When first starting out, it often seems that simple things like monthly subscriptions will only help your business. But after the first few months—then years—the small costs can really add up. That’s why we asked 11 entrepreneurs from Young Entrepreneur Council (YEC)
the following question.
Q. What is one major spending mistake entrepreneurs make unintentionally?
1. Paying Too Much in Merchant Account Fees
One critical component in your business is how you collect money from your customers. A large piece of that for many companies is credit card processing. As someone in the industry, I know how costly it can be to make a knee-jerk decision to set up what is quick and has a simple pricing model, rather than finding a reputable rep to save you on fees. – Darrah Brustein, Network Under 40 / Finance Whiz Kids
2. Hiring the Wrong Coach
Business coaching is a huge business and it’s easy to get swept up into making a five-figure investment without considering what your business needs most. Be willing to take your time, really research a coach’s reputation and get the right fit. – Kelly Azevedo, She’s Got Systems
3. Paying for Services That Charge Monthly
Services that charge monthly can become a financial drain. The prices don’t seem high but when you multiply everything by 12 months, these benign costs can really add up. A lot of early-stage entrepreneurs are not tight enough on costs. Imagine if you had found enough savings to hire another employee. I’d much rather have another great employee than a bunch of rarely used services. – Luke Skurman, Niche.com
4. Spending Too Much on Rent
Getting a cool office at the beginning might seem like a great idea. You can afford it this month, but can you really afford it for the next year or two? I have seen people who have glamorized the “startup lifestyle” and believe cool offices are a necessary part of it. That couldn’t be further from the truth. You can change the world straight from your garage. – Kenny Nguyen, Big Fish Presentations
5. Paying Unexpected Legal Expenses
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