Have a killer business idea but worried about not having enough cash? Don't stress. Wherever you are on your journey, setting up your business on the cheap is possible. Here we explore five ways you can bootstrap your business.
TAKE STOCK OF WHAT YOU ALREADY HAVE
When scoping out a business idea, take stock of what you have at your disposal. Review your:
Skillset – what can you do? Think about some hard skills (technical skills such as software knowledge) and soft skills (people or social skills such as emotional intelligence).
Experience – where have you worked and what roles have you performed in the past?
Resources – what do you own and what do you have access to? For example, access to specialized equipment, memberships and subscriptions, or even business advisors.
We recommend finding a quiet place and writing down the responses to the three points above. Think carefully about the answers and if it helps, ask some friends or family about what they believe are your top skills and strengths.
GET THE BASICS UP AND RUNNING
There are a few administrative things to consider first when starting a business.
Apply for an Employer Identification Number (EIN): this is used for various tax and business purposes. You can apply for an EIN for free on the Internal Revenue Service website.
Register your website domain: in this digital age, setting up your online presence early is essential. A catchy domain name or the name of your business is all you need to start. You can search whether your domain name is available on GoDaddy. For the price of a large fry from McDonald's, domain names start from as little as $1.00. Also, check the US Office of Patent and Trademark to see if your name is available.
Create a website: you can create a free website on WordPress and Wix. There are plenty of beautiful pre-designs or themes to choose from. You can download royalty-free stock images from Unsplash and Pixabay, saving you hundreds.
Set up social media accounts for your business: these are all free to create. Invite your family and friends to like and share them.
HAVE SOME SAVINGS AT HAND
While tapping into your savings account isn't ideal, it's common for many start-ups to dig into their savings to start a business. When putting together your business plan, be honest with yourself about how much you're going to spend and work out a budget.
Be realistic on how much revenue you're likely going to bring in. Forecast how long it will take before you see some form of profit.
It takes about six months on average before you may start seeing any cash flow. Make it an intention to save at least six months' worth of living expenses so you can dedicate yourself to your new business.
KEEP YOUR DAY JOB
You can reduce your financial risk by keeping your day job, even if it's on a casual or part-time basis. When you are just starting, having some stability can be a lifesaver.
While this does mean you will have less time to dedicate to your business and that you may have to work harder, it means you can still put food on the table and pay your bills.
Try to allocate some savings aside each week in the lead up to your business launch. The money will help keep things ticking along until it starts to generate revenue. As your business grows, you'll be in a better position to quit your day job and launch into your business full-time.
ARE YOU READY TO START?
Starting a business isn't just for experienced entrepreneurs — anyone can take that leap of faith and start now with little or no cash. Use the essential steps above to smash your startup journey, and you'll have everything you need for long-term success.