Money — it makes and breaks a solopreneur, so much so that many single-person businesses don’t make it past 12 months because the finances just don’t add up.
And while you can read all the articles you can, watch all the videos you can find, and listen to every podcast you’ve sourced, there’s no blueprint for how your business should manage its money.
I’m not here as your white knight. But I am here to tell you that there are ways you can save it money.
However, you might need to take a seat. Why? Because it’s not all jolly cuts.
Everything I’m going to tell you now is about spending money, but doing it in the right way – so that you save money in the longterm and your business lasts well beyond its first year.
Use credit to manage your cashflow
Cashflow management is a simple concept that’s hugely important to first-year solopreneurs – it’s controlling your incomings and outgoings, so that you don’t spend more than you make.
Solopreneurs need to take credit in their first years – it’s a given. However, you can save yourself the cost of late payment fees by taking the right sort of credit, sensible borrowing that lets you manage your cashflow.
There are many examples of credit you can take, such as government loans. One of the simplest is to get a fuel card. This allows you to buy your petrol and diesel now and pay for it later – so you can deliver goods or visit clients, and keep the lights on.
You can pick from plenty of options, with this review explaining the benefits of a Texaco fuel cad. The important thing is that you pick the right for you, the one that gives you most control to manage your cashflow.
Go second-hand where possible
Buying equipment can be a big drain on your finances as a solopreneur – you need the tools to do your work and there’s no getting around that.
Except, there is a way of getting around the cost – using second-hand equipment.
I’m not simply talking about buying a cheap office chair. My suggestion is that you start by forgoing new items wherever you possibly can and there are many examples when you can do just this.
Take computer equipment. Do you need a shiny new monitor? Nope. Is it essential that your keyboard is fresh off the shelf? Not a jot. Is software even something that has to come wrapped in new packaging? Not at all.
You can find lots of great options for second-hand office equipment – including Microsoft office. Take this site – you can get everything from licenses to operating systems. The key is that you vet the second-hand goods you get first – there’s no sense in picking up a chair that collapses the first time you sit on it.
Use sensible outsourcing
What’s the best way of saving money? Not spending any of it, of course. But if it were that simple I wouldn’t be writing this article and you wouldn’t be reading it – and you’re right, because sometimes you do need to spend. What am I talking about here? Investing in sensible outsourcing.
As a solopreneur, the temptation is to do everything yourself – the hint is in the name. But that’s not a sensible strategy, both for your sanity and for your company accounts.
The reason for this is that you (quite literally) can’t do everything – you just don’t have the skills. And I’m sorry if this is a rude awakening but it’s one that’s necessary. What this means is that you need to use sensible outsourcing for the things that you can’t do, so that you can spend more time on the things only you can do.
Without knowing your unique skillset, it’s nigh on impossible for me to say what you should and shouldn’t outsource. So, I’ll use myself as an example and hope that helps.
I can write (you might argue that I can’t, but we can agree to disagree on that) but I can’t do much in the way of accounting. Now, I need to do accounting as a solopreneur and I can’t change that. What I can do, though, is accept my shortcoming and outsource my accounting.
This allows me to spend more time writing and less time making an ass of myself with Excel spreadsheets. And what this ultimately means is that I make more money because can do more writing and bill more to clients.
Adopt the same approach to your solopreneur ventures and you too can save yourself money in the long run by spending it sensibly.
Recommended reading: 4 TIPS FOR STARTING A BUSINESS IN A SMALL TOWN
Saving money in your first year as a solopreneur isn’t simply about spending less cash – it’s about being smart with your necessary expenses.
Because let’s be clear about this – you do have to spend money, you just don’t have to throw it away on a shiny new monitor that means you can’t afford the electricity bill next month.
So, put my recommendations into practice and you’ll feel the benefit in the long run.