Can you start a new business with little or no money?

The greatest challenge we all face with starting and growing a business is money.? How do you start a business if you don’t have any money?? We have all seen the kid on the street corner selling lemonade.? This is a classic no-cost, low-cost entrepreneurial start up example. ?So, let’s look at it a little closer.? Asking the right questions is a good place to start when envisioning a new venture.

·?????? What is the business need?? What problem are you trying to solve and who will be willing to pay to have you solve their problem for them?? It is a hot summer day and people will be thirsty.

·?????? What is the opportunity?? Is the business environment right for you to become successful?? I live on a busy street with lots of pedestrians and no shade.

·?????? Is there any competition or barriers to you operating the business.? Are you aware of any risks that could prevent you from being successful or barriers (people, processes, laws, etc.) that would slow your progress or prevent you from doing business altogether?? If there are three other kids on your block already selling beverages it is going to hurt your chances for success.? Do you need a peddler’s license from the police department, or will the county health department shut you down for not producing your lemonade in a certified commercial kitchen?

·?????? What supplies, resources, and time will be required for you to operate?? If there are only two lemons and very little sugar in your kitchen, then you will be out of business before you are able to serve many customers. Understanding your supply chain, (what do you need to plan and prepare for before you can serve customers) is another critical aspect of successful business operations.

The common thread here is that the creation of a business takes planning and careful consideration.? You will need to imagine what your business will look like once it is up and running as well as anticipating what problems and challenges you might face.? So, why do some businesses succeed when others fail?

·?????? What are you passionate about?? What do you believe strongly in?? Who else shares your beliefs and passions? ?It is well established that entrepreneurs who are passionate about the goals and mission of their businesses are more likely to succeed.? If you surround yourself with others who share your passions, then the groups’ combined passion will often be greater than the sum of each individual’s passion and ambition.

·?????? Can you identify a niche market?? This is often the greatest single success factor that creates successful startups.? It may be as simple as you can see a long stretch of road, with no convenience stores, where lots of new houses are being built.? (Demand without supply.)? Often, identifying a niche market is much more subtle. ?We noticed that our disabled niece had difficulty when she was travelling because many travel-related companies have accommodations for people with physical disabilities, but nothing to offer for neuro diversity disabilities.? The thing to watch for is who has a problem that is difficult to solve, too expensive to solve and/or there just isn’t a solution available in the area where the need is. Our solution was to start a travel agency for families living with disabilities.

·?????? Can you innovate and make an existing business concept better, faster, or cheaper?? How do you build a better mouse trap?? How can you speed up the time between when a customer decides to purchase your goods or services and when those goods/services get delivered?? Controlling production costs, reducing expenses and saving money are all things that will make a business more successful.

Ok, so you have done some thinking, so what kinds of businesses are the easiest to start?

·?????? Services.? Simply put, a service business is one person helping another and getting paid for it.? What things can you do that other people cannot?? Or…? What things are you willing to do that others don’t want to do?? I have a friend who built a successful business clearing pet waste from people’s back yards.? Why? because it is a nasty task that nobody likes to do, and things pile up (literally) if you don’t do it.? (Another example of demand without supply.)?

·?????? Knowledge.? What do you know or are good at where others would benefit from your knowledge or experience?? A home fix-it person is a good example of this.? Some people just have a knack for fixing problems and overcoming obstacles.? So, take that talent or gift you have and see if you can turn it into income.

·?????? Entertainment.? Many famous people started out as street performers.? The person who volunteers reading stories to children at the library, may find that they have a knack for writing children’s books.

·?????? Sales.? One person’s trash is another person’s treasure.? Junk removal is a great example of this.? First of all, people will pay you to haul away their junk.? Then, if you can repurpose, recycle, donate or sell the junk to someone, it is money for next to nothing.? An entrepreneur that is in my hometown differentiates their junk removal business from everyone else with a used pickup truck and a strong back by stating their mission.?? Their advertised goal is that none of the junk they receive goes into a land fill.? Anything that can be recycled gets recycled.? If the item is useable by someone else, it is sold or donated to a person in need.? Yard waste gets composted.? There are even people making arts and crafts by using junk as an artistic medium.? Repurposing old items can be fun and lucrative.? Sales is all about getting people to either believe in what you are doing or making the thing that you are selling seem better, nicer or more affordable than what the competition is selling.

In conclusion, yes, it is possible to create a business from next to nothing.? There are also people that are in the business of helping others start a business.? People start selling on-line through Etsy or Ebay because it is easy to get started and you do not have to create a web site and payment processing function from scratch.? The catch here is that you are paying for that convenience and help.? This is a good way to start an online marketplace, but shipping costs, transaction processing fees and marketing what you are selling will cost more when you are starting out and need help.? The goal is then to reduce your operating costs as your business grows, but that will take serious determination and grit.? This is not something for the faint-hearted to take on.? It is difficult and the odds will likely be against your initial success.? If you fail, learn from it, update your plans and try again.? Almost every successful entrepreneur that I know can tell you multiple stories of hardship and failure when they started out. There are also criminals and con artists out there looking to trick and take money away from people who need help and let their guard down.? If you are not willing to accept these realities, then I suggest you give some serious consideration to your next steps as an entrepreneur.? On the other hand, the best way to learn to be a good entrepreneur is to become an entrepreneur.? You learn it by doing it.? There is no more powerful way to learn than by experiencing it.

The next article in this series is: (7) Can you start a business with little or no money? Part 2. | LinkedIn

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