Starting (and maintaining) a business on a budget is tough, but it’s definitely possible as long as you follow these five tips from Robert Herjavec:
Make sure you’re passionate
Plenty of people decide to start businesses solely based on their desire to make money. While making a profit is important, you should also consider your interests and passions. If you’re putting hundreds of hours into something you don’t really care about or like, you’re going to get burnt out fast, especially when you’re on a tight budget and aren’t making money right away. Try starting your business around something you’re passionate about instead. “When you become great at something you love, the money will follow,” shares Robert.
Make smart investments
Starting a business is expensive, and a lot of people consider investing their money to help with the costs. However, just because you’re feeling eager and excited doesn’t mean that you shouldn’t be smart with your finances, especially when you know you’re on a tight budget. “Don’t let the fear of missing out drive you into investments you can’t control,” says Robert. Do your research and invest in things you already have some knowledge in as well. “Wise investors don’t put their money into things they don’t understand,” he adds.
Have realistic expectations
It’s easy to dream about all of the good things your business can bring in the future, but remember to be realistic about things, especially in the beginning. “Many entrepreneurs underestimate the amount of money a business requires during its first year of operation, while overestimating the sales and profit it will record,” shares Robert. Don’t get your hopes up about making crazy profits right away, and be sure to be practical when it comes to planning and sticking to your budget. “Take a cold, hard look at the expenses involved in starting a company and maintaining it,” he adds. It might not be as easy or glamorous as you think, but it will be worth it.
When you’re short on time or money, it can be easy to rush through big business decisions. But even though you think making quick choices will help your company, it can actually end up costing you. Take picking a business partner or hiring a new employee, for example. “If the employee is not suitable for the position because you made your decision too quickly, it will cost your company needlessly,” Robert warns. Even though you might not feel like you have the time to keep searching for another option, you should never settle just because you’re in a rush. “Spending a little more time to ensure that you have [made the right decision] reduces the likelihood of wasting money,” he says.
As you build your business, celebrating your successes is important. However, don’t let one great month or sale get to your head. Remind yourself that you’re still on a tight budget. “When you relax with no need to hustle for a buck every day, you risk extinguishing the fire in your belly that drove you to become an entrepreneur in the first place,” Robert points out. Staying humble and motivated throughout your successes is essential to maintaining your business on a budget.