Guidelines on Starting a Business with limited Finances!
Starting a business will always cost you money, but there are ways of doing it that could prevent you from having to come up with huge amounts of capital.
Here are some tips:
Don’t quit your day job: If you are fortunate enough to be employed, use your current income to experiment with your business idea. Work on your products in your spear time, and talk to people who are in the industry you plan to enter. Talk to prospective customers about what they think of your idea, and give them samples to look at or try out. Also, talk to the suppliers of the equipment and materials you will need. This will pave the way for you to make some sales of your product so that you can be sure that there is a market. It will also hopefully give you some cash to start putting aside.
Develop and use a business & marketing plan: Taking a slower approach to starting your business will give you the time to think through all the hurdles and challenges that can and do arise. A business plan is a useful tool to help you through this thinking process. Start working on a business and marketing plan as soon as your ideas begin to come together, then develop and modify your plan as your ideas develop and change. (Remember: a business and marketing plan is a working document, the purpose won’t change but the plan will differ) It is there to ensure that you know what you’re aiming for and that you’ve thought about how you’ll get there. The plan, it is said, never survives the first battle! So you need to keep updating it.)
Build up sales before you launch: Your marketing plan will assist with growing or building your client base. Ideally, get a few regular customers before you go into the business full-time. Get all your paper work sorted and register on a few government supplier databases. Try out some inexpensive marketing techniques, there are various ways available. You may even consider employing someone or hiring a firm to build you a client base on a temporary, part-time basis. This will take the pressure off you when you launch the business officially and give the business a bit of time to ‘warm up’ before you try to draw a salary from it.
Get some suppliers on your side: One of the cheapest forms of ‘credit’ can be your suppliers. While you should never drag your heels when it comes to paying your debts, you might be able to find some material suppliers who will agree to give you a few months to pay while you are starting up. This could benefit your business enormously, as you could get supplies without having to go to a lender for the money; and from the suppliers’ point of view, you could become a good customer for them.
Phase your business into operation gradually: Depending on the type of business you plan to start, it may be possible to get it going gradually, reducing the amount of money you need to put in initially. There may be certain products that will sell better than others, with less infrastructure or with less capital outlay. Start with these, and get the cash flowing. Be strict about putting a portion of this cash aside to fund your expansion into other products.
Get as much paperwork and Marketing collateral done: Attend to all the regulatory requirements (such as trading licences) early, so that it doesn’t waste your valuable selling time once your business is launched. Register your company, get your tax requirements sorted out, register for VAT if necessary, find out what insurance you will need, open your business bank account, etc. Develop your brand identity and required marketing collateral If, you do not have the time consult a business development agency to guide you on the processes.
Get your systems in place early: Don’t launch before you have a proper record-keeping system, processes in place, invoicing system, bookkeeping system, customer care system, marketing and client retention plan in place. These will form the foundation of your office administration and will keep your business running on oiled wheels. Get this organised early, as you will be working flat out when you launch to visit possible customers, to present your product, and to produce what the orders require.
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