So you decide to open a business, you make plans, come up with unique strategies, you find the target audience, you start to follow every detail and are all fired up to achieve perfection. What about your budget? This is a common problem for almost every other entrepreneur to be actually for obvious reasons. Without money, your plans and strategies will be of no use, and in order to do that you must learn how to manage the limited budget.
Managing your Cash Flow
If you are a college student, it will be very difficult for you to start a business, but that doesn’t mean you cannot start with baby steps. In order to get anywhere, you must first know what your budget actually is. Let us say you have a budget of $10,000. You cannot let a single dollar go to waste, so you must plan things very carefully. After you have evaluated your audience and their demands, it’s time to start. Divide the $10,000 dollars into each section. Raw material, marketing, transport, etc, assume raw materials cost you $3,000. Other accessories and stuff cost $2,000; this means that you only have $5,000 to work with. Without marketing your business will not be able to reach your intended markets, so you must spend more on marketing.
Let us say you spent $3,500 on it. Now the rest of the money must be distributed for the other sectors. Always remember that you must take each step with caution, you have a limited budget after all.
Cut-Backs
Try to find a section during this process where you can cutback and save money, the more you save, the better. You can use that money to invest in another area of the business to improve your services, or quality.
Managing
Make sure you plan things out properly. Limited budget means you have been restricted on a lot of things, but never let them get to you in any way. Manage your sales growth as well. Sometimes having too much on your plate can make a huge mess for you, and at other times, if there is not enough, you will starve. Make policies which will please your customers, something like delivery within 15 days or no delivery charges will be beneficial as well. Cash on delivery is always a good idea too. Communicate with all of your employees clearly so as to ensure nothing is left to chance or ignored. Even a small mistake can result in massive losses.
Give strong proposals to your vendors, make sure they are the right people who can deliver everything on time, and at a good rate as well. Do not settle for less, even when you are restricted; you will only end up compromising on the quality of the material. If you provide your customer with the quality they were not paying for, not only will you lose them, but this will definitely effect your reputation. As a beginner, you cannot afford that.
