As a small business owner, start small with your startup strategy to save on overhead costs. Offer online payments, run your business from a home office with a virtual address or save with a furnished executive suite, use free resources, and hire a virtual assistant.
4 Ways to Start Your Business Without Accruing Too Many Overhead Costs
Starting a small business as a blossoming entrepreneur can be challenging. As it says in the name, just start small. Reducing your overhead costs will help your small business to profit early on before expanding locations.
What are Overhead Costs?
Investopedia defines overhead costs as expenses not related to labor or production.
Overhead costs include:
- Utilities such as electricity and water.
- Transportation costs.
- Manufacturing costs.
- And more!
Now that you know more about overhead costs, here are 4 ways to start your business without accruing too many of them.
1. Offer Payments Online
When you set up your online store, offer virtual payment options such as debit card, credit card, PayPal, Venmo, and Cashapp.
While you may have to pay a small fee per debit and credit card that’s transacted, you will generally not have to pay fees if someone sends you money on Venmo or Cashapp.
Keeping all payments online will save you the cost of a cash register. You can just use a cash box if anyone comes to pick up an order and wants to purchase with cash.
Be sure to list any cash sales in a ledger and/or electronic spreadsheet so you are keeping track of all purchases.
2. Run Your Business From a Home Office Without Sacrificing Professionalism
How do you run a business from home without appearing unprofessional? There are many options with virtual office services where you can receive mail at a professional address, access meeting rooms, and more while still working from home.
Set up a professional-looking office in your home to take business phone calls, catch up on your paperwork, and do your work depending on the product or service of your small business.
Make sure the office is well kept, clean, and organized. If a client would like to visit your home office, then you will be prepared for a visit at any time.
Tips for an Organized Home Office
- Have a set place for all business paperwork in a filing cabinet.
- Decorate your desk, but do not over-clutter it, so that you have a proper amount of workspace.
- Keep a display of business cards right next to where the client would be seated, so you can give one to him or her at any time during the meeting.
- If the client prefers, set up a virtual meeting on Zoom, Free Conference Call, or another video conferencing app.
3. Use Free Online Resources
The Failory Blog states that using free online resources will reduce overhead costs to increase profit.
Use free online resources such as:
- Accounting software trial: To keep records of your business sales.
- WordPress: To start a company website.
- Facebook: To start a free social media page for your company to reach out to more customers.
- Google: Use Gmail to keep in contact with customers; Google Drive to save and back up all company documents; Blogger as a blogging option.
4. Hire a Virtual Assistant
Hiring a virtual assistant can reduce overhead costs by:
- Getting help for only the amount of hours you need.
- Reduce labor costs compared to hiring a full-time person at a physical business location.
- Keep utility costs in check since the Virtual Assistant will be using their own electricity.
Decrease Overhead, Increase Profit!
Try these tips and more to get your overhead costs down and your profit increased. As a small business, customers will be more willing to support you because you are an icon of the local community.
