Although it doesn’t require a PhD in rocket science to start up a business on a low budget. However there are issues which if addressed early on will set your new business apart from the high percentage of business failures. Some business Guru’s deem it as madness to consider to start up in business in the middle of an economic downturn. However in my experience, many of these business guru’s are out of touch and simply wrong. Economic downturns present lots of wonderful business opportunities for business entrepreneurs who are willing to take calculated risks.
During uncertain economic times most businesses batten down the hatches and try to ride out the devastating effect of a recession. What this means in reality is that gaps appear in the market place where previously lots of other businesses were chasing the same opportunities. In effect, the race for the finishing line was very, very crowded. Whereas in the midst of a credit crunch, the finishing line has very few runners.
When most of your potential competitors have taken their eye off the business ball while attempting to ride out the storm, you have the opportunity to enter the market and start up a business on a low budget. Please don’t confuse a low budget, with a no budget, as there is quite a difference. Unless you have an absolute sure fire high income generation business idea, which will instantly convert into business revenue from day one, with no initial financial outlay, then attempting to start up in business on a no budget is corporate suicide. Historically the only exceptions to this rule are start.biz dot.coms. Even though there was a flood of these businesses, the bubble quickly burst when a former economic downturn hit the business world. Generally speaking, to start up in business you require business start-up finance. This typically comes in the form of a bank loan, external investment, internal investment, i.e. from your own revenue or a loan from family and/or friends. Some businesses source a business start up grant while the more canny business entrepreneur approaches a variety of institutions for their business start-up loans.
To successfully start up a business on a low budget and steer it through to long term sustainable business success you need the following 5 things
1. A well researched fantastic business idea. For the benefit of this article I’ll form an imaginary company called start.biz and use this as an example for how to start up a business on a low budget.
2. A business growth specialist. You need someone in your start.biz business who is skilled and a proven business growth specialist. These people are typically referred to as a business consultant. It’s true that many business entrepreneurs form their own businesses and assume sole control over its direction and perceived growth. However the number of annual business failures are testament to this corporate folly. Most managing directors, as high as 97% of them, have no formalised academic business management training. This doesn’t bode well when a new untrained managing director decides to start up a business on a low budget. This and a lack of adequate business start-up finance are the two biggest killers of any new business start-up.
3. A carefully crafted strategic business growth plan for your start.biz. This should not be confused with a conventional business plan which is generally only ever required for obtaining finance or investment from a financial institution. Your start.biz strategic business growth plan cannot be a generic business plan written on a template obtained from one of the banks or online financial institutions. It has to be a carefully crafted bespoke plan designed by you and your business consultant.
4. Business start-up finance for your start.biz. It doesn’t matter whether it is a bank loan, a business start up grant, investment, or one of the business start-up loans. You need finance to tide you through the first troublesome months when your cash flow is tight.
5. Passion. For start.biz to stand the test of time you as the managing director have to have oodles of passion, an aptitude for hard work and a burning desire for start.biz to succeed and become the best business start up.
Fuse these 5 components together in your new start.biz and you have the success formula to start up a business on a low budget within your grasp. Manage your business well and you can achieve relatively short term financial success. Who knows you may even win an award for the best business start up. One of my current clients is a 20 year old business entrepreneur; he has just been shortlisted for young business entrepreneur of the year. Like I said opportunity knocks in times of crisis you just have to open your ears to hear it.