Cash flow is essential for a budding startup, and too many end up sinking because of a lack of it. The worst thing is that many of these businesses are performing as they should. What ends up destroying them is the mismanagement of their overheads and overspending. In some cases, they might be leaking money either out of negligence or ignorance. That’s why you need to be able to spot those leaks and plug them. Here are some of the ways that your tech startup might be losing money.
There could be many reasons why businesses end up paying more than they should on utilities. The first one is just plain waste. Did you know that appliances that stay plugged in during use could account for as much as 20% of your electricity bill?
This is why you need to do everything in your power to cut them off. Your first need to take inventory of items that are plugged in, but not continually used. Make sure that you take a pad and paper and note everything.
If you have luxuries like mini-fridges everywhere and space heaters, unplug them and ask your employees to dress warmly. If you have a mini-fridge in your office, turn it off and use a communal fridge instead. Add energy strips to make cutting off energy easier and have a clear policy for unplugging devices at the end of shifts.
This is another major issue with tech startups and one that is difficult to fix. Having to hire employees costs money, especially if you’re working with a headhunter. Then you have to count the time spent on training and onboarding, and the dip in productivity that comes with someone who’s not completely familiar with their role yet.
The only sure thing that you can do is make sure that you pay employees a competitive wage when compared with the competition. Also, look at what benefits packages they offer. Consider going agile and allowing for more mobile work and flexibility. These are all things that will give you a better chance of finding and retaining top talent.
Supplies are something you’ll constantly have to keep an eye on and restock. You can’t escape it. But two things you can do are shop smarter and use supplies responsibly.
The first thing you should do is look for a good supplier with a wide selection of products. You can find a ton of great suppliers online. Services like officecrave.com have pretty much anything you’d need in an office at very competitive prices.
Once you’ve found a good supplier, try to buy things in bulk and become a regular to get preferential fees. You can then start working smarter, like printing on both sides of the page, going as paperless as you can, and ditching k-cups for regular coffee. Make sure that you reuse everything that you can as well, such as file folders and binders among other things.
If you manage to keep an eye on these unnecessary expenses, you’ll at least be able to make a few savings. These could be enough to allow you to stay afloat and could be reinvested in your company’s growth.