How to start a business with little capital? That is the question asked by many people who do not have a job or are not satisfied with their current position. Having your own business has many advantages, including above all that you become your own boss, but sometimes we back down thinking that we need an excessive financial investment. However, this is not always the case, and here we give you some tips on how to start a business with little capital.
Steps to follow:
1. Assemble the home office. Think about whether you really need to have your own premises in the center of the city to serve customers or to carry out your administrative tasks. If it is not a commercial establishment, it is most likely that at first you can use your own home as the headquarters of the business, reserving some of the rooms as an office or meeting room.
2. Start with an online store. If you plan to dedicate yourself to a purely commercial activity, you can value working as a virtual store, in which the Internet is your showcase to sell to everyone, paying only a small part of what it is worth to maintain a premise (rent, electricity, water, insurance, alarm, furniture, etc.). There are a multitude of pre-designed services to install your own online store on a website of your property, and the costs of hosting a server and your own domain are very low. If you don’t know how to do it and you want to have a 100% professional result, you can also ask a computer scientist and a designer for a quote.
3. Rent instead of buying premises and appliances. If you need to have a physical presence with a commercial premise or an office, you can always resort to renting instead of making the large initial investment that buying everything in property implies. You can rent practically everything, not only the premises, but also the furniture and work instruments.
4. Agreements or deals with suppliers. You are at the beginning and you don’t have much to offer, but your suppliers are also interested in you growing professionally to have another assured client. That is why you can reach deals or agreements with them at the beginning, providing them direct services instead of money in exchange for their merchandise, or setting another exchange time that does not mean spending more money.
5. Franchises. If you have a business idea and have a saved capital, but not enough to make all the necessary investment, you can always resort to a franchise that will give you everything done in exchange for an initial outlay. The amounts vary greatly depending on the type of business and the size of the company, but it is all a question of asking. You can orient yourself a bit by doing a search on it on Google.
6. Advertise on the Internet. Take advantage of the great power of social media to advertise and reach a large number of people with a very small investment. Currently almost all social networks have tools to advertise directly on them, just like in the Google search engine. Also take the opportunity to improve the positioning of your website in search engines with SEO techniques (Search Engine Optimization) and publish updates and offers in the 2.0 profiles of your company.
7. Seek outside funding. If you do not get the savings, you can try your luck with the bank, although if the credit does not flow as it should, you can always turn to family or friends, or look for business partners to provide capital. Especially if it is an ICT-related company, it is advisable to attend sector events in which the business idea can be presented to potential interested investors (“business angels”).
8. Hire few staff first. Spending on salaries can bring down the business in the first few months before it becomes consolidated. So, at the beginning if it is not strictly necessary and you can take care of that extra workload, you can save a few thousand euros. Assess well the needs of the company and the total workload, as well as the type of contract that you can offer and that you really need: full-time, part-time contract, with commission payments, etc.
9. Sell by consignment. If you are a supplier for other companies, try to reach an agreement with your customers so that they sell the product to the end customer, charging them an amount for each sale made. If the business goes back, you can consider changing the model, selling large quantities at one time, in cash or on credit.
10. Fixed expenses list. If you still do not get the accounts, make a list as detailed as possible of all the expenses you plan to make at the beginning and order them from most to least important. Start to cross off the last ones on the list and ask yourself if the business can continue to operate without each item you cross, and keep doing so until you are left with only strictly essential expenses.
11. Choose the type of business well. There are many trades and professions in the service sector that you can practice without hardly investing in material: home assistance, communication, crafts, cultural entertainment, private classes, sale of second-hand items. Think about it, surely there is something that you works well and can also give you an economic return.