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How to Run a Lean (But Not Cheap) Online Business

office coffee shop

When I first starting this blog and transformed it into a full-fledged freelance business, I didn’t have a lot of money. I was in $14,000 of consumer debt and was living in a very sketchy apartment (that I desperately wanted to move out of).

The only thing I could do, was start a business using The Lean Startup model. But that’s not to say I only made choices based on what was cheap.

Running a lean business doesn’t mean you have to be cheap or use anything that’s poorly made. It’s all about running it efficiently and focusing on the areas that are worth the investment.

You’ve got to evaluate the parts of your business that are making money (or have the potential to) and invest your time and money into those areas.

And if those areas aren’t bringing in much of an income, it’s time to stop outsourcing work or spending too much time on those things. You want your business to be self-sustaining, not a time or money suck.

1. Know where to splurge, and where not to.

You want to work on projects that give you the most return (ROI), which could mean anything really.

Freedom, revenue, creativity — whatever you want your online business to be is how you should gauge what you invest in. Invest in areas that directly give a monetary return.

2. Keep a low overhead.

When you run a business from home, it’s important that your personal overhead be as low as possible. As a sole proprietor, your business and personal income and expenses are one in the same (at least in the IRS’ eyes).

So the lower your personal expenses are, the more money can be invested in making your business flourish.

3. Spend money on the first impression.

When a customer or client lands on your website, you don’t get to redo that first impression. That’s why I’m constantly trying to revamp, update and tweak my site’s design and function.

Working with a professional web designer, either from your network or a site like Shopify, can ensure your first impression is the best one possible — which will in turn help you convert leads into sales.

4. Invest in yourself.

Instead of investing too much in software and products that could become non-existent tomorrow, opt for investing in your own knowledge and skills instead.

Anything that can affect your personal and professional growth — like debt or negative influences — should be dealt with, so you can focus on making your business successful.

5. Leverage out-of-the-box ideas.

There are tons of ideas and resources available for you to use to grow and market your business without having to spend a lot of money.

Of course some of them will take a little time investment, but when you’re strapped for cash all you have is time to work with. With a little creativity, you can leverage those ideas to the fullest!

Do you run a lean business? How have you seen it compares to choosing the cheapest options?

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About Carrie

Carrie Smith is the owner and editor of Careful Cents. She helps serious solopreneurs and full-time freelancers earn more money in less time, through systems and financial organization. She's been featured in The Huffington Post, Glamour Magazine, Kiplinger Finance and several other business websites. In May 2013 she quit her full-time accounting job to pursue entrepreneurship and blogging. You can find her on Twitter or Instagram @carefulcents.

Comments

  1. With the Lean Startup model, I think about testing the viability of ideas as soon as possible. I feel like I’ve gotten bogged down with doing work that didn’t end up being profitable rather than testing a minimum viable product, even if that product was related to freelancing.

    I try to keep costs down, but I definitely spend money on things that I know will give me a positive ROI, like trainings or web apps.

    • I’m guilty of this too Jeffrey. I think we all get stuck on perfecting our idea, our design or our product instead of testing it to see if it will even be a success. Testing and experimenting is always a smart thing!

  2. R.Joyce Heard says:

    Great article. I liked how you made the distinction between cheap and lean.

  3. Spot on! Entrepreneurs should learn to prioritize which areas of their business to invest in. Investing in oneself is indeed something that goes beyond the business. It’s something you’ll be taking with you no matter what happens.

  4. Above all you have to be wiser, take risk or spend most money on the things that could give benefits. That’s simple, and always learn.

  5. I used fiverr to save on a my logo. I’m thrilled with the way it turned out. But when it came to web design, I decided to “splurge” and hire a designers so my users could have a good site experience and come back.

  6. Starting your own business doesn’t mean you have to have a huge amount of money in your pocket.It’s just a matter of looking for some resources that you could use to lessen your expenses. Thanks for sharing these tips Carrie!

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