In today’s scenario, a good idea is a valuable asset and can easily compensate for lack of huge capital and yet generate good profit. Revenue can be successfully generated with a low seed capital also.
While considering business ideas within a small amount range of Rs 50,000 to 1 lakh, it is also important to have a strong and creative Business Plan. Let us take the example of a Home Bakery –
- Identify the Unique Selling Proposition (USP) of the business and why it differentiates from the competition. In this case it could be delicious, well designed, innovative and customised cakes.
- Segmentation of the Market –
- Captive audiences like a housing colony or a university campus hostel where word-of-mouth advertising spreads quickly.
- Online forums where people looking for such services visit regularly.
- Own network of family, friends and colleagues.
- Positioning – As a provider of creatively designed and theme-customised cakes offering a full money back guarantee to dissatisfied customers. This helps you build a reputation.
- Strategy – Create a value added service such as home delivery of the bakery items along with the unique positioning. Use Online advertising to drive the business. Aim to create repeat orders from a smaller base initially.
- Financial Planning – To execute the above, calculate the initial capital requirements such as the minimum equipment such as an oven, mixer, kitchen appliances etc. Since it is primarily an order based business, gestation period is very low. Estimate Working Capital needs such as cost of Ingredients, Electricity, Delivery Costs etc.
Let us now look at a few Small Business Ideas which require a seed capital of around Rupees Fifty Thousand to a Lakh and can make good money:
1. Niche Blog
A niche blog educates readers about a particular subject or topic. The blogger is usually very passionate about that area and knowledgeable about that topic. A niche blog therefore creates a captive and loyal audience who is interested in that topic and visits the blog regularly to read the relevant and updated information provided by the blogger.
Typically the blogger makes money in the following ways:
- CPC (Cost per Click) Ads – These are banners which are placed in the content or in the sidebar. Every time a reader clicks on that advertisement the blogger is paid.
- CPM (Cost per fixed number of impressions) – These ads pay the blogger a fixed amount of money depending on how many people view the advertisement.
Google AdSense is a good medium to advertise in the above manner as it automatically places relevant ads as per the content on the blog.
- Private Ads – The blogger can contact advertisers directly. If there is a lot of traffic on the blog advertisers may also directly contact the blogger.
- Affiliate Marketing – The blogger puts a link to the advertiser’s product site. If a sale is made by clicking on that unique link then the blogger is paid a commission.
- Selling related Products – The blogger can sell e-books or courses related to the content on the blog. A segment of the captive audience may be interested in purchasing these products.
- Selling Subscriptions – If the niche blog is related to education, then readers may be invited to subscribe to a paid portion of the blog where, for example, educational counselling is provided.
- Branding of Expertise – The blogger eventually gets branded as an expert and may then leverage his credibility in various ways.
An example of a niche blog doing very well is Kunzum which is a travel blog. It makes money through advertisements, certifications, workshops, travel books and courses to name a few hence capitalizing on its expertise in its niche.
2. Home Bakery
Home Bakery is today a lucrative Small Business Idea. The initial investment required is an oven, a mixer, some baking tools, kitchen equipment and basic ingredients. One may need to hire a delivery person and print pamphlets for advertising regularly. The industry is not very organized in terms of pricing so customised bakery items like breads, cookies, cakes, sweets etc. designed innovatively can be offered at a good price to make money.
Social media can be used for marketing in the following ways –
- Facebook has forums like Home Bakers Guild which has over a lakh members on a common platform. Interacting and having a presence on such forums can create a positive impact.
- Instagram can be used to sell by showcasing pictures of the products.
- Twitter can be used to send tweets with a daily promotional message like a free cupcake to the first visitor.
- Whatsapp and E-mail can be used to drive sales.
- Blogging about desserts can help in building a loyal customer base.
- A website can be built to showcase products.
Other ways to market the home bakery are –
- Participation in bakery events.
- Gifting one’s own bakery products to family and friends on occasions and thereby building goodwill through word-of-mouth.
- Selecting a captive audience like a particular housing colony nearby and focusing just in that area initially can bring repeat sales and drive the cost of logistics down.
Bake My Day in Chennai is an example of a home bakery which has successfully used online media for its marketing.
3. Movers and Packers Services
This is a neat Business Idea – a service which helps people relocate by packing and moving their goods. A truck needs to be rented and a few people need to be hired to start this simple venture. Packing material needs to be procured.
Initially one can focus on local relocation. People move for a variety of reasons such as –
- To live in a bigger house as family grows
- To move to an area closer to their work
- To live in an area which is friendlier demographically and socially
- To move to a more upmarket area with increase in income
- Work transfers
- Retirement homes
Hence there is a good market for Movers and Packers service. Depending on the competition one can devise a pricing strategy. For a low investment Start Up, Market Penetration with a mass-based pricing strategy could be a good idea. This means pricing low and building a steady business and thereby Goodwill slowly. The strategy however can vary for people if they are in a town where competition is less. It would be useful to create a customer database. Referrals should be sought.
Reliability and minimum damage to goods is an important consideration. The startup has to tie up with an insurance company to offset their liability and offer the same to the customer. Certain goods have emotional value. Hence a dedicated approach or a no-damage orientation will go a long way in building goodwill.
VRL Packers and Movers in Ahmedabad is an example which started with just one truck and now is nationally renowned.
4. Coaching Classes
This can be a great money making idea which requires minimum capital. The coaching industry in India is huge. Majority of school children are taking coaching. This is because of cut-throat competition and limited seats in higher education.
The premises for coaching may also be rented and school students can be coached. There could be various segments –
- Coaching in subjects currently being taught at school
- Coaching for various entrance exams
- Coaching for government job entrance exams
Certain requirements for starting coaching classes are:
- Deep knowledge in the subject if one wishes to be involved in teaching
- Basic infrastructure – furniture, good lighting, stationery, neat classrooms
- Good and clear Screen Projection of the material taught
- Study Material Handouts which also acts as an advertisement.
- Smart and innovative Teaching Tools
- Experienced Teachers who can communicate well while using modern teaching aids
- Result Orientation
Marketing – Since there is usually a lot of competition in this area it is good to price low initially and target more students. This also generates quick word-of-mouth publicity. One can try to establish a strong Brand Identity and gradually diversify into other segments as above.
When a student performs well in an exam this could be highlighted to generate publicity. Media advertisements and pamphlets could be used to create awareness.
An example of a result oriented renowned coaching centre is Bansal Classes.
5. Maintenance Service
There is huge demand for professional mechanics, plumbers, electricians, etc all over the country. Home and Office repair services from pre-screened professional service providers is a lucrative Small Business Idea.
Initial investment is primarily in rented office space and necessary Tools especially Drills, Saws, Wrenches, Electric Meters, Wire Cutters, Consumables like nails, tape etc. Cheap Mobile phones may be provided to the professionals to ensure smooth communication.
The market could be segmented into homes and offices to begin with. A minimum charge per visit could be kept. Pricing could be customised as per the work. Organizational newsletters and notice boards could be targeted for advertising. A brochure of services offered should be prepared. A website and online marketing will help in increasing sales. Search Engine Submissions are important to generate awareness about the brand. In case of housing colonies pamphlets and word-of-mouth marketing will help people become aware of the brand.
An example is Befikr which also believes in innovative practices. Their professionals are also trained in soft skills to give the customers a friendly and smooth experience.
6. Hobby Centre
In the comfort of one’s home, a hobby centre can be launched. Dance, Music, Painting, Craft etc could be taught. Investment required in this Very Small Business Idea is low. A good music system and a laptop with good projection to play videos would be required.
Skill sets in the required area is the critical requirement. A trained person could impart great value. Various forms could bring diverse customers. Segmentation of the market in the case of dance for example could be in the following way:
- Young Children – Parents take interest in their children learning an extracurricular skill. Modern Bollywood dance is normally popular with the young ones. Here serious forms like Kathak could also be introduced if there is demand and the expertise is available with the trainer.
- Young Adults – Modern forms like Salsa, Rumba
- Couples and Elderly people – Ballroom Dance
Marketing – Dance lessons could be packaged at Beginner, Intermediate and Advanced levels. There could be periodic competitions within the groups. Children could be encouraged to participate in school dance programs. Periodic assessments could be shared with parents. Pamphlets could be distributed in localities and pinned on the notice boards of schools.
7. Something like Nanny Services
With increasing urbanization, nuclear families and working couples, a huge market has emerged for nannies and babysitters. Trust and reliability are key drivers here. The parent must trust the business owner thoroughly before entrusting the child. Hence it becomes vital that adequate background checks and screening are carried out for every nanny who is on board. Regular feedback from parents after the job has been done should also be solicited. Investment would be in uniforms, mobile phones and training given to less experienced nannies. A rented small office space would be required.
The parents could be called to the office and introduced to the team of nannies. A rapport building session could be initiated in a group to make the parent comfortable. At times, the choice of nanny may also be given to the parent.
Marketing – Word-of-Mouth, Referrals and online and offline advertising would help generate business. Testimonials from satisfied parents would also help in building confidence and trust among the parents. Initial pricing should be at market rates, but in cases where the parent asks for a particular nanny most of the time, premium charges can be taken for customized selection.
8. Amazon/Flipkart Seller
E-Commerce is the present and the future. By registering as an Amazon seller one can list and sell fast moving products like mobiles and computer accessories online for a small fee charged by Amazon. This money making Idea has many benefits:
- The seller is free from Logistical worries which selling through one’s own website incorporates.
- A huge base of customers can be reached without any additional cost.
- Remote corners of the country can be accessed without investing in manpower.
- The Easy Ship model helps in freeing the seller from delivery problems if desired.
- The Seller can advertise the products and make it stand out. Keyword targeted ads boost visibility and the seller pays only when the ad is clicked upon.
- Lots of testimonials of delighted Amazon / Flipkart sellers are published.
- Indian Regional languages are now also supported.
- Customers can give a review of the product which if positive helps in furthering one’s goodwill and reputation. If negative it acts as a feedback to the seller as to how to improve further.
9. Party Planning Services
With people having very hectic schedules today, a Party and Event Planner is very welcome making this a very lucrative low-investment Business Idea.Some segments are:
- Special Occasions like weddings and birthdays.
- Showroom opening and product launches
The Unique Selling Proposition (USP) of an event planner is the ability to manage and organize everything in a detailed and researched manner. Innovative ideas for theme based parties are in great demand. Some typical tasks of event planners are:
- Finding the venue
- Organizing the food, entertainment, and decor,
- Selecting the Design Theme,
- Sending invitations,
- Welcoming the guests,
- Coordinating the event as scheduled,
- Handling unforeseen situations
- Evaluating the success of the event
Investment of the planner is mainly in trained manpower, uniforms, building a network of suppliers and marketing and renting an office space if required. Usually, a delivery van is useful for transporting bulky materials.
Money is made through professional fees. Generally a lumpsum is paid upfront to take care of expenses as well as to pay to suppliers as required. Depending on the scale of the event, lucrative amounts can be charged as professional fees.
An example is Kriti The Creation Events and Advertising based in Lucknow.
10. Used Car Dealership
The used car segment in India is a rapidly growing. This is because people now prefer to change cars within a shorter period than earlier. Also, enhanced durability of cars encourages used car sales. Social acceptance has also increased in this segment.
One model is that Clients approach the dealership to sell used cars and give a commission on the cars sold. Initial investment, therefore,is in renting an open space where cars can be displayed. The requirement of Manpower and Marketing involve some cost also.
The dealership has to ensure that:
- The buyers are convinced that the cars are reliable and safe
- In good working condition
- The legal papers are in order
Market Research that can be carried out by the dealership –
- Type of used car sold most – Compact, SUV, Premium
- Petrol or Diesel
- Reason for purchase – Multi-car Household, Value for Money, Brand
- Demographics – Age, Sex, Social strata
This will help in the better selection of the cars and increase sales hence one can make good money.
Initial investment in this Idea requires buying equipment and getting training if required. Customised and segmented photo shoots can bring in good money. Pricing can be based on a hourly system or a flat fee to cover the event.
An example is Pranesh Photography who today successfully deals in wedding photographs through traditional photography and videography, photo-realistic photography and creative wedding cinematography to name a few.
He had no funds when he started except a borrowed SLR camera from his uncle.
12. Beauty Parlour
A beauty parlour is a Business that requires little initial investment and has low operating costs. Initial Investment is in rented space and trained manpower. Interiors may also take up some cost. Certain beauty products along with accessories also need to be bought.
The parlour may have a range of services such as spa, nails, waxing, tanning,etc. It may cater to men, women, children or a combination.
Pricing may depend on whether the service is standard or premium. Courtesy and Service are the keys to success. Personal rapport formed during the service rendered is a key factor in achieving repeat sales and getting referrals by word-of-mouth publicity.
Some segments that the parlour can cater to are:
- Regular customers at the store
- Kitty parties
- Bridal makeup
- Makeup for birthdays and other events
Related : How to Start a Spa Business
13. Food Truck/Catering
The Food truck business is for the person who is passionate about providing good quality and delicious food to customers. The person drives the truck around the city and sets up a temporary base in designated places. The initial investment is in a food truck and basic cooking equipment along with never-out-of-stock ingredients. An assistant can be hired.
Overhead costs such as fuel should be accounted for. Pricing can be flexible with bulk orders. This can further extend to catering at parties.
Possible segments that can be catered to are:
- Birthday Parties
- Commercial Events
One’s own capacity needs to be understood vis-a-vis the catering. Orders should be taken as per the number of people who can be catered to in a specific span of time without compromising on quality. Networking with people who come for the party can help in getting future business and making money.
Related : How to Start a Food Truck Business?
14. Digital Advertising Agency
A Digital Advertising Agency makes money by providing creative and strategic development of products and services online through mediums such as websites, mobiles, podcasts, videos, social media,etc.
By using this, businesses can create Competitive Advantage by understanding the behavioural patterns of their clients and their subsequent needs. Some services include:
- Website Design
- Email marketing
- Viral campaigns
- Search Engine Optimization (SEO)
- Pay Per Click and Banner Advertising
- Media Planning and Buying
Pricing involves the degree of creative design and technical services required. Placing adverts directly generates revenue.
An example is Bcwebwise founded in 2000 and is a highly respected digital marketing agency today. One of its core strengths lies in its visual multifaceted storylines that engage the customer. They enhance the web presence of their clients through strategic and creative mediums.
15. Instagram Ecommerce Store
The youth today spends hours on Instagram, and while they are doing that, they are being influenced by the huge content related to fashion and lifestyle. Selling fashion products like watches, shoes, spectacles,etc on Instagram is a trending Business Idea which requires very little investment.
Instagram can be used for marketing and thus make money in the following ways:
- Products and Services can be showcased through pictures and stories.
- Customers can be requested to show their photos while using the product turning the visual experience into a lifestyle display.
- Exclusive promotional deals could be put
- There are many ‘Influencers’ on Instagram who can be identified and targeted to increase sales.
After taking a close view at the 15 low-cost Small Business Ideas highlighted above, it can be observed that in today’s scenario, capital is not necessarily an Entry Barrier to creating good profit through a Lucrative business.
A creative idea executed with finesse can take one a long way.