3 Money-Saving Tips Every Startup Owner Should Know

If you’re running a startup, chances are that you are so focused on day-to-day business operations, you might be forgetting about saving money or even getting it too.

In the early stages of your business, this can make a huge difference. Here are a few things you could be doing to make sure you’re managing your company money more wisely.

1.  Make good use of all available grants and tax credits

These days there are numerous ways and initiatives in which governments and other organizations support entrepreneurs, so take some time to research what grants your business might be eligible for.

One of the first things you should look into is grants. Unlike business loans, grants don’t need to be repaid so if used wisely it’s almost like getting some “free money” for your startup.

Don’t worry, you don’t need to run a big business or corporation. There are many grants created specifically to support small businesses.

But be careful, as most grants have very specific guidelines on how the money should be spent. Make sure that the grant you’re applying for can cover what you need to develop or sustain your business.

Another thing you should look into as a business owner are ways to save money on taxes. There are many tax incentives governments offer and you should check which ones you could be taking advantage of.

If you’re running a startup in the technology or science sectors, look into R&D tax relief you might be eligible for. Research and Development (R&D) tax credits are meant to support companies that work on innovative projects in these fields.

The mistake a lot of people make is assuming that they must be working on some groundbreaking discoveries or developing world-changing technologies in order to apply for such tax relief.

In fact, when it comes to R&D tax credits, it can be obtained by companies working on small projects, and “innovation” has a very broad meaning.

What’s more, it can even be claimed on unsuccessful projects! So don’t hesitate, it doesn’t hurt to check and ask.

Source: Unsplash

2. Consider Lean Management

If you’re the kind of person who believes that big things are achieved by small changes, lean management is something you might want to try for your business.

The main goal of this approach is to optimize processes by cutting any potential waste of time, resources and money. To put it simply, a lean management approach makes you analyze every process in your business and cuts out anything that is wasteful or unnecessary.

The entire concept of lean management relies on 3 ideas:

• Delivering value from your customer’s perspective
• Eliminating waste － anything that doesn’t bring value to the end product
• Continuous improvement － reviewing and adjusting your processes on a regular basis

The concept dates back to the 1940s when it was first introduced by Toyota Production Systems looking to decrease the number of processes within their production cycle. As a result, they have increased productivity as well as time and cost-efficiency.

Even though lean management has its roots in manufacturing, nowadays it’s used across a variety of industries. If you’re serious about implementing lean management model in your company, there are 5 principles you need to follow:

• Identify value
• Value stream mapping
• Create a continuous workflow
• Establish a pull system
• Facilitate continuous improvement

If you’ve just recently founded your own start-up it might seem that it’s too soon to think about implementing these kinds of concepts.

At this stage, you might be doing the work of the CEO, secretary, and as marketing manager at once.

You haven’t paid yourself a proper salary yet and maybe a part of your staff are your friends who are willing to work for less because they believe in your dream and determination. So where do you fit lean management into this?

If you really think about it, there is no better time than now. Things are still fresh and new, there is a lot of space to clearly define your processes, and since, as a startup, you probably don’t have much in the way of resources or manpower, you will have to make sure you use them efficiently.

Once you have your processes mapped out it will be easier to follow them consequently, and continue to review and improve them as your business grows.

Implementing the right mindset and efficient process from the very start is much easier than reorganizing your entire business later on when there are more people involved.

3. Look for small changes to save big money

Now that we’ve covered the big things you can do to save money for your business － taxes, grants, and management styles － it’s time to think about the small things that can make a big difference. Below you can find a few examples of simple ways to save money.

Using free tools. A lot of business owners assume that if they run a business they have to pay for all the “premium” options, “golden” subscriptions and “professional” packages.

It might seem like a small cost but if you add up all the tools you need for your business and multiply it by twelve months, it really does come up to a significant cost by the end of the year.

Sure, there will be a time when you will need all the options paid tools can offer, but try to use the free ones for as long as you can. It will save you a lot of much-needed money when you need it most.

Look for cheaper options. If you decide that you really do need a specific tool or tech solution for your business, don’t go directly to the big brands. With all the new companies around, see if there is a startup that can offer the same or similar solution for a cheaper price.

The same goes for your workspace. Do you need a fancy office from the start? It looks good and surely will be necessary at some point, but at the early stages of your business when your team is still small you should consider other options.

Running a remote/mobile office. If you know and trust your team, you might not even need an office at the beginning.

With all the tech solutions out there, such as Slack, Trello, Skype and many others, you can easily connect with your team throughout the working day and arrange to meet in person once in a while. This way you might not even need an office for the first few months.

These are just a few examples of what you can do to save money for your startup. Of course, making money is the main goal for every business, but especially in the early stages, being frugal is what can save you from failure.

So make time to analyze what you spend money on in your startup and look for ways to minimize these costs － you will be surprised how many unnecessary things we spend money on.

from Feedster https://www.feedster.com/business-start-up/3-money-saving-tips-every-startup-owner-should-know/