Introduction
Starting a business or side hustle is one of the exciting achievements you could ever think of as an individual. The excitement could last, but not until you look at the price tag. The rent, the equipment, the website you are going to host, the stocks, and how you want to brand your business. If you do not lay the foundation well, before you know it, your little idea will be chewing through your savings as if it were a hungry goat.
This is not something I am writing just because I feel like it or off the top of my head. No, this is an experience I have had with many entrepreneurs when it comes to business. Many entrepreneurs rush in, swipe their credit cards, and end up drowning in debt by the end of the day, even before they make their first sale. This is a painful start to most entrepreneurs, as I have so far observed, but you know what, you do not have to join that club. With the smart ideas I am about to share with you, you can grow your business without chaining yourself to loans. Let us get in as you learn from an expert today.
First idea on my list of ideas: Know the Real Cost Before You Spend a Coin
From all the observations, analysis, and notes I have made so far, I came to realize something some entrepreneurs neglect. Here is what I learned. Most people underestimate the cost of beginning a business because they do not consider all the factors involved in the business. Some will take some cost and let go of another; no, it doesn't work out this way.
Here is the Solution I Found For You
Before buying anything to start up a business, you must list all the potential expenses you could be making. I have gathered a few for you
- The business registration licenses should be a priority.
- The website or domain hosting for your business, if it will be going online for the world to see
- The equipment and tools you will need for the business
- How will you market your business? Will you use ads, flyers, social media platforms, or which form do you have in mind?
- What if people must order your services? You have to consider the packaging, shipping, delivery fees, and all other factors that are important for the business.
A quick reminder, you should add emergency funds to the cost as well. This helps a lot in cases of emergency.
Start Small: Not The Biggest Eatery When Your Customer Base is Uncertain
Entrepreneurs' dream: Big brands with fancy offices and a full team. No, you don't need that for now. Build the simplest version of your business that would solve the problems of customers, get a loyal customer base, before you can go on a full scale. Let me help you with some examples to help you understand this.
- Do you want to open a bakery shop? You can start with people pre-ordering from you at your home before you even think of renting a shop. Pretty simple, right? Isn't it better than renting a shop with an exorbitant price or with some loan and finding yourself in deep waters in no time?
- Want to sell clothes? Why not try a pop-up stand or an Instagram store first before your big push agenda sets in?
- Or you're dreaming of an app? Then test the idea with some basic landing pages and collect some sign-ups before going all in.
You don't want to be stuck with paying loans, right? Then here is the best idea from my list of ideas
Use Cash You Already Have
From my own encounter with loans, it is very tempting because of the speed it promises. But then, do you know the truth I have come to know? Paying off debt is very hard and painful. It is not a bad idea to borrow for a business, I am not saying so. But for some entrepreneurs, it is borrowing too early that traps them. Here is the catch I have for you: where possible, to inject more money into the business, use
- Your personal savings. Take precautions, do not empty your savings account. I call it a safety net.
- Your profits from small pre-sales. It just feels like putting in a little for more
- Your gifts or contributions received from friends and family.
Let me not leave the next idea list without giving you the advice: If you must borrow, keep it small. Loans that you know you can pay off quickly.
Say No to "Buy Everything Now"
Buying everything if you do not have enough capital kills the budget. You must have a spending rule, and for this rule, you must stick to it.
A rule I noted in my notes for you
"If what I am buying doesn't directly benefit or deliver my product, it waits."
What does it mean?
- Skip that expensive, beautiful, fancy office chair if your dining seat works for now
- Delay the major upgrades you are craving for until income proves the need
Let me make it a quick one here for you. Businesses grow in stages, and you do not need the final version upfront. Assuming knowing the final results of a football match before it begins, is it ever possible? I will leave that one for you to answer.
The Idea You Might Miss: Bootstrapping Like a Pro
Here is where you limit your fantasy world dreams. Grow your business with what you have, not with outside cash. What must you do? Here is the awesome help:
- Are you skilled in marketing? You need a website, have no skill to design one, then offer a website designer your marketing skills to market his website design skill while he designs you a website in exchange. Pretty cool, isn't it?
- Join the do-it-yourself train. Market your business yourself using social media platforms, blogging, or making short videos. These ones cost little, just a little time and a little extra cash for internet service.
Have a Successful Business (Track Every Coin, Yes, I Mean Every One)
Money leaks very quietly, and many entrepreneurs fail to realize and see that. Just keep a simple spreadsheet or free accounting app to track your expenses and income. Have no idea about those? Why not do the following instead?
- Log income and expenses every week in a book specifically for that
- Set a ceiling for spending. You've got to be like, hey! I won't spend beyond this.
- Review what is working and cut off the dead weights. Simply put, do not do what does not benefit or profit your business.
Do You Want To Scale Up? Do Not Forget to Validate First
Growing a business feels very beautiful and loving, but growing it without proof is very dangerous. Here are the questions you have to ask yourself
- Do people actually buy my product and not just compliment it?
- Are my costs lower than the price I can charge for my products?
- Is demand repeated, or do people just come and bounce back? Never come again?
Once you realize all these factors are in place, functioning and working well, hey, what are you waiting for? Scale up to the needful.
The Sweet Perk That Saves: Build A Cushion For Bad Days'
Even big businesses hit bumps, climb into highs and lows, so yours will not be immune to the bad days. Put aside some funds for emergencies and repairs. Do not grab all the profit and waste it. It will be very painful at the end when the blows hit hard.
The Final List of Ideas: Finally. Keep Your Day Job
Everyone works to be paid, so even as you run your own business, why not? There is no shame in keeping a salary while you profit. They go a long way
- To help you cover your bills when business matures
- To let you reinvest instead of living on them
- Lowers your urge to borrow only so you can survive.
My last words: Ignorance is very expensive, so take time to learn the basics of money.
