How to Waste Your Startup Money

Most articles tell how to maximize money but only a few tell you how to avoid wasting money

. As a business executive, one of your key functions is to find out where your business is leaking and to find ways to seal itfast.

If you are just starting in the game, it pays to know where your money is going. It is easy to overspend in the initial stages especially because you still have a huge amount to spend. But after a while you will realize that your money is almost drained. When the going gets tough, you soon realize the need to account for every cent. Too late? Ummwell, yes. Experts suggest for start up businesses to be there until the long haul, you need to be a miser with your money. Avoid the temptation of spending on things that will make you feel or look like you are a successful business person. Rather, you should carefully spend your money on things that will make your business a success. Focus on how you effectively and efficiently deliver what the customers want and not what would make it more convenient for you.

So before spending any cent on anything, pause for a while and ask yourself, Will this generate business?'

If the answer is no, do not entertain the thought. Here are some fanciful' ways most businesses waste money.

1. Fancy office paraphernalia. As I said earlier, there is the temptation for any startup entrepreneur to spend on things that will make him or her appear successful. Some of these things include fancy business cards, custom greeting cards, letterheads on expensive paper, etc. They will make you feel like a successful business person; but then again, ask yourself this question: Will this generate business?' The answer is usually no. An ordinary but professionally done business card will do the trick. Greeting cards done with creativity and uniqueness will do the trick. A letterhead on ordinary paper will be able to convey the same message, less a few hundred dollars.

2. Fancy Offices. Everything fancy for a startup business is not a good idea and this includes fancy offices or shops. Most startup business executives think about the office the moment they get the permit to operate. Will it generate business? Not really. Not a good idea. Sometimes even if these business executives are hard up on money, they try to get fancy offices because they want to impress. If doing business means converting your garage to a temporary office, by all means, turn the garage into your work area. You do not have to spend a ridiculous amount of money for an office you cannot afford. Better your garage than closing the business in a few months.

3. Fancy Cars. To complete the fancy look, business executives try to get fancy company cars. They think that luxury cars enhance the image they want to project. Well, that is just it an image. Will the new luxury car generate business? Absolutely not. It does not only generate business, it will also make your business poorer by some thousand dollars. If there is nothing wrong with your present car, I mean if it still serves your purpose of transporting you from one place to another, then why ditch it?

These three things probably gave you an idea of why most startup businesses fail. They fail because they prioritize things that will not bring business but that would just enhance image. Yes, image can be a factor especially if you have established yourself in your field; but for startup businesses, customers would not care about how your car looks or why your office is in your garage. Ultimately, customers will care about the quality of your products and services.

How to Waste Your Startup Money

By: Robert Johnston

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