The number one question that a small business owner probably is going to have at the beginning of the new business venture will be; how can we save money as we get are small company underway. After all, the first six months of any small company’s life are when it is at its greatest risk. In fact, in a recent study done by Harvard Business School, nearly seventy percent of all small businesses fail within the first six months of starting, and at least half of those failures can be attributed to the company running out of funds. In this article we will highlight a few ideas for saving money which many small business owners might not consider.
One excellent tip is for small business owners to hire an outside firm to take care of their taxes during the first year. The first tax filing is often said to be the most complex, and there are a lot of delicate issues that have to be taken care of during the first filing which the average person probably won’t know about. Tax preparation agencies such as, www.mmillercpa.com have tax agents who are experts in creating a company’s first year tax filings, and doing so while seeking out any possible tax benefits which a small company stands to earn. The amount of taxes which a small company has to pay can vary greatly depending on how many exemptions the company can use. In fact, it is estimated that nearly one out of five tax exemptions which are set up to help small companies go unused by those who should be their benefactors. Tax preparation CPA and other professional assistance programs for companies that need to file taxes for the first time can help make sure that small companies are getting every break they can, and that can save a small company enough money to make a big difference.
Small business owners should be careful about overspending during the first year they are in business. After improper tax handling, the most common mistake for small businesses to make is probably to spend too much money on items they don’t need when they are just getting started. People that know their stuff when it comes to business will advise small business owners to keep all their first year expenses to an absolute minimum. One common area of overspending for new companies is with marketing. As a good rule of thumb, the first year a company hits the market, no more than 15 percent of its funds should go towards marketing spending, and some business professionals would say that figure should be even lower. The problem is that marketing might bring in a lot of cash over time, but is a company starts off overspending right from the start, they run the risk that they will go belly up before they can even enjoy the fruits of the money that they have invested in their marketing efforts. Small businesses should start out slow and build their marketing efforts up over time as their income gets stronger and more reliable.