We launch a business with small capital and high profitability

Trending small business ideas that work today.

The information below gives a basic understanding of business ideas with minimal investment. The figures in the article are very approximate and may vary greatly depending on the region. Each field of activity has its own characteristics and pitfalls; it is impossible to list everything within the scope of this review. We deliberately do not indicate possible income; this metric depends entirely on how much you will invest in advertising, what channels you will use and how effective the company will be, what employees you will hire, how you will work on your reputation, and so on. The article is not a guide, does not pretend to be a coach, it is intended to provide information - interesting business ideas for beginners with minimal investment and inspire changes, perhaps the best in your life!

Here are our 15 business ideas for a business with minimal investment:

1. Cleaning of apartments and private houses
2. Dumpling production
3. Business on trade with China
4. Sale of postal packages
5. Business selling cotton candy
6. Babysitting services
7. Dropshipping. First money, then goods
8. Pancakes with delivery
9. Delivery of lunches to offices
10. Production of custom bow ties
11. Baking cakes to order
12. Delivery of flowers and fruit baskets
13. Sale of beer bouquets
14. Key production point
15. Business selling exotic fruits

How to calculate in a simple way

The formula used to calculate the payback period in a simple way looks like this:

PAYBACK PERIOD = INVESTMENT SIZE / NET ANNUAL PROFIT

Or

PP = K0 / PChsg

We take into account that PP is the payback period expressed in years.

K0 - the amount of invested funds.

PChsg - Net profit on average for the year.

Example.

You are offered to invest an amount of 150 thousand rubles in the project. And they say that the project will bring in an average of 50 thousand rubles a year in net profit.

Using simple calculations, we obtain a payback period of three years (we divided 150,000 by 50,000).

But such an example gives out information without taking into account that the project can not only generate income during these three years, but also require additional investments. Therefore, it is better to use the second formula, where we need to obtain the value of IFsg. And it can be calculated by subtracting the average expense for the year from the average income. Let's look at this using the second example.

Example 2:

Let us add the following fact to the existing conditions. During the implementation of the project, about 20 thousand rubles will be spent every year on all kinds of expenses. That is, we can already obtain the value of PChsg - by subtracting 20 thousand rubles (expenses for the year) from 50 thousand rubles (net profit for the year).

So, our formula will look like this:

PP (payback period) = 150,000 (investment) / 30 (average annual net profit). Result - 5 years.

An example is illustrative. After all, as soon as we took into account the average annual costs, we saw that the payback period increased by as much as two years (and this is much closer to reality).

This calculation is relevant if you have the same income for all periods. But in life, the amount of income almost always changes from one year to the next. And to take this fact into account, you need to perform several steps:

We find the whole number of years it will take for the final income to be as close as possible to the amount of funds spent on the project (invested).

We find the amount of investments that remained uncovered by profit (we take it as a fact that income arrives evenly throughout the year).

We find the number of months it will take to reach full payback.

Let's consider this option further.

Example 3.

The conditions are similar. You need to invest 150 thousand rubles in the project. It is planned that during the first year the income will be 30 thousand rubles. During the second - 50 thousand. During the third - 40 thousand rubles. And in the fourth - 60 thousand.

We calculate income for three years - 30+50+40 = 120 thousand rubles.

In 4 years the amount of profit will be 180 thousand rubles.

And considering that we invested 150 thousand, it is clear that the payback period will occur somewhere between the third and fourth year of the project. But we need details.

Therefore, we proceed to the second stage. We need to find that part of the invested funds that remained uncovered after the third year:

150,000 (investments) - 120,000 (income for 3 years) = 30,000 rubles.

Let's move on to the third stage. We will need to find the fractional part for the fourth year. There are 30 thousand left to cover, and the income for this year will be 60 thousand. So we divide 30,000 by 60,000 and get 0.5 (in years).

It turns out that taking into account the uneven influx of money across periods (but uniform across months within a period), our invested 150 thousand rubles will pay off in three and a half years (3 + 0.5 = 3.5).

What will it take to open your own business?

1. The right attitude. We are ready to start our own business and are confident that it will bring success. You are already mentally prepared for the difficulties ahead. The business will last a long time.
2. What is your goal? You must clearly know about the upcoming work, and not open according to the principle “a work colleague has launched a grandiose project, why am I worse” and start doing something that is not your own business.
3. Calculate the risks. The service market is constantly changing and, accordingly, you need to be aware of what is popular. You should not start a business with money saved up over many months if you are not sure that it will bring results.
4. Small steps to success. All successful entrepreneurs started small. When thinking about additional income, you should not grab those niches that initially require huge investments.
5. Mind your own business. If you are good at something, then start by attracting clients in this niche. For example, shoe repair. Again, as in the second point, you shouldn’t do this, “first I’ll spend money, buy material for the production of exclusive things,” and then I’ll look for information on the Internet on how to make these things. It’s better to do this, first learn a new profession, and then make grandiose plans.
6. Follow your goal with confidence. Before starting a project, every person has a fear: money is invested, but there will be no return. If you have any doubts about the niche you are going to occupy, you may want to think about changing your activities and working in a different direction.
7. Quality - guaranteed. You should always be better than your competitors. Let’s say you got your first clients, but they didn’t like the service, they will simply go to others and you can put an end to your business. Therefore, study your competitors and become better.

Online consultations.

The quick payback here is due to demand in the market and low investments. Everyone needs up-to-date information, but not everyone is ready to search for it and spend their personal time on it. In connection with this, in 2020, users are increasingly turning to specialists who are well versed in the topics they need for advice.

Recommendations from specialized specialists: lawyers, doctors of various fields (from psychologist to veterinarian) are very popular. Online consultations in the fields of finance, accounting, taxes and audit are in considerable demand. In these areas, large orders often come across with a large amount of work and serious payment. The topic of consultations on relationship psychology is gaining popularity. Couples fight regularly, and not everyone can solve the problem on their own.

Find your niche according to the specifics in which you are an expert and launch your own business . The advantage of this business idea is that you can live in a small town or village and work from home with clients all over the world.

Material on the topic: Top 10 business ideas for a small town.

If you haven’t decided on a topic yet, then no one forbids you to learn, even if your knowledge is zero, the main thing is to choose a popular niche. For faster promotion, I advise you to take a closer look at advertising on social networks. The most suitable option is Instagram. Understand a specific topic and constantly develop in it, obtaining information from the Internet or books.

The amount of money earned from consultations depends on the size of the audience. Average duration is 2 hours. Seminars are often held on Skype or using other alternative services that provide video communication services.

At the initial stage, it is recommended to set the cost of one consultation in the range from 500 to 1500 rubles. At the same time, besides advertising, there are no other costs.

If you conduct at least one video communication session per day, the revenue will be from 15,000 to 45,000 rubles per month.

By providing services in the form of seminars or video marathons, you can increase your income . Since the number of clients in a video chat will not be limited, during the same time you can earn a much larger amount.

Economic understanding of payback

Before investing in a new or existing business project, any investor evaluates his own risks, the time interval for the return of invested funds, and the prospects for making a profit.

Return on investment is the level of return of invested funds to their owner after a certain period.

Cost recovery is the ratio of the income received from the project to the costs incurred.

The payback point is the moment at which the invested funds are fully covered by the income received. After this, using a coefficient or percentage, the profitability or interest rate of profit on the invested capital (expenses incurred) is determined.

If an enterprise makes capital investments to reconstruct an existing facility, the effectiveness of long-term costs is calculated.

Business ideas with quick payback

Many experts note that recently the service sector has been the most profitable for doing business. It has been proven here that people are always willing to pay good money for quality services. Well, they call the most popular and in demand services:

• Lawyers;
• Doctors;
• Accountants, auditors;
• Realtors;
• Programmers;
• Tutors;
• Creditors, etc.

But, since to provide the above services you need to have a special education and, preferably, extensive work experience, these business ideas with a quick payback of 2021, unfortunately, are not suitable for everyone. But there is no need to be upset. After all, there are many interesting ideas that can be implemented, starting not only without certain knowledge, but also without having a lot of money. In general, we suggest considering the following business options.

Calculation examples

Example 1. An investment was made in Ecoprom OJSC to produce food products using new technologies. The costs of the new project are 2 million rubles. It is planned to receive net profit from the project:

• 1 year – 50 thousand rubles.
• 2nd year – 250 thousand rubles.
• 3rd year – 500 thousand rubles.
• 4, 5 years – 750 thousand rubles.

Over 5 years, the planned total net profit will be 2,300 thousand rubles or 460 thousand rubles/year. Payback period = 2000 / 460 = 4.3 years.

How to calculate the payback period taking into account the discount is easier to understand using a specific example:

Example 2. The initial data for the business project of OJSC Ecoprom are presented in Table 1 (thousand rubles).

* calculation of the discounted amount – 100 / 105 x 50 = 47.6. Round up to 48.

Thus, taking into account inflation expectations, the payback period for the new line of business of the joint-stock company exceeds 5 years. For example, if in the sixth year of activity it is planned to receive a net profit of 800 thousand rubles, then the total discounted payback period is 5 - (-88 / 800) = 5.11 years.

In addition to the discount, for a realistic calculation of the repayment period, one should take into account the general economic situation in the region and the investment industry.

Assessing these factors will help determine the likelihood of the need for additional investments throughout the project, unforeseen expenses, interruptions in sales and logistics processes.

Determination of cost recovery

Cost effectiveness is usually calculated in cases where annual additional operating costs are required in addition to the initial capital investment. They are also calculated by two methods: simplified and discounted.

Example 3. A thorough analysis of the Ekoprom OJSC project revealed that in the process of its implementation, the investor’s current costs in the amount of 100 thousand rubles are additionally required annually. These changes will affect the net profit and cash flows of the project.

Table 2. (thousand rubles).

The table shows that the investor’s costs, even according to a simplified calculation, will pay off only in the 6th year after the implementation of the business project.

For a potential investor or owners of an existing enterprise, what matters is the level of profitability of the business after reaching the “zero mark” of return on funds.

For example, if in 6-10 years of activity a business entity reaches a high level of profitability (over 25%), its participants will consider the investment profitable and are ready to further finance the activity. The planned estimate should include calculations of the return on invested capital for a long period (8-12 years).

To calculate the profitability of an investment, the formula is often used:

R inv. = (Revenue.inv – costs.inv) / 100%

The calculation takes into account investments, income and expenses (including taxes, mandatory payments) related to the business object.

If a long-term bank loan is used in whole or in part for investment, experts of the creditor bank additionally pay special attention to the solvency of the borrower at the target dates of loan repayment, interest for its use using calculated debt coverage ratios.

Carpentry workshop

Wood products are increasingly valued every year, and therefore a carpentry workshop can become a very profitable business.

Before opening a carpentry workshop, you should decide what kind of products your company will produce. You can start creating furniture or start making kitchen utensils. It is important that the supply is compared with the demand available in the market. You shouldn’t immediately start making several fundamentally different products. Without the proper experience and a specific client base, you can waste your time and make a loss. It is better to start with a narrow focus and gradually expand your activities.

It is worth paying attention to the wood that will be used in carpentry. The choice should be based on the direction with which the workshop will work. For example, hard varieties (maple) are suitable for furniture. They are more difficult to process, but are more durable. Soft varieties are more pliable and flexible, and therefore are well suited for dishes

To open such a business you will need about 200 thousand rubles: equipment, consumables, individual entrepreneur registration, premises rental. The payback of such a business will vary around 3-6 months, which depends on the goods produced and sold. For example, when creating interior doors, the wholesale price of which is 8-10 thousand, the business will return its money in three to four months. This is possible provided that at least 2 doors are manufactured per shift.