longchamphandbagsus.com – Is it possible to start a business with only usd 1 million? You may have thought that a business with a capital of usd 1 million is very unrealistic. However, this is actually something that is very realistic. Small capital business is very possible for you to develop.
How can this small business continue to grow until it becomes a business with tens of millions in turnover? You have to understand the tricks of developing a 1 million capital business. That’s what we will discuss today. Curious? Immediately, follow the full discussion below.
How to start a business with capital of 1 million
There are several important things that you need to pay attention to when starting a business with minimal capital. Small capital business, big profits don’t just come. You need to fight for it. Here are some things you need to pay attention to.
1. Find a Business Idea
The first thing you need to do is find the right business idea. If you are keen to see opportunities, there are many types of businesses that you can develop.
Because your capital is limited, you also need to choose a business idea that doesn’t require large capital. In this case, online business is the solution. By opening an online business, you don’t need to open a physical store. In fact, you don’t even need to stock up on items. An example of this business is a dropshipper or reseller.
Apart from these businesses, there are other types of businesses that might suit your field. You can open a culinary, handicraft, or other business. Just make sure your business doesn’t require large capital and can be marketed online to expand your target market.
2. Market and Competitor Research
After you find a business idea that might be right, it’s time for you to take the next step, which is market and competitor research.
Market research here means finding out whether you have a potential target market or not. The purpose of market research is to find out whether your product can be sold or not.
Furthermore, competitor research is to find out business competitors, especially those related to price, product quality, and competitor uniqueness. Because you don’t have big capital, there are no funds for trial and error. You can make it easier with the ATM principle, namely observe, imitate, and modify.
3. Allocate Business Capital Appropriately
Furthermore, after successfully finding the right business idea and having done research, then start to allocate funds. In this case, we can imitate Raymond Chin’s distribution of 1 million business capital.
According to Raymond Chin, with only 1 million capital, we need to make the right capital allocation. We can use a 40-40-20 division, which is 40% for making products, 40% for marketing, and 20% for operations.
With a capital of usd 1 million, the allocation for products is usd 400,000. In this case, you may not allocate all of it for stock items. Watch for healthy margins. The selling price must be higher than the capital price, but remain competitive.
So, you will mostly use the initial capital for this product for research. It doesn’t matter, the important thing is that you can find the right product that fits your target market.
Furthermore, even with small capital, you need marketing. In the context of a business capital of usd 1 million, a la Raymond Chin, the allocation for marketing is usd 400,000. What can you do?
Don’t spend money on YouTube ads or influencers. According to Raymond, you should improve your foundation, which is related to logos, packaging designs, or other things that are more pressing for long-term marketing. Online stalls need to be considered more than distribution.
Finally, operations related to emergency funds. You can use it for logistics and finance.
4. Pay attention to Business Cashflow
For those of you who don’t have expertise in financial recording, you can use a helper application. After all, financial records are the most important in building a small capital business.
5. Always Do Product Innovation
Once your business starts running, don’t stop at the existing products. You can continue to innovate to find the latest products. Your business can grow even more.
6. Recruiting Employees or Not Necessary?
Finally, with regard to employees, the consideration of whether or not to recruit employees depends on the situation and conditions. You may recruit employees when the business is starting to stabilize.
To build a business with small capital, you really need extra effort. You can’t stop learning. To be able to keep up with competitors and adapt to a changing market, you need knowledge that is constantly updated. Learn free and paid materials about small capital businesses for beginners. This is the best app for budding businessmen. Developing even a small capital business is not as heavy as you think.