Tips for First-Time Business Owners
Starting your own business may sound enticing, fun, and challenging for some people. There is much more to operating a business and making it successful than most people realize. They often jump in, head first, and then within a short period of time find themselves broke, in debt, and considering bankruptcy. To help ensure your business venture does not end up like this, take the time to review the following tips and suggestions.
- Watch where your money is going. Question every expense and evaluate if it is really needed right now. Shop around for better deals with multiple vendors to find lower prices. Avoid running out and buying an expensive office suite, blowing money on luncheons and dinners at five-star restaurants, and other such temptations. Healthy cash flows are essential to growing your business, so remember to be frugal with your money.
- Outsource services to help control expenses. From uniform rental companies to Internet and Cloud-based storage providers, there are several different types of services that can help save your business money with lower upfront investment costs, compared to purchasing these items outright on your own. Take advantage of rental and lease programs or “on-demand” services that best meet your needs. Never be afraid to ask for promotional offers or incentives from the vendors/providers.
- Rent a shared office space. Shared office spaces are the latest “in-thing,” especially for new business owners. If you do not have a home office, this option provides you with an affordable office, without long term leases and the flexibility to choose from a variety of office plans. Plus, most rentals include access to office equipment, cover utilities, and other such amenities to help keep your overhead low.
- Take care of legal aspects upfront. Work with a business lawyer to determine the best business structure, file for tax ID numbers, and decide what insurance is necessary for your business. Open a business checking account. Make sure to use contracts with certain clients and your vendors to protect yourself, and have a legally enforceable document should there be a problem. For work that is being done upfront with payments made later, never be afraid to ask the client to pay between 10 and 25 percent down. Remember to set aside money for self-employment and business taxes every time the business earns money, and to pay taxes quarterly.