How to achieve more with less when starting a new business
If you’re a future entrepreneur in the making, or if you’re already starting out as a small business owner, you’re likely looking for some pointers on how to dodge avoidable mistakes.
You’ve come to the right place.
Small businesses have a number of strengths compared to large ones. They are agile structures, quick to change and adapt, so they are easier to control and direct.
However, without a sturdy capital net to cushion the fall, small businesses are also more vulnerable to fluctuations in cash flow and resource instability. You’ll never be able to avoid every unwanted situation, but there are some predicaments some you can easily predict and manage before they escalate.
So here are some tips on good resource management that we’ll help you do more with less.
Hire Only the Talent You Absolutely Need
When you start your business, make sure you fill in crucial positions, then outsource the rest. Look at the processes you need and assess which positions are indispensable to cover those areas. Think of what tasks your teammates will have to cover each day and who you really need on the payroll.
It’s expensive and wasteful to pay for the workforce and skill you only occasionally use, so consider outsourcing the skillsets you only need for a specific project or the processes for which there is still not enough full-time demand.
Another great option is to offer internships and use the talent, ideas, and energy of young people who are getting their bearings in the industry as they split their time between work and study. You’ll gain part-time workers you can also train and direct, and they will gain valuable work experience for their CV.
After all, who knows, maybe you’ll be able to keep them on as you expand.
Focus on the Right Audience
Segment your potential and existing customer base and invest resources into marketing directly to a narrow band of prospects most likely to convert. Throwing a wide generic net and trying to reach customers of all profiles can be very costly. And what’s more, it rarely delivers.
Therefore, your best course of action is to study available data and get to know your ideal customer profile, and focus your efforts on what’s appealing to them. Data is essential! It allows you to spend only a fragment of resources you’d waste by going into a poorly targeted marketing campaign blindly.
The more time you invest in studying your market, the higher quality content you’ll be able to deliver. Your product will also improve based on feedback from the customers. Remember that you don’t need a huge number of potential leads — you only need the right ones.
Approach Your Assets Economically
Most companies and businesses out there are unaware of best asset management practices, so they improvise, and a whole lot of assets wind up collecting dust in some dark corner or depreciating.
Losing money on improperly managed assets is a far greater problem for small companies than for large operations with capital to spare, as it is a drain on their modest resources.
It is wiser to own a few key assets that are crucial for operations, and rent or borrow other expensive pieces of equipment, vehicles, and storage space, especially if it is only used rarely. You don’t want to waste money on the maintenance and insurance of assets that end up just sitting there. Instead, get rid of non-essentials, minimise, and declutter.
The vital assets you decide to keep need to be taken care of and kept in great condition. You need a system to know what you have, its value, cost, condition, and how you can prolong the life cycle of an asset as long as possible.
Excel in Core Products or Services Before Expanding
Specialisation breeds success. Product lines that are too branched out will be distracting for businesses of any size. They are hard to keep track of and maintain. They also dilute the message, which renders effort wasted, and diminishes the impact of your investment.
Would you rather be amazing at one thing or mediocre at ten?
Funneling resources into only a handful of well-developed products or services exponentially increases the chances that these efforts will be fruitful. Once you’ve excelled in a few things and built a name (and a customer base) for yourself, you can consider expanding.
Launching new products and services is always risky, so try to keep their general ethos in line with your starter products. Better yet, make an improved upon version of your older product and surf on the existing market visibility of its predecessors.
Bonus: You already know your past customers are interested, and you don’t need to start from zero.
If you have limited resources, you need to be that much wiser about your business decisions. To recap, there are some core things to consider.
Outsource any position that isn’t absolutely necessary. Focus on your perfect customer, and direct all of your efforts to making your product or service visible and valuable to them. The sooner you close, the more resources you’ll have left to invest in other areas.
Go through your assets and downsize. Keep only what you need and let go of anything draining your budget, such as assets with no ROI, especially those used so rarely they don’t cover their own maintenance.
Finally, get great at one thing.
It helps to make a name for yourself in a specific niche with a narrow offer of goods and services before you expand your offer. Keep on exploring, and don’t be afraid to look to your community for answers — there will always be people who were in a similar position as yourself who can give you advice.
Featured image courtesy of Pexels
Ashley Wilson is a content creator writing about business and tech. She has been known to reference movies in casual conversation and enjoys baking homemade treats for her husband and their two felines, Lady and Gaga. You can get in touch with Ashley via Twitter.