4 Ways to Cut Business Expenses in Cities with High Startup Costs

[This article was written by Anica Oaks.]

Any business inevitably must spend money to make money. At the same time, the more business expenses any company in a city with high startup costs can minimize from the beginning, the greater the chances of turning an early profit. What you don’t spend translates into minimal debt, maximized emergency cash on hand when you need and longer runway before initial resources run dry. If you know when and where to invest your capital, your company can grow steadily without starving for its bare necessities.


John Schnatter launched what would eventually evolve into the Papa John’s pizza empire from a repurposed broom closet in the back of his father’s tavern. Jeff Bezos laid the framework for Amazon in his Bellevue, Washington, home’s garage. If these two eventual titans of their respective industries can grow such mighty oaks from modest acorns by necessity, then hope springs eternal for plenty of startups willing to forego buying or renting space and starting a business from an attic, dining room table or unused guest room.

Whatever space you choose to spare yourself this overhead, outfit it as you would a proper office. Keep it neat, organized and healthily stocked with necessities. Many major metropolitan areas host rentable, temporary corporate spaces with conference rooms, private offices and waiting areas for those days that call for a more polished, professional setting. Try setting aside the foregone cost of office space each month and marvel at how much sooner you can more comfortably afford to buy or rent when it’s time for you to expand.

Be Brutally Honest About Your Needs

Know the difference between beneficial and essential spending because the two adjectives are easily mistaken and not always synonymous. If an expense doesn’t positively impact your startup’s core activities, it probably is not worth breaking the bank during the company’s infancy.

Selling something online doesn’t always require starting with a full-fledged website and transaction portal all your own. Etsy or Handmade at Amazon may wet their beaks from your sales, but whatever they take will pale in comparison to how web hosting, payment processing fees and other costs may potentially cannibalize modest early revenue during a period when every dime counts. Again, estimate what a dedicated website would cost each month, and set that amount aside. Play the long game. The savings add up rapidly.

Get the Most Out of Your Money

If a job calls for the thoroughly trained technical expertise of a qualified commercial electrician, and you settle for the lowest-priced, low-reviewed contractor in your area instead, you risk learning the hard way about getting exactly what you pay for. In fact, you’ll likely end up shelling out money to another contractor to rectify someone else’s shoddy work.

Sometimes inexpensive service is the product of admirable commitment to integrity and fair pricing. In other cases, businesses have no choice but to hold their prices down because their poor reputations won’t justify charging more. Hindsight often vindicates paying a little bit more immediately for lasting quality.

Keep Your Head (And Data) in the Cloud

Quality cloud computing resources are indispensable tools for any startup with a mind toward minimizing IT expenses. Purchasing and maintaining pricey on-site servers and software upgrades will quickly break a small business. Embracing the cloud provides universal access to the latest and best versions of essential business applications and flexible bandwidth and storage expansions on demand.

If your system crashes, or even the cloud itself crashes, the providers will almost certainly pick up the ball to recover your data. By comparison, the cost of paying an IT consultant to meticulously recover everything on a proprietary server is a windfall to one party and an excruciating outlay for another.

Fortunate sometimes favors bold spending, but cutting business expenses in cities with high startup costs will almost always favor realism, patience and smart shopping. Limiting overhead in the short run may sacrifice small degrees of comfort, but remember that running a business is a marathon, never a sprint.

Author Bio:

Anica Oaks is a freelance writer and web enthusiast.

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