Starting a business is no child’s play (like we say here), but it doesn’t have to put you into huge debt or require you to take on investors (which is really just another word for debt!).
Why? For one thing, you can become distracted by the expectations of investors, which may be different than yours. Plus, you may ultimately be forced to give control of your business because you couldn’t pay up your debt.
If you’re just starting a business, you could use some tips on scaling back your spending, and avoid running into debt.
1. Don’t quit your day job yet
Quitting your day job even before the scale tips, to start a business, may not be the right decision. It is advisable to keep working until the time is right. Wait until you have enough business or money to justify spending more of your time on a side gig than a regular job.
Sure, you may be raring to start a business at full force from day one, but focus on building up your clientele before quitting your day job. Waiting until your new business is beating your job in some metric, will ensure its viability.
If you want to start a boutique, which could cost 200,000 Naira before you even hang up the “open” sign, see if you can think of ways to sell your goods to people in your free time: Maybe start small with your goods in the boot of your car or sell out of your apartment. Refine your strategy and grow your customer base until it makes sense to get a shop.
2. Don’t be afraid to start small
Getting an office space is not a bad idea, but make sure it’s really necessary to your business. If the idea behind renting a space is solely to make you look more legitimate, then reconsider. Your clients may not care where you do business from, as long as you offer good quality and customer service.
This advice may not work for everyone, but of course, there are other options. You could look into using a co-working space or renting an office from an existing business. It will prove to be a win-win arrangement.
If you really have to have your own business office, then try minimizing costs by buying used office furniture or renting it. There’s absolutely no need to have state-of-the-art desks when some used desks would work just fine.
3. Get staff on an as-needed basis
As a young startup, never make the mistake of thinking you need a marketing, sales, PR , human resources team, and the works. That would amount to scaling much too fast for your own good. In the beginning, you really only need one or two other competent people.
While getting some extra hands isn’t bad in itself, do you have the clientele to support additional staff? As you get started on more projects, you can add people to your team. Hire very slowly, and you may not have to let someone go due to lack of business or not being able to pay them.
A great way to get some extra helping hands and not deplete your purse is in getting interns who are willing to contribute their skills and time to getting experience. You can also try out potential employees on a contract basis.
Starting a business is exciting, but in the midst of all that, be sure to focus on your idea. Never run into debts even before you ever make a profit.
Now, tell us about your big startup idea — how has it been for you? We’d love to hear all about it!