One of the most rampant business myths out there is that you need a lot of money to start a business. Not so. You can become financially independent even when you have to start with a smaller amount of capital. It’s not impossible, but it will take some work.
After all, when starting an online business money does matter. You have to pay for licensing, production, operation, distribution, advertising and more to make your business idea become a tangible reality. “It takes money to make money,” is an overused cliché, but it is true.
As one entrepreneur pointed out, “You have two main paths of starting a business with less money: lowering your costs or increasing your available capital from outside sources.” If you don’t have the capital you need to begin business operations, don’t worry. You have options before you, and giving up on your dream doesn’t have to be one of them.
Try out some of these hacks and simple strategies for starting a business online, even with a small budget:
Sell on Marketplaces
Setting up an ecommerce website costs about roughly $60/year. To make that investment worth it, you need to get sales rolling into your new online store. But that will take even more expenses in the way of marketing and advertising your brand. Plus, if you’re not tech-savvy, paying a developer to maintain your site can also be costly.
On the other hand, you could begin to sell your products on an online marketplace. Sites like Amazon, Ebay and Etsy already have an established audience base you can tap into immediately. Keep in mind that you will have to pay a small fee for uploading products and selling them on these marketplace’s pages. But this can be a cheaper and faster way to start selling if you don’t want to pay for your own website at first.
Go with the Crowd
If you don’t have the money to finance your business, there are a handful of people around you who do. One way to raise capital that’s becoming more and more common is through crowdfunding platforms. The two most popular sites for crowdfunding are KickStarter and GoFundMe.
Simply start a project/campaign, write a description (and/or upload a video description) and share your page like crazy. This can be a great way to validate your idea before you start production. Some crowdfunding campaigns take off because they resonate with their audience. You’ll soon find out if your product or service is something people want by how well your campaign trends. Validation is key to avoid wasting your time, energy and money on a project that has no demand.
Use Drop Shipping
Keeping production costs low comes down to good demand forecasting. You need to know what your customers want and then be ready to meet that demand. Too often new entrepreneurs will overstock or understock items because they didn’t know how to evaluate market demand. In these cases, you may lose more money than they make. Validating your idea early on can help with this, but so can drop shipping.
Drop shipping involves you paying another vendor to create your product, ship it and fulfill the order whenever that new order comes in. With drop shipping you reduce inventory costs by only producing items in immediate demand. You avoid overstocking on products that just won’t sell. Furthermore, you don’t house any inventory yourself, saving yourself more money on storage. Drop shipping lowers the price it takes to stock your store, while making inventory management much simpler.
Most get-rich-quick companies or promotions are not as great as they seem at first. Some beginning business owners invest in these scams, with the hope that it will earn them more revenue, only to find their money depleted with nothing to show for it. The Federal Trade Commission works to protect small businesses from such scams, but you can do your part as well to avoid them.
If an opportunity seems almost too good to be true, or asks you to enter your credit card information right away, be wary and do some more research. Ask the seller for a disclosure document on their offer, then follow up with questions like, “What is the total cost involved?” and, “Can you back up your claims?”
You can potentially earn more revenue by investing instead in legitimate training or resources. Sometimes businesses need that little extra help to make more income than they already make. Digital Altitude is one of those companies that’s worth your while. We offer courses that give you real-world advice you can use to build up your revenue little by little. When you put in the work, you get the reward.
Those are the kind of resources you need to be looking for. Be careful of companies that offer you a way to get rich with little effort. You can earn a living through an online business, but it’s going to take some work and it usually doesn’t happen overnight.
Find Free Ways to Market
Business growth doesn’t have to put a huge dent in your bank account. In fact there are several ways to market your brand that don’t cost any money at all. Blogging can create some great brand awareness, and you can even create your business’s blog on a free website template (without needing to buy a domain name or hosting platform).
Or you can start building up followers on social media accounts. You’ll have to pay if you want to advertise on these accounts, but you can begin marketing for free by posting regularly and reaching out to market influencers. One t-shirt designer started his online business in 24 hours, in part by emailing a notable influencer who brought followers to this man’s site. He did this with no extra money in his budget, and you can, too. You don’t need money to reach out to those people who will spread the word for you.
Limit What You Need
Accumulating wealth isn’t about earning more, it’s about spending less. This can be difficult when building a business because you need to spend to start. If you don’t have a large income coming in every month, then how much you spend on your business should be limited as well.
Forego business expenses that aren’t necessary when you’re first starting out. Don’t spend hundreds on office supplies or new equipment. Those can come later. Or before you rent out an expensive office space, start small and build your business from your home. Some of the most recognizable brands in the world started in a garage. It doesn’t matter where you start or how little supplies you have to start with. It just matters that you start in the first place.
Don’t want to wait too long testing and validating your business idea that you never start making some real money. Experts at A Better Lemonade Stand include this advice as part of their company’s manifesto: “Start something…Don’t get caught up waiting for the perfect moment, stalling for the most ideal circumstances or postponing until you have more time, energy or money. Those excuses will do nothing for you except waste more of your precious time.”
You may think you need more money to start your online business. But you don’t. You can begin right where you are. Use your talents and the resources in front of you and just begin.