One of the priorities for many new businesses is finding ways to run lean. After all, capital is probably low, and income and profits have yet to come in.
However, a focus on saving money can lead to mistakes that prove costly. Look at the following errors and see if you have managed to avoid them. If not, now is a good time to adjust course.
Focusing on price rather than quality
An emphasis on price rather than quality can affect your business in many ways. For example, you might make subpar hires who then commit major, even illegal mistakes or who simply have no passion for the business and who just go through the motions. Similarly, you might try to do legal paperwork yourself instead of outsourcing the work to a law firm. You might also bypass business formation to save money upfront. Price over quality can also lead to your business offering inferior products and services.
This is not to say that anything inexpensive is bad for your business. It just means to check that you are getting something of quality in return for your money.
Going it alone
A way to save money upfront is to handle everything yourself, including the accounting, marketing and product sourcing. If you are not skilled in a certain area, you take the time to learn to do the job with minimal competence. At least, that is the goal. The reality is more like you juggling a zillion tasks, many of which you are not sure how to do, and getting more burnt out with each day that passes.
Underestimating what your business has to offer
Another common blunder is underestimating how much customers or clients will pay for your product or service. After all, you are so concerned with saving money. Other people must be too, right? Yes, this can be a priority for some customers, but it might surprise you the prices quite a few customers are willing and able to pay for good products and services. Try pricing your offerings higher and see what happens.