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10 Ways to Make Your Startup More Cost Effective

10 Ways to Make Your Startup More Cost Effective

Getting a startup off the ground does require money, but there are many ways that you can reduce your expenses. Simple adjustments can make you less reliant on loans and investors, and make it easier to turn a profit. In other words, placing an emphasis on becoming more cost effective could ultimately make the difference between success and failure.

1. Consider Outsourcing Infrequent Tasks

Outsourcing has become a dirty word to some people in the business world, but the reality is that it can be necessity for a startup. Instead of outsourcing common tasks, though, the goal is to identify things that do not happen frequently enough to train a staff member how to handle them. For example, if you only put together flyers once a quarter, it may not make sense to employee someone who specializes in designing promotional materials. Outsourcing this task instead can ultimately save you money and provide better results.

2. Cut Utility Expenses

Utility costs are skyrocketing. Because of that, a single business landline can cost up to $100, and even baseline Internet is likely to be at least $70 per month. Although there are some areas where you may be unable to reduce expenses due to a local utility monopoly, you do have the ability to save money on telephone service. Turning to a VoIP business line such as those offered by Nextiva can cut up to 80 percent off of your bill.

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3. Use Telecommuting when Possible

Telecommuting is much more than just a way to please your employees by letting people work from home. Keep in mind that each person who is in the office actually costs you money by requiring more electricity, water and paper products. Therefore, keeping workstations powered down while employees telecommute can be very beneficial.

4. Implement a Four-Day Work Week

A whopping 43 percent of companies are now offering at least some employees the option to work four days a week, and the benefits are staggering. Not only can you shut the entire office down for a day and save on utilities but your workforce will be more creative, happier, and more productive. With all of these perks, it is no wonder that the four-day work week is rapidly gaining popularity.

5. Build a Strong Social Media Presence

Marketing is vital, but you do not necessarily have to budget an exorbitant amount of money to connect with current and potential clients. Social media has drastically altered the way that businesses communicate with consumers, and the Internet has made traditional marketing methods much less viable. Companies report a 54 percent increase in leads from inbound marketing, and this includes free or discounted methods such as tweeting and posting blog entries. Consequently, focusing on your social media presence is one of the best ways to drive traffic to your website without paying for it. Be sure to encourage your customers to write an online review and to check-in if you have a brick and mortar location.

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6. Get Professional Advice

The desire to save money can end up costing you an arm and a leg if you fail to seek out professional advice for certain topics. After all, unless you are a tax or payroll expert, it is highly possible that you will make an expensive mistake. With this in mind, it is recommended to get professional advice about important tasks that you are not well-trained in. Taking on this expense can save you money and time in the future, and it may also help safeguard your company’s reputation.

7. Start with a Soft Opening

Many businesses utilize the so-called soft opening to begin generating sales and interest without investing as much money. This is a wise approach because you will not need to be fully staffed or have a full inventory to test out the market. Another nice perk of a soft opening is that it can help you work out any kinks or employee training issues before a large amount of people are exposed to them. You may also discover that one of your products or services is not as desirable as you thought, which will let you focus less of your inventory and marketing budget on something that is not going to become a big moneymaker.

8. Implement Organizational Tools

A lack of proper organization can be very damaging, and not just because this type of work environment is not conducive to a productive day. If you do not get all of your inventory properly organized, you are much more likely to experience unexpected losses. Unfortunately, a loose setup such as this will also be much more welcoming to a dishonest employee who wants to steal from you. Use storage organizers to keep physical products easily accessible, and be sure to put a good inventory tracking system in place to minimize wasted time and issues with filling orders on a timely basis.

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9. Invest in Employee Training and Morale

Studies have shown time and again that training and workplace morale makes a huge difference in turnover rates and productivity. Each employee who is not properly trained costs a company $5,466 annually on average. Even worse is the fact that their job satisfaction rate will be lower, which can easily lead to turnover. Industry estimates indicate that the process of hiring and training a new employee costs $7,500, so it definitely makes more sense to invest in morale and training improvements. Keeping your current employees educated and happy is one of the best ways to run a more cost-effective startup.

10. Barter and Negotiate when Possible

Many people believe that bartering is dead and negotiating a lower business rate is not possible, but this is definitely a misconception. The reality is that small businesses barter and negotiate all the time. A prime example is that people who provide services such as acupuncture or massage therapy often trade services with another licensed professional. No money exchanges hands, but both parties get something valuable for their time. In order to cut costs, be sure to ask for any applicable bartering options. You can also negotiate contract terms to get the best possible rate.

Placing an emphasis on reducing expenses and becoming more productive will make it easier to transform your startup from the beginning stages into a successful business. Be sure to remain focused on being cost effective even after your profits begin to boom because this will ensure that you always get the most out of your hard work.

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Featured photo credit: 3 Browse more: black, boy, business, designer, desk, home office, homeoffice, iphone, laptop, macbook, man, mobile, office, people, setup, tablet, thinking, work, working Test Drive image Take a look how this image can be used! Man Checking His iPhone & Working at Home Office, by Viktor Hanacek, picjumbo via flic.kr

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Last Updated on October 18, 2018

10 Key Characteristics of a Highly Successful Entrepreneur

10 Key Characteristics of a Highly Successful Entrepreneur

When it comes to starting your own business and pursuing your dream of becoming an entrepreneur, it can be advantageous to go all in and embrace the flexibility of finally quitting your day job.

Keep in mind, though, that it takes a special kind of person to take the business world by storm: a person who has cultivated the key characteristics of entrepreneurial success.

People with these characteristics are likely to succeed, whereas people without them have difficulty moving forward with even the most brilliant business ideas.

These characteristics of an entrepreneur are so important that I’ve decided to cover all 10 of them in detail so that you can start your business with your best foot forward.

1. Successful Entrepreneurs Practice Discipline

Plenty of business experts claim that you can’t get anywhere as an entrepreneur without vision or creativity, but that’s simply not the truth. Instead, the one quality that no entrepreneur can be successful without is discipline.

To build an idea into a business, you have to have the discipline to spend time slogging through the least fun parts of running a business (like the bookkeeping), rather than taking that time to do something fun.

Andrew Carnegie, one of the most financially successful Americans of all time, grew up working dull and difficult jobs in factories. Despite going to bed hungry some nights, he continued doing his best work. He was eventually hired by a railroad company and continued to move up the ladder until starting his own successful businesses. Carnegie is a fine example of an entrepreneur dedicated to discipline and hard work. He truly earned his dreams of prosperity and success.

When you’re the boss, there’s no one to keep you at work except yourself — and there’s no short-term consequences for skipping out early.

Sure, if an entrepreneur plays hooky enough he knows that the business just won’t happen, but it’s very hard to convince someone that ‘just this once’ won’t hurt (and to keep ‘just this once’ from becoming a daily occurrence).

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2. Successful Entrepreneurs Keep Calm

Things go wrong when you run your own business.

Most entrepreneurs go through crises with their businesses — and more than a few wind up with outright failures on their hands. But when you’re responsible for a business, you have to be able to keep calm in any situation. Any other reaction — whether you lose your temper or get flustered — compounds the problem.

Instead, a good entrepreneur must have the ability to keep his cool in an emergency or crisis. It may not make the problem easier to solve, but it certainly won’t make it harder.

Honestly, losing your calm is a quick path to becoming the kind of person who gives up in the face of adversity. Instead giving in to frustration, remember classic entrepreneur Benjamin Franklin.

Franklin kept his calm as he experimented and tweaked his inventions again and again in pursuit of success. He didn’t give up during his many failures – he chose to innovate. You can choose innovation, too.

If an entrepreneur can handle failure without frustration or anger, s/he can move past it to find success.

3. Successful Entrepreneurs Pay Attention to Details

Restricting your attention to the big picture can be even more problematic than ‘sweating the small stuff.’

As an entrepreneur, unless venture capital has magically dropped out of the sky, a small expense can be a killer. It’s attention to detail that can make a small business successful when it has competition and it’s attention to detail that can keep costs down.

Attention to detail can be difficult to maintain — going over ledgers can be tedious even when you aren’t trying to pay close attention — but keeping your eye on a long-term vision is just asking for a problem to sneak in under a radar.

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After a business grows, an entrepreneur might be able to hire someone to worry about the details. In the beginning, though, only one person can take responsibility for the details.

Skeptical about the importance of details? Look no further than Howard Schultz, who grew a small coffee shop called Starbucks into one of the most globally successful coffee businesses in the world through his extreme attention to detail.

He is famous for taking all aspects of growing a business into account, paying attention not only to financially smart business decisions, but also focusing on socially responsible business decisions. Details can take you far.

4. Successful Entrepreneurs Embrace Risks

No entrepreneur has a sure thing, no matter how much money s/he stands to earn on a given product. Even if a product tests well, the market can change, the warehouse can burn down and a whole slew of other misfortune can befall a small business.

It’s absolutely risky to run a business of your own and while you can get some insurance, it’s not like most investment options. Even worse, if something does go wrong, it’s the entrepreneur’s responsibility — no matter the actual cause. In order to deal with all of that without developing an ulcer, you have to have a good tolerance for risk.

You don’t need to channel your inner frat boy and take on absolutely stupid risks, but you need to know just how much you can afford to risk — and get a good idea of how likely you are to lose it. If the numbers make you uncomfortable, the risk is too great.

Embracing risks is essential for growth and additional success, as well. Walt Disney, for example, could have stayed comfortable with his advances in the film and animation industries, but decided to expand his brand with a new dream: a theme park that soared above the competition. Without taking this risk, the incredibly successful Disney theme park empire would never have come about.

An entrepreneur has to be willing to accept pretty big risks, with some level of comfort.

5. Successful Entrepreneurs are Balanced

You can take any characteristic too far. There’s a point at which attention to detail can become obsession or calm can become unemotional response.

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As an entrepreneur, you have to be able to balance your characteristics, getting the most of them without going over the edge. But balance for an entrepreneur goes far beyond keeping your characteristics in check, though.

Just as an entrepreneur doesn’t have a boss to keep them at work when necessary, they don’t have one to send them home when they’re done. If you are working for yourself, you have to decide how to balance your work and home life — and if you have a day job to add into the equation, balance just gets more complicated.

Oprah Winfrey, one of the most successful and influential entrepreneurs out there, understands the importance of balance. Winfrey has a lot going on; she runs her own media kingdom, acts, produces films, publishes print, and more. In an interview with Fast Company,[1] she talks about her efforts to balance priorities and self care, saying that she must ask herself what is truly important in each limited day.

You may or may not have as much on your plate as Oprah, but learning how to balance whatever you have going on in life will certainly help you farther along down the road as you learn to be a great entrepreneur.

6. Successful Entrepreneurs are Passionate and Motivated

In order to develop any of the above characteristics, you must have a foundation of passion. Staying disciplined day after day during the building of your business takes unrivaled motivation.

Before you start any business, ask yourself if you can sustain true excitement about your idea during even the darkest days ahead of you. If the answer is yes, then good for you! Nurture your natural motivation by taking these action steps throughout your business journey:

  • Commit to making short and long-term goals. Check in with them often to stay on task.
  • Have a plan in place for the inevitable days when you feel discouraged. Make a list of things that will help keep you motivated and focused.
  • Share your ideas with trusted individuals who are just as excited as you are. They will help keep your enthusiasm rolling even when you are feeling down.

By being prepared for apathetic days and holding fast to your authentic passion, you can actually enjoy your journey to success.

7. Successful Entrepreneurs Adapt

Remember this one word: flexibility. Seasoned entrepreneurs know that change is not only a part of life, but also a part of the business world. Expect change and choose to adapt.

As a new entrepreneur, it will be tempting to cling to your original business plan with no exceptions, even if you notice it isn’t working. Good entrepreneurs know that it’s okay to make smart, informed changes in order to ensure efficiency.

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8. Successful Entrepreneurs are Marketing and Sales Experts

No matter what kind of business you are starting, a knowledge of marketing and sales will save you many headaches. A passion for creating a beautiful handmade lifestyle product is not enough to run a successful lifestyle brand; it is critical that you understand key business principles in addition to your natural skills or great product line.

Not sure how to start? Taking business courses is a great idea, but you can also easily brush up on sales and marketing through free online resources. Check out these 10 Sales Skills Everyone Should Master To Be Successful to begin now.

9. Successful Entrepreneurs Have Strong Money Management

Along with sales and marketing skills, money management is a very useful tool in the box of the entrepreneur. Understanding how to best manage your money can be the difference between early success and early failure in the business world.

If money management isn’t your strongest skill, prepare to hire a financial expert to help you with any tricky business that comes up. Financial guidance and knowledge is never a bad idea.

10. Successful Entrepreneurs Ask Questions and Continually Improve

Pride is a natural human quality, but it’s important to humbly conduct some constructive criticism every now and again on both yourself as a leader and your new business as a whole.

Assess how things are going and be willing to make positive changes if necessary. Here’re 15 ways to cultivate lifelong learning.

If you are always improving, then how can you ultimately fail?

The Bottom Line

Let me remind you of one important fact: the qualities of an entrepreneur listed here are not exclusively available to some people and elusive to others.

Although some people may have natural strengths and weaknesses, these qualities can be learned by anyone interested in taking up the entrepreneurial challenge. It might not be easy to change old habits, but it is absolutely possible to cultivate these characteristics in yourself.

Whether you’re a business owner or an aspiring entrepreneur, with hard work, you can train yourself to develop the qualities that truly determine the entrepreneurial spirit and future success.

Featured photo credit: Unsplash via unsplash.com

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