Starting a business requires a ton of money, right? Sometimes it does. If, say, opening the next McDonald’s in town is your heart’s desire, you’re going to have to downsize your dream unless you have some serious cash ($750,000 minimum).
But it’s also quite possible to be your own boss with a far more modest bankroll. In fact, many small businesses require very little money up front — and if you follow some of these tips, you could get started for less than $1,000.
1. Turn your hobby into a business. What do you love to do? Organize spaces, babysit, or repair appliances? Consider whether what you do in your spare time could make a viable business. Do you love decorating? Charge people for creating Clark Griswold-style holiday scenes.
2. Become a consultant. Selling products (think inventory) requires storage and often retail space. Selling your knowledge requires neither. Depending on your field of expertise, you may need a license and ongoing training, but beyond that it’s all about getting the word out.
3. Barter your services or skills. Talk to noncompeting businesses about trading services. Do you know a web designer? Offer that person your services in exchange for theirs.
4. Work from home. Businesses that are just getting started can often function from home. Convert a bedroom or basement area into your “global headquarters.” By the way, if you use that space exclusively for your home office, it’s tax deductible.
5. Start with good — not great. Do you have your heart set on top-of-the-line office furniture, an amazing iGadget, or a shiny company car bearing your impressive logo? Save all of that for when your operation is bigger. For now, a folding chair, a garage-sale desk, and your laptop will work just fine. As for the car, use your personal vehicle and write off your business mileage.
6. Hire freelancers. Employees come with baggage like wages, benefits, and tax withholdings. Instead, hire freelancers who can work for your startup as needed.
7. Do some of the work. … but freelancers aren’t cheap and they charge by the hour. You can save time and money by doing some of their work for them. For example, if you hire a graphic designer, provide logos you like, research colors, and use the Hex Hub to find the HTML color codes you want to use.
8. Use affiliates. When somebody sends you a lead that turns into a sale, you pay that person a fee. This is called affiliate marketing. The tactic is mostly used by online businesses, but you can set up referral fees with business owners in your area to get cheap leads on new business.
9. Exploit social media. Twitter, Facebook, and the like allow you to reach thousands of people rapidly and free of charge. It may take a while to learn how to do so effectively, but once you do, you will find that these sites aren’t just for broadcasting details of your personal life.
10. Get a free mentor. Organizations like SCORE and the SBA offer free mentors to small-business owners. The SBA also offers online courses to new business owners. Often, you will be connected with people who have started and grown a company and can help you get your business off the ground.
11. Go easy on the website. You can build your own website for free, or you can hire somebody to customize a WordPress site to suit your needs. However you do it, the days of paying big bucks for a website with basic functionality are gone.
12. Use free software. There are numerous free web-based utilities to help you run your business. A few notable ones are Dropbox, SurveyMonkey, Mint, and Wufoo. All of these programs and services allow you to organize and execute your business plan without paying a dime.
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