Start a Business for Less Than $5,000: From Accountant to Window-Washing Service, 125+ Profitable Business Startups for Under $5,000

Start a Business for Less Than $5,000

From Accountant to Window-Washing Service, 125+ Profitable Business Startups for Under $5,000

Richard Walsh

Adams Business, an imprint of Adams Media, an imprint of Simon & Schuster, Inc.

Avon, Massachusetts

Contents

Introduction

Legal Issues for Small Businesses

Putting Together a Solid Business Plan

Why Some Start-Ups Fail (and How You Can Succeed)

The Businesses

Abstracting Service

Accountant

Adoption Search Service

Advertising Sales Representative

Arbitration Service

Art Broker/Corporate Art Consultant

Association Management Services

Audio Recording for Trade Shows and Seminars

Auto Maintenance

Boat Maintenance/Cleaning Service

Bodyguard

Book Binder

Book Packager

Bookkeeping Service

Broadcast Sales/Advertising Broker

Business Broker

Business Consultant

Buyer’s Information Service

Calendar Service

Carpet/Upholstery Cleaning

Chimney Sweep

City Planner

Clipping Service

College Internship Placement

Color Consultant

Commercial Actor

Commercial Photographer

Computer Security Consultant

Construction Management Services

Consumer Researcher

Cooking Class Instructor

Counselor/Psychologist

Credit Consultant

Dance Instructor

Data Retrieval Service

Day Care Service (Children)

Day Care Service (Elder Adults)

Direct Marketing/Sales

Disability Consultant

Economic Development Consultant

Employee Harmony Consultant

Environmental Consultant

Errand/Messenger Service

Exterior (House) Painting

Factory Site Location Consultant

Fan Club Management

Farmer of Fruits or Vegetables

Feed Consultant/Broker

Financial Aid Consultant

Flea Market Organizer

Food Delivery Service

Food Manufacturing Consultant

Forensic Consultant

Freelance Illustrator/Artist

Freelance Writer/Editor

Fundraiser

Government Contract Consulting

Grants/Proposal Writer

Herb/Flowers Farming

Image Consultant

Interior Designer

Interviewer

Invention Consultant/Broker

Investment Club Organizer

Labor Relations Consultant

Licensing Agent

Liquidator

Lobbyist

Manufacturer’s Representative

Massage Therapist

Medical Practice Management Consultant

Meeting Planner

Mobile Hair Salon

Money Broker

Motivational Speaker

Mover

Murder Mystery Producer

Newsletter Publisher

Newspaper Delivery Service

Novelty Messenger Service

Oil and Gas Field Services

Online Auction Sales

Online Job Search

Paralegal

Parenting Specialist

Payroll Administrative Services

Personality Analysis/Testing Service

Personal Coach

Personnel Safety Consultant

Political Campaign Management

Pollster

Printer Cartridge Refilling Service

Product Developer

Profit Sharing Plan Consultant

Property Management Service

Recreation Activities Consultant

Recycling

Referral Service

Reflexologist

Relocation Consultant

Respiratory Equipment Repair

Resume Service

Retail Bakery/Specialty Food Store

Retirement Planner

Reunion Organizer

Sales of Novelty and Promotional Products

Secretarial Service

Self-Defense Instructor

Sign Painting

Software Conversion Service

Specialty Food Production

Speechwriter

Standardized Test Preparatory Services

Stenography Service

Systems Integrator

Taxidermist

Time-Management Specialist

Trademark Agent

Translation Services

Travel Agent

Tree Service

Upholsterer

Vending Machine Owner

Voice-Over Actor

Wallpapering/Interior Painting

Water Pump Repair

Webmaster

Wedding Planner

Welcoming Service

Window Treatment Specialist

Window Washing Service

Also Available

Copyright Page

Introduction

There has never been a more exciting time to start your own business! New businesses are springing up every day all across the country. Whether these new ventures are inspired by women re-entering the job market, young people starting their careers in home-based businesses, previously employed middle managers seeking new opportunities and greater job satisfaction, or just regular folks looking to earn some extra cash on the side, more and more people are finding themselves caught up in the entrepreneurial spirit.

What has led to this entrepreneurial boom? First, there has been a sharp increase in downsizing at both large- and medium-sized businesses. In recent years, many corporations in the United States, such as IBM and General Motors, have been laying off workers in record numbers. Not only are those workers deemed unnecessary to operations laid off, but companies are also cutting full-time staff in critical functions such as accounting or payroll. These functions are then either outsourced to specialty providers, or non-benefited workers are hired to perform the tasks. Either way, companies realize a cost savings.

As companies are learning to be leaner and meaner, career-minded professionals cannot expect job security the way they could in the past. In today’s economy, chances are good that the average individual entering the workforce today will not stay at one company throughout his or her professional career. And a growing number of people feel that the best way to prevent an almost inevitable layoff is to take the skills they have and open up shop for themselves.

Changes in government programs and tax benefits for minority-owned businesses provide still more clues why entrepreneurship is on the rise. Despite affirmative action programs, it is still a statistically proven fact that there is a lack of opportunity for women and minorities within medium- to large-sized companies. Thus, thousands of women and minorities are recognizing that their earning potential is much higher on their own than it would be in the corporate world, and that there is no glass ceiling to block your opportunities when you are your own boss. In addition, it is now easier for minorities and women to get financing to start new ventures, either through local banks or government programs.

The success rate is good for new minority and women-owned start-ups. According to the U.S. Census Bureau’s 2007 Survey of Business Owners, women owned 7.8 million nonfarm businesses, 28.7 percent of all nonfarm businesses in the United States. This represents a 20 percent increase since 2002. And minority-owned businesses are doing particularly well, growing more than four times as fast as U.S. firms overall.

Other population groups are jumping on the entrepreneurial bandwagon as well. Burgeoning technological advances have opened up new opportunities for the physically challenged. In the past, persons with disabilities were limited in their professional choices by their physical handicaps. Affordable computers, the Internet, and greater public acceptance of home offices have opened up a wide range of opportunities for those with physical limitations, and many have launched successful ventures as a result.

The concept of the home office continues to rise in popularity. Many entrepreneurs have even been able to start new ventures while still employed at another firm, thus increasing their capital and minimizing their day-to-day financial risk. With an answering machine, a cell phone, a computer, some letterhead, and business cards, many home-based businesses can literally run themselves while you keep your day job, leaving you to fill orders or talk to clients on your off time. A few years ago, this type of business practice would not have been acceptable. But now, many new businesses are getting off the ground just this way. And if you do choose to quit your day job and work at home full-time, a high-speed Internet connection will keep you in touch with the outside world during business hours, too.

All of these cultural changes working together have created an atmosphere of opportunity in the entrepreneurial environment. The rest is up to you. Making the decision to become an entrepreneur is the hard part. All you have to do now is choose the type of business that best meets your financial, emotional, and intellectual requirements, and get going!

How to Use This Book

You’ve chosen this book because you’ve got a certain amount of money to start a business — $5,000 or less — and you want to know what kind of enterprises might fit into that sort of financial framework. You can either start by looking for those particular businesses that match your skill set and available resources. Or you can simply flip through the pages at your own pace to learn more about all of the different types of businesses out there. Who knows — you might just stumble onto something that addresses a lucrative skill or interest you didn’t even know you had.

As you read each business description, you’ll notice some specific statistical information at the beginning of every entry. It is organized as follows:

Start-up cost: These costs are calculated by adding together all equipment, advertising, and operating capital costs. We tried to consider every possible cost, and then asked the question: What’s the least amount of money you would need to start this business?

Potential earnings: This range is based on what similar businesses are grossing. This is an average figure and does not take into account geographic variables nor costs and overhead.

Typical fees: We researched each field to determine the average hourly rate or per-project rate. For many entries, you will see a range instead of one flat fee. This is because your geographic location may dictate the demand for your goods or services, and demand is what drives prices up.

Advertising: Here, we rounded up all of the possible ways you could promote each type of business, from methods that cost nothing, such as networking, to long-term media contracts that cost several thousand dollars. The advertising costs are built into the start-up costs.

Qualifications: This category contains everything you need to know about professional certifications, personality requirements, and other information pertinent to what it takes to run your business. Because licensing and certification requirements vary by location and tend to change over time, you must always check the rules with authorities in your jurisdiction.

Equipment needed: We researched and surveyed the equipment purchases you’ll likely need to make to run your business effectively. You may need anything from a basic home office setup to specific industry-related machinery.

Home business potential: Many of the businesses can be launched and run out of your own home. We’ve also identified those that really need more space (such as a manufacturing facility), and those that you can run from your home even if you are not actually doing a lot of the work there.

Staff required: A high percentage of the businesses profiled can be one-person operations, but those needing additional staff are identified, often with a suggested number of employees.

Hidden costs: This is probably the most important element of each entry. The costs that you don’t think about are often the ones that can drive your business into the ground. We’ve tried to uncover costs you might not have thought of when developing your business plan or strategy. They include insurance coverage, workers’ compensation, and even fluctuating materials costs. Many of these are costs you simply cannot predict — or might not have realized will be incurred as you work to abide by state and federal government requirements.

The balance of each entry, divided into three sections, provides a comprehensive guide to each individual business. With each, you’ll get a total picture of what’s involved in successfully running the business in question so that you can zero in on those which best match your background and expertise.

Lowdown: This section supplies the details of exactly what each type of business demands of its owner, what your day-to-day activities will be, and who your customers are. This section also includes information on specific marketing opportunities.

Start-up: Here, you’ll find an in-depth breakdown of your start-up costs, including everything from office furniture and computer equipment to advertising costs. You’ll also find valuable information on how to arrive at specific earnings goals for each business.

Bottom line: This section points out the positive and negative aspects of each business, so you’ll know exactly what you’re in for. Remember, no business is perfect; there are pluses and minuses to every opportunity.

What Is Running Your Own Business Really Like?

One business owner answered that question pretty eloquently when he said that the best thing about owning your own business is that it’s your own business, and the worst thing about owning your business is, well … that it’s your own business. While owning your own business is the opportunity of a lifetime, you may come to find out that the opportunity to work — or worry — twenty-four hours a day is not one worth having. But you’ll never know until you try. And what might be one person’s burden is another person’s ticket to financial independence and personal fulfillment.

The trick is to manage your entrepreneurial journey well enough to expect the good with the bad — and not pressure yourself to perform flawlessly every time. After all, this is new ground and no one expects you to be perfect. While this book certainly does not provide all of the answers, it does address several issues you’ll need to think about to determine if owning your own business is really right for you.

As a potential new business owner, the most important place you can start is with a solid idea of what you want to do, and what will it take to achieve your goals. We wish you good luck as you embark on what will surely become the most interesting journey of your professional life!

Legal Issues for Small Businesses

Many start-up businesses do not have a lawyer, and some companies operate for years without ever needing legal advice. The owners have done their homework and understand the legal situations likely to arise in their areas of business. They know which of the government’s rules and regulations affect them and have set up systems to insure that they dot their i’s and cross their t’s consistently, keeping accurate records to prove it.

Do You Need a Lawyer?

It costs money to hire a lawyer, but, as a general rule, most entrepreneurs find that working with an attorney who specializes in small business issues is worthwhile for the time, worry, and (possibly) large sums of money it can save them over the long run. If you are wavering in your decision, it may be helpful if you think of your attorney as one of many business advisor relationships that strengthen your organization rather than simply deplete its resources. You will definitely need to work with an attorney:

If you decide to incorporate or form a partnership.

When you need to sign a contract or agreement (an attorney can help you understand the legal language so you know exactly what you are committing your business to do).

Whenever you prepare a contract or agreement for others to sign.

If someone brings a lawsuit against you.

Finding an Attorney

To find a good attorney, start by asking friends and business associates for recommendations. Then, before committing to anyone, check each lawyer’s business experience and learn about his or her general approach to working with clients. You are looking for direct, no-frills service that provides substance at the least possible cost. You will need to find an attorney who is willing to be part of a real relationship — someone who responds to your calls within a reasonable period of time, answers your questions in plain English, and takes an active interest in the success of your business. Most attorneys are willing to provide an initial consultation at no charge. Take advantage of this free time to get all your questions answered, especially the ones about fees. Once you have chosen a lawyer with whom you can be comfortable, develop a fee or retainer plan that fits your budget. Finding a compatible attorney can be a somewhat lengthy process, but it is time well spent. And don’t wait until a crisis hits to begin your search. In fact, having an attorney you can call on before you take an action might just save you from tedious, expensive trouble later on. What are your chances of being sued? If you know the danger is high, in addition to keeping an attorney on retainer, you might want to also consider insuring your business against potential legal costs.

Avoiding Legal Trouble

Most businesses never get sued, and clearly you want to do everything you can to be in that category. Establish and conduct your business with the aim of keeping legal troubles from arising. Get business agreements in writing, and maintain clear, organized records of each transaction. Add to the files your notes on what is said during any subsequent telephone calls or meetings in which expectations, promises, modifications, and other issues are discussed.

Know and follow the laws and regulations that apply generally to businesses, as well as those that apply specifically to your business type. Make sure your employees and customers know what your policies are, and set an example by following them yourself. Social media has opened new communication territory, so it’s wise to clarify your expectations. This is an area where your leadership will have a more powerful effect than all the memos and employee handbooks in the world. When you do what you promise and follow through immediately to resolve complaints, you create an atmosphere of trust. That’s the best legal protection your business can have.

Be aware and make your employees aware that e-mail communications are not private and may be entered into evidence during legal proceedings. If your company’s e-mails are always professional and courteous, you will have no cause for concern.

Agreements

New business owners may not recognize that many situations are considered agreements or contracts, even though no official piece of paper has been written to label them as such. Do you get paid in advance for a service or product to be delivered later? Do you send payment to a supplier and receive delivery of the materials at a later date? These constitute agreements: money is exchanged on the expectation that a desired result will occur.

As you become more experienced, you will no doubt discover the same painful truth many slightly more experienced business owners have come to appreciate: agreements aren’t always honored by the other party. Suppose you provide a service that requires you to lay out money, to buy the paper to produce a catalog, hire an associate, or accumulate travel costs, for example. You intend to send a bill when the job is complete, but the client keeps asking for one small change after another. You finally send the bill — but it never gets paid. Unless you have kept excellent records of what the client asked for, what you promised up front, and what you actually delivered, you may have no way of recovering this loss. One situation like this can destroy a fledgling business. For safety’s sake, ask your attorney to set up a formal agreement procedure that you can follow before you do any business. That’s the best way to make sure your fingers do not get burned.

Contracts

If written contracts are part of your business, you will need to work with your attorney to draft the kind that will protect you. Getting all requests, plans, and promises down on paper is actually a good selling technique: your customer knows exactly what to expect, and you have a checklist to make sure that you perform the work to expectations. When you put everything in writing, there will be no gray areas that could lead to discomfort, disagreements, and disappointment later. You protect your business, while at the same time, you guarantee customer satisfaction. It’s a win/win situation.

Contracts tend to be more formal than agreements. If you prefer to write your own, have your attorney create the first one as a model, then ask him or her to check any major variations that you may make in later versions. If you are asked to sign a contract prepared by another organization, read every word of it. Have your attorney read it, too, and ask him or her to explain the murky parts. Again, you can’t provide complete customer satisfaction if you don’t have a clear understanding of what you’re supposed to do. Renegotiate whatever provisions you do not wish to meet. The other party has the option of doing this as well. Think of this process as the first step in simply building a satisfactory working relationship: providing your products or services to meet your client’s needs in a mutually agreeable way.

Protecting Your Good Name

Copyrights and trademarks are tools you can use to protect your rights to intellectual property, that is, ideas, words, names, and so on. These two types of protection are very different in their ease of use, and they have different effects. Neither is a guarantee of anything. They simply give you the right to try to enforce your ownership. Major legal cases involving copyright infringement occasionally receive national attention in the news media, but the day-to-day application of copyright and trademark protection, regardless of the size of the case, is