As many as 29% of small businesses fail due to cash flow problems.
If you are a budding entrepreneur with nothing but your savings to build your business on, you might feel like the odds are stacked against you long before you start.
This is not always true.
If you look around, there are numerous businesses that were founded on limited capital, but still grew into the powerhouses they are today.
Building a successful enterprise might be tough, but not impossible. Here are some smart ideas to help you bootstrap your business successfully.
1. Choose a Field you Know
While you have the freedom to start any legal business, it is unwise to invest in an industry that you have little knowledge about.
Having insider knowledge and industry connections are useful as you are setting up. This means you know your way around licensure, regulations, and where and how to find clients.
It also means you know other players in the market that can refer clients or become clients themselves.
The unpredictable nature of the business also poses some risk. Familiarity with a line of business means you have a good understanding of what these are and how to mitigate them.
2. Work From Home
Working from home can save you a tidy sum in business rents and overheads.
If your business is not one where you expect customers in and out of your business premises each day, then this is a viable option.
Even if you work with other people, you can run operations seamlessly through the use of applications and software that support collaborative work.
You can make savings on salaries as well as most people will be willing to accept less pay for the flexibility remote work brings.
Also, in regards to human resources, consider using interns at a small stipend or even relatives that would be willing to help out at the business for a small token.
3. Absorb as Many Roles as You Can
There will come a time when you will feel the need to hire additional staff. However, this might not be necessary for the beginning.
While different roles will still have to be filled, the amount of work might not be enough to justify paying a full-time employee.
Consider taking up some key business courses so that you will be well equipped to run different departments until the business stabilizes.
For example, you can take bookkeeping courses online, accountancy, marketing as well as any other courses that can add value to your business.
4. Practice Economy
Each saving you make, no matter how small, can be channelled towards other activities that can grow your business.
Continually identify areas in which savings can be realized.
One such area is by bulk buying. Buying in large quantities allows more room to negotiate on prices. Again, buy generic items whenever possible and consider buying second-hand furniture and equipment for your office.
When you have to travel, book flights as early as you can as this is when you can get the cheapest tickets.
Also, utilize free trials for software and applications you need for your business.
You can also try bartering, where you make agreements with other businesses to trade products and services.
You just need to find a business that compliments yours and provide them with what they need in exchange for what you need.
5. Track Expenses
Track your spending expeditiously to ensure you are sticking to the budget and to identify ways to make small savings.
If you do this correctly, you will be able to tell your financial position and identify shocks long before they happen.
Persistence Is Key
If you are certain that this is the path you want to take, it will be important to recognize that entrepreneurship is a lot of hard work.
Therefore, resolve to be committed and persistent and always remain focused. Success might be around the corner.