Setting a Budget for Small Business: Saving vs Spending

As you pursue your career as an independent professional, you’ll quickly discover that your success is tied to the business decisions you make. What you choose to do with your money is an important part of that challenge. Which purchases are smart investments? Which are simply a waste of money? Here are three areas where you can cut costs and three areas where splurging could actually pay off.

3 Ways to Save

Pass on Brand New Equipment

Maybe you’ve heard that a new car depreciates by 10% the moment you drive it off the lot. The same is often true for the equipment you’ll need for your business, including office furniture and electronics. By shopping for pre-owned items, you can often find what you need in “like new” condition for a significant discount.

Beware of Trendy Technology

Yes, we all know it’s tempting to rush out and buy the latest device, but there are three reasons that you’ll be better off waiting. First, consider need versus want. Can you quantify how this new gadget will improve your productivity? Next, remember that the first version of a brand-new technology nearly always contains flaws that will be improved upon in subsequent versions. Finally, if you’ve decided that the product is indeed justified, keep in mind that prices often drop shortly after release. As the novelty wears off, you can purchase what you want at a better price—or even pre-owned.

Reconsider Office Space

You want to project an image of success, but while that private office in the fashionable section of town may seem enticing, it could come at a high cost. As an independent, you’ll likely have choices when it comes to where you work. Many choose to work out of a home office, designating a specific area of their house into a room for business while avoiding spending extra on rent and utilities. Coworking facilities are another option which give workers the benefit of an office environment, often complete with equipment and conference rooms, at a fraction of the price of a private office.

3 Ways You Should Spend

Prioritize Your Physical Comfort

When times are tight, the $50 work chair from an office supply store may seem like it makes more sense than spending hundreds of dollars on seating. However, when back spasms or wrist pains that tend to accompany cheap office equipment strike, chances are you’ll wish you would have spent the extra money on ergonomic upgrades. Items that increase your physical comfort will more than pay for themselves by making your work environment more enjoyable and increasing productivity.

Invest in Quality Technology

While paying top dollar for the latest trends may not make sense, purchasing high-quality technology is still a smart investment. You aren’t actually saving money if your cheap knockoff computer needs maintenance every few months. Your purchases don’t need to be brand new or top-of-the-line, but for an item you use regularly, buying a reputable brand that is built to last is worth the extra cash.

Design a Professional Website

In order for potential clients to find you, a strong online presence in the form of a personal website is practically a necessity. The quality of that presence has become the standard by which modern businesses and professionals are judged. Cheap, slapped-together websites can give off an amateur impression of an unprofessional business. Spending tens of thousands of dollars on website design isn’t necessarily required, but hiring a professional to design your site will boost your professional image, assuring visitors that you are an established, qualified expert they can trust.