From wherever you look at it, starting a new business is not for the faint of heart. It’s no easy task! However, when you’re starting out with an especially tight or restricted budget, it becomes even more difficult. Long gone are the days when you necessarily need an office space or a storefront to attract customers, true; but there are still parts of a business model that need capital no matter how you frame the picture. So if you’ve turned your hobby into a side-hustle like we suggested; here are our five top tips on starting a business when you have restricted capital or a tight budget.
1: Rent A Serviced Office
If you need an office space, this one is the way to go. Although traditional office spaces are not deemed a necessity anymore, I would highly recommend having one (especially when you’re just starting out). An office space promotes collaboration, open communication, and productivity. However, like anything, they come at an expense. Rather than going with a non-negotiable yearlong contract; try out serviced offices. They come with the same perks as a normal office, but they are far more flexible, and also easier to just get in and start using. The biggest perk of a serviced office is that they come move-in ready, with everything you’ll need for a basic office space already installed. This means no pesky hours on the phone with telephone companies, no days spent furniture shopping, and no wasted time. Serviced offices can also get all you need at a far cheaper price because they are bulk buying; so the cost will be lower than if you were to do it all yourself. However, it is important to keep in mind opening an office mid-pandemic.
2: Try out Drop-Shipping
What’s drop-shipping? Well, it is basically the premise of having a shop without having a store. It is operating a company that sells products to consumers without having to worry about the overheads of rental of a storefront, employees in the store, or the expense of decorating a store. Drop-shipping basically entails having a website which contains all of your products, with one significant difference to normal. Solomon Hare, a business writer at PhD Kingdom and 1day2write, noted, “Drop-shipping only buys your stock as you sell it, with the supplier posting the item to the buyer. It is basically being a selling middle-man.” Although this initially will not garner as much profit; it can be a great way to get you some start-up capital with little risk. It can be a great way to get involved in the business of e-commerce and build contacts in the industry; before you move on to sell your own products or expand your business model.
3: Utilise Pre-existing E-commerce Websites
It’s not skipping the line if everyone else does it right? Platforms such as EBay and Amazon do a great job of helping little companies get across the start mark and access wider audiences. Many companies that now have large followings once started out just on an Amazon page waiting for someone to buy them. This method allows you to not only bypass the initial need for a storefront, but also one for a website as well. If your product is able to promote and sell itself, you can simply put it up on these worldwide e-commerce platforms and watch the extra income roll in. The important thing to realise though, is that these platforms will take a small cut once products sell. However, they open you up to a much wider audience than you would have had if you had just started listing on a little unknown website; so they are a great place to start.
4: Outsource Tasks
There are some tasks that it is not worth having employees on payroll for. Not only is it an additional expense to have someone always around for one particular job; but some things only have to be done once or a few times. So why not try outsourcing your work? Rebecca Wise, a recruiter at Britstudent and Write My X, commented, “There are many companies, agencies, and even freelancing individuals that can build a website for you, construct a marketing campaign for you, edit your webpages or product descriptions for you.” In all honesty, the money you will save on outsourcing a few of these important but expensive pieces of the puzzle will enable you to invest more in your product and the advertising which will contribute to its success. Outsourcing work saves companies from throwing money away by employing someone full-time who is only needed a couple of times a month.
5: Try out Hosted Software Solutions
They myth that you need expensive software solutions to succeed it just that, a myth. The majority of software solutions will have a free version which could do the trick until you have enough capital to trade up to the more expensive package. If there is not a free version of what you need, look around the market for subscription based software packages. These are great because they only end up costing a small amount per month rather than a large amount upfront. This can be subsidised and hopefully covered by the profits you end up making partly due to it! There is no need to invest all of your start up capital in trying to get the best software upfront, because a small business doesn’t need all the latest techno gadgets right away. Start small, and let your business be able to build and grow from there.
The myth of needing an overwhelming amount of capital to start a new business is just that, a myth. Although capital is helpful when you are initially getting started in a new industry; there are many ways to achieve success with a business without an overwhelming amount of capital. The modern world has allowed starting a business to fit alongside the digital age and become more accessible for the everyday person. All you need is a great idea and a lot of motivation to make things work.
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