By Ericka Simpson
Start a restaurant and you could shell out $400K to $500K or more on space leasing, construction, appliances, furniture and advertising. That’s for a small restaurant, the type of eatery that operates more like a fast food or carryout than a family sit down restaurant. Manufacturing businesses aren’t much less expensive to get off the ground.
Reducing the costs of business
Even if you start an at-home business, you’re going to incur costs. A crafts shop owner spends $1,500 a month to advertise her business on Facebook alone. Then, there are shipping costs.
Don’t let overhead costs stop you from developing a successful business. You could bargain with other entrepreneurs to cover expenses like copying, writing and information technology. For example, you could barter with a freelance writer to write your press releases at a reduced rate if you, in return, develop graphic designs (i.e. social media page logos, banner ads, t-shirt logos) for the freelance writer. Just make sure that the price value of both forms of labor are equal or as close to equal as possible.
As with any business agreement, draft a contract. Make sure that both you and the entrepreneur you barter with sign and date the agreement before any work related to the bartering agreement begins.
Other bartering possibilities involve information. If you’re a lecturer, you could barter with researchers who need speakers to help them advance their findings. Traveling to the same hotel or convention? See if the establishment uses products or services that you develop. If it does, schedule a meeting with a manager who has the authority to make buying decisions and ask about a steep hotel discount for you and your team members in exchange for bulk business or a product/service exchange.
More costs saving deals and business bargains
You may not be able to get exclusive deals as that could be encroaching on fair competition laws. However, by bartering with organizations or professionals that you regularly conduct business with, you could balance the amount of risks both organizations assume during the normal process of your operations.
Another step you could take to reduce your overhead costs, is to share talent. What do I mean by this? Let’s say you own a cafe and you know someone who owns an event planning company. Try asking the owner of the event planning company if you could use the services of the payroll specialist that she uses. You might be able to get the specialist at a reduced rate if you and the event planner offer the specialist a shared working space.
What does this do? It lowers the specialist’s travel costs, telephone expenses, etc. It also makes it easy for the specialist to land a new client (you!). Consider using this as leverage to bring the specialist on at a lower rate, keeping in mind that each specialist should adequately paid for her services.