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Starting Your Business On A Shoestring Budget
If you would like to start your own business but your have limited funds, you may want to refocus yourself and goals to move at a slower pace. Sure, you want to be successful, but you also have to be realistic and if you don’t have deep pockets, then build your business slowly, by putting one foot in front of the other.
Big Ideas, Small Pockets
You may have a big idea, bigger than the funds you have to operate your business. That is alright as many new business owners have had to invest more sweat equity than financial equity into their business before it was able to fund itself. A number of successful startups which started out small and with little funds: Apple, Mary Kay Cosmetics and Terra Cycle. Many small businesses initially operated their business from their garage. They also didn’t see a profit in the beginning, sometimes not for a few years, as all their money was reinvested to produce more products to sell or keep their business going.
A small home based business opportunity is a primary way business owners get started and grow it slowly, and deliberately, which allowed it the best opportunity to succeed. If you start out with the idea you will have a big company and go forward with that in mind without proper planning you just may be setting yourself up for failure. In fact, the majority of businesses that start each year end in failure because of poor planning and dollar signs in the eyes of the owner.
Business Opportunities on a Small Budget
The most obvious reason to pursue a low cost business opportunity is that you can do it easily and quickly. You don't have to put together a business plan for approval from an investor or for a bank loan, and you don't have to explain to family members how you will repay them. Also, you don't have to get a personal loan, charge up every credit card to it’s limit, take out a second mortgage, your retirement funds, or raid the children's college savings account.
In other words, a low cost business opportunity typically grants you much greater financial freedom and flexibility since you're not tying up as much cash or creating a mountain of debt which may lead you to bankruptcy. See the article: 133 Ways To Find Extra Cash for some ideas.
Many small businesses require only a small investment and little more than a computer with Internet access and a phone. With a home based business there is no rent, and there are certainly a number of tax benefits to using a part of your home as an office – best to speak with a CPA.
If the business idea you are trying out leads you to realize that the business doesn't suit you, the financial investment is small and this allows you to put it aside with less of a sense of loss. You may have put in your time which gives you experience, a definite learning experience which can be useful in planning your next business.
Challenges of Starting a Small Business
Because it is easier and quicker to start a business from home that doesn't require a great deal of financial investment,
many people are going it. In fact, during this Recession, which started around September of 2007 and continued through 2009, more people than ever before have started a home based business. The barriers to entry are low, so competition is likely to be high.
Determining what is unique about your business or the product you sell, and how you will do it better than your competition will be essential in differentiating yourself from your competitors. Will it be your superior customer service? Does your product provide something your customers can't find somewhere else? Or, how can you differentiate your services from other businesses in the area? Does your product provide an answer to a problem like no one else does? These are all things to consider and then push as part of your overall marketing.
Making your product or service stand out will give you a leg up over your competitors. Although, you may only be working with a shoestring budget, you will still need to spend money on your marketing efforts. Make sure you spend it where it will give you the most benefit.
In addition to your startup costs, you may also need to set aside a small amount of money for materials, whether that may be for office supplies or materials used within your business to create a product. Eliminating waste from the onset will help assure your business success and it can become a marketing niche – you are greener than your competitors.
One more thing you’ll need to think about is reliable transportation is another necessity for any business. It doesn’t mean you necessarily need a car when local public transportation will do.
After you have taken of the essential equipment needed to run your business you will to next invest is in your marketing, or more simply, advertising. Whether that is a simple business card, flyer or print ad in the local paper. When you are trying to keep costs manageable, or you may be tempted to hold off on marketing, don't. Marketing is necessary to growing your business, reaching out to your potential customer’s and to the overall success of your business.
For example, let's say there are a few competing firms in your area. One way you must differentiate yourself is to emphasize the quality of your services. The other way is through developing a unique marketing approach which helps your business stand apart from everyone else. Use word of mouth to your advantage, guerrilla marketing, and other free forms of advertising, but also keep an eye out for finding other ways to get the word out. Frugal, yet potent, marketing ideas are the name of the game with a small budget and small business.
With a great product or service and a well thought out marketing plan, you can make the most of a small budget and increase your chances of success one step at a time.
Some Helpful Resources
Starting A Business Made Easy: 10 Steps To Successfully Starting Any Business On A Shoestring Budget
Starting on a Shoestring: Building a Business Without a Bankroll
Surviving a Downturn (Business on a Shoestring)
Powerful Marketing On A Shoestring Budget: For Small Businesses
Duct Tape Marketing: The World's Most Practical Small Business Marketing Guide
Maximum Marketing, Minimum Dollars: The Top 50 Ways to Grow Your Small Business
Boosting Sales (Business on a Shoestring)
How To Start Your Own Janitorial Business On a Shoestring
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