Starting a business doesn’t have to cost the earth, and while some businesses do require financial risks to be taken, and big injections of cash, many can be started - and even operated - in a way that doesn’t need lots of investment
North East businesses have helped us to put together six essential tips for starting a business on a shoestring, as some of them shared stories of bootstrapping their own startups.
1. Work from home
Working from home can save a significant amount of money for a new business. Not only does it save the money of renting office space, but it also reduces the money spent on travel.
If your business is desk-based, you can easily work from home with just a computer and a telephone. There are also low-cost hot desking and co-working spaces available if you feel you need to work away from home, such as the North East BIC, several Newcastle City Council managed business centres, or via companies like Rural Connect.
2. Make the most of free tools
You can also use free online resources like podcasts and blogs to learn about specific aspects of starting a business, such as PR and marketing. There are thousands of different topics covered, so use a search tool like Alltop or Blog Search Engine to find a blog that’s right for you. For podcasts, search via iTunes or apps like Stitcher, Soundcloud or Podcast Addict for different business topics of interest to you.
In the early stages of your business you will likely need to be a ‘jack of all trades’, and some training will help you understand anything you aren’t clear on. There are a range of training courses available for free or low prices.
3. Ask for help
Use contacts you already have; whether it’s asking a friend or family member to help out with work, or just asking them to spread the word about your business. You can use free social networking tools like LinkedIn, Twitter and even Facebook to connect with people who can help you.
Mentors can also be a valuable source of support and advice. They’re very experienced, and as they aren’t working within the business they can provide a useful outside view. The mentoring pages of our website can help with finding a mentor for you.
4. Spend wisely
Know when to splash out – if you can only spend money on one aspect of starting the business, think carefully about what will be worth the money. If you need to buy equipment for your new start-up, why not look into buying second hand?
5. If you MUST borrow, check your terms
You might find it hard to get a good rate on personal credit, especially if you don’t have a stable job and regular income. Beware of expensive short term loans as they can cause financial difficulty. Depending on how much you need, evaluate loans, overdrafts and credit cards carefully and realistically before borrowing. And only borrow what you must have. Check out our finance and funding pages to find out more about potential avenues for your business.
6. Choose your clients wisely
Kari Owers started her creative communications agency, O, in 2005 from the attic in her home with just a laptop and phone. With a vision of building an agency to compete with any in London or beyond, she has built the business one client at a time.
Now a nationally award-winning PR agency, based in a cool pottery building conversion in Ouseburn and counting household names like Dr. Martens on its roster, Kari lists its humble roots as an enabler of its success today.
Kari said: "We had no investors to please or a hefty bank loan to influence our decisions, so have always stuck to our roots in strategically choosing good clients that allow us to do great work.
"Do the job well and the money will follow someone once told us, and that advice has stood us in good stead. We have never spent cash we didn't have and our biggest investment has always been in our people. It's this quality first approach that's allowed us to grow steadily and realise our ambitions to pitch and win at a national level.”