What business owner doesn’t want to cut expenses? But it is even more important for a young entrepreneur who has limited savings, limited access to capital and overall less options. So we reached out to get ideas from business owners on how they have saved and what they think young entrepreneurs should do to save money. Here are 55 answers from business owners on how young entrepreneurs can cut expenses….
1. Here’s my tip for today: an important part of being an entrepreneur is educating oneself, and buying books can be expensive. The simple solution is to go to the library. I use the New York public library, and I can find any book in the system, reserve it and have it routed to my closest library, and when it comes in, I get an e-mail. Dan Nainan
2. Run lean and mean. You don’t need to pay rent for an office if you never meet clients there; You don’t need to lease a Mercedes because it makes you feel successful, when a Mini Cooper will give you the transportation you need. Wayne Spivak
3. One great technique we use to cut our payroll expense is establishing a network of contracted freelancers. Instead of hiring one employee who has average skills in a variety of areas, we can tap multiple people with the best talent in a specific field. We avoid costly salaries and benefits, deliver the best work possible, and only have an expense when new projects come in the door. Doug Winegardner
4. Scrimping on effective business tools and software is not the way to go. However, the essential programs for tracking finances, project management, design or content management systems can be costly when you’re starting up solo. The key is to do your research, because often you can find different providers that offer free or discounted trial versions of their software products that you can test out and see how they work for your individual needs, before purchasing an entire suite. Dana Leavy, Aspyre Solutions
5. Go Online.* Minimal startup time & investment. Powerful, fast and efficient marketing and communication tool and medium. Very inexpensive way to reach new markets and interact with them. Anthony Saladino, Kitchen Cabinet Kings
6. The best way to cut expenses is ask for things for free. It never hurts to ask people because the worse they will say is no. For example, I always ask my lawyer friends for free legal advice. Kelsey
7. When you’re starting off a tech company, give your initial employees increased option plans as a substitute for salary. This helps you reduce costs, and gives them more skin in the game, and as a result, their work product is often better. Jonathan Simkin, SwoopThat
8. Meeting Spaces – Use a location that is very business friendly to conduct meetings and work, like Panera Bread. Most locations have free WiFi and even have private rooms where you can hold meetings and seminars, for free. I use them all the time. Karina Alvela
9. My best cost cutting tip: Cloud based software (SAAS programs) can give small companies access to quality enterprise level programs without the up front cost. I have used google apps, and by registering a website through google received custom email addresses, and access to google docs, etc. for $10/yr. Daniel, Daniel’s Promise, LLC
10. The best way to cut expenses in your company is to outsource any repetitive work you do. We manage a team of 125 in the Philippines through Odesk.com, which has been a huge boon to our business. We can do tons of work at a low price – and the quality is great. We love our team abroad, and our company would be bankrupt without them. Sander Daniels, Thumbtack.com
11. Some of our cost cutting tips: We use google docs for everything. Amazing for collaboration and organization, hosted in the cloud so we can access from anywhere (no network needed), and free. Free project management software like Basecamp. Bummed office space from a friend, so we pay no rent. Zach Kupperman, Pollbob
12. Keep as much work as you can in-house–ie do it yourself. By handling as many matters as you can, not only do you save yourself the money of paying someone else, but you’re also learning new skills and strengthening old ones. Nicholas J. McGrue, polymathlegal.com
13. Don’t pay for PR! Use resources like HARO, MediaSynch, AwardSynch, PRWeb, and Handle Your Own PR to develop your own press releases, distribute them, and respond to journalist queries. Reach out to bloggers and journalists via social media too and develop a relationship with them that will eventually lead to some coverage of your company or product. Lea Richards, pigofthemonth.com
14. Advertise on the best radio stations from midnight to 5 am. It’s CHEAP and you can produce your spot at the station for free. Katie Evans, livinglitenow.com
15. Blogging. Blogging is a good (free) way to push your internet marketing presence and increase your presence on the net. Andrea Harvey, Harvey Law, PC.
16. The best advice for young business owners is to utilize tax planning when trying to retain more of your revenue and decrease costs. Tax planning is a year-round event if you want to minimize your business’s tax bill and maximize your net income. No matter what type of business you run, taxes will be one of your largest yearly expenses and proper planning is critical in building a successful business. Jeffrey Stewart, creativecapitalgroup.biz
17. I use a simple method to cut our biggest expense, salaries. First, I hired a great CTO (who was not cheap), and we then used his expertise to hire and train co-op developers from local colleges. We typically extend a full-time offer upon graduation that includes an equity stake, which provides us with an incredibly talented and motivated developer team without having to pay the sometimes extravagant salaries more experienced developers demand. Blake Shipley, CoupSmart
18. Carefully planning your daily routine, business trips, seminars etc can help you cut down drastically on your travel expenses. Using webinars, Skype for video calls etc, can dramatically cut down on the need to travel over distances for business meetings, seminars etc, thus saving precious cost and time. Victor Kwegyir, vikebusinessservices.
19. I try and utilize as many free or open-source programs as possible. For example, I use GnuCash or accounting, Inkscape for graphic design illustrations, and OpenOffice for word processing. Not only do these programs improve my bottom line, but they also allow me to pass along the savings to my customers. Brandy Sites, BR Graphic Design LLC
20. Barter or exchange services with other service providers. Give shares or options for shares if you don’t have money to offer employees. Build alliances with other small companies for mutual benefit. Maureen Daniek, coachforlifechange.com
21. Find an incredible virtual assistant. Attempting to do it all will burn you out and make you incredibly ineffective. Hiring a great VA means that someone else can manage your calendar, manage your inbox, call people back, organize your meetings, and more. My VA is incredible at integrating all the back-end of my business, ensuring that all the payment systems are working, that traffic is flowing, and letting me know if I need to look at something. Racheal Cook, TheYogipreneur.com
22. As a young entrepreneur, learning how to design your website yourself or atleast learning how to make changes to will save you a lot of money. You’ll probably edit your website a lot more than you expect. It’s not worth paying someone everytime you want to showcase a new offer, or add new services/products to your website. Glyn J. Caddell, SINYTutor.com
23. Get college interns in the mix. You will be surprised how much you can get from kids who simply are looking for some college credit and relevant work experience for their resumes. See if you can get in some local, hungry interns to do work that you normally have to pay for. Alex Becker, HighlyRelevant.com
24.Tthere are a lot of free tools for startup entrepreneurs to run their business that are FREE or very low cost. These tools are easy to set up and allow you to perform many of the same activities as established companies on a much smaller budget. For example, for cloud-based web-hosting you can use Amazon.com; for video conferencing, Skype.com; for design services, websites like 99designs.com or Crowdspring.com; for enterprise email and calendars, Google apps; for web analytics, Google analytics; and for multivariate testing, Google Website Optimizer. Doug Feirstein, uSell.com
25. My tip would be utilize your university’s (if you went to college) resources as often as possible! Apply for entrepreneurship programs and contests that offer money. Use their software. Attend their networking functions for connections and food (we are bootstrapping here). Use their web hosting. Look for interns that are willing to work for experience only. Universities have a lot to offer. Lindsay Reardon, ubimen.us
26. Look on craigslist for sales of office products – I found an office closing down and purchased a laser printer and extra keyboard. I bought 300 padded envelopes from the PR company for $40. Alana Cash, alanacash.com
27. Put your accounting in the cloud. Using cloud-based accounting systems, let your service providers enter their “time sheets,” let your producers enter their “sold products,” and let cloud-based invoice systems quickly, promptly, and easily invoice your clients, collect your funds, and update your accounting system. Patricia Sigmon, LPS Consulting
28. Technology can be very expensive and you need to be above board with your business, so looking for cloud solutions such as google docs, google apps, drop box etc allows for file and data sharing is a life saver. Eric Stauffer, CardPaymentOptions.com
29. Every 6 months we carefully sort through our corporate card statements looking for recurring charges. We confirm with the person who is responsible for the recurring charge that they are still actively using the service. You’d be surprised at how many subscriptions services continue to hang around after the person has stopped actively using them. Healy Jones, officedrop.com
30. We’ve turned to the smaller business intelligence options instead of the huge expensive ones. Salesforce costs too much, but we get similar functionality for our needs from highrisehq.com. We also eschew expensive enterprise project management software for a product called basecamp which lets us co-ordinate projects without a lot of expense but tons of features. Sherrod DeGrippo, bluekeystudio.com
31. Get into an incubator. If you get into the right one, it’s free. Office space is a huge expense, and you can use that savings to hire another 1-2 full time employees. That’s huge for a new business. Mitch Gordon, GoOverseas.com
32. Slash your marketing costs by going in on the arm of someone already trusted by your target audience. Shel Horowitz, greenandprofitable.com
33. As a recent college graduate and no expenses to spare, my two parterns and I turned to the largest crowd-funding platform for support — Kickstarter — a site where people can essentially pre-order our product. Within two weeks, we doubled our minimum goal which was just enough to satisfy our minimum order requirement. Jessica Malouf, Brys + Edgewood Cake Co.
34. In order to achieve savings on salaries, especially as a young business, it is essential to find people who are passionate about your business and the product/service you provide. Passionate people will be willing to work for less (or free) and will still do a good job because they enjoy what they do. Kenny Kadar, NightTap.com
35. One great cost cutting tip is to use free cloud storage such as Dropbox instead of paying for an office network. No expensive IT consultant, no tape backups and no need to set up a VPN, since the cloud storage can be accessed by all employees remotely. Brian Lee, experiencerevelation.com
36. Do your online marketing at a site that’s free and already full of eyeballs, like Facebook or Amazon, instead of buying a domain, buying site hosting, buying website development, and buying ads to drive traffic there. Erin Lale, Skinflint Hints
37. Suck it up and do everything yourself. Don’t hire what you don’t have to. Unless it’s something REALLY outside of your skill set, don’t hire it done. You’ll be amazed at what you can accomplish. Get organized and automate everything you can. Matthew Jones, ShizzleDizzleMagic.com
38. Develop a expense review process (and use it). To do this properly, you need to have good bookkeeping. By properly classifying expenses, you can easily review many aspects of your overall expenses with a quick glance at an expense report or profit and loss. Jeff Huckaby, rackAID LLC
39. Our largest cost-cutting strategy has been our philosophy of hiring hard-working, smart developers who can learn mobile, web, etc. rather than trying to find someone experienced in the field we need them for. Because they’re gaining value in learning a new skill and understand they’re not as experienced as peers who might apply to the job, they’re likely willing to work for less and grow into the position if the payoff is higher down the road. Alex Schiff, fetchnotes.com
40. My suggestion is to use your strengths and hire your weaknesses. For example, part of my work involves a great deal of writing, but I¹m not a fast typist and to waste my energy there doesn¹t make sense, so I use a service called I Dictate. Teri Johnson, mypersonalbest.biz
41. Review all of your monthly subscriptions and committments. Eliminate all of the unnecessary monthly burns. Rich Christiansen, zigzagprinciple.com
42. I’m a bridal gown designer and the easiest thing to do to save money is to research supply sources even if you are a loyal customer to a supplier you have to see what the competitor has. For my business, the cost of fabric is rising and if someone has the same quality, same product for less, I am willing to buy even if I have been loyal to another supplier. Jennyvi Dizon, jennyvi.com
43. Join a barter exchange. Your business probably isn’t operating at 100% capacity. So why not trade your down-time or excess product for the things your business needs like printing, employee incentives, marketing, website design and hosting and almost everything you need to run a business. All businesses should conserve their cash and join a formal barter exchange to help them do that. Catherine Cohen, PremierBarter.com
44. At Debutante Media, we use a free tool to actually keep all finances in order. It’s called Wave Accounting, and because it allows you to import your other accounts, it becomes like a Mint.com for business. I can’t live without it! Jaime Palmucci, debutantemedia.com
45. When trying out software, take advantage of free plans! There is a lot of software that seems like a good idea, such as accounting software, time tracking, productivity, etc., but a lot of it turns out to be overkill or unnecessary for a small business. Most web applications will offer a free plan, so try it out before you spend money on the full-fledged version. And if there is no free version, a lot of companies will do a couple-week trial that you can cancel if it isn’t worth the cost. Michael Kaiser-Nyman, Impact Dialing
46. Our employees all work from their home office, and although we’ve had to change our management strategies a bit, the lack of a large office space cuts down on our expenses. We also use Skype for video calls, free conference call softwares, and other inexpensive resources in order to communicate. I suggest that a young business owner utilize technology to his or her benefit in order to be successful. Catherine Cunningham, virtualdatingassistants.com
47. My best advice for any entrepreneur on cost savings is hire young, hungry, and excited individuals. While it takes some time away from your day here and there, you can get so much done for such a low cost. Tony Adam, eventify.me
48. My biggest cost cutting tip for young entrepreneurs is to build an adviser list. Whether these are alumni from your school, friends in relevant industries, fellow entrepreneurs, etc etc, think through this list first or better yet, reach out to them before spending big money on contractors and someone will probably be willing to help for free or make an introduction that reduces your cost. Yifan Zhang, gym-pact.com
49. My one piece of advice to new entrepreneurs…..and this is huge for someone trying to make things work….it’s not how much money you make…it’s how much you keep!….so overhead is key….it takes down more businesses that you can imagine. Even people working from home can still bankrupt themselves through ill conceived overspending…especially in technology!! Craig Wolfe, CelebriDucks.com
50. The main way I cut costs is to use Mint.com to monitor expenses, hiring unpaid interns, and utilizing communication technology like Skype, Gmail, and Dropbox. Andrew Gazdecki, BiznessApps.com
51. Don’t bother to print business cards – people will throw them away and they are not relevant today. Instead, the people you want to contact do so and give them your simple website name to further engage. When people ask you for a card just say – “if you want to contact me go to www.xyz.com. Terri Levine, terrilevine.com
52. Negotiate for everything, never take any cost at face value…especially if you are buying more than 1! My customers always ask me if they can receive better pricing on my products, so eventually I figured, why shouldn’t I be doing the same with my vendors? Debra Locker, shopbellabag.com
53. In my company, one of the most practical steps that I’ve found in cutting expenses is to find other entrepreneurs that I can split certain expenses with. That has included office space, equipment, even transportation to conferences. Thursday R. Bram, thursdaybram.com
54. My best tip is: If you can do something on your own – do it. Have to prepare a speech – do not hire a ghostwriter. Have to
interact with your clients – do not hire a customer support rep. You have to learn to count only on your skills, imagination, and talent. Once you feel overloaded – start outsourcing. John White, BestEssayHelp.com
55. Take the time to find the right partners or employees. Don’t rush to hire the first people because you want to push your idea forward as soon as possible. Finding the right people will save time and money in the long run. Jared O’Toole, Under30CEO.com
