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Starting a business at any point in time is both an exciting and terrifying experience. The thrill of anticipation as you visualise all the success coming from your billion dollar idea, will quickly be replaced by the reality of trying to start a business in South Africa. 

Starting your own small business is difficult, more so in a country like South Africa where entrepreneurship is not actively supported. Although many programs and initiatives exist that encourage entrepreneurship; access to finance is extremely difficult if you don’t have existing income or assets to put up as collateral.

With the limited access to funding raising the barrier of entry for most of the population,we have created a list that attempts to offer some solutions to individuals who are faced with this predicament.

The Current Situation

In South Africa, if you have a business idea, no bank is going to lend you money unless you have existing income or assets to put up as collateral. Unfortunately you cannot depend on the government for support either. At this point, there are a few options available to you: If your idea requires more money than you currently have, you can either continue to seek a loan until you get one, or you can find a way to make the money on your own.

In South Africa, if you have a business idea, no bank is going to lend you money unless you have existing income or assets to put up as collateral. Unfortunately you cannot depend on the government for support either. At this point, there are a few options available to you: If your idea requires more money than you currently have, you can either continue to seek a loan until you get one, or you can find a way to make the money on your own.

There is not much advice that can be offered if you choose to continue to seek a loan. It is entirely based on the individuals like investors, or institutions like Banks to decide whether they will give you the money or not.

When it comes to finding a way to generate the money on your own – there are some tips and tricks that you might find useful. It must be said that taking this route might delay your intention to start your business, but it will give you the power to decide your own fate while also providing you with experience.

Here is a list of some ways to acquire the capital you require to execute your business idea or to start any business. Most of these require hard work and determination – so trying it out for a few days and giving up will not help. Nothing worth having comes easy.

Ways To Start Your Get Started WIth Business With Limited Money

Start A Service Business

A service business requires little to no stock but instead requires a certain skill and some tools (and in certain cases a vehicle but don’t let this put you off if you don’t have one yet). Most of these skills can come from your background, interest and hobbies. 

Most service businesses requires an up-front payment such as a 50% deposit before the job can be done. This amount can be used to cover whatever materials is needed for the job and the remaining 50% can be regarded as income. The money made from the service business can be saved and used to fund your original business idea or you can grow this business if you end up loving it. 

There is nothing to lose and everything to gain with this option. 

Here are some examples of service jobs you can try in South Africa: handyman, fat-checking and research, chef, dent removal, skills tutoring, tyre polishing, car washing, child care services, call-centre agent and so forth.

A Product Business That Involves Recycling

Stock is expensive to buy and hold but if your main material is waste that you can get for next to nothing then your startup cost is much, much less. All it takes is to look at what you used to consider trash and find a way to turn it into something useful for your business or a product.

Ideas include: drinking glasses made from bottles, recycling laptop batteries, braais made from washing machine drums, reselling leather offcuts, recycling tins and cans, collecting and recycling aluminum, recycling plastic bottles into rope that can be resold, make and sell leather cord and selling furniture made from wooden shipping pallets.

A Product Sourcing Business With No Stock & Free Delivery

There is a third way to start out with very little and that is to only purchase stock once an order is placed for a product. So usually you’ll have images and specifications of the products in the form of a catalogue to present to clients which they can order from. 

This works better from an e commerce point of view where the model is called “drop shipping”. Where once you get the clients payment and you send the order through to your supplier to fulfil and you pocket the difference. 

This is not as easy as it sounds, competition is fierce so margins are tiny and sometimes suppliers don’t have stock, leading to problems.

Renting Out Current Assets

There are always shared economy opportunities out there, especially with the rise of virtual business that give their Users the power to make more money.

The options here include renting out your home on AirBnB, or becoming a part-time driver for Uber to mention but a few. With the large adoption of those services in South Africa, you are now able to make money from such.

The only problem here is that this is more viable for individuals living in main cities like Johannesburg, Cape Town and Durban – where there is a large market that already exists.

In Conclusion

These are some of the options we think are the best available to someone who is ready to do whatever it takes to see their idea come to life and become a success. The beauty of taking this route is that these cash cows might end up being your main business or a second business to your main idea.

The experienced gained will also be valuable when moving on to your original idea and generally when dealing with more entrepreneurial decisions. What all of these businesses need to succeed is great Branding and Marketing and Brains World can provide you with quality services at cost effective prices. If you are feeling inspired and want have more questions, email us or leave a comment below.

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