By Aaron Gomez
It doesn’t take a genius
to understand that running a business is expensive. Almost everyone has some experience running a start-up, whether
they realize it or not. For example, though on a very small scale, having a
lemonade stand as a child could be considered a business. Cutting grass or shoveling
snow for profit are also examples of small independent businesses that are very
common among younger people. Even though you don’t think about it when you’re a
child, everything costs money. Though it may have seemed to be the $4.25 you
made selling lemonade one morning was all your profit, the truth proves
otherwise. After subtracting costs for materials and time, profits were much
less. This similar concept applies to real businesses. Business-owners need to
be as efficient with their resources, being careful not to waste money. Fortunately,
there are tips that successful entrepreneurs such as Allan Branch, the founder
of LessAccounting, have come up with to help new business-owners save money. I
have condensed these into three general tips:
1. Understand the income - It’s important to know how much revenue is being brought in and how often.
Depending on the type of business, business may be more successful during
certain times of the year. It’s important to understand when your strong times
are so that you’re able to set aside extra income during this time to cover the
costs during the slower seasons.
2. Know your strong suits - As a business-owner, you are not going to have expertise in every single area
of business. It’s important to be able to ask for help and have a staff that
understands the areas where you may not be as knowledgeable in. For example, if
your background is in marketing, it’s important to have people on your staff
with a finance background. This will save a lot of money in the long run.
3. Don’t work too hard - This was one of the main
points that Branch stressed. As an entrepreneur, putting your life into your
business may seem like the only option. But putting too many hours into the business
just to keep it afloat is not healthy for the person or for the business. Your
time is worth at least $5000 an hour (or maybe not :p). But seriously, ask for
help. It’s okay. If you’re giving the business 110% and it’s barely surviving,
it may be time to consider other options.
Keeping these ideas in
mind when running a small business will be very helpful in saving money. Even if that business is something as small as a lemonade stand, saving money and time will always be important.
- Aaron Gomez
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