Starting a small business without much money can be a difficult prospect. Typically most of us do not have a terrific amount of cash lying around to be able to make the purchases we need to get started. It can also be equally difficult for businesses that have been around for a short while, but don't have the capital needed to grow to the next level.
As your company starts to grow, to be able to handle any growth, you need quality people working with you. However, as hiring people is expensive, many companies avoid hiring until it becomes absolutely necessary. They only make the change when business activity exceeds capacity. The belief is that once the need is there, they can simply bring in people to meet the capacity. This is based on this idea that hiring people should be a no-cost scenario; you only hire when capacity can handle immediate increase in your expenses.
What would you say is the biggest barrier to growth? Let's see a show of hands. I'm willing to bet you were thinking: “money.” It seems so obvious that it doesn't seem to need repeating. You don't even have to be in business to understand this piece
However there's a little more to it than that.
In order to start your business, you need some start up cash. Most likely you start by going to people that you know that might have some investment capital. Your first stop is family or friends. You've pitched them this great idea, and you either gave them a share of the business or you took it as a loan, promising that you'd pay it back. Family, if they have any money, are those most likely to have helped you out. With friends, it's a little tougher, but maybe they really liked your idea and wanted to come on board. (Of course, loans from friends are rarely a good idea if you want to keep those friends, but we won't go any further into that here). However you managed to do it, you got started.
You've heard it before. It's a never-ending refrain. No matter how good your product, and no matter how good your sales pitch is, you hear your potential client say the dreaded words:
One of the fundamental truths of marketing is that maintaining existing clients is a lot easier than obtaining new ones. However, as a business, you also know that to be able to succeed, you need to grow. In almost every case, this means getting new clients.