Starting any business is a risky opportunity, evidenced by the number of failed businesses suffered every year. To mitigate those risks, try to reduce your financial investment and eliminate the need to take out loans. If you haven’t put much money into the venture, then you’re not setting yourself up to lose much money if it doesn’t work. Of course, you’ll still need to invest a lot of time and effort into your new business — time and effort that you’ll never get back. Ideally, you can start the business as a sideline, working another job or career at the same time to maintain steady income and security.
First of all, you’ll need an idea. The most affordable types of businesses to start include selling your own crafts and artwork, providing lessons, tutoring or consulting, reselling products and providing services like repairs.
You’ll need a business plan, which requires some effort to develop, but no money. Your plan will include such details as your business name, a market analysis including potential customers and competitors, a marketing strategy, a management plan and, most importantly, a financial summary.
You’ll want to establish a web presence for your business. A custom domain with web and email hosting will cost you about $300 per year, but this expense is absolutely crucial. With the prevalence of online access today, a wide variety of low-cost business services and opportunities are now available. The internet is really the key to starting up a business on the cheap.
Your business will need some office space, which could be a room or space in your home. Just make sure that space is dedicated for your business to reduce distractions and allow for tax deductions.
Advertising on social media is free, so take advantage of that. Business cards are a minor expense, but great for networking. You can get about 300 business cards for $10 to $20.
In general, maintenance and repair businesses are cheaper to run than production businesses, but they can still come with costs. A maintenance and repair business will usually incur costs for training, certification and licensing, transportation and hauling, tools and a stock of common replacement parts. The specific requirements for licensing depends on your state. “Nevada requires a contractors license to work on A/C units, boilers and heating units,” says Steve Lewis, the CEO and President of Ambient Edge, a furnace repair company in Las Vegas. Typically, these formal requirements like testing and licensing end up costing about $100 initially along with annual renewal.
Many costs of operating a repair business can be mitigated by focusing on “handyman” type tasks. These jobs tend to be smaller and more informal and general contracting work, meaning that you won’t have expenses like certification, insurance, special tools and an inventory of parts. A typical handyman might fix a leaky faucet in one home and repair a light fixture in another — neither of which requires anything special in terms of training or tools. All that’s required is an aptitude for figuring things out, some manual dexterity and a willingness to research and learn new things.