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Starting a business on a shoe string

Discussion in 'Startup Clinic' started by Team Leith Training, Oct 8, 2012.

  1. Team Leith Training

    Team Leith Training UKBF Newcomer

    Posts: 1,460 Likes: 264
    How easy is it to start a business up these days on a shoe string budget? For some people they have merely a laptop, bit of webspace, and an internet connection to start.
    Many moons ago this was me. One thing you learn fast is how to get creative and make what you have stretch. Learning many skills as you go.
    What experiences do people have from doing this, and what tips and suggestions can you offer other people doing the same thing? Especially for those unemployed trying to make a success.

    One lesson i learned FAST was network fast. Skills barter. Offering something to someone in return for a little of their skills or service (even a testimonial) in return was one of the things i often did. And it WORKED!
  2. Paul_Rosser

    Paul_Rosser UKBF Contributor Full Member - Verified Business

    Posts: 3,748 Likes: 927
    I think if you are selling professional services then it's fairly easy as you don't need much to start with other than a laptop, email and a printer.

    If however you are planning on selling products then you need a lot more to buy stock in the first place.

    Personally for me as Team Leith said networking was the most important thing and once I had a few clients ensuring I did everything I could to make them happy as you can't beat referrals from existing clients to boost business.
  3. ITsoldUK

    ITsoldUK UKBF Contributor Full Member

    Posts: 2,221 Likes: 663
    As above, when offering a service I started out with a PC, notepad and a telephone...

    That was 8 years ago and my lifestyle business suits me fine AND I still have my own house and food in the cupboard.

    One key ingredient is motivation.

    Without that....forget it. Go work for someone else ;)

    Over the years you can add new strings to your bow and get relevant qualifications to enhance your knowledge but in answer to your question, with motivation you can start up with nowt.

    Oh, and I don't network, breakfast lunch or other types...but that's just me.

    Last edited: Oct 8, 2012
  4. businessfunding

    businessfunding UKBF Contributor Free Member

    Posts: 3,406 Likes: 918
    Many businesses can be started on a shoestring, whether by scrimping and saving or by starting along-side a salaried job

    It depresses me that so many new start feel that there is some inherent right to funding - often for nothing more than a 'just in case' fund.
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  5. ITsoldUK

    ITsoldUK UKBF Contributor Full Member

    Posts: 2,221 Likes: 663
    Or the flip side when a new business goes down the pan and you speak to the owner and they say, I only took £15k out of it to live :eek:

    But the business was losing money.................:rolleyes:
  6. sirearl

    sirearl UKBF Regular Free Member

    Posts: 27,782 Likes: 6,177
    Knowledge is the key to starting a business on a shoestring.

    There are many avenues to selling goods or making money without having to buy stock.e.t.c

    Motivation and passion will always come a poor second to knowledge.IMHO.
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  7. Philip Hoyle

    Philip Hoyle UKBF Regular Free Member

    Posts: 1,936 Likes: 985
    It's surprising what you can achieve on a shoe string.

    Two of my clients are cases in point.

    One was a guy who started out making specialist electrical connectors in his garage - just a few old bits of metalworking machinery. 10 years later, he had three factories, 300 staff, £10m turnover and he sold out to one of the international oil companies for around £20m.

    Another was a woman who started out selling household goods on ebay after buying £200 of stock and just constantly reinvested the sales proceeds, buying more stock every time, then created her own website and ended up after 5 years with a turnover of £1.5m and net profit of £500k p.a.

    Neither of these had any investment whatsoever - the latter never even had a bank loan nor overdraft. Really shows what can be achieved just by ratcheting up a business bit by bit. The question is how you survive personally - if you need to draw profits out in the early days or fall into the trap of borrowing just to pay yourself, then it's a different story!
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  8. Shaz2369

    Shaz2369 UKBF Newcomer Free Member

    Posts: 2 Likes: 3
    Yes things can be achieved on a (very short) shoestring ;)..

    My daughter & I started by selling a vehicle, buying a small amount of stock & then selling on local markets... To this end - 5 months on - we are opening our first retail outlet on 1st Nov!! :D
    all the takings went straight back into stock...no drawings at all...
    Exciting times ahead methinks..... :D
    Last edited by a moderator: Oct 9, 2012
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  9. Team Leith Training

    Team Leith Training UKBF Newcomer

    Posts: 1,460 Likes: 264
    I think it depends on what you're startup costs are.

    If your going to work in retail, these are going to be higher, what with costs of stock, storage, and logistics.
    Comparing to say a web based e commerce site where the cost might be little more than the laptop, internet connect, and mobile phone. Perhaps cost of a domain and website.

    The motivation and discipline factor are a most though, agreed there.
  10. Stretchy

    Stretchy UKBF Contributor Full Member

    Posts: 4,455 Likes: 1,401
    As Earl said, knowledge is far more important than motivation, in my opinion. You can be the most motivated person in the world, but without knowledge you are going to need money to allow you to get things wrong.
  11. businessfunding

    businessfunding UKBF Contributor Free Member

    Posts: 3,406 Likes: 918
    To expand on this, knowledge is more than product and market knowledge it is a comprehension of the business environment and o the legailities surrounding your business - there is no point running a busy cafe only to be shut don by EHO..
  12. Mr Tel

    Mr Tel UKBF Newcomer Free Member

    Posts: 2 Likes: 0
    I knew a guy who started of with a van and a couple of lights serving the film & Television industry for sparks equipment. He then started up his empire called AFM lighting & 20 years later he sold the company to a Billionaire who owns Panavision Camera company.... I don't know how much for but he certainly ended up a multi multi multi millionaire in his early 50's........

    It's amazing how people start from nothing and become successful and very very wealthy. You of course need abit of luck along the way tho aswell.
  13. Matt121

    Matt121 UKBF Newcomer Free Member

    Posts: 99 Likes: 7
    As what many have already said, yes it is very much possible. You just need to know how to do it, who to target, motivation to achieve goals, and maybe a bit of luck as well.
  14. SMIB

    SMIB UKBF Newcomer Free Member

    Posts: 1 Likes: 1
    I agree and would say that it's really down to good research and careful budgeting. I've seen many startups begin with a few hundred pounds, and with free platforms to engage new audiences on e.g social media, you can really test a market before a full business launch for very little whatsoever.
    Of course, a little bit of good luck goes a long way too ;)
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  15. teutonic

    teutonic UKBF Regular Free Member

    Posts: 6 Likes: 0
    Some inspiring replies ! I am going around in circles trying to decide where to start. Having been made redundant in my mid fifties I have a few k to start up but dont know how or where to start up, or what product or sector to venture in.

    Sole trader is a given. I'd like to sell my practical skills as a service to business, rather than sell goods. Beyond that I cannot think how to do such a thing, and any good advice would be appreciated.
  16. Stretchy

    Stretchy UKBF Contributor Full Member

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    What practical skills are you thinking of selling?
  17. MissHanifaD

    MissHanifaD UKBF Newcomer Free Member

    Posts: 24 Likes: 3
    I agree. We started our e-commerce business selling personalised gifts on a small budget and we used our home as the storage facility, in fact we kept it that way for quite a while until we had the funds to expand. Our initial outlay was for an engraving machine - but we were able to lease this and building the website. If you've got good friends and family who are willing to help you get started, then that is always a bonus - we were lucky in that sense :)

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  18. Philip Hoyle

    Philip Hoyle UKBF Regular Free Member

    Posts: 1,936 Likes: 985
    Even in retail, you can start on a shoestring.

    Nothing to stop you buying minimal stock and starting out on a market stall and then building it up by re-investing profits into more stock and eventually moving into a small shop on a side street, then again trading up to a larger shop in a better location.

    There are also other options, such as renting space in other retail premises. In Chorley there's an old converted mill (Botany Bay) where you can rent space and you can leave your stock there without being there yourself. Customers can take your goods to the mill's own checkouts and they just take a small commission for handling and credit card costs etc. If you are there yourself, then you take the money yourself and don't pay the commission for their checkout.

    It's quite common, for say, jewelry makers, artists, etc., to put their stock in shops and give the shop owner a commission for anything sold.

    Barriers to entry are only there if you let them!
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  19. teutonic

    teutonic UKBF Regular Free Member

    Posts: 6 Likes: 0
    Hi Stretchy. I was a medical electronics engineer for 14 years. Before that an instrument technician in the semiconductor industry. It's all a bit specialised which does'nt help going solo and seeking self employment. Even so, on my practice flyer, well the first one, I thought of offering the following:

    Computer services:
    Data Recovery
    Operating System Repair
    Hardware replacement/upgrade
    Network solutions
    PAT testing

    I then prepared a second flyer offering these further services...

    Medical grade safety testing to IEC 60101-1
    Legacy equipment repairs
    Medical equipment movements and relocations / setup.

    because I would love to find work within the medical industry.

    So thats what I'm going around in circles with. Which, if any, would secure enough paid income to keep the mortgage paid ? Is there a way to offer all the services ? Should I plod around distributing my own flyers. ? Should I pay to advertise ? Should I keep hunting for a paid job instead ? I would approach personally every good contact I've made over the years.

    The decisions will become more urgent as the redundacy cash slides slowly downwards over the coming months.

    I am ready for my solo career. The right age, wisdom, bitter experience and qualifications, and even my own test equipment. But I cannot bring myself to take the plunge.

    Looking for someone to hold my hand in truth. The proverbial safety net. But there is'nt one really in existence so ....
    Last edited: Oct 17, 2012
  20. teutonic

    teutonic UKBF Regular Free Member

    Posts: 6 Likes: 0
    Most interesting info. I used to drive past the Botany Bay building on the M6 to Preston, wondered what it was all about !