5 tips for starting a new business in the current financially challenging climate

If you have only recently came up with a great idea for a new business, you could feel despondent about the prospect of starting that business now — a time of economic crisis in many markets.


Yahoo! Finance cites “a warning that Britain faces its longest recession since the 1920s” — while, in September 2022, German industrial orders fell more quickly than expected, sparking fears of a recession hitting Europe’s largest economy.  


However, you can still give your new business relatively favourable odds — for example, if you follow these tips…


Think carefully about what you should offer — and to who 


According to one statistic shared by Investopedia, 50% of small businesses remain intact at least five years after their formation. Whether your own business ends up being in that 50% is likely to depend very much on what you will offer compared to the competition. 


If you go too broad with your company’s selection of products or services, you could find that many members of your target audience spurn your business in favour of a longer-established competitor. It could therefore work out much better for you to go niche.


Look for somewhat unconventional sources of funding 


One major reason why starting a new business is often tricky in a struggling economy is that banks can be more reluctant than usual about lending to businesses. 


This situation puts the onus on you to look high and low for alternate funding sources you might be able to use. You could find that friends and relatives are surprisingly willing to offer you starter funds, while crowdfunding is another option worth considering.


Don’t be too ambitious with your first choice of workplace 

While you might be tempted to simply work from home, the wisdom of this plan could unravel when potential customers or clients want to meet you at your workplace and find that it isn’t quite as professional-looking a place as they had expected. 

However, as you also don’t want to pay over the odds for a dedicated workplace, one good tactic would be to rent a start-up space that can grow with the company over time.

Take a creative approach to getting hold of equipment and supplies 

This can be easier than you might have anticipated, since the economic situation can essentially hold many vendors and suppliers to ransom, forcing them to offer their products or services at a lower price than usual.

Still, you might not exactly be handed cut-price deals on a plate. You should endeavour to show these businesses why you can be trusted to keep up your side of the bargain.

Take advantage of low-cost marketing avenues 

Good examples of these would include social media sites like Facebook, Instagram and LinkedIn. With online communities like these, you can develop a following at little expense.

It would also bode well for you to learn good practice in the field of search engine optimisation. That way, you could attract visitors to your site through Google without necessarily having to foot a large bill for engaging in paid advertising.

Lifestyle   Health   Investing   Business   Loans   PersonalFinance