Running a small business in today’s volatile market is challenging. But the good news is that since the pandemic, businesses in Australia witnessed an increase of 7 %. Out of 2,569,900 actively trading businesses in the Australian economy, 92.6% had a turnover of less than $2 million. While the time is conducive for businesses, making your new venture successful is difficult because most businesses fail in the first year. It is usually due to poor financial management. Thus, here are ways small business can save money in their first year. Have a look.
Focus on Financial Planning
One of the biggest mistakes business owners make is skipping financial planning. It is vital to achieve your financial goals and if you lack the expertise, the best option is to seek business consultancy. Professional with business management services offer sound financial planning advice according to current trends and market positioning. Whether you take professional assistance or choose to do it yourself, make sure to have a financial plan before starting a small and while running it.
Network, Network, Network
Establishing a good and supportive business network is key to running a successful venture. You need loyal stake holders, clients, customers, employees, partners and other important people to have a strong network to brave the ups and downs of your industry.
You can use business management tools for growing your connections online. Additionally, meet with people as often as possible to make a good network with like-minded entrepreneurs, manufacturers, suppliers, traders, etc.
Use Free Tools & Apps
Want to save money as a new and small business? Get hold of professional tools and apps for marketing, book keeping, networking etc. There are many tools like LinkedIn, zoom, homebase, Hootsuite, square point of sale, deputy and more to help small business owners.
Pay Attention to Research Before Development
A common error most business owners make is ideating a product or service and speedily start development. If you don’t want production money to go to waste, then invest in good research. It can help validate your idea and ensure it is a success upon launch.
If you don’t have the funds to pay for research, validate your idea yourself by taking opinions of family/friends, conduct free online surveys, get into crowdfunding, and ask for feedback on platforms like reddit.
Don’t Keep a Huge Marketing Budget
Marketing a new business is stressful and you can get carried away and try to do everything at once. However, rather than depleting your funds on marketing, strike a balance and evaluate your start-up budget before allocating money for marketing. Ideally, new businesses should keep aside only 5-8% of your total budget.
Manage Your Tax Obligations
Understanding tax laws and regulations is challenging and if it is not your strong suite, it is best to hire someone who can. In addition to seeking the assistance of a professional business consultancy to manage your ta x obligations and save you a lot of time and hassle. Whether you do it yourself or hire help, here’s what you must do.
Use an Appropriate Shipping Strategy
Customers in the age of digital shopping expect free shipping. If you choose to provide it upon certain amount of shopping, you have to device a shipping strategy to deliver products without depleting your financial resources. There are many things you can do such as,
If you hire a business consultancy for business planning and strategy, they can help you devise a good shipping strategy as well.
The Bottom Line
Running a new business well and keep it afloat in the first year is extremely hard. Therefore, a lot of new ventures sink due to silly errors. If you have a small business or planning to start a new company, hire a business consultancy. Also, use the tips mentioned above to save money in the first year of your small business.