efforts based on the return on investment. In theory: you build the small business as if it were a completely operational unit but without the major investments such as ordering product. What you do, instead, is test the market to see how well it responds to your offer and, depending on the response, you only then stock up and finish shipments. By doing so you have an easy way to back out (“we no longer carry that product”) but also an easy way in (“we are currently experiencing a backlog”). Either way, you are receiving a response that will influence your decision. If initial capital comes from pre-orders then you can use that as startup capital for the rest of your operations.
I often notice that businesses fail because their owners fail to invest in the business. They look at the startup cost and immediately want to repay their lenders (or themselves). By doing so they are stifling the investment into the business, that’s much needed, to take the business to the next level and proficiently operational.
The small costs, in many ways, come through this idea of pettiness (sorry, but true). The business owners end up nickel and diming their own business before it ever reaches a point where it’s performing on a level that isn’t reliant (and derivative) of the financial injection. How can you determine how well the business is doing if you’re still running on startup costs?
The small things aren’t worth sweating: a couple hundred to empower employees with mobile devices, new computers, fun and functional workspaces, and mental well-being through competitive environments. So many small business owners look at the bottom line and lose sight. There are great options for when financial injection is needed; once you know this you, as a business owner, won’t cut the corners to stunt the growth – keep those options open.
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