Businesses on a Budget – Getting Started With Little Cash
by Larry Slusser on February 19th, 2008
Businesses do not usually fail due to a lack of a business plan or incompetent management. It is usually due to a lack of capital. Of course you can start a business with little cash; however, there are some challenges you will be facing. Below are some of those challenges and suggestions on how to be successful without a lot of capital.
First, choose carefully a business where you do not have to invest a lot of capital to get it started. Obviously a franchised business will be out of the question. Be realistic about the type of business you choose, and the amount of resources that are available to you. You may be starting out small, but think big! A suggestion is to start out part-time until you have raised enough capital to go full-scale. Another idea is to ask your spouse to support you while you are in the start-up phase of the business.
You may not have a lot of capital, but your time and effort are worth a lot of money. Realistically, the lack of capital will require you to put in more time and effort in order to get the business going and keep it going strong.
Being creative when it comes to getting things done is also required when you do not have a lot of capital. For instance, if you do not have the money to rent an office space or to properly set up your home office, start off on the dining room table.
Additionally, the many materials needed to market your business can get expensive. You will need to get creative, and this effort you put in at the ground level of your business will actually make it and you stronger.
Instead of using banner ads for marketing, use discussion boards or article submissions to spread the word of your business. These are usually free or very low cost. Every cost-cutting measure you take will help you to gain capital; plus you do not have money to waste.
Being a small business owner, you will be responsible for completing all the tasks that need to get done. You are the accountant, the sales person, the marketing guru, and the CEO of your newly started business. With a lack of capital, you need to be prepared to do all these tasks yourself, even when you do not want to do them.
In order to raise more capital quicker, you may want to enlist investors or borrow money. You will need more money in order to grow your business; but be very careful about borrowing. Do not borrow more than you need, but be realistic about how much will be needed-if all of your cash flow is going to pay debts, then it will be hard to grow your business. Be prepared to obtain loans in the future, should the need arise.
Starting a business with low up-front investment cost in terms of dollars is very possible, particularly with the advent of the internet and internet commerce. Learn your business, invest your time and talent in your enterprise and soon you will be astounded by the growth in sales and profits.