Most budding entrepreneurs get discouraged when they realize that their great business idea can’t come to life due to the lack of capital. But businesses don’t always need a huge capital to get off the ground.
You need a well thought-out business plan and the ability to run a tight ship to be on your way to entrepreneurial success. Here are some tips on starting a business with a small capital:
1. Turn skills, knowledge, and passion into a business
When you build your business around your skills, knowledge, and passion, you more or less know how your chosen industry functions. This cuts down on the time and money you’ll spend trying to navigate totally unfamiliar territory.
2. Inform as many people as you can
Spreading the word about your business is crucial. You don’t need to spend money on big advertisements; there are many inexpensive online and offline ways to market your business. Tell your family, friends, former workmates, and business contacts about your new venture. Call people, email them, and announce your new business on your social media pages. Ask them to share your post.
3. Spend wisely
Avoid overspending or buying unnecessary items for your business. Your expenses should be relevant to the growth of your business. Make sure your office or business space is comfortable for your employees, but you may want to rethink perks like a top-end espresso machine for something a little more modest. Consider renting rather than buying, outsourcing certain aspects of your operations, and hiring virtual assistants.
4. Be mindful of your debt
It can be so tempting to use your personal credit card when paying for office items and other supplies for your business. But this can eventually backfire when all these expenses add up. The business should bear the cost of office expenses and the supplies you need.
5. Learn accounting basics
Knowing basic accounting principles goes a long way. It helps you keep track of your cash flow and allows you to analyze how money is being spent vis-avis your profits and business targets. Accounting information is also crucial to creditors and lenders as it shows the credit worthiness of your business.
6. Sweat equity makes a big difference
Sweat equity is the time, effort, and energy that you spend in the development of the business. It includes actual labor, a specific knowledge, the value of your name or connections, and the provision of work space and utilities at no charge to the company, among others. If you run the business with a partner, make sure a monetary value is attached to each instance of the sweat equity to avoid potential problems down the road.
FilePino is uniquely positioned to help you set up your new business here in the Philippines. If you’re just starting a new company, we have the contracts and know how to grow your business quickly.
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