The UK, one of the world’s largest financial centres, has become a promising business hub for startups and small companies due to its flexible market, government regulations, and thriving entrepreneurial culture.
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Still, setting up a business in the UK, especially for startups, can be expensive. With limited resources and budgets, UK startups constantly seek ways to cut expenses and maximise returns.
In this blog post, we will share 22 innovative strategies that ensure startups save money.
Table of contents
● What are startups in the UK?
● What are 22 creative ways for startups to save money?
● Conclusion
What are startups in the UK?
A startup is a young company that develops unique products or services, brings them to the market and sells them to customers.
They work like any other company in the UK, and what distinguishes them from others is the objective of creating entirely new or improved systems or processes. These companies start with little-to-no funding and need to share their concepts with investors to get financing for growth.
What are 22 creative ways for startups to save money?
There are numerous ways of saving money for startup owners, and listed below are some of them.
1. Invest in co-working spaces
Most startups in the UK opt for co-working spaces rather than traditional office setups. It helps them save money on rent and associated costs.
2. Encourage remote working
You must look for startup business ideas that save money in the long run.
By encouraging remote working, you save on office costs, utility bills, travel expenses, and other related expenditures.
3. Look for outsourcing facilities
As a startup entrepreneur, you can outsource non-core functions like accounting, bookkeeping, customer support, and advisory roles to specialist firms or freelancers.
They charge you only for the service they offer, and you save on paying them throughout the year and offering employee benefits.
Why don’t you use Experlu’s budget-friendly startup specialists and accountants to save on costs without compromising on the services?
4. Invest in automation
Businesses can use automation tools to streamline repetitive and manual tasks. Thus, such solutions can save time and money while increasing productivity. Use tools for project management, team communication, social media scheduling etc.
5. Purchase open-source software
You can leverage open-source software in place of investing in expensive proprietary alternatives. It eliminates licensing fees and reduces software expenses.
6. Focus on energy-saving measures
Businesses implementing energy-efficient practices like LED lighting, smart thermostats, and motion sensors can significantly reduce electricity bills.
7. Go paperless
You must digitalise most of your business processes, adopt electronic document management systems, and utilise cloud storage to reduce printing and paper costs.
8. Use the power of bulk buying
Startups can buy products and supplies in bulk and negotiate discounts with the supplier. This process helps you secure better pricing from suppliers.
9. Master the art of negotiation
You must use your negotiation skills to secure a good price with landlords, consultants or suppliers. It includes favourable lease terms, such as rent reductions or flexible contract lengths. Thus, negotiating prices helps you ease the financial pressure.
As they say, you don’t get until you ask!
10. Adapt to flexible staffing
You can hire contractual or freelance workers on an as-needed basis in startups. They provide flexibility and cost savings compared to full-time employees. You don’t pay them employee benefits like paid sick leave, thus saving money.
11. Use bartering policy
Most startups are tapping into the barter system to exchange goods or services with other businesses to avoid cash expenses. You can also try the same to save unnecessary costs during the initial years of your business.
12. Introduce virtual meetings
You can replace physical meetings with video conferencing tools. It helps save on travel costs, conference space rents and other associated costs like buying food and drinks, paying extra utility bills, etc.
Additionally, virtual meetings give the flexibility to speak to your employees and partners from anywhere and at any time.
13. Focus on bootstrapping
Applying for startup business loans is the most challenging process, especially when borrowing money from banks and other financial institutions.
Therefore, many UK startups finance their ventures through personal savings, avoiding costly loans or equity dilution.
14. Start a referral program
Startups are now implementing referral programs where existing customers refer them to new clients. You can encourage them by offering incentives or rewards. It reduces customer acquisition costs and keeps your existing base satisfied for longer.
15. Try guerilla marketing
UK startups are adopting low-cost yet innovative marketing techniques like social media campaigns, content marketing, and viral videos over traditional methods with higher ROI.
This reduces your marketing and advertising costs and ensures greater reach to the target audience.
16. Use DIY design tools
You can utilise different design tools and templates from various online platforms. They allow startups to create professional branding materials with minimum investments. Thus, reduce expenses by eliminating the need to outsource to expensive design agencies.
17. Apply a collaborative purchasing approach
Startups can collaborate with other businesses to bulk office supplies or equipment purchases. It helps in reducing individual costs and avail better discounts.
18. Flexible payment terms
You can request extended payment terms from suppliers. It helps ease cash flow challenges and provides some financial breathing space, especially when on a tight budget.
However, once your revenue increases, you must clear all your debts to avoid future problems.
19. Invest in online learning
You can take benefits of online courses and resources instead of expensive training programs to upskill employees at a lower cost. It ensures a better return on investment as these trained employees help your business grow.
20. Use the benefits of crowdfunding
Some startups turn to crowdfunding platforms to raise funds and validate their business idea. This saves them from the need for initial investment, solves immediate financial challenges, and helps the business grow.
21. Gather customer feedback
Entrepreneurs must actively seek customer feedback to improve their offerings. It will help them minimise potentially costly mistakes or product flaws and satisfy customers. This increases customer retention, revenue boost, and business growth.
22. Utilise bartering office space facilities
Do you have an empty office in your company? Startups leverage open office spaces by exchanging them with other businesses to reduce property costs. It is a great way to have a physical presence while paying less for all associated expenses.
Conclusion
Startup owners must be creative with their spending strategies to save costs and run businesses efficiently within their budget.
Additionally, these steps in startups help you grow into a full-fledged business. You can always consult an Experlu advisor who can suggest the best ways to run your business and make the most out of it.