You don’t need lots of money to think big, especially if your business is online. Phil Rothwell, marketing director of ecommerce software supplier, SellerDeck, shares his tips and experience below.
One of the things that almost all new businesses have in common is a lack of money.
I’ve worked in a number of start-ups and I can’t remember the number of times I’ve wondered what I might be able to achieve had I got a few hundred thousand pounds at my disposal. The interesting thing is though, when my company did have a lot of cash to spend in the dot.com boom of the late nineties, the reality didn’t match the dream. To cut a long story short, we blew it.
The truth is that finance is extremely important in business, but it’s no substitute for business acumen and operational discipline. In fact, if my experience proved anything, it is that it is possible to have too much success and too much money. The former makes you arrogant and the latter far too relaxed about spending in general and contract negotiations in particular.
If you are willing to believe that lacking a decent pot of cash can be a blessing, then I have further good news for you. Over the last decade, it is perfectly possible to start a business with very little money and the range of businesses you can start with a meager pool of funds has mushroomed.
Twenty years ago, there was a saying that all you needed to set up a public relations company was a desk a chair, and a telephone. Today, you can set up an online retail business with a notebook, an internet connection, and a mobile phone. You can always use someone else’s desk if you need one.
Pay-as-you-go
But it’s not just technology itself that has revolutionised the way business works, it’s the way technology is supplied and the services it has facilitated that have been far more transformational. Once upon a time, setting up a company demanded a relatively substantial financial outlay covering the basic legal and the infrastructural things you need to get going.
This has changed. From a business development perspective, money spent on what is little more than business basics is basically money wasted. You have to do it, but every pound spent is a pound that can’t be used to generate and fulfill sales. Today these basics are all available online at minimal cost. For instance, you can:
- Register your company online at Companies House
- Obtain free business banking online, often for as much as the first two years with the High Street banks
- Sign up to receive online payments with services such as PayPal
- Buy template legal agreements from websites such as Contract Store.
The same is true of technical services. As well as financing your computer hardware, you can buy the essential software you need on a pay-as-you-go basis. For well under £50 a month you can pay for a company to host your website and email address and even host your online store. You don’t even have to be technical as many services are designed for novice users. However, some basic writing and image editing skills can get you a long way, especially if you start by trading on eBay and Amazon, or build your own online store using a product like SellerDeck Catalog.
You make the difference
So, if setting up a business is that easy, why doesn’t everyone do it and why isn’t everyone successful? Well, putting it tactfully, not everyone has the imagination and ability to create a successful business.
Although my own company, SellerDeck, is an eCommerce supplier, we have always been aware that it’s not our software and services that create success for our customers, we simply enable it. Successful entrepreneurs tend to combine commercial awareness with expertise in the fields they operate in. They seem to know where to spend their money and how to spend their time.
Play to your strengths
Time and money are interchangeable commodities, the key is to spend your time where you can make the most impact, and spend your money where other people can make the most impact. This may be little more than a fancy way of advising you to play to your strengths, but it’s also a challenge for you to find out what your strengths are. One caution, don’t assume you know already.
If you are looking for external help, then again the internet has an answer. There are many thousands of freelancers in the UK and beyond, who are willing to sell their skills at a reasonable a day rate. So long as you are specific about your needs, you can often engage them at a daily or hourly rate to fill in the gaps in your skillset.
First, break all the rules
It’s great to have a lot of start-up capital, but if you don’t the internet means that it’s definitely not a show stopper. There are plenty of low-cost alternative ways to get your business moving forward and if you love what you do and spend your money wisely, you can start a business on a shoestring. In the early days, think big, but spend small. If things take off you can either enjoy the lifestyle or raise the funds you need to hit the big time.