The UK boasts millions of entrepreneurs who’ve taken the life-changing step of setting up their own business. The majority of these are very small businesses – in fact, it’s estimated that around 74% of UK businesses only have one employee: the owner themselves.
This statistic underscores an important and inspiring point: that setting up a profitable business all by yourself doesn’t have to be a pipe dream. What’s more, you don’t necessarily need a lot of starting capital to turn the dream of self-employment into a reality.
It goes without saying that certain types of businesses do require a lot of upfront investment. Think, opening a physical shop or restaurant, or founding a tech company which relies on lots of research and development.
However, many business opportunities don’t require you to have a hefty amount of savings, or to take out a business loan. By keeping your running costs to a minimum, you can both minimise the personal financial impact if your business should fold, and maximise your profit margins throughout the life of the business.
Being savvy and seeking out low or no-cost business tools can make all the difference to your bottom line. One such tool is the free business account from SumUp, which makes it a cinch to track exactly how much you’re spending and making.
There’s certainly no shortage of low cost, high return business ideas out there for you to weigh up. Whether you want to get out there and meet customers, or are wondering how to make money from home, there are plenty of options to consider.
As there are quite a few listed below, we’ve grouped them into five categories so you can jump straight to the low capital, high profit business ideas that appeal the most.
If you’re creative by nature, there are multiple ways to turn your talents into a business that’s based online. And, since your main “raw material” is your own imagination, your running costs will be naturally kept low.
Let’s look at just some examples of online creative businesses that may fit the bill, whether your skills run to design or telling compelling stories.
Podcasts really started to surge in popularity in the wake of the global success of the true crime series Serial. This popularity is showing no signs of slowing down, with the number of UK podcast listeners expected to reach 28 million by 2026.
Creating your own podcast will require a flair for storytelling and strong research skills. If those are your strong suits, and you are prepared to carry on doing your existing day job while your podcast grows, then this may be one of the most enjoyable and creatively satisfying businesses to get into.
To forge a successful podcast you’ll need to:
Pick a subject you have a real interest in – while true crime podcasts are all the rage, almost every subject can attract droves of listeners if it’s written and performed in a compelling way.
Take your time crafting quality scripts – this step is perhaps the most important, so don’t rush it. Even if your podcast is an improvised, freewheeling “chat with friends” style show, it helps to have a good outline in place.
Invest in the right equipment – this will include a high-quality microphone, noise-cancelling headphones and a shock mount.
Find the right music – a quality soundtrack will give your podcast a polished, professional feel, and you can source tracks from royalty-free sites like Bensound.
Create cover art – you’ll want a good logo or “cover image” to accompany your podcast listing online, so if you aren’t a designer you should hire one from a cost-effective marketplace like Fiverr.
Research podcast hosting sites – prominent examples like Buzzsprout and Libsyn also provide tools for monetising your podcast and putting it out on top directories like Spotify and Apple Podcasts
Whether you have a passion for fashion, video games, movies, food, or pretty much any other niche, you can build a real business on that foundation by creating entertaining content on social media platforms like Twitch, TikTok and YouTube.
There are two main ways to do this. One is by taking advantage of monetisation tools on the social media platform itself.
For example, YouTube has a partner programme which you may be eligible to join after you amass 500 subscribers with 3,000 public watch hours. This will unlock monetisation features for you.
The other way to make money as a social media figure is through sponsorship and affiliate links.
If, say, you create a popular Instagram page on the London food and restaurant scene, you may be approached by artisanal food brands to feature links to their products on your page. You may then get a commission whenever items are purchased through the links.
Startup costs for being a social media creative are typically low, but you will need to ensure you use a high-quality webcam and microphones. Bear in mind that editing and polishing the videos can take as long as making them, and you may need to hire freelance video editors unless you’re skilled in this area.
Substack has fast become one of the world’s most talked-about online content platforms. It allows anyone to publish blog posts and newsletters for paying subscribers, meaning that you can generate revenue from your writing without needing the approval or help of editors and other traditional media gatekeepers.
Practically any subject can make for a hit Substack. Successful writers on the platform write blogs and newsletters on everything from politics to food to stock market speculation to conspiracy theories. So you can absolutely pursue your own passion and get paid for it.
Most writers on Substack publish a mixture of free and paid content. The free content is important as it will attract readers who will then hopefully convert to being paying subscribers. If, say, you attract 1,000 subscribers paying the minimum price of $5 per month, that equates to $5,000 in revenue per month.
It will take time to build up those paying subscribers, of course, so you should consider your Substack a labour of love to start with. But, if it goes well, you’ll be making money simply from words on a screen, with few overheads to eat into your profits.
Rumours of the AI-fuelled death of the graphic design industry have been greatly exaggerated. Indeed, the global graphic design market is expected to reach a lofty $76 billion before the end of this decade.
Both large and small businesses will always require skilled designers of posters, logos, social media posts and the like. So, if you have creative prowess and are well versed in tools like InDesign and Photoshop, you can carve out a slice of the market for yourself.
You can get your foot in the door by advertising your services on sites like PeoplePerHour and Fiverr. With perseverance, you may get further graphic design gigs through personal recommendations, and hopefully secure ongoing clients.
It’s important to keep up to date with the latest design trends, whether in terms of typography, corporate illustration styles or the types of memes that are getting shared on social media. It also almost goes without saying that you’ll need a distinctive personal website that reflects your design abilities.
Running an online business is a great option if your budget is tight. After all, you won’t have to spend money on work premises. And, depending on the kind of work you do, your overheads will be limited to one-off purchases of software. Remember, the lower your overheads, the bigger your profits.
You can also enjoy the sheer freedom of being able to work virtually anywhere you like. One day you can clock in at your dining table, the next you can mix things up by working in a favourite café. Here are some of the most profitable business ideas that provide this kind of flexibility.
Copywriting is arguably one of the lowest-cost business ideas of all. Armed only with a word processor and your own talent for prose, you can potentially create all kinds of content for paying clients.
The fact is that many companies large and small need high-quality editorial content in order to reach out to their customers, and you can cater to this demand. It will undoubtedly take time to build up clients, but once you have a few under your belt then word-of-mouth may help you secure more revenue streams.
As a copywriter, you can specialise in a number of content types, including:
Web copy for client websites, from homepage content to case studies
Online product descriptions
Blog posts which are search engine optimised to help boost clients’ presence online
Online marketing content, such as sponsored posts and newsletters
You can also offer services as an editor and proofreader, if those are additional strengths.
There are online marketplace sites where you can get your start by advertising your services. For example, Fiverr has a huge array of sub-sections you can promote yourself under, from technical writing to general web content.
Affiliate marketing is a booming industry. A survey of UK businesses conducted in 2022 found that almost half expected to spend more on affiliate marketing in the following year. On a global level, the affiliate marketing industry is anticipated to reach $15.7 billion in value by 2024.
As an affiliate marketer, you’ll create content which is embedded with links to other companies’ products and services. You’ll then earn a commission whenever your readers engage with those links – for example, if they make a purchase, or sign up to a promotion.
Your content can take many forms, from social media posts to blogs and online reviews. For example, you might create a tech review site, and embed affiliate links for laptops, VR headsets, gaming chairs, and other related products.
You can forge partnerships through established affiliate marketplaces like Amazon Associates, or by going directly to specific companies’ websites to see if they have their own programmes in place.
Affiliate marketing can be an attractive business idea as you’ll be able to devote yourself to a sector you genuinely enjoy and the startup costs are minimal. However, patience is key.
You’ll only generate income if your content takes off, and there will be a lot of trial and error as you experiment with types of content and links.
While using social media is an invaluable promotional tool, many businesses don’t have the in-house resources to maintain an active presence on sites like Instagram, Twitter, Facebook and Linkedin.
As a social media consultant, you may be hired to handle one or both of the following:
Developing social media campaigns, which may involve brainstorming ideas for posts, scheduling posts to coincide with new product lines or promotions, developing hashtags, and coordinating content across multiple platforms.
Creating the content itself, for example writing Twitter and Linkedin posts, and engaging directly with replies.
As a newcomer with no clients to your name, you can make up for a lack of previous case studies by maintaining an active and dynamic social media presence yourself.
This can take many forms, but as a fledgling social media consultant it makes sense to write about the industry. So, you could post tweets and Linkedin think pieces on the latest social media and marketing news.
Post regularly, make use of up-to-date memes and infographics, and always remember this will be your portfolio which potential clients will judge you on.
You can find your footing as a social media consultant though marketplaces like Upwork, Fiverr and PeoplePerHour, but it’s also worth being bold and directly contacting companies you can imagine working with.
Even as the world becomes ever-more digitised, the tech industry is still hampered by a stark shortage of web developers. This can present a great opportunity for anyone with an interest in coding, and who likes the idea of helping businesses and organisations create and test websites and apps.
If you don’t have a techie background, it may seem like a daunting industry to enter. However, it’s actually very possible to learn code in your own time without spending a fortune.
There are plenty of other companies and bootcamps you can choose from too, with many also providing ongoing mentorship and opportunities to network with fellow coders and potential clients.
Many busy people like to reduce their mental load by delegating certain tasks to virtual assistants. These aren’t AI-powered bots, but PAs who work remotely, in a freelance capacity.
Virtual assistants perform all kinds of tasks for their clients, such as making travel arrangements, managing and replying to emails, producing and editing PowerPoint presentations, updating company websites, and managing diaries.
As a virtual assistant, your overheads will be low, though you will of course need a computer and the appropriate software such as Microsoft Office. Experience is also important here, so this can be a great path if you’ve already worked as a conventional PA.
You can get your start through marketplaces like PeoplePerHour and established virtual assistant-specific sites like Time etc. However, you can also plant your flag in the sector by launching your own company website detailing your services and experience.
Here’s an eye-catching fact: online shoppers in the UK spent a hefty £110.6 billion in 2022 alone. So there’s every reason why you might be wondering about things to make and sell through ecommerce sites.
You won’t need to spend on opening a physical shop. You may not even need to stockpile any expensive inventory. So, let’s consider some of the best low cost business ideas with high profit potential for budding ecommerce entrepreneurs.
Industry experts anticipate that the global dropshipping market will be worth an impressive $476.1 billion by 2026. One of the reasons it’s such a popular way to do business is that startup costs are very low, since you don’t actually have to purchase the products you’re selling.
As a dropshipping business, you only have to concern yourself with creating an online store where you showcase the products you’re selling.
Any orders you receive are then passed onto third party suppliers who take care of packaging and delivering the products in question. Your profit is the amount left when you deduct the supplier’s wholesale cost from what your customer pays you.
By outsourcing the inventory side of the business, you keep your financial risk to a minimum. However, dropshipping is a highly competitive industry. It may help to focus on a particular niche and research current trends within that niche, keeping an eye on what your potential customers are talking about on social media.
You’ll also need to partner with trusted, reliable suppliers, but the good news is that dropshipping networks like Worldwide Brands and SaleHoo have pre-vetted thousands of suppliers who may be right for you.
If you have a creative side, then this variation on the dropshipping model may be the right fit. As with dropshipping, this is a form of ecommerce where you don’t need to invest in inventory, with all the items you sell going straight from the supplier to your customer.
The difference with straightforward dropshipping is that your items will be specific to your business. So, you might want to create your own line of clothing or homeware emblazoned with your own designs.
Firms like Printify and Printful make it easy to select and customise the items you want to sell. You simply use online tools to apply your designs to, say, t-shirts and hoodies, and create your bespoke product line in moments.
The success of this kind of business really relies on how distinctive and unique your designs are. As well as setting up an online store, you’ll want to ensure you regularly update Instagram and other social media platforms with your wares, and keep up with the trends people are pursuing.
There’s a huge market for handmade arts and crafts items, from quirky earrings and brooches to clay ornaments to homeware fashioned from wood. A quick look on sites like Folksy, Crafter’s Market UK and Etsy will reveal the sheer variety of designs out there.
While this kind of ecommerce will require investing in raw materials, these won’t be too pricey if you shop around different online wholesalers and steer clear of precious metals and gemstones. By focusing on monetising your artistic talent and vision, rather than expensive materials, you can maintain high profit margins on everything you sell.
Promoting your creations is all-important in a market as competitive as this. Taking high-quality, high-definition photos of the products against attractive backgrounds is essential. It may even be worth hiring a photographer from a site like Fiverr to ensure the pictures are tip-top.
We also recommend you take a step beyond marketplaces like Etsy, and set up your own online store. This can help make your brand look more distinct and established in the eyes of many customers.
Having an active presence on sites like Instagram and TikTok can also help draw in customers.
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Selling artisanal foods by mail order is one of the more complex small business ideas on our list, as it involves not only creating the treats themselves, but also packaging them in an attractive way.
However, savvy sourcing of ingredients and materials can keep your startup costs low. Choosing the right product line is also important.
For example, creating gourmet chocolate cakes and cookies can require premium ingredients like 70% dark chocolate. This may mean a relatively high outlay compared to, say, making pickles and chutneys, which only require everyday veggies and spices.
Packaging doesn’t have to be too elaborate when you’re starting out. If, say, you’re selling sweets, you only really need to invest in some colourful cardboard boxes and stickers featuring your logo. You can find cost-effective, custom sticker printing services readily available online.
Just bear in mind that you’ll need to adhere to regulations on selling food for delivery. The Food Standards Agency has all the details.
Contrary to popular belief, you don’t need to have formal qualifications in photography to take it up as a profession. If you are skilled with a camera, you may be able to cater to a very large, ready-made market for high-quality photographs.
Sites like Shutterstock and Getty Images have paid many millions to the legions of freelance photographers whose works they feature on their platforms. If your work is accepted, you’ll be paid royalties whenever your photos are used by their clients, which often include media outlets, ad agencies and large corporations.
Of course, photography equipment like professional-grade digital cameras aren’t cheap. However, chances are you already have at least some of the right kit if you’re contemplating turning your hobby into a business, and beyond equipment expenses your only real outlay will be the cost of travel to the locations you’ll be shooting.
It almost goes without saying you should also promote yourself as much as possible. While image-based platforms like Instagram can be a great space for showing your skills, you can also boost your name by writing about photography and recent shoots on sites like Linkedin and Twitter.
If you’re skilled in a particular field, you may be able to turn your knowledge into profit. And profit is the key word here, since the startup costs associated with teaching are typically low. They may even be virtually non-existent if you’re doing purely online tutoring.
Of course, your expertise is of paramount importance, and you’ll need to actively enjoy interacting with different people and building a rapport. If you’re a “people person” and want to pass on your knowledge, here are some low cost high return business ideas to consider.
It’s never been easier for parents to arrange private tutoring for their kids. Once upon a time it would have meant looking up tutors in physical directories and print ads, then arranging to have them come over to teach the children in person.
In the digital age, the whole process is far simpler and more accessible, which has led to skyrocketing demand.
What’s more, as an online tutor, you won’t be limited by geographical distance. You’ll be able to potentially provide your services to families based all over the country, from the comfort of your own home – and without having to spend a penny on travel costs.
You won’t need formal qualifications to be a tutor, although established tutor marketplaces like Tutorful will have their own eligibility criteria. If you meet the criteria and pass their interviews, you’ll be able to advertise for clients online.
If you have an affinity for young people, an in-depth knowledge of your subject, and an ability to communicate well over webcam, you may be able to reap the rewards of a business which requires very little in the way of outlay, meaning profit margins are always high.
There’s a vast global demand for learning new skills online, with the overall e-learning market expected to reach $648 billion by the end of this decade.
You don’t necessarily need to have a degree or other formal qualifications to carve out a slice of this market for yourself. Thanks to platforms like Udemy, you can create your own curriculum and upload videos, articles and other resources for students who’ll pay for the privilege.
Whether you want to teach social media marketing, painting and design, or hypnotherapy, the possibilities are limitless – providing you have the expertise.
High production values are important, so your initial outlay may include the cost of a quality webcam and microphone. While it will take time to plan and create your courses, an advantage of this business idea is that it’s quite easy to scale.
This means that as more and more people discover your existing courses, your revenues will increase without you having to do any extra work or spend any more money. This makes online course creation a potentially high profit enterprise.
Thanks to an ever more eclectic restaurant scene, an unstoppable barrage of food competition shows on TV, and the rise and rise of supper clubs, food is now a bona fide passion for more and more people in the UK.
If you’re highly adept at cooking, perhaps with some experience in professional kitchens, you can cater to this interest by providing in-person cookery courses.
This will require some spending on your part – primarily with regards to renting appropriate kitchen space for lessons. The good news is this isn’t as pricey as you might imagine.
Even in a generally expensive city like London, it’s possible to find adequate kitchen premises for a few hundred pounds an hour, with the potential for discounted full-day rates.
Creating a name for yourself as a cookery instructor can be vital to success. A good approach is to specialise in a particular niche, whether that’s cuisine from a certain part of the world, or a cooking technique like sous vide.
You can then create YouTube and TikTok cooking videos, being sure to engage with commenters and promote your in-person tutorials.
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There’s no getting around the fact that it will require a chunk of money to gain the qualifications required for becoming a reputable personal trainer.
You’ll need to complete Level 2 Gym Instructor and Level 3 Personal Trainer courses provided by CIMSPA-approved centres, and this can cost up to a few thousand pounds.
But remember that your overheads will dramatically dip after you obtain those key qualifications. From that point on, your own knowledge and skills as a motivational instructor will be the main tools of your trade.
This is especially true if you work in a gym, which will mean you won’t have to purchase your own weights and other equipment.
Reputation is everything for a personal trainer, and you can bolster your credibility by posting YouTube, TikTok and Instagram videos of you working out and providing tips on correct lifting technique.
If things go well, you may eventually decide to set up your own studio. But, in the meantime, you can keep costs down, and profits high, by working at gyms or in public parks with your clients.
Enjoy working directly with customers and clients? These are some of the low capital high profit business ideas you might like to consider.
All of them can be set up without putting a big dent in your budget, and are ideally suited to entrepreneurs who actively enjoy meeting new people.
Being a private chef can require relatively modest investment in basic kit like whites and chef’s knives. Other than this, you’ll simply be monetising your culinary skills and your experience (since having a track record of working in professional kitchens is generally seen as a prerequisite for becoming a private chef).
A popular way to establish a reputation as a private chef is to provide your services at one-off events, such as birthday parties, weddings and corporate dinners. You can advertise on chef marketplace sites like La Belle Assiette and Yhangry, which allow you to describe your culinary specialities and present your menus.
You may even progress to the point of being hired to work long term for specific clients. Your responsibilities will typically include planning menus, sourcing ingredients and, of course, preparing the meals every day.
If cooking is your passion but you lack the financial resources or inclination to open your own restaurant, becoming a private chef is well worth considering.
The cleaning sector is valued at close to £60 billion in the UK alone, and demand is higher than ever with an estimated one-third of British housholds now regularly using cleaners.
There are low barriers to entry when it comes to setting up your own cleaning business. You’ll need to be physically fit enough to carry out the often strenuous cleaning work itself. Financially, your initial outlay will be modest, with equipment like brushes, mops, detergents and a vacuum cleaner all able to be purchased on a tight budget.
Remember, however, that you should also invest in public liability insurance to cover any costs that may be incurred by accidents relating to your work – for example, breakages in a client’s house.
You can reach out to clients by placing ads on sites like Airtasker and TaskRabbit. On top of this, we recommend creating your own company website to further establish your brand – and don’t be afraid to make it bold and colourful with an eye-catching logo.
Cleaning is a crowded field, so stand out by showing your personality and expertise on social media. Posting informative, fun cleaning hints and tips on TikTok and Instagram can really make you stand apart from cleaners who only have a presence on sites like TaskRabbit.
Rather than cleaning inside clients’’ houses, you may prefer to specialise in windows only. The fact is that window cleaning services are in constant demand, with the market being worth almost £300 million in this country, so this can absolutely be a viable business idea.
Your budget will have to stretch to essential pieces of cleaning equipment. This shouldn’t be too pricey, and will include things like squeegees, water purifiers and telescopic water-fed poles.
You might also want to invest in a portable card reader, as this will mean your customers won’t need to have cash to hand in order to pay for the job. It’s a small touch of convenience that can help make you stand apart from the competition.
Many window cleaners will still personally go from door to door in particular areas to ask if their services are required. This can be an effective way to generate initial custom, but you should also create a profile on popular marketplaces like TaskRabbit.
Creating your own company website is also highly recommended if you want to really establish a permanent presence in this sector.
With well over 60% of British households having at least one pet, it’s no wonder there’s a strong demand for pet sitting services. Formal qualifications aren’t required, though you will obviously need to have had plenty of experience taking care of animals.
The array of services you offer may include:
Daycare (looking after pets in your home)
Boarding (looking after pets overnights)
Visiting houses to feed and look after pets
Overheads tend to be low for pet sitting, with the main costs being pet toys and transportation.
When it comes to getting clients, you should utilise marketplace sites like Rover, which allow you to present yourself in the best light to prospective clients.
It always helps to put up nice photos of yourself with animals, along with a warm, welcoming write-up which explains your experience with pets. In time, you may also choose to set up your own pet sitting website.
If you have experience of organising events in a professional capacity – perhaps as a former PA or planner within an organisation – you may want to consider making this the basis of your business.
Startup costs can be kept low if you work from home. After all, other than a laptop and mobile phone, you won’t need much in the way of equipment or inventory in order to set yourself up as an event planner.
What you will need is initiative and a genuine love of the hustle and bustle that comes with event planning. Forging the right contacts with suppliers, caterers, contractors and venue managers is all-important, so you’ll need to invest time and energy in attending networking events, researching companies and firing off emails.
By diligent networking, creating an attractive company website and making your existence known via social media, you’ll hopefully be able to apply your skills to orchestrating both private parties and corporate events.
Are you a dab hand at carpentry, tiling, painting and decorating, and other DIY tasks? That may be all you need in order to work as a professional handyperson. Official qualifications aren’t required, but if you have a larger starting budget you have the option of taking on vocational courses such as the City & Guilds Handyman course.
Your main business expenses will be the cost of getting to customers’ houses, a suitable public liability insurance policy to cover you in the case of accidents relating to your work, and the tools of the trade. These will include hammers, pliers, screwdrivers, wire cutters, sanders, brusher, extension cables, and drills.
While some tools can be on the expensive side, they will very likely last you for the whole of your career as a handyperson, and chances are you won’t need to make too many additional purchases further down the line.
So, once these initial expenses have been recouped, any income you make will be pure profit, minus the aforementioned travel costs.
If you have a driving licence and a mid-sized vehicle, you can quite rapidly set up a new career path as a delivery driver or courier. One path into this sector is via Amazon Flex.
Once you pass through the registration process, Amazon Flex will notify you of delivery jobs through the app. This can be a good way to test the waters by making deliveries as a side hustle idea to start with.
If you find that this kind of high-pressure, target-driven job is for you, you may then take things further by creating a business website and joining the Courier Exchange. While it will require monthly fees, the platform can bring in revenues by connecting you with available jobs in your region.
As a delivery business, you’ll need to factor in courier van insurance, public liability insurance and goods in transit cover. The most substantial overhead will likely be your fuel costs, so it will be important to keep careful track of your revenue and outgoings. Setting up a free business account will make it easier to do exactly that.
As there are so many low capital, high profit business ideas to choose from, it can be tricky to work out which path to go down. Here are some signs that an idea may be right for you.
Running a business isn’t easy. Even a small, simple enterprise will present numerous logistical challenges to overcome, and you’ll likely find yourself working long hours – at least to start with.
You need real motivation to persevere, and real motivation only stems from real excitement. So, if an idea gives you a good gut feeling, and you find yourself eager to get on with it, that’s an excellent sign.
You should ideally try to focus on business ideas which rely on skills you already have – whether that’s cooking, writing long-form prose, or design. This isn’t simply a matter of you feeling confident in your ability to do the job. It will also mean you won’t have to spend time and money retraining.
That’s not to say you definitely shouldn’t do the latter. If, say, you dream of being a web developer or personal trainer, and you have the budget to cover the costs of doing the right courses, then it may be worth lowering your initial profit margins to fulfil that dream.
Even if you like an idea in principle, you should think carefully about whether it matches your temperament and lifestyle. For example, while you may like the idea of becoming a delivery driver because you enjoy driving and don’t mind spending most of your working hours in your own company, it will only really be a viable career path if you thrive under pressure.
To take another example, if you want the freedom to work your own, unconventional hours, then many customer-facing business ideas like running cookery classes may not be a good fit. You may instead prefer online business ideas which are flexible enough to fit around your other responsibilities.
Despite having very low overheads, some business ideas will not yield significant profits right away.
Examples from our list above include being a social media influencer or Substack writer, both of which will require you to patiently create content and engage with followers for weeks and months before you’re able to monetise their interest.
This may well suit you, if you’re happy to take things slowly and maintain your primary job for the foreseeable future. However, if you’d prefer to see profits at a faster pace, then other ideas such as dropshipping or cleaning may be better alternatives.
Once you’ve carefully weighed up different high profit low startup cost business ideas and picked out the one for you, it’ll be time to bring it to life. Here are the steps to follow.
It may sound obvious, but doing some market research is important before launching most businesses. The internet can do much of the legwork for you, and here are some of the questions you may want to look into.
Who are your main competitors? Look at their websites and social media profiles, and assess areas where you can improve on what they offer and how they engage with customers.
Who is your target market and what do they want? Read the Google and Trustpilot reviews which customers have left for rival businesses in your chosen sector, and don’t forget to look up relevant hashtags on social media for insights.
How much should you charge? If you’re selling crafts online, check Etsy to see what similar products are going for. Similarly, if you’re creating a food and drink Substack, see how much successful writers are charging their subscribers in this genre.
Every business in the UK must adopt a specific legal structure. There are three main types to consider as a small business entrepreneur.
If you operate as a sole trader, you are your business, legally speaking. It’s the simplest way to do business since the paperwork is minimal. Other than dealing with HMRC by submitting your tax return every year, you won’t have to register your business with any official authority.
As the taxation process for sole traders is relatively simple, you may not even require the assistance of an accountant, which can cut your overheads further and increase that profit margin. Just bear in mind that as a sole trader you’ll always be personally liable for debts or losses accrued by your business.
If you’re running your business with one or more other people, you may choose to form a partnership. This is almost as straightforward as being a sole trader – the main difference being that one partner is formally responsible for managing the accounts and company tax returns.
As with being a sole trader, all profits are yours to keep, and the partners will be legally liable for debts, should they arise.
You might consider setting up a limited company. This is a more complex structure, since it puts a legal divide between you and your business. There are more in-depth accounting requirements, you’ll have to register with Companies House, and your business will have to pay Corporation Tax.
All of this is undeniably more effort, but having a limited company does bring its advantages. It’s a far less risky way to do business, since you won’t be personally liable for any debts or losses racked up by your company.
Your tax burden may also be lower as a limited company director, compared to being a sole trader.
If you’re not intending to apply for a business loan or pitch for investment, do you still need to know how to write a business plan? Absolutely.
You should think of the business plan as part to-do-list, part roadmap to success. It’s a document you can use to marshal your thoughts and update with new ideas and objectives as required.
Your business plan should include:
An executive summary, which describes the nature of your business and its legal structure
A summary of your market research, detailing your target market, competitors, and consumer trends related to your sector
Details of how your business will be funded, and a repayment schedule if loans have been taken out
A breakdown of your overheads, sales projections and expected profits across the next six months to a year
As this guide has shown, you can start working for yourself without having to spend a lot of money on stock and equipment.
By leveraging your creativity and drive, it’s possible to set up a small business that keeps running costs down and profits high.
Organise your business costs
A dedicated online space for managing your expenses and revenues can make life as an entrepreneur much easier. Learn how you can open a free SumUp business account.Find out more
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