Hundreds of businesses are set up every year, but hardly a few of them cross the stage of breakeven. The success of a business is not merely dependent on the uniqueness of your idea. You will need a constant flow of cash to ensure a smooth running of business. However good an idea you have, you are not going to generate an inordinate amount of profit in the first few months. A constant supply of cash is a must to keep the ball rolling.

Most businesses require time, effort and money to become successful. You cannot win the game without patience. Before starting a business, you should carefully calculate whether you have enough funds to meet the initial cost and whether you will be able to get hold of cash to hit the ground running.

While you have the option to fund the initial investment with unsecured business loans with no personal guarantee in the UK, it is not a cinch to get the nod. You will need to prove your repaying capacity. In fact, you will also need a backup source to repay the debt in case your business goes bust.

Ways to start a business without initial investment

First off, you need to choose a business with little or no investment at all. There are various kinds of businesses you can start without a heavy initial investment, such as drop shipping, service-based businesses, handicraft goods, and the like.

When you do not have a large amount of money to invest in, it makes sense to choose a niche that fits your budget. However, you must have certain skills to make it to the top. It is vital to remember that running a low-cost business does not mean that you do not need any money at all as initial capital.

For instance, if you decide to provide writing and designing services to your clients, you still need money to create a website and maintain a social media presence. Apart from this, other prerequisite steps include:

• Designing a business plan

It is likely that you have to take out quick business loans with no credit checks. You cannot get the nod for these loans without a business plan. A lender would want to know the reason for borrowing, how you will utilise the money, and how you will pay it down. Your business plan must include all these details. However, the need for a business plan is not just meant for borrowing. It is a kind of layout that helps you hit each milestone.

When starting a business, the first question that comes to mind is how you will make money. If you have no answer, you should probably not start that business. You must not be aware of ways to make it successful. Before embarking on your venture, you should have answers to these questions:

• How much your business will cost you?
• Who will be your target audience?
• How will you reach your target audience?
• What will be the pricing strategy for your products and services?
• How will you grow your business over time?
• How will you set yourself apart from your competitors?
• What kinds of people will you need to hire? What will be their remuneration?
• What external funding sources will you rely on if your savings fall short of cash?
• Is there any alternative repayment plan to settle the debt in case your business fails before taking it off the ground?

Having answers to all these questions will give you a clear picture of how likely your business is to thrive.

• Test your idea

Research is the key to understanding how likely your business will be successful. It will help you know whether your business idea is viable. You should carefully figure out whether the market has the demand for your product. It is likely that a lot of competitors have already been providing the same product or service, so you will find it impossible to take hold of the market.

If you are steadfast in pursuing your business idea, you should figure out ways to set yourself apart from your competitors. You should consult your friends or neighbours to get their feedback on your product. When they share honest opinions, you will likely understand how you have to make your product or service better to attract a large number of customers.

• Make the most of your assets

While starting a business from very little investment, you should be mindful about using your assets. It is always recommended that you make do with what you have. For instance, if you need to deliver materials to your clients, you can use your personal car as a business car, too.

Some businesses require an office space. It can be a bit hard to invest money in it. Renting a commercial space will come in handy, but it adds to your regular expenses. Try considering a work-from-home facility if possible. For instance, if you provide writing services to your clients, you can allow your writers to work from home. It will save a lot of money in the long run. Your employees will also feel motivated and work harder.

As far as it is about buying a new asset for your company such as equipment, consider second-hand goods. You might get them at half price.

• Ask your friends or family for a loan

Even though you have set aside a considerable size of savings to start your business, they might fall short of cash. If that is the scenario, you should consider taking out a loan from your friends or family. Because the loan amount is not too large, they will feel inclined to help you.

However, you must treat their help strictly and professionally. Discuss the repayment length and interest that you would want to pay. Adhere to your obligation so it does not strain your relationship.

The final statement

To start a business without initial investment, you should try to manage with available assets, choose a niche that does not include too much investment and seek help from your friends and family.