Just over 600,000 businesses open each year. Within two years, the vast majority of those businesses close.
Why is that?
The obvious reason is that most businesses don’t find ways to become profitable fast enough. A big component of that issue is not being able to effectively manage expenses.
There are a number of things that you’ll think to invest in when you’re starting a new venture. Consulting, real estate, employees, etc. What we’re here to tell you is that there’s a good chance that you don’t need most of what you’re planning on spending money on.
To help keep your costs in check in the early days of opening your doors, consider these questions to ask when starting a business.
1. How Much Can I Do Myself?
Bootstrapping is a popular concept for new business owners. It means finding creative ways to get things that you need to be done for low or no cost.
Do you really need to pay a web development agency thousands to build your website? Why not try getting up and running with WordPress on your own?
Do you need to hire a social media marketing expert or can you manage marketing without additional help?
Simple questions like that could equal big savings later on down the line.
2. Do I Need an Office Space?
You’ve just launched a business. Conventional wisdom says that you need an office now, right?
That depends.
If you’re running a medical practice then sure, it’s worth your time to engage a practice real estate group to find space to operate out of. If your business isn’t typically consumer-facing though, you may be able to save yourself an office lease and instead, work with clients remotely.
You can always rent a space for a few hours for the occasional client meeting.
3. How Can I Best Manage My Bookkeeping?
A big way to save money as a new business owner is by doing your taxes effectively. Tax breaks for start-up costs, expenses and a variety of other things having to do with your business are all available.
In order to claim them, you have to track your expenditures carefully so that you or your accountant can properly write things off come April.
We recommend using software like QuickBooks to stay organized. Alternatively, you can self-track expenses in Excel or Google Sheets.
4. Are There Grants Available?
Our final questions to ask when starting a business suggestion is one that many people neglect. Always inquire about small business grants.
Many people, particularly those in minority groups, may qualify for various grants when starting their own business.
Information on grants can be found online and perhaps through your local city hall.
Wrapping Up Questions to Ask When Starting a Business
By going through the questions to ask when starting a business above, you give yourself the best chance of starting off on a cost-effective foot which can do wonders for your chances of staying in operation for years to come!
For more business finance advice, peruse more of our content on All Things Finance today!
