Knowing how to start a business on a budget is a critical skill to have in today’s world if you are thinking about entrepreneurship.
Starting your own business is fun, but it can be expensive. Lockdown has taught me to have multiple income streams. I was lucky enough to have my blog and side hustles to keep me afloat.
Running your own business is a great way to gain experience and increase your income. However, they can cost a lot to start up and aren’t guaranteed to make it past the first year. If you’ve always wanted to start your own business, here’s how to start a business on a budget!
Why You should Start a Business
There are many benefits of starting your own business. There are also so many different types to go into. Before you set up your own shop, you need to think about why you’re doing it. Here are some great reasons to start a business and why you should keep going when it gets tough!
- It’s an extra source of income for your household.
- You’re able to quit your job once sales pick up, giving you more freedom.
- You’re able to work flexible hours, and on the days you want
- You have the chance to work in a role you love and improve on the skills you do have.
- You can work anywhere you like, including at home, perfect for keeping safe during the pandemic.
- You can gain new skills and experience from running your own business.
- You can fill a gap in the market with a product that people will want and love.
- It helps you to build a career that you want to be in.
- You have the opportunity to give jobs to those in need when you expand your business. It’s beneficial for the community!
Setting a Budget
Before you can create your business on a budget, you need to set a budget. Look at what financials you have available, and work from there. Equipment and products can cost thousands, so you’ll want to consider needs before wants. If you can set up your business from home, that will save you money on an office. If you can use a budget laptop to start with, factor that into your budget. You can start a business with $100, depending on what it is and how well you can budget.
Make sure you’re strict with your budget. If you set $100, stick to it and don’t go over. You should also keep a spreadsheet with all of your transactions. It’s worth keeping invoices and receipts for reference too. When you’re starting out, you only need the basics. It can be tempting to buy decor, a new laptop and monitors, but they will only eat into your profits. Once you start making money, you can spend a bit more on the things you want.
Start with the Basics
The basics for a business is a name, products and possible logo. You need to decide what is a need and what is a want when setting up your business. For example, packaging for items is a need. A new label printing machine is a need, especially if you have a printer already. Use the things you have around you to save money. If you sell a virtual product, then you won’t need a printer or shipping costs. If you’re selling physical products, there is a bit more to think about, like shipping, storage and sourcing materials. Here are some simple ways to cuts costs:
- Use social media for promoting your products. It’s free, easy to use and gives you access to a wide range of potential buyers.
- If you want a website, Blogger and WordPress will let you create the site for free. You may need to pay for hosting, a domain name and a theme.
- Reuse packaging from parcels that you’ve received. You can also use shredded paper from old letters or newspaper to protect any fragile items.
- Use Canva or other free software to design any logos or digital content. It is cheaper than hiring a designer to do it for you.
Keep Products Simple & Build from There
Perfecting 5 products is better than offering 100 and them being easily re-creatable or average. You want a product that stands out, which takes time to perfect! It’s a good idea to have a signature range and expand once your products are taking off. If you’re offering a service, you should limit how many clients you take on. That way, you can make sure you’re giving your new clients the best service possible. It also encourages them to give repeat business. It’s often the first reactions that can make or break a business.
Do What You Can By Yourself
Services such as logo design and website making can cost a lot of money. If you’re able to design things yourself, do that! There may be some things that you want to hire a professional for. You should include that in your original budget and agree on a price before any work has begun. Skills are easy to pick up when it comes to running a business. There are lots of free courses and tutorials that can guide you through the process. Doing things by yourself allows you to save money and learn skills for future purposes. Maybe you can sell those skills on later as a side hustle or second business!
Your skills can save you money and make you money. For example, if your business is blogging, you could sell logo design on the side. If you make candles, you could do a candle making workshop. Whatever skill you have, you should use it to your advantage. Whether you make money from them or do everything yourself, your skills are highly valuable.
Of course, as you start generating income, you need to keep a portion away for taxes. Check out Tax Deductions for Small Businesses – A Must-Read for Entrepreneurs to learn more about tax tips!
Use Social Media for Promotion
Social media is a free resource that you need to help your business grow fast. Most brands have a social media account as it’s free to use and has a large audience. You want to choose social media accounts that allow you to showcase your products well. If your business is fashion, Pinterest or Instagram may work better for you. If your business is stationary, Tik Tok allows you to showcase some of your designs. You should also try to schedule promotional posts ahead of time. There are lots of free services that you can use, such as Tailwind. Twitter also has a built-in scheduler.
When using social media, make sure you’re using hashtags, engaging with bloggers and followers and posting regularly. You want to keep your audience excited about new products and be able to share existing ones. It may be worth adding a blog section to your website as you can promote your products, talk about updates and gain new traffic that way.
Collaborate & Use Influencers
When you start to create new products, you could run a giveaway for your followers. Giveaways usually don’t cost a lot to run, but you’ll need to supply the products and the shipping. It’s a great way to gain followers and possible future customers. If you don’t have a big platform to run the giveaway form, you could collaborate with another brand or influencer. They will help you promote your giveaway. If you team up with a blogger to host a giveaway or send them products to review, you can gain their traffic. When you choose a blogger to collaborate with, you need to check a few things. Make sure they have a good following and engagement. It may also be worth considering their DA score. Your influencer must also align with your vision and brand. Just because they have a huge following doesn’t mean they’re the right promoters for your brand!
Creating your own business can be fun but also costly. There are lots of things to consider when you’re setting up a business. Setting a budget with fall back money is important to survival. Likely, you won’t succeed straight away, but keep going! Some of the best businesses nearly failed at first. It’s possible to start a business on a budget, there just needs to be some give and take. What are your favourite budget-friendly business tips? I’d love to hear some places you saved money!