I never ceased to be amazed by how keen people are to spend money when they start a business! You hear people say crazy things like: ‘You’ve got to spend money to earn money’ or ‘it’s ok, it’s all included in my business plan projections’ or ‘it’s a business expense and I’ll write it off against tax’… or even ‘I’m expecting to make a loss in my first year’ ?!? That expensive iPad tablet… the really nice ‘company’ car… the high end website and expensive graphic design… these are all eroding your profits and you need money for the really important stuff or unforeseen problems. Think carefully about what you spend money on – and, if you’re smart and willing to learn a few extra skills, there are lots of things you can do yourself instead of outsourcing – when you first start, you are time-rich! Use the time well.
I was going to write a single post on money and what not to do in the early days of starting your business. Then, as I thought it through, I realised that this could become many posts and I’ve even created a new post category ‘Spend or save’.
There is no ‘one size fits all’ when it comes to money and budgets etc – if you’ve designed a physical thing that requires manufacturing then you need machining, production, packaging, storage etc and all their associated costs. And to be honest, my background is in services and property investment. So these posts really are aimed at people who are providing services. The next few posts will cover the following topics
- Starting a business? Then get a job…
- Fee systems – what systems do you want and need
- Time rich, cash poor – Learn to use a computer
- Website, graphics, logos, social media
- Advertising and marketing costs – set a budget
- Accreditation and Trade/Industry trust
- Accounting systems
- CRM, Database management systems
Next article – ‘Starting a business? then get a job’