Becoming an SMB-owner always brings certain challenges.
No matter how experienced you are in handling business operations, working as a team leader is much different from being a business owner.
Once you decide to go your own way, you need to take a different point of view. Now you’re in charge of everything regarding your business operations, from asset management to overhead expenses.
In this article, we’re going to share some frugal tips that will help new business owners to manage their ventures with smooth finance management.
1. Automate time-consuming accounting
No matter if you’re a sole proprietor or the only employee of an LLC, you shouldn’t waste your time on non-core business operations.
You’ll already have too many duties on your plate to carry out activities that can be outsourced or automated.
For starters, automate your accounting operations as much as possible. Learn more about accounting software tools and apps that are free of charge and easily installed. Once you connect it with your business account and set the necessary parameters, such a solution can track your accounts payable and receivable. What’s more, you can automate your invoices. This is a practical tip to always make your due payments on time.
Accounting software can calculate and prepare your tax return, as well. Just make sure to open a separate bank account to which a certain amount will be put aside for taxes from every payment your business receives.
2. Limit your expenditure
Both successful and struggling business owners have a tendency to spend more than necessary. The sole fact that you’re now a business owner can nudge you to buy things that you don’t actually need.
Therefore, one of the prerequisites for steady business growth is to limit your expenditure.
For starters, pay yourself a salary and don’t spend a dime more than that for your private expenses. Do your homework and research how much SMB-owners similar to your size and workload pay themselves. It will give you a reference point on your salary.
Avoid using credit cards for your business but plan your costs in advance. Take a piece of paper and write down all the fixed expenses you’re going to have in the first month of your business activities. Include all the overhead expenses, the taxes, and the money you need to pay to your suppliers. All these details will help you come up with a budget plan for your business.
At the end of the first month, you’ll see what costs have changed and adjust your expenditure plan to the new situation.
If possible, postpone renting an office as long as possible. Today, many businesses can be managed from the comfort of a living room – say, eCommerce, digital marketing, SEO-ventures, online payment businesses, etc. Unless having an office it’s crucial for your reputation and operations, wait until you start making enough money to rent an office space without too much financial struggle.
3. Control the business growth
Many business owners think that they need to reach success as soon as possible. This premise forces them to invest all their time, money, and energy towards stellar development.
More often than not, such an approach backfires at aspiring entrepreneurs. If you’re still a rookie in business management, you won’t know how to deal with too fast growth. Handling too many projects and clients at the same time is both time-consuming and mentally demanding. If you go that way, you’ll most probably have to hire additional staff. Each of them will cost you some money and you’ll still have to supervise all these operations.
Instead of reaching fast success, you might end up missing deadlines and eventually burn out. Of course, some novice SMB-owners will manage to handle rapid development, but a larger number of entrepreneurs won’t.
A more comfortable option is to project slow but continuous business growth. By doing so, you’ll build tighter and deeper connections with your clients. The longer you collaborate with someone, the more mutual trust you’ll develop. In the long run, this is a more favorable position for a new business owner. As you keep acquiring such clients, you’ll be able to finish the arranged projects on time. This will help you build an affirmative reputation, strengthening your brand in the niche.
4. Ensure long-term projects
Closely related to the previous paragraph, long-term projects will guarantee financial stability over a longer time.
The first stop on this road is to make up your mind at the beginning of your journey. You need to decide what kind of projects and clients you want to aim at. For instance, on Upwork, long-term projects usually have such a label so that potential collaborators know what to expect. Likewise, one-time projects are highlighted, as well.
Depending on your business experience and preferences, you’ll make a choice for your business. Our two cents: if you don’t have too much experience as a business owner or manager, focus on long-term projects. The money will keep pouring in while you’re learning the ropes of SMB-management.
5. Promote via online marketing
There’s no business presence for new ventures if they’re not active in digital marketing channels. The good thing is that there are many options available today that don’t cost a single cent.
First and foremost, activate business accounts on social media. Facebook, Instagram, and LinkedIn are must-haves for all companies and businesses. Here, you can use various parameters to see what your target audience would be, based on products or services that your business offers.
Secondly, every SMB needs a well-organized website. As explained by the design crew from a Houston web design company, a website doesn’t have to cost a lot to generate a lot of leads and potential customers. Just make sure to provide all the important information for potential visitors to draw their attention to your business as they come to see it.
Also, use infographics, stats, success stories, original photos, and business videos to illustrate what your business does and why someone should opt for your services.
The more online marketing options you use, the more likely you’ll be to get the desired visibility.
If you want to properly nurture your small business, you can spend only less than you earn. By introducing strict financial discipline from day one, you’ll have more assets at your disposal to boost your venture. Automate mundane tasks, limit your costs, and don’t bite more than you can chew. Finally, go for long-term projects and turn to digital marketing options to spread the word about your business. s