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How to Start a Business with no Money without Going into Debt

Starting up a business with no money could help to lower the chance that you’ll go out of business because you won’t be spending anything!  However, this will slow down your rate of business growth and it will take longer to become profitable so you’ll need to wait a while before being able to pay yourself a wage from the business.  This is a low risk way of starting up a business though and it’s an ideal way to test the water, starting up a company whilst holding on to the day job.  Today we’re going to give you some tips on starting up a business with little or no money.

Pre-sell -    If you’re trying to kick-start your business the best way of doing this is to build an online community around your products or services and then selling to the community before you’ve even launched the business at a preferential rate.  Once you launch, you’ll need to follow through and honour these orders, using this to your own advantage by delivering a great product or service that will help to create brand advocates right from the very start.  People are already used to this type of business model nowadays, with crowdfunding websites like Kickstarter and Indiegogo as a platform for attracting your first wave of customers.

Trade – if you need to grow your business and you’re producing products or offering services, then these products are going to cost you a fraction of what you hope to sell them for.  This puts you in a great position – you have something to offer that people want and you can exchange this cheaply for other goods or services that your business needs.  For example, if you’re producing a product for £30 and selling it for £150 and you need some graphic design work done that would usually cost £150, you could offer your product to a graphic designer in exchange for the design.

Set Payment Terms – everybody these days is protecting their cash flow – the traditional expectation of 30 day payment terms (which often ends up being 60 or 90 days if they feel they can get away with it) is not set in stone.  You can set your own payment terms for customers or clients by either setting them up on a direct debit (for repeat customers) or send invoices with immediate payment or payment on receipt terms.  This can have a significant positive effect on your business cash flow and enable you to expand more quickly than you otherwise would be able to.

One of the main considerations right from the beginning is to develop a positive cash flow – a regular income will give you peace of mind, knowing what will be in your account the next day, week or month.  This will enable you to budget more effectively and grow your business faster.  Cash flow is king when it comes to business – without a positive cash flow you may find yourself teetering close to the edge of debt or even insolvency.  Pay attention to your cash flow for a healthy business outlook.