Do you like the idea of running a business with virtually no fixed costs? Where almost all of the revenue you generate is translated to profit?

This isn\’t a sales pitch – it\’s a look at business models that require virtually no capital to start up. Such businesses are excellent for \’new\’ entrepreneurs who are looking to start a venture part time while still in fulltime or part time work.

When you analyse the various businesses around the globe, these can be categorised into two types: Capital Intensive, and Labour Intensive.

Capital intensive firms require plant and machinery, land and buildings and other equipment to function. These can produce high levels of returns but require substantial start up capital – often in the form of a bank loan.

The second and more interesting type of business are those small, one-man ventures where the individual contracts out their services (often by the hour) for a fee.

Examples of such businesses include Piano Teachers, Accountants, Vocal Coaches, Management Consultants, Bloggers and Window Cleaners! A vast array of jobs that all share the same thing in common: their low overheads.

There are many advantages to running a low overhead business. The first is that losses are very unlikely. While private companies may be forced to file for bankruptcy after piling up debts, this will never happen to a window cleaner! This reduces the risk of the venture and ultimately allows you to sleep easier at night!

Another advantage is that you can live a very flexible lifestyle. Need to pick up the kids at 3pm? Sure! Need to attend several weddings in a 6 month period? No problem! You can shift your working hours around the other demands on your time and ultimately live life to the full.

How to do it:

The first stage of beginning your \’business on a shoestring\’ is to do your research. Are the realities of the job in line with your expectations? Are there any formal qualifications you require before beginning, and how much do these cost? Use a mixture of official sources (Trade Organisation Magazines for instance) and personal contacts (in person or online, either will be helpful).

The second stage is to invest yourself in the project. Schedule time in the evenings to acquire tools you need, and decide how you are going to win clients to begin with. The often slow-start to these type of businesses allows for a reasonable learning curve. In other words, you hopefully won\’t be overloaded at once.

The third stage is going out there and performing for your first few clients. This will be exciting, as well as tremendously nerve wracking if you consider yourself a \’novice\’ at the profession. Those nerves will keep you in shape, so learn to live with them, rather than being worried by them!

Try not to get carried away with initial assumptions and forcast them too far in the future. I\’ve seen many start-ups say things like \”I\’ve gained 3 new clients this week, so that\’s equivalent to $X,000s in income per year!\”. Such estimates don\’t usually take into account the \’turnover\’ of client (i.e. despite even your best service, some may choose to end the contract).

I wish you every bit of luck in starting your own, small, low overhead business!

Author Bio: Simon blogs about leadership styles and other leadership & business management topics at Leadership Expert.

Category: Business Management
Keywords: Entrepreneur, Business Start Ups, Business, Businesses, Advice, Leadership, Leadership Styles