3 Simple Strategies for Success When Money Is Scarce
Success in business depends on how well you can turn your resources into profits. Unfortunately, I’ve worked with many clients who thought money was the only resource that would make their business a success. As a result, they postpone -- or worse yet, abandon -- their dreams of starting their own business. I’ve also seen other clients, who have already made the entrepreneurial leap, give up and close shop due to lack of funds. While having plenty of capital has its advantages, when it comes to starting or growing your business, money is only a measuring stick, not a necessity.
Successful entrepreneurs know there is plenty they can do that doesn’t require money. Their motivation, drive, commitment, and hard work become the go-to resources.
If finances are tight, know that you can still be successful. By using the suggestions below, anyone can overcome the obstacle of having little to no money.
Strategy #1: Bootstrap to make the most of what you have.
Bootstrapping -- the discipline of covering your operating expenses using only the revenue generated by the business -- is one of the most common and effective ways to start a new venture when funds are tight. While it does require a leap of faith, you shouldn’t fear starting a business with little to no capital.
In addition to the financially responsible benefits of this approach, bootstrapping provides motivation to put forth the extra effort to increase revenue. When your business needs a $100 more to keep the lights on, you’ll be surprised at how creative and committed you can become in generating an additional $100 of revenue. Bootstrapping also forces you to find original ways to keep operating expenses at a bare minimum.
In addition, bootstrapping can be extremely rewarding. An entrepreneur who has put her all into building a business can say, “I did this” with more sincerity, than someone who had to rely on outside funding. With bootstrapping, you are the business. You are the lifeblood of the business.
With one-step forward, you can become the leader of your new company. Survival depends on profitability. However, if from day one, every financial decision is focused on increasing revenue and decreasing expenses, then you can do it. Believe in yourself and your idea. Spend time working rather than trying to borrow a lot of money.
Strategy #2: Keep marketing costs down with social media.
You are the only person who can authentically tell the story of your company. However, when raving fans of your products and services shout from the rooftop, people from all over the world become your marketing staff.
Marketing today is about creating relationships. Individuals are hardwired to do business with people they know, like, and trust. While you must let the world know about your business and your products, in today’s social media world, marketing is not about selling your product as much as it is sharing your story. Your online marketing strategy should focus on sharing valuable and useful information to your customers.
In order to bring that value to your customers, you need a plan. While some company’s social media efforts appear to be random and haphazard, effective companies’ campaigns are well planned out and deliberate in their intent. By having a defined purpose, you bring focus and meaning to your social media efforts.
As the campaign rolls out, pay special attention to comments from your followers. A benefit of social media is that it allows you to interact with your customers. Through it, you can solicit feedback, gather recommendations, and reward loyalty. Not only does this solidify your customer base, but if done judiciously, it can help you tweak your offerings to appeal to more people.
Strategy #3: Learn from your mistakes and make adjustments.
In business, mistakes happen in a variety of ways: a miscalculation in your accounting, poor judgment when hiring vendors, incorrectly estimating your profit margins, or underestimating your expenses. Even small mistakes can be expensive; therefore, it is important to limit their financial impact on your growing company.
However, mistakes add great value to your company too.
Mistakes are great teachers if you take time to learn from them. When you make a mistake, find out why it happened, and take the time to learn from it. Don’t quickly dismiss it. When ego keeps you from taking the time to examine your mistakes, you set yourself up to repeat it.
Growth occurs when you do something differently from what you did yesterday. Learning from your mistakes shines a light on what you need to adjust and do differently. These adjustments can lead to innovating your business. In addition, innovation itself cannot take place without making mistakes along the way.
As soon as you start thinking of money as a luxury instead of a necessity, you can begin to break down the mental barriers that stop or derail entrepreneurs. The strategies listed here are just a few ways that you can be successful without having to spend a lot of money. Successful entrepreneurs don’t give up when faced with an obstacle—even when that obstacle is lack of money. You shouldn’t let it stop you either.