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October 22, 2018

Innovative Low-Cost Ideas for Starting Your Own Business

Written by Joshua Griffin

Do you have a great business idea? According to the Small Business Association, all you have to do is grab the spare $29,000 you have lying around and get going. Yes, it’s that easy, except most people who want to turn their entrepreneurial dreams into a reality don’t have anywhere near that kind of money.  However, you’re not most people. You’re ready to do whatever it takes to launch your business. There’s no way you’re going to let a little thing like lack of capital stand in your way. What can you do to follow in the footsteps of the increasing number of business owners who have launched their companies with little or no cash?  

Understand the Mechanics of Budgeting

If you’re currently working, you probably have at least a small amount of savings available. Start by calculating how much you can realistically spare for a business venture. Keep in mind your new company won’t net enough to give you a livable wage at first, so sticking with your day job or another viable source of income is a good way to go.  List all the possible costs associated with starting and running a business and familiarize yourself with how to follow a budget to meet these expenses. Don’t forget about the money you’ll have to set aside for taxes, which is significant if you’re self-employed. Learning how to maximize deductions when tax time comes will help you hold onto more of what your business brings in and make it easier to budget for the future.  

 Follow a Passion

Balancing passion with practicality is a difficult task, but it’s worth learning. A lot of people will tell you you’re nuts for wanting to “follow your dream”, and will try to convince you it’s a bad idea. How many innovative companies would never have gotten started if the founders listened to the naysayers?  Your business idea does have to be viable, but if you start a company just because someone else tells you it’s a great way to make money, you’re probably not going to want to put in the massive amount of time necessary to make it work. Picking something that you love and can also be objective about lets you pour your passion into your business and enjoy your work while still allowing you to be smart when making tough decisions.  

Explore Low-Cost Business Ideas

Not every startup requires pouring huge amounts of capital into a product before launching. You only have to poke around the internet to find a bunch of businesses you can start with little or no money: 

  • Freelancing a skill through sites like UpWork, Moonlighting, and Freelancer  
  • Opening a storefront on a platform like Amazon or eBay 
  • Selling or teaching digital courses  
  • Making affiliate commissions for your favorite products  
  • Becoming the “go-to” person for home or automotive repairs  
  • Selling food or crafts in the community or through a marketplace like Etsy  
  • Providing services people can’t do, don’t have time to do, or don’t want to do for themselves, such as walking dogs or cleaning cars  

Pretty much any idea similar to these can be marketed for free via word of mouth or for very little on the internet. Most can be started as side gigs while you’re still working your day job so that you can continue to bring in a reasonable salary while building your brand.  

Leverage Grassroots Marketing

Don’t start a low-cost business and waste the rest of your money on useless expensive marketing tactics. Stick with your plan of bootstrapping by making the most of free and low-cost advertising options like:  

  • Content, especially video and live video 
  • Promotional ad credits from Google, Bing, and other big names
  • Answering questions or starting discussions on Reddit and Quora
  • Sharing infographics with influencers in your niche
  • Offering useful referral rewards to customers
  • Hosting classes or events in your area
  • Leaving amazing business cards everywhere you go
  • Sending fun, interesting, and unique emails without spammy marketing gimmicks  

You’re probably wondering why social media isn’t on this list. Algorithm changes can make it difficult to build brand awareness organically, so if you do decide to dip your toe into the social media waters, pick one platform to focus on, and realize you’re going to have to pay for ads at some point to gain visibility. 

Go Old-School

You know those community announcement boards at the grocery store, the library, the post office, and even the gas station? They work. The same goes for the slightly hokey local publications you toss in the trash every week. You might think they’re silly, but guess what? People in your community pay attention to them. There are more eyes are on these old-school advertising platforms than you realize.  Print some flyers and stick them up everywhere you can. Write an article for a local paper. Do a direct mailing to people and businesses around the community, and even give cold calling a try. This kind of marketing costs next to nothing and can do wonders to drum up interest in your business.  

Be Comfortable with Imperfect Action

“How can we make our business run more efficiently?” is a common question for entrepreneurs. One easy answer is to give up perfectionism. Instead of wasting your entire budget in an effort to create the perfect product before you launch, aim instead for the minimum viable version of what you want to offer.  More startups are taking this route, and it’s a smart idea because you don’t have a clue if your initial design is something customers will want. Launching what amounts to a beta product requires less money and gives you a chance to get feedback and make changes before investing in updates. When you do release the final product, you can be more confident it will resonate with your target audience.  

Find High Quality at Low Cost

Become a budget shopping expert right from the start, and you’ll save a bundle as your business grows. Look for: 

  • Used equipment and equipment rentals
  • Liquidation sales
  • Local co-working spaces if you need an office 
  • Opportunities to trade or barter
  • Reputable dealers with low wholesale prices  

Don’t forget the option of asking friends and family members if they’d be willing to donate time or talents to help you out.  

Get Your Head in the Cloud

The rapid pace of change in technology can make software you buy today obsolete next week, leaving you with a useless program for which you paid way too much. Use cloud options instead to cut down on startup costs and give yourself a scalable solution you can continue to use as your business grows.  Cloud-based software can power everything in your business, including project management, customer service, accounting, invoicing, and even a credit card swiper for your phone so that you can make sales anywhere. Many platforms either include multiple tools or they easily integrate with other cloud solutions to create smooth workflows and allow you to automate a lot of the tasks on which business owners used to spend hours. 

Don’t Be Afraid to Be Bold

Is there a big business in town with an audience similar to your niche? Call them and pitch your products. Walk in the door of local company with complementary products and services, and ask them if they’ll work with you. Stop telling yourself they’ll only say no. If they do, you lose nothing. If they say yes, you could gain a highly visible platform for showcasing your company.  

Be a Fundraiser

No matter how much you work to cut costs, you’re going to need at least a little money at some point. Skip the pricey business loans, and look for alternatives without the potential to sink you into crazy amounts of debt. You probably have at least one family member who thinks your business is a great idea and is willing to help you out. Maybe a friend owes you a favor or is in a giving mood. There’s also always the option of finding an angel investor if you don’t mind sharing some ownership equity.  If you have a pretty good network, crowdfunding could be the way to go. It’s a great alternative to hitting up your friends and family for massive amounts of business capital. Instead, they can give as little or as much as they want and help you spread the word by sharing your campaign with their own networks. Platforms like Indiegogo, Kickstarter, and GoFundMe give you a framework for setting up and promoting your campaigns, and you can either offer rewards in exchange for different donation levels or pay a small fee on the total amount you raise.  When you know what kind of business you want to launch and can create a viable plan to make it work using the money you have available, it’s possible to get going even if your budget is tiny. Prepare yourself to put in the blood, sweat, and tears necessary to realize your dream, and be ready to stick with it for the long haul. Dedication is just as important as capital for launching your business and keeping it going, so pair your passion with smart business practices to increase your chances of success on a shoestring budget.

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